Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_24-cv-00728/USCOURTS-azd-2_24-cv-00728-1/pdf.json

Nature of Suit Code: 371
Nature of Suit: Truth in Lending
Cause of Action: 15:1681 Fair Credit Reporting Act

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Before the Court is Defendants Midland Credit Management Incorporated and 

Encore Capital Group Incorporated’s (“Defendants”) Motion to Dismiss (Doc. 40), 

Plaintiff Daniel D’Agostino’s Response (Doc. 56), and Defendants’ Reply (Doc. 60). The 

Court now rules as follows. 

I. BACKGROUND

Plaintiff Daniel D’Agostino (“Plaintiff”), appearing pro se, brings suit against 

Defendants Comenity Capital Bank (“Comenity”); Comenity’s parent company, Bread 

Financial Payments, Inc. (“Bread”); Midland Credit Management, Inc. (“Midland”); and 

Midland’s parent company, Encore Capital Group, Inc. (“Encore”), alleging various 

violations of state and federal law. (Doc. 32 at 4–5). This case arises out of a dispute 

regarding a credit card account Plaintiff opened with Defendant Comenity on July 13, 

2016. (Id. at 5). 

Plaintiff alleges that he opened the credit card account over a phone call with a 

Defendant Comenity representative, in which the representative told Plaintiff the account 

Daniel D’Agostino,

 

Plaintiff, 

vs. 

Comenity Capital Bank, et al.,

Defendants. 

)

)

)

)

)

)

)

)

)

)

)

)

No. CV-24-00728-PHX-SPL

ORDER

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 1 of 20
2

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

would have a zero-percent interest rate for the life of the loan and no additional fees beyond 

the principal amount borrowed. (Id.). Plaintiff alleges that the representative did not 

mention any written terms and conditions associated with the account. (Id.). That same 

day, Plaintiff used the credit account to purchase dental services totaling $697.50. (Id. at 

6). Defendant Comenity later sent a written agreement outlining the accounts terms and 

conditions to Plaintiff, which Plaintiff did not see prior to the account’s opening and initial 

use. (Id.). Plaintiff alleges that the verbal, not written, agreement controls in this case. (Id. 

at 9). Plaintiff subsequently began making regular payments on the credit card account, but 

noticed nearly a year later, in July 2017, “unauthorized charges and interest appearing on 

his account statements.” (Doc. 32 at 10). 

Plaintiff alleges that he promptly contacted Defendant Comenity to dispute the 

interest charges and fees, but that despite discussing his concerns with multiple company 

representatives, “Comenity failed to provide a satisfactory explanation for the unauthorized 

charges and interest and refused to make any corrections.” (Id. at 11). On December 1, 

2021, Plaintiff requested a full record of his account transactions, but Defendant Comenity 

allegedly failed to provide a complete record or to address the disputed charges and interest 

in its response on December 10, 2021. (Id. at 12). Plaintiff also alleges that Comenity 

reported negative information about Plaintiff’s account to credit bureaus, which resulted in 

delinquencies appearing on his credit reports from July 2021 through December 2023. (Id. 

at 14). On May 2, 2023, Plaintiff mailed Defendant Comenity a letter detailing the history 

of the dispute, demanding a refund of all payments made other than the initial $697.50, and 

requesting Comenity to remove related negative items from his credit report, to which 

Comenity allegedly failed to respond. (Id. at 13–14). On December 29, 2023, Defendant 

Comenity closed Plaintiff’s account and transferred it to Defendant Midland. (Doc. 32 at 

15). Plaintiff alleges that Defendant Midland undertook “aggressive collection efforts, 

including threats of legal action” following the acquisition of his account throughout March 

2024. (Id.). Plaintiff specifically alleges that Defendant Midland sent a collection letter on 

an unspecified date stating that it was considering forward the account to an attorney and 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 2 of 20
3

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

made two phone calls to Plaintiff on March 4 and 19, 2024, on which Defendant Midland 

representatives threatened legal action. (Id. at 15–17). 

On April 2, 2024, Plaintiff filed his pro se Complaint. (Doc. 1). Plaintiff filed his 

FAC on July 9, 2024. (Doc. 32). Plaintiff brings numerous claims alleging federal and state 

statutory violations and common law contract and tort injuries. (Doc. 32). Additionally, 

Plaintiff seeks to bring these claims on behalf of a potential putative class. (Id. at 19).

II. LEGAL STANDARD

“To survive a Rule 12(b)(6) motion for failure to state a claim, a complaint must 

meet the requirements of Rule 8.” Jones v. Mohave Cnty., No. CV 11-8093-PCT-JAT, 

2012 WL 79882, at *1 (D. Ariz. Jan. 11, 2012); see also Int’l Energy Ventures Mgmt., 

L.L.C. v. United Energy Grp., Ltd., 818 F.3d 193, 203 (5th Cir. 2016) (Rule 12(b)(6) 

provides “the one and only method for testing” whether pleading standards set by Rule 8 

and 9 have been met); Hefferman v. Bass, 467 F.3d 596, 599–600 (7th Cir. 2006) (Rule 

12(b)(6) “does not stand alone,” but implicates Rules 8 and 9). Rule 8(a)(2) requires that a 

pleading contain “a short and plain statement of the claim showing that the pleader is 

entitled to relief.” Fed. R. Civ. P. 8(a)(2). A court may dismiss a complaint for failure to 

state a claim under Rule 12(b)(6) for two reasons: (1) lack of a cognizable legal theory, or 

(2) insufficient facts alleged under a cognizable legal theory. In re Sorrento Therapeutics, 

Inc. Sec. Lit., 97 F.4th 634, 641 (9th Cir. 2024) (citation omitted). A claim is facially 

plausible when it contains “factual content that allows the court to draw the reasonable 

inference” that the moving party is liable. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 

Factual allegations in the complaint should be assumed true, and a court should then 

“determine whether they plausibly give rise to an entitlement to relief.” Id. at 679. Facts 

should be viewed “in the light most favorable to the non-moving party.” Faulkner v. ADT 

Sec. Servs., Inc., 706 F.3d 1017, 1019 (9th Cir. 2013). “Nonetheless, the Court does not 

have to accept as true a legal conclusion couched as a factual allegation.” Jones, 2012 WL 

79882, at *1 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)).

Rule 12(f) provides the Court with authority to “strike from a pleading . . . any 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 3 of 20
4

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

redundant, immaterial, impertinent, or scandalous matter.” Fed. R. Civ. P. 12(f). “Although 

generally disfavored, a motion to strike may be granted where necessary to spare the parties 

the time and expense associated with ‘litigating spurious issues.’” Cheatham v. ADT Corp., 

161 F. Supp. 3d 815, 833–34 (D. Ariz. 2016) (quoting Sidney–Vinstein v. A.H. Robins Co., 

697 F.2d 880, 885 (9th Cir. 1983)). “A successful motion to strike must show that the law 

is clear beyond reasonable dispute and that the relevant claim or defense could not succeed 

under any set of circumstances.” Id. at 834 (citing Sanders v. Apple, Inc., 672 F. Supp. 2d 

978, 990 (N.D. Cal. 2009)). “The motion to strike ‘was never intended to furnish an 

opportunity for the determination of disputed and substantial questions of law.’” Id.

(quoting Salcer v. Envicon Equities Corp., 744 F.2d 935, 939 (2d Cir. 1984)). “Moreover, 

even a purely legal question will not be decided on a motion to strike if discovery might 

provide useful context for decision or render the question moot.” Id. (citations omitted).

As with motions to dismiss under Rule 12(b)(6), “Rule 12(f) requires the Court to accept 

the non-moving party's well-pleaded facts as true and to draw all reasonable inferences in 

favor of that party.” Id. (citing Farm Credit Bank of Spokane v. Parsons, 758 F. Supp. 

1368, 1371 n. 4 (D. Mont. 1990)).

III. DISCUSSION

Defendants Midland and Encore argue that Plaintiff’s claims against them included 

in the FAC should be dismissed as they (1) fail to state claims upon which relief may be 

granted and (2) fail to demonstrate that Defendant Encore is liable for any acts of its 

subsidiary, Midland. (Doc. 40 at 2). Additionally, Defendants request the Court strike 

Plaintiff’s putative class claims, as pro se litigants cannot represent third parties or 

prosecute the claims in a class action. (Id. at 3).

a. Liability of Defendant Encore

As a threshold matter, the Court finds that Plaintiff’s claims against Defendant 

Encore must be dismissed. Generally, a parent company may only be held liable for the 

actions of its subsidiary if a plaintiff shows a high degree of control by the parent over the 

subsidiary, which may be demonstrated through either the alter-ego or instrumentality 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 4 of 20
5

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

doctrines. Midtown Hotel Grp. LLC v. Selective Ins. Co. of Am., No. CV-22-01395-PHXJAT, 2023 WL 3603677, at *4 (D. Ariz. May 23, 2023); Harris Rutsky & Co. Ins. Servs. 

v. Bell & Clements Ltd., 328 F.3d 1122, 1134 (9th Cir. 2003). Plaintiff’s FAC provides no 

facts that Defendant Encore or its representatives were involved in any way with the alleged 

conduct in this case beyond the conclusory allegation that it “is responsible for the policies 

and practices of” Defendant Midland. (Doc. 32 at 5). The operative complaint does not 

purport that there is such a unity of interest and ownership that the separate personalities 

of the two entities no longer exist, as required under the alter ego exception. Harris Rutsky, 

328 F.3d at 1134. Nor does the FAC purport that liability is warranted under any other 

theory of corporate veil-piercing or that Defendant Encore is directly liable—the FAC 

provides no facts at all about the relationship between Defendants Midland and Encore, 

Defendant Encore’s conduct, or any other information relevant to Defendant Encore’s 

alleged liability. As such, Plaintiff has not alleged facts sufficient to establish that 

Defendant Midland’s conduct is attributable to Defendant Encore, and the Court finds 

dismissal of Plaintiff’s claims against Defendant Encore is appropriate. However, as 

additional facts may exist that would remedy Plaintiff’s claims, the Court finds that leave 

to amend is appropriate.

b. Motion to Dismiss

i. Fair Debt Collection Practices Act

Plaintiff alleges Defendants Midland and Encore violated various portions of the 

Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq., (“FDCPA”). A plaintiff must 

show four elements to bring a successful FDCPA claim: (1) the plaintiff qualifies as a 

consumer under the act; (2) the debt arises out of a transaction entered into for personal, 

family, or household purposes; (3) the defendant is a debt collector under the act; and (4) 

“the defendant violated one of the provisions contained in 15 U.S.C. §§ 1692a–1692o.” 

Wheeler v. Premiere Credit of N. Am., LLC, 80 F. Supp. 3d 1108, 1112 (S.D. Cal. 2015). 

The parties do not dispute that the first three elements are satisfied in this case, and instead 

primarily dispute whether Defendants violated 1692d–1692g, as alleged by Plaintiff. 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 5 of 20
6

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

(Docs. 40 at 8; 32 at 35). However, as a threshold issue, the Court finds that Plaintiff has 

not alleged facts that, taken as true, show that Defendants are debt collectors as defined by 

the act. Section 1692a(6) provides that

The term “debt collector” means any person who uses any 

instrumentality of interstate commerce or the mails in any 

business the principal purpose of which is the collection of any 

debts, or who regularly collects or attempts to collect, directly 

or indirectly, debts owed or due or asserted to be owed or due 

another.

15 U.S.C. § 1692a(6) (emphasis added). Courts have interpreted this definition as 

providing two prongs for designation as a “debt collector”: (1) the principal purpose prong, 

which covers “those engaged in ‘any business the principal purpose of which is the 

collection of any debts,’” and (2) the regularly collects prong, which applies to “those ‘who 

regularly collect[] ... debts owed or due another.’” McAdory v. M.N.S. & Assocs., LLC, 

952 F.3d 1089, 1092 (9th Cir. 2020) (quoting 15 U.S.C. § 1692a). Under the first prong, 

the Ninth Circuit has held that qualification as a debt collector is warranted if the Court 

determines that debt collection is a “business’s dominant, or principal, objective” rather 

than just incidental to a business’s objectives. Id. at 1093. Under the second prong, the 

Supreme Court has noted that “by its plain terms this language seems to focus our attention 

on third party collection agents working for a debt owner—not on a debt owner seeking to 

collect debts for itself.” Henson v. Santander Consumer USA Inc., 582 U.S. 79, 83 (2017). 

“Neither does this language appear to suggest that we should care how a debt owner came 

to be a debt owner—whether the owner originated the debt or came by it only through a 

later purchase.” Id. Thus, under the “regularly collects” prong of 1692a(6), a party cannot 

be liable under the FDCPA for its collection conduct related to a debt it seeks to collect for 

itself.

Plaintiff’s operative complaint does not submit an argument that Defendants qualify 

as debt collectors under the principal purpose prong. Instead, Plaintiff alleges that 

Defendants are debt collectors under the second prong of this definition: because “they 

regularly collect or attempt to collect, directly or indirectly, debts owed or due or asserted 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 6 of 20
7

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

to be owed or due to another.” (Doc. 32 at 34). In this case, Midland is the debt owner and 

seeks to collect the debt from Plaintiff for itself. (See id. at 15). As such, Defendants do not 

qualify as debt collectors under the second regularly collects prong. While Plaintiff’s FAC 

quotes a Midland representative referring to Midland as a debt collection agency (id.), 

“Plaintiff's FAC is devoid of any allegations that indicate Defendant primarily engages in 

debt collection, or debt collection is the ‘principal purpose’ of the business” as opposed to 

incidental to its business objectives. Smith v. Credit Corp Sols., Inc., No. 

320CV01295JAHRBB, 2022 WL 959597, at *5 (S.D. Cal. Mar. 30, 2022). To that end, 

Plaintiff does not sufficiently allege that Defendants qualify as debt collectors within the 

meaning of the FDCPA and therefore fails to state a claim under the statute. However, as 

discussed below, even if Defendants qualify as debt collectors under the statute, the 

majority of Plaintiff’s FDCPA claims are still deficient.

1. § 1692d

Plaintiff alleges Defendants harassed, oppressed, or abused Plaintiff in connection 

with debt collection in violation of § 1692d. (Id.). Section 1692d sets forth six nonexclusive circumstances that constitute harassing or abusive conduct: (1) using or threating 

to use violence or other criminal means to harm the physical person, reputation, or property 

of any person; (2) using obscene or profane language that would abuse the hearer or reader; 

(3) publishing of a list of consumers who allegedly refused to pay debts; (4) advertising 

sale of a debt to coerce payment of the debt; (5) repeatedly or continuously calling any 

person “with intent to annoy, abuse, or harass”; or (6) placing telephone calls without 

disclosing the caller’s identity. 15 U.S.C. § 1692d(1)–(6). Plaintiff does not allege that 

Defendants used or threatened violence or criminal means to harm him; used obscene or 

profane language; published his name on any list; advertised sale of his debt; or called 

without disclosing their identity. The only alleged conduct that is remotely contemplated 

by § 1692d is Defendant Midland’s alleged phone calls, which are not alleged to be 

continuous or abusive in nature. (Doc. 32 at 17). Plaintiff alleges that Defendant Midland 

merely sent Plaintiff a collection letter and then made two phone calls on March 4, 2024, 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 7 of 20
8

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

and March 19, 2024, during which Midland representatives tried to come to an agreement 

with Plaintiff and communicated that they may pursue legal action otherwise. (Id. at 15–

17). The Court finds that a single letter and two phone calls “does not rise to the level of 

threats and intimidations exemplified in Section 1692d.” Bellini v. Patenaude & Felix APC, 

No. CV-22-02188-PHX-DJH, 2023 WL 6248577, at *8 (D. Ariz. Sept. 26, 2023); see also

Arteaga v. Asset Acceptance, LLC, 733 F. Supp. 2d 1218, 1227–28 (E.D. Cal. 2010)

(collecting cases). Thus, Plaintiff fails to state a claim under Section 1692d upon which 

relief may be granted.

2. § 1692e

Section 1692e prohibits “any false, deceptive, or misleading representation or 

means in connection with the collection of any debt” and provides a non-exhaustive list of 

specific violating conduct. 15 U.S.C. § 1692e. Plaintiff alleges that Defendants violated § 

1692e(2)(A) by “[f]alsely representing the character, amount, or legal status of the debt”; 

§ 1692e(5) by “[t]hreatening to take legal action that was not actually intended to be taken”; 

and § 1692e(10) by “[u]sing false representations or deceptive means to collect or attempt 

to collect the debt.” (Doc. 32 at 35). 

In evaluating whether a representation was false under section 1692, the Ninth 

Circuit applies the “least sophisticated debtor” standard, which finds that a debt collector 

has violated the act through false, deceptive, or misleading representations where the least 

sophisticated debtor would likely be misled. Swanson v. S. Oregon Credit Serv., Inc., 869 

F.2d 1222, 1225 (9th Cir. 1988). A communication is deceptive where it can be reasonably 

understood “to have two or more different meanings, one of which is inaccurate.” Gonzales 

v. Arrow Fin. Servs., LLC, 660 F.3d 1055, 1062 (9th Cir. 2011) (citation omitted). The 

allegations in this case do not implicate the kind of deceptive and misleading conduct 

contemplated in other section 1692e cases. Compare Bazan v. Hammerman & Hultgren 

PC, No. CV-20-01138-PHX-DLR, 2020 WL 5439517, at *1 (D. Ariz. Sept. 10, 2020)

(violation where letter described confusing calculation of debt, accrued interest, and 

continuing interest rate that could reasonably convey three different balance figures) with 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 8 of 20
9

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Youssofi v. Cmre Fin. Servs., Inc., No. 15CV2310 JM(WVG), 2016 WL 245849, at *3 

(S.D. Cal. Jan. 21, 2016) (no violation where defendant sought to collect an incorrect 

amount lower than the debt owed and there was no evidence of subterfuge, abuse, 

unfairness, or unconscionability). For instance, the Ninth Circuit stated in Donohue v. 

Quick Collect, Inc. that “[i]n assessing FDCPA liability, we are not concerned with mere 

technical falsehoods that mislead no one, but instead with genuinely misleading statements 

that may frustrate a consumer’s ability to intelligently choose his or her response.” See

Donohue v. Quick Collect, Inc., 592 F.3d 1027, 1034 (9th Cir. 2010). In that case, the court 

found that a falsehood in a debt collector’s communication “did not undermine [the 

plaintiff’s] ability to intelligently choose her action concerning her debt.” Id. Indeed, the 

court ultimately found that liability was not triggered under sections 1692e or 1692f, 

because the plaintiff could have challenged the accuracy or legality of the debt, settled the 

debt, or taken other action based on the information contained in the communication. Id.

Here, Plaintiff was not at risk of being misled by the amount or character of the debt 

allegedly communicated by Defendant Midland under the least sophisticated debtor 

standard. As noted in Plaintiff’s FAC, Defendant Comenity communicated the status and 

amount of the debt to Plaintiff when it transferred the account to Defendant Midland. (Doc. 

32 at 15). Plaintiff was well aware of the source and amount of the alleged debt. Defendant 

Midland’s communications about the debt were not deceptive as to mislead an 

unsophisticated consumer. Rather, an unsophisticated consumer in Plaintiff’s position 

would understand exactly what Defendant Midland was referring to in its communications. 

Defendant Midland’s communication did not undermine Plaintiff’s ability to intelligently 

choose his action concerning his debt, such as determining whether to challenge its 

accuracy or legality or otherwise come to an agreement to pay the alleged amount owed. 

Plaintiff fails to identify how Defendant Midland’s practices are otherwise unfair or 

unconscionable. Thus, Plaintiff’s claims under sections 1692e(2)(A) and 1692e(10) are 

insufficient, and dismissal is warranted.

Further, Plaintiff’s allegation that Defendants violated section 1692e(5) by 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 9 of 20
10

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

“[t]hreatening to take legal action that was not actually intended to be taken” fails to state 

a claim. (Doc. 32 at 35). Plaintiff sufficiently alleges that Defendant Midland threatened or 

impliedly threatened litigation. Zilbert v. Credit Corp. Sols., No. CV 17-02617-JAK-SK, 

2017 WL 8236354, at *4 (C.D. Cal. Dec. 13, 2017) (“[S]everal district courts within the 

Ninth Circuit have determined that ‘vague threats of “other remedies” or “further steps” ... 

constitute an implied threat of legal action to the least sophisticated debtor.’”) (citations 

omitted). However, the FAC fails to allege facts sufficient to show that Defendant Midland 

would not have brought a civil action against Plaintiff to seek to recover the amount 

allegedly due, and instead “makes the conclusory allegation that Defendant did not intend 

to take such legal action.” Id. Thus, Plaintiff fails to meet the pleading standard for his 

section 1692e(5) claim.

3. § 1692f

Plaintiff alleges that Defendants violated 1692f(1), which prohibits collection or 

attempted collection by using unfair or unconscionable means, by attempting to collect an

amount unauthorized by the agreement creating the debt. (Doc. 32 at 35–36); 15 U.S.C. § 

1692f(1). The Court presumes that Plaintiff’s allegations refer to Plaintiff’s alleged oral 

agreement with Defendant Comenity, which Plaintiff claims included an agreement that 

the credit account would have zero interest for the life of the loan and no additional fees. 

(Doc. 32 at 5). While Plaintiff’s FAC shows that Plaintiff was on notice of the interest and 

fees as early as December 2016 (Doc. 32-1 at 513) and Plaintiff apparently acknowledges 

the dubious nature of a business model that offers zero-percent interest loans (Doc. 56 at 

3), at the motion to dismiss stage, the Court must accept all factual assertions as true. As 

such, the Court finds that Plaintiff’s section 1692f(1) claim may proceed should Plaintiff 

establish that Defendant Midland is a “debt collector” as defined by the statute upon 

amendment.

4. § 1692g

Under Section 1692g(a), a debt collector must provide a proper validation notice 

within five days of sending a plaintiff an initial communication. 15 U.S.C. § 1692g(a). In 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 10 of 20
11

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the Ninth Circuit, this statute requires only that the debt collector sent a written notice, not 

that the debtor actually received the notice. Mahon v. Credit Bureau of Placer Cnty. Inc., 

171 F.3d 1197, 1201 (9th Cir. 1999), as amended on denial of reh'g and reh'g en banc

(Apr. 28, 1999). Plaintiff’s allegations do not specify the date of the initial communication, 

which is necessary for this Court to determine if and when the five-day notice timeline was 

triggered. (Doc. 32 at 35). Instead, Plaintiff argues in his Response that “this information 

is within Defendants’ possession and can be easily obtained through discovery.” (Doc. 56 

at 5). As Plaintiff received and is in possession of the collection letter that purportedly 

serves as the initial communication, Plaintiff ought to possess information regarding the 

date of the communication, as well. (Docs. 32-1 at 616; 32 at 15). Furthermore, Plaintiff

does not allege that Defendant Midland never sent a written notice: Plaintiff’s allegation 

states that Defendants failed to provide him with a notice. (Doc. 32 at 35). As noted, in the 

Ninth Circuit, a debtor’s receipt of the notice is not required. Mahon, 171 F.3d at 1201. 

Without more information, Plaintiff’s FAC fails to include the factual contentions 

necessary to establish a claim under 1692g(a). However, as additional facts may exist to 

cure the identified deficiencies, Plaintiff may move for leave to amend on his section 

1692g(a) claim.

Under section 1692g(b), “when a consumer disputes a debt in writing and requests 

verification of the debt, the debt collector must place an immediate hold on all collection 

efforts pending verification of the debt.” Simington v. Clark Cnty. Collection Serv., No. 

CV-10-8236-PCT-FJM, 2012 WL 1157077, at *2 (D. Ariz. Apr. 6, 2012). An oral notice 

of a dispute fails to satisfy the statute. Id. In this case, although Plaintiff alleges that 

Defendants continued collection efforts “without properly validating the debt after 

receiving Plaintiff’s timely written dispute and request for verification” (Doc. 32 at 35), 

Plaintiff fails to allege that he ever submitted a written dispute or verification request and 

failed to address Defendants’ argument that such written dispute notice or request was ever 

received in his Response. (Docs. 40 at 9–10; 56 at 5). The Court therefore accepts this 

argument as conceded. See, e.g., M.S. v. Cnty. of Ventura, No. CV 16-03084-BRO (RAOx), 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 11 of 20
12

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2017 WL 10434015, at *24 n.20 (C.D. Cal. Mar. 7, 2017) (“Failure to respond to the merits 

of one party's argument constitutes a concession of that argument.”); see also Indep. 

Towers of Wash. v. Washington, 350 F.3d 925 (9th Cir. 2003) (“Our circuit has repeatedly 

admonished that we cannot ‘manufacture arguments for [a party]’ . . . .”). Thus, the Court 

finds that dismissal of Plaintiff’s section 1692g(b) claim is warranted and leave to amend 

would be futile. 

ii. Unjust Enrichment

In Arizona, “[u]njust enrichment occurs when one party has and retains money or 

benefits that in justice and equity belong to another.” Loiselle v. Cosas Mgmt. Grp., LLC, 

228 P.3d 943, 946 (Ariz. Ct. App. 2010) (citations and quotations omitted.). “To prevail 

on an unjust enrichment claim, a plaintiff must prove: ‘(1) an enrichment; (2) an 

impoverishment; (3) a connection between the enrichment and the impoverishment; (4) the 

absence of justification for the enrichment and the impoverishment; and (5) the absence of 

a legal remedy.’” Serrano v. Serrano, No. 1 CA-CV 10-0649, 2012 WL 75639, at *7 (citing 

Trustmark Ins. Co. v. Bank One, Ariz. N.A., 48 P.3d 485, 491 (Ariz. Ct. App. 2002)). A 

plaintiff must show that the defendant retained a benefit at the plaintiff’s expense and that 

it would be unjust for the defendant to retain the benefit without compensating the plaintiff. 

Span v. Maricopa Cnty. Treasurer, 437 P.3d 881, 886 (Ariz. Ct. App. 2019) (citations 

omitted). Moreover, “where there is a specific contract which governs the relationship of 

the parties, the doctrine of unjust enrichment has no application.” Brooks v. Valley Nat. 

Bank, 548 P.2d 1166, 1171 (Ariz. 1976) (citations omitted). The existence of a contract 

bars tort claims when the claim would not exist but for a breach of a contract. Huffman v. 

JP Morgan Chase Bank, NA, No. CV-22-00903-PHX-JJT, 2024 WL 4817654, at *2–3 (D. 

Ariz. Nov. 18, 2024) (collecting cases discussing contractual bar to unjust enrichment 

claims). 

Plaintiff alleges that Defendants were unjustly enriched by (1) acquiring Plaintiff’s 

account at a discount based on its disputed status and (2) attempting to collect the full 

amount of the disputed debt. (Doc. 32 at 45). Plaintiff alleges that he has been impoverished 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 12 of 20
13

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

by (1) paying amounts exceeding his original verbal agreement with Defendant Comenity; 

(2) suffering damage to his credit score and status; and (3) incurring expenses in attempting 

to resolve his account issues. (Id.). These allegations fail to state a claim for unjust 

enrichment. With respect to Plaintiff’s claim that Defendants were unjustly enriched by 

acquiring Plaintiff’s account at a discount, Defendant Midland obtained the account from 

Defendant Comenity, and Plaintiff fails to allege that he suffered a related impoverishment 

from the switch in ownership over his debt account. The requisite impoverishment and 

connection between the impoverishment and benefit are not present here. Moreover, to the 

extent Plaintiff alleges that Defendants were unjustly enriched by “attempting to collect 

the full amount of the disputed debt” (Doc. 32 at 45), the Court cannot fathom how a party’s 

attempt to collect debt equates to a benefit conferred on that party. Plaintiff fails to 

demonstrate a connection between this “benefit” and his alleged impoverishments, as well. 

Beyond these allegations, the Court identifies from the FAC that the only benefit or 

enrichment Defendant Midland received and the only connected impoverishment to 

Plaintiff was Plaintiff’s $348 payment to Defendant Midland made on March 19, 2024. 

(Doc. 32 at 17). However, Exhibit K attached to Plaintiff’s FAC reveals that this payment 

was made pursuant to an agreement made between Plaintiff and Defendant Midland to 

establish a payment plan. (Doc. 32-1 at 1279). Exhibit K further shows that Plaintiff has 

continued to make the agreed-upon payments following the commencement of this lawsuit. 

(Id. at 1290; 1295). Any allegation that Defendant Midland wrongly received Plaintiff’s 

payments of amounts exceeding his original verbal agreement cannot be remedied by an 

unjust enrichment claim, as such a dispute would directly relate to Plaintiff’s payment 

agreement with Defendant Midland, acknowledged in Exhibit K, or would otherwise arise 

out of Plaintiff’s contract with Defendant Comenity. Because Plaintiff’s contractual 

agreements with Defendants Midland and Comenity “form[] the essential basis against 

which Plaintiff’s claims for unjust enrichment . . . must be understood,” his claims arise 

out of contract and the doctrine of unjust enrichment has no application here. Huffman, 

2024 WL 4817654, at *3. In sum, Plaintiff fails to submit a claim for unjust enrichment 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 13 of 20
14

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

upon which relief may be granted against Defendants Midland and Encore.

iii. Arizona Consumer Fraud Act

Against all Defendants, Plaintiff alleges a violation of the Arizona Consumer Fraud 

Act (“ACFA”), A.R.S. § 44-1521 et seq. (Doc. 32 at 46). Plaintiff alleges Defendants 

Midland and Encore violated the act by (1) “attempting to collect a debt without verifying 

its validity or accuracy”; (2) “misrepresenting the amount and legal status of the alleged 

debt”; (3) “employing unfair and deceptive tactics in their collection efforts”; and (4) 

“failing to properly investigate and respond to Plaintiff’s disputes about the debt.” (Id. at 

47–48). The ACFA prohibits

[t]he act, use or employment by any person of any deception, 

deceptive or unfair act or practice, fraud, false pretense, false 

promise, misrepresentation, or concealment, suppression or 

omission of any material fact with intent that others rely on 

such concealment, suppression or omission, in connection with 

the sale or advertisement of any merchandise[.]

A.R.S. § 44-1522(A). Under the ACFA, the elements of a private cause of action are (1) a 

false promise or misrepresentation, (2) made in connection with the sale or advertisement 

of merchandise, and (3) the plaintiff’s consequent and proximate injury from relying on 

the misrepresentation, although the reliance need not be reasonable. Naiman v. Alle 

Processing Corp., 706 F. Supp. 3d 892, 900 (D. Ariz. 2020) (citations omitted). 

Plaintiff’s FAC alleges no facts that establish a private right of action under the 

ACFA. Defendants Midland and Encore purchased Plaintiff’s alleged debt from Defendant 

Comenity. (Doc. 32 at 15). Plaintiff does not claim that Defendants Midland or Encore sold 

or advertised any merchandise, made any sort of related false promise or misrepresentation, 

or that Plaintiff relied on such a false promise or misrepresentation. Defendants’ alleged 

conduct—none of which is related to any sale or advertisement of merchandise—is plainly 

outside of the scope of the statute. Thus, Plaintiff’s ACFA claim against Defendants 

Midland and Encore must be dismissed, and the Court finds that amendment would be 

futile.

///

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 14 of 20
15

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

iv. Intentional Infliction of Emotional Distress

Plaintiff brings a claim of intentional infliction of emotional distress (“IIED”) 

against that Defendants Midland and Encore, resulting from their collection efforts, which 

included threats of legal action and “misrepresentation of the debt’s status and amount” 

despite being informed of Plaintiff’s dispute of the debt. (Doc. 32 at 50). 

To bring an IIED claim, a plaintiff must show (1) the defendant’s conduct was 

“extreme” and “outrageous”; (2) the defendant either intended to cause emotional distress 

or recklessly disregarded a near certainty that distress would result from its conduct; and 

(3) severe emotional distress indeed occurred. Citizen Publ’g Co. v. Miller, 115 P.3d 107, 

110 (Ariz. 2005) (citations omitted). “One may recover for intentional infliction of 

emotional distress only where the defendant's acts are ‘so outrageous in character and so 

extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as 

atrocious and utterly intolerable in a civilized community.’” Patton v. First Fed. Sav. & 

Loan Ass’n of Phoenix, 578 P.2d 152, 155 (Ariz. 1978) (citation omitted). The “defendant’s 

conduct must ‘fall at the very extreme edge of the spectrum of possible conduct.’” Reynolds 

v. Mitchell, No. 1 CA-CV 06-0803, 2007 WL 5463507, at *5 (Ariz. Ct. App. Dec. 27, 

2007) (citation omitted).

The bar to demonstrate outrageous and extreme conduct is quite high. See generally

Cluff v. Farmers Ins. Exch., 460 P.2d 666, 667 (Ariz. Ct. App. 1969) (rejecting IIED claim 

where insurance adjuster allegedly made false and malicious threats to cajole plaintiff into 

accepting settlement for son’s wrongful death); Patton, 578 P.2d at 155 (finding that while 

bank’s unilateral change of loan agreement, unilateral imposition of increased interest rate 

and fees, foreclosure of plaintiff’s home without notice, and delayed refusal to return 

plaintiff’s savings account “may have been harsh ... it is still within the realm of acceptable 

business practice.”). Arizona courts have often found that debt collection tactics like those 

alleged in this case do not amount to extreme and outrageous conduct. See Arce v. LHM 

Dodge Ram Avondale, No. CV-23-02267-PHX-MTL, 2024 WL 1051988, at *4 (D. Ariz. 

Mar. 11, 2024) (“But standard, or even unprofessional, attempts to collect on a debt are not 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 15 of 20
16

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the sort of extreme and outrageous conduct that can sustain a claim for intentional infliction 

of emotional distress.”); Jaffe v. Cap. One Bank, N.A., No. 1 CA-CV 13-0600, 2014 WL 

2917083, at *3 (Ariz. Ct. App. June 26, 2014) (repeatedly sending billing statements and 

suing to recover delinquent credit card debt plaintiff allegedly did not owe did not 

constitute outrageous conduct); Helfond v. Stamper, 716 P.2d 70, 72 (Ariz. Ct. App. 1986)

(finding threat of legal action to recover medical insurance debt was not sufficiently 

extreme and outrageous). “[C]ourts have uniformly insisted that the creditor’s conduct be 

clearly and obviously excessive in order to sustain a cause of action.” Midas Muffler Shop 

v. Ellison, 650 P.2d 496, 499 (Ariz. Ct. App. 1982). 

Additionally, Arizona “courts have also uniformly insisted that the emotional 

distress suffered be severe.” Midas Muffler Shop v. Ellison, 650 P.2d at 501 (Ariz. Ct. App. 

1982); Sport Collectors Guild Inc., 2018 WL 8248944, at *5 (rejecting IIED claim when 

Plaintiff cited “no specific examples of any emotional distress suffered, such as 

hospitalizations [or] medical treatment rendered” beyond general claims of humiliation, 

grief, and anxiety). In providing examples for what evidence constitutes a showing of 

severe emotional distress, one Arizona court, collecting cases, cited plaintiffs suffering a 

heart attack; entering premature labor and having a stillbirth; experiencing a state of 

extreme shock and hysteria such that plaintiff could not perform her job; and requiring 

hospitalization. Midas, 650 P.2d at 501 (collecting cases).

Defendant Comenity closed Plaintiff’s account and transferred it to Defendant 

Midland on December 29, 2023. (Doc. 32 at 15). Plaintiff alleges that Defendant Midland 

mailed Plaintiff a collection letter alerting Plaintiff that Midland was “considering forward 

the account to an attorney.” (Id.). Plaintiff also alleges that Midland continued its collection 

efforts through a series of calls. (Id.). Plaintiff’s FAC only mentions two calls, however: 

one made on March 4, 2024, where a representative “threatened legal action,” and another 

on March 19, 2024, where Plaintiff alleges that Midland representatives again stated they 

may have to hire an attorney and pursue legal action if no agreement was reached but also 

communicated that they “obviously don’t want that to happen.” (Id. at 17). Plaintiff filed 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 16 of 20
17

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the lawsuit soon after, on April 2, 2024. (Doc. 1). 

Defendants’ alleged conduct in this case—two phone calls and a letter over the 

course of three months that indicated consideration of pursuing legal action—does not 

involve the prolonged course of hounding or extreme volume of threatening letters and 

bills Arizona courts have found necessary to establish intentional infliction of emotional 

distress. See generally Midas, 650 P.2d at 499–500. Moreover, this Court cannot say that 

the Midland representatives’ alleged language, as quoted by Plaintiff, was “so atrocious as 

to be utterly intolerable in a civilized community.” Id. at 500. 

Furthermore, the Court finds that Plaintiff’s FAC fails to demonstrate that the 

emotional distress suffered was severe. While Plaintiff alleges that that he experienced 

anxiety, stress, sleeplessness, and a few physical manifestations of “headaches, digestive 

issues, and exacerbation of existing health conditions,” (Id. at 50–51), these symptoms of 

distress do not amount to the level of severity contemplated by Arizona case law. Plaintiff 

did not provide specific examples of severe distress, such as hospitalizations or medical 

treatment. See Sports Collectors Guild Inc., 2018 WL 8248944, at *5. “It is only where it 

is extreme that the liability arises. Complete emotional tranquility is seldom attainable in 

this world, and some degree of transient and trivial emotional distress is a part of the price 

of living among people.” Midas, 650 P.2d at 501 (quoting Restatement (Second) of Torts 

§ 46 Comment j (1965)). In sum, while Defendants’ collection tactics may have upset 

Plaintiff, they did not amount to intentional infliction of emotional distress, and dismissal 

of Plaintiff’s IIED claim is warranted.

c. Motion to Strike

Defendants argue that Plaintiff’s alleged class claims should be stricken because pro 

se litigants cannot represent the interests of others as a class representative. (Doc. 40 at 16). 

District courts within the Ninth Circuit have routinely granted motions to strike putative 

class claims on the grounds that “a pro se plaintiff cannot represent other parties and 

therefore cannot represent a class.” William v. First Transit Inc., No. 2:24-CV-00137-

RGK-MAR, 2024 WL 1600641, at *3 (C.D. Cal. Feb. 27, 2024) (citing Claiborne v. Cnty. 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 17 of 20
18

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

of Los Angeles, 158 F. App’x 853 (9th Cir. 2005)) (granting motion to strike of pro se 

plaintiff’s putative class action claims); Langan v. United Servs. Auto. Ass’n, 69 F. Supp. 

3d 965, 988 (N.D. Cal. 2014) (striking pro se plaintiff’s class allegations with leave to 

amend if plaintiff secured counsel and counsel appeared in the action); Yagman v. Allianz 

Ins., No. LACV1500921JAKJCX, 2015 WL 5553460, at *4 (C.D. Cal. May 11, 2015)

(granting motion to strike pro se plaintiff’s class allegations without prejudice).

Because Plaintiff is a pro se plaintiff, and as such, the “face of the complaint shows 

conclusively that the proposed class cannot be certified,” the Court finds it appropriate to 

grant Defendants’ Motion to Strike without prejudice. Langan, 69 F. Supp. 3d at 988. 

Plaintiff may reassert the class allegations in an amended complaint that complies with the 

local and federal rules, “but only if he has secured the representation of experienced 

counsel and such counsel has entered an appearance in this action.” Id. at 989.

IV. CONCLUSION

All told, “whether a complaint states a plausible claim for relief will . . . be a contextspecific task that requires the reviewing court to draw on its judicial experience and 

common sense.” Iqbal, 556 U.S. at 679. A district court should normally grant leave to 

amend unless it determines that the pleading could not possibly be cured by allegations of 

other facts. Cook, Perkiss & Liehe v. N. Cal. Collection Serv., 911 F.2d 242, 247 (9th Cir.

1990).

While Plaintiff only needs to allege enough facts to “plausibly give rise to an 

entitlement to relief,” that has not occurred here. Iqbal, 556 U.S. at 679. Therefore, the 

claims against Defendants Midland and Encore fail to satisfy the pleading standards set 

forth by Rule 8 and 12(b)(6), and their dismissal is both warranted and necessary. Taking 

the facts included and attached to Plaintiff’s FAC as true and considering Plaintiff’s 

reiteration of those facts and his arguments in his briefing, the Court finds that the 

allegation of additional relevant facts consistent with the FAC could not save the majority 

of Plaintiff’s claims. Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 

1401 (9th Cir. 1986) (“If a complaint is dismissed for failure to state a claim, leave to 

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 18 of 20
19

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

amend should be granted unless the court determines that the allegation of other facts 

consistent with the challenged pleading could not possibly cure the deficiency.”); Bonin v. 

Calderon, 59 F.3d 815, 845 (9th Cir. 1995) (“Futility of amendment can, by itself, justify 

the denial of a motion for leave to amend.”). 

However, as allegations of additional facts could potentially cure some of Plaintiff’s 

claims, Plaintiff will be granted leave to amend to cure the deficiencies identified by the 

Court throughout this Order. Specifically, Plaintiff will be granted leave to amend his 

claims that Defendant Encore is liable for any of Defendant Midland’s conduct; that 

Defendant Midland qualifies as a “debt collector” under 15 U.S.C. § 1692a(6); and that 

Defendant Midland failed to comply with the requirements of 15 U.S.C. § 1692g(a).

Additionally, as noted above, the Court finds it appropriate to grant Defendants’ Motion to 

Strike Plaintiff’s class allegation without prejudice. Should Plaintiff secure the 

representation of experienced counsel and should that counsel appear in this action, 

Plaintiff may reassert his class allegations upon leave to amend. Plaintiff’s other claims 

against Defendants Midland and Encore are dismissed without leave to amend. 

Accordingly, 

IT IS ORDERED that Defendants Midland Credit Management Incorporated and 

Encore Capital Group Incorporated’s Motion to Dismiss (Doc. 40) is granted. 

IT IS FURTHER ORDERED that Plaintiff’s claims against Defendant Encore 

Capital Group Incorporated are dismissed in their entirety with leave to amend to correct 

the deficiencies identified in this order. 

IT IS FURTHER ORDERED that Plaintiff’s Count V is dismissed with leave to 

amend to correct the deficiencies identified in this Order. Plaintiff’s Counts IX, X, and XI 

are dismissed with prejudice and without leave to amend. 

IT IS ORDERED that Defendants Midland Credit Management Incorporated and 

Encore Capital Group Incorporated’s Motion to Strike Plaintiff’s Putative Class Claims 

(Doc. 40) is granted without prejudice. 

///

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 19 of 20
20

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Dated this 10th day of January, 2025.

Honorable Steven P. Logan

United States District Judge

Case 2:24-cv-00728-SPL Document 64 Filed 01/10/25 Page 20 of 20