Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_12-cv-01058/USCOURTS-azd-2_12-cv-01058-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 15:1692 Fair Debt Collection Act

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Sol Jaffe, 

Plaintiff, 

v. 

Cardworks Servicing, LLC, 

Defendant.

No. CV12-1058-PHX-DGC

ORDER 

 Defendant Cardworks Servicing, LLC filed a motion to dismiss Plaintiff Sol 

Jaffe’s complaint on the grounds of res judicata and failure to state a claim. Doc. 8. 

Plaintiff filed a motion to strike Cardworks’ motion to dismiss, which the Court will 

construe as Plaintiff’s response (Doc. 11), and Cardworks filed a reply (Doc. 12). The 

Court will grant Cardworks’ motion and dismiss the complaint with prejudice. 

 “Res judicata bars relitigation of all grounds of recovery that were asserted, or 

could have been asserted, in a previous action between the parties, where the previous 

action was resolved on the merits.” United States ex rel. Barajas v. Northrup Corp., 147 

F.3d 905, 909 (9th Cir. 1998). A dismissal for failure to state a claim constitutes a ruling 

on the merits for res judicata purposes. Stewart v. U.S. Bancorp, 297 F.3d 953, 956 

(9th Cir. 2002). 

 Plaintiff previously filed an action against multiple defendants alleging 

substantially the same violations of the Fair Debt Collection Practices Act, 15 USC 

§ 1962, (“FDCPA”), gross negligence, and intentional infliction of physical and 

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emotional distress as those alleged in this case. Compare No. 2:11-cv-01839-NVW, 

Doc. 1, ¶¶ 25-34; 35-38; 39-42 with Doc. 1, ¶¶ 4-13; 14-18; 19-21. Judge Neil V. Wake 

screened the complaint and dismissed it for failure to state a claim and improper joinder 

of defendants. See No. 2:11-cv-01839-NVW, Doc. 24. Judge Wake gave Plaintiff leave 

to amend as to one defendant and provided detailed guidance on how Plaintiff could cure 

the pleading deficiencies in his complaint. Id. Plaintiff failed to file an amended 

complaint, and, pursuant to Judge Wake’s order, the Clerk entered final judgment for the 

defendants and against Plaintiff on December 9, 2011. Id., Doc. 43, 44.1

 

 Subsequent to this dismissal, Plaintiff filed substantially the same action in 

Maricopa County Superior Court. Doc. 8-1 at 26-38. Superior Court Judge John Rea 

dismissed the complaint with prejudice on May 11, 2012, on the grounds of res judicata

and failure to state a claim. Doc. 8-1 at 41. 

 Plaintiff argues that res judicata does not apply to this case because Cardworks 

was not a party to the case before Judge Wake and the state case – to which Cardworks 

was a party – was wrongly decided, and it applied state standards of res judicata that do 

not apply here. Plaintiff also argues that he has raised different claims than those raised 

in the state case. Doc. 11 at 1, ¶ 1, 3, ¶ 1. 

 Although Cardworks was not named as a party in the first complaint, res judicata

applies where “privity between parties” exists. Tahoe-Sierra Pres. Council, Inc. v. Tahoe 

Reg’l Planning Agency, 322 F.3d 1064, 1077 (9th Cir. 2003). Privity is met when a party 

is “so identified in interest with a party to former litigation that he represents precisely 

the same right in respect to the subject matter involved.” In re Schimmels, 127 F.3d 875, 

881 (9th Cir. 1997). Plaintiff’s first complaint alleged that all defendants engaged in 

unlawful credit reporting and debt-collection practices – the same allegations made here. 

One of these defendants was Merrick Bank Corporation (“Merrick”), and Plaintiff 

 

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 Judge Wake denied Plaintiff’s motion to proceed in forma pauperis on appeal on the grounds that an appeal in lieu of amendment is frivolous, and Plaintiff’s appeal was not taken in good faith. No. 2:11-cv-01839-NVW, Doc. 43 at 2. 

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acknowledged in his second complaint that Merrick and Cardworks are related 

companies. Doc. 8-1, ¶ 17(D). Cardworks argues, and Plaintiff does not dispute, that it 

serviced the debt that Plaintiff alleged he did not owe to Merrick, and that the two 

companies are thus in privity as to Plaintiff’s claims. Doc. 12 at 4. 

 Even if Cardworks is not in privity with Merrick for purposes of the first 

complaint, Plaintiff clearly named Cardworks as a defendant in his state complaint. 

Doc. 8-1. Plaintiff’s claims in the state complaint rested on the same allegations of 

wrongful credit reporting and debt collection that served as the basis for his claims in the 

first complaint and that Plaintiff now alleges for the third time. Compare Doc. 8-1, ¶ 

17(C)&(D) with Doc. 1, ¶¶ 7-12. The fact that Judge Rea applied state res judicata

standards to determine that the claims in that complaint were precluded is immaterial to 

whether Judge Rea’s final judgment is entitled to preclusive effect here. The case was 

resolved on the merits as res judicata requires. Moreover, Judge Rea found, as Judge 

Wake had, that Plaintiff failed to state a claim as to any defendant. Doc. 8-1 at 41. 

Plaintiff’s disagreement with Judge Rea’s decision does not entitle him to ignore the 

effect of that judgment on this third attempt to bring the same or similar claims. 

 Plaintiff’s argument that he has raised claims here that he did not raise in the prior 

complaints also lacks merit. Identity of claims exists when two suits “arise from the 

same transactional nucleus of facts.” Owens v. Kaiser Found. Health Plan, Inc., 244 

F.3d 708, 714 (9th Cir. 2001) (internal quotation marks and citation omitted). Although 

Plaintiff’s allegations in this case are somewhat vague and conclusory, Plaintiff does not 

point to any new facts raised here that he did not raise in his first two complaints. 

Moreover, whether Plaintiff previously brought the same claims against Cardworks on 

the basis of these facts is immaterial because res judicata applies both to claims that were 

brought and those that could have been brought. See, e.g., United States ex rel. Barajas, 

147 F.3d 905, 909 (9th Cir. 1998). Plaintiff’s claims are therefore precluded, and leave to 

amend would be futile. 

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 IT IS ORDERED: 

 1. Defendant’s motion to dismiss (Doc. 8) is granted. 

 2. Plaintiff’s motion to strike (Doc. 11) is denied and his complaint (Doc. 1) 

is dismissed with prejudice. 

 3. The Clerk of the Court is directed to terminate this matter. 

 Dated this 19th day of September, 2012. 

Case 2:12-cv-01058-DGC Document 24 Filed 09/19/12 Page 4 of 4