Martinez v. Bank of America, National Association

Filing 24

ORDER DENYING 6 Motion for Summary Judgment; DENYING 13 Motion to Strike ; GRANTING 14 Motion for Leave to File Amended Complaint. Signed by Judge Xavier Rodriguez. (rf)

In the United States District Court
for the
Western District of Texas
JUAN C. MARTINEZ
v.
BANK OF AMERICA

§
§
§
§
§

SA-11-CV-139-XR

ORDER

On this day came on to be considered Defendant’ motion for summary
judgment (dkt. no. 6), Defendant’s motion to strike Amended Complaint (dkt. no.
13), and Plaintiff’s motion for leave to file a first amended complaint (dkt. no.
14).
Background
Plaintiff initially filed this suit in the 45th Judicial District Court of Bexar
County, Texas. In his petition, Plaintiff alleged that he is a senior citizen 1 , he
began a banking relationship with Juan Cisneros, an officer of Bank of America,
and subsequently discovered that Cisneros made unauthorized withdrawals to
his account in the amount of $90, 369.42. In this petition, he generally alleged
that Defendant Bank of America made “material false representations.” He also
generally alleged that the acts or omissions of the Bank constitute a breach of

1

It is unclear whether he currently is 79 years of age, or was 79 years of age when he
first became a victim of the Bank officer’s fraudulent statements.

contract. He alleges that the Bank is responsible for Cisneros’s conduct because
of an agency theory or respondeat superior theory.

The Bank thereafter

removed the case to this Court pursuant to the diversity jurisdiction statute. On
July 12, 2011, the Bank designated Cisneros as a responsible third party
pursuant to Tex. Civ. Prac. & Rem. Code §33.004.
On September 4, 2011, Plaintiff, without leave of court, filed an amended
complaint.

In that amended complaint Plaintiff clarified that “Cisneros

intentionally misrepresented to Plaintiff the need to withdraw funds from his
account so they did not exceed the bank’s limit in these two accounts. Plaintiff
relying on said representations agreed that the Bank representative could move
funds to other holding accounts until the Plaintiff’s accounts were below the
limit and funds could be transferred back to said account.” 2
Bank’s Motion for Summary Judgment
The Bank acknowledges that Plaintiff was a customer and that he had a
checking and money market account with the Bank. The Bank also implicitly
acknowledges that unauthorized withdrawals were made from Plaintiff’s

2

The Bank moves to strike the amended complaint because no court leave was sought,
the amended complaint was filed after the deadline set forth in the scheduling order. Plaintiff
moves for leave of court to file allow the amended complaint, arguing that he has asserted no
new causes of action and has merely elaborated upon the factual background. Rule 16(b)
governs amendment of pleadings after a scheduling order deadline has expired. Fed. R. Civ.
P. 16(b) (4); S & W Enterps., L.L. C. v. SouthTrust Bank, 315 F.3d 533, 536 (5th Cir. 2003). To
determine whether to extend the scheduling order deadline, the Court considers: (1) the
explanation for the failure to timely move for leave to amend; (2) the importance of the
amendment; (3) potential prejudice in allowing the amendment; and (4) the availability of a
continuance to cure such prejudice. No new causes of action are raised in the amended
complaint. Plaintiff has never been deposed in this case and no prejudice in this regard is
shown. Accordingly, no continuance to cure any prejudice is required. Defendant's motion to
strike Amended Complaint (dkt. no. 13) is denied. Plaintiff's motion for leave to file a first
amended complaint (dkt. no. 14) is granted.

2

accounts.

The Bank argues that pursuant to the terms of the Deposit

Agreement, Plaintiff was required to report any unauthorized withdrawals
within 60 days of receipt of his monthly statement.

Plaintiff alleges that

unauthorized withdrawals began to occur as early as 2001. The Bank argues it
timely sent Plaintiff monthly statements to his home and that Plaintiff never
reported any discrepancy until April 12, 2010. Accordingly, the Bank argues
that with the exception of six timely reported unauthorized transactions,
Plaintiff’s claims of breach of contract are barred by the sixty-day notice
requirement. Alternatively, it argues that Plaintiff’s claims are barred by a oneyear notice requirement pursuant to Tex. Bus. & Com. Code §4.406.
Summary Judgment Standard
Summary judgment is proper only when the movant can demonstrate that
there is no genuine issue of material fact and that she is entitled to judgment as
a matter of law. A genuine issue of material fact exists if a reasonable jury could
enter a verdict for the non-moving party. To defeat a properly pled motion for
summary judgment, “the nonmovant must go beyond the pleadings and
designate specific facts showing that there is a genuine issue for trial.” Little v.
Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc) (citing Celotex
Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). The
court must resolve factual controversies in favor of the nonmoving party.
However, the nonmoving party cannot satisfy its burden merely by establishing

3

“some metaphysical doubt as to the material facts,”3 by conclusory allegations
in affidavits, or by only a scintilla of evidence.4
Analysis
The Bank relies upon numerous cases that state section 4.4.06:
facilitates financial transactions, benefitting both consumers and
financial institutions, by allocating responsibility among the
parties according to whoever is best able to prevent a loss.
Because the customer is more familiar with his own signature,
and should know whether or not he authorized a particular
withdrawal or check, he can prevent further unauthorized
activity better than a financial institution, which may process
thousands of transactions in a single day. Section 4.406
acknowledges that the customer is best situated to detect
unauthorized transactions on his own account by placing the
burden on the customer to exercise reasonable care to discover
and report such transactions.5
The Bank's reliance on Martin, however, is misplaced.6 Martinez could not
have discovered any forged check or unauthorized activity. Indeed, Martinez
asserts that he was deceived by the Bank's officer into authorizing a transfer of
his monies into what he believed was another account.
Conclusion
Inasmuch as the Bank raises no other arguments in its motion, the
motion for summary judgment (dkt. no. 6) is denied. Defendant's motion to

3

Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348,
89 L.Ed.2d 538 (1986).
4

Little, 37 F.3d at1075 (quoting Davis v. Chevron U.S.A., Inc., 14 F.3d 1082, 1086 (5th
Cir. 1994)).
5

American Airlines Employees Federal Credit Union v. Martin, 29 S.W.3d 86, 91 (Tex.

6

Jones v. Wells Fargo Bank, N.A., --- F.3d ----, 2012 WL 34123 (5th Cir. Jan. 9, 2012).

2000).

4

strike Amended Complaint (dkt. no. 13) is denied. Plaintiff's motion for leave
to file a first amended complaint (dkt. no. 14) is granted.
It is so ORDERED.
SIGNED this 26th day of January, 2012.

_________________________________
XAVIER RODRIGUEZ
UNITED STATES DISTRICT JUDGE

5