Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_13-cv-03061/USCOURTS-casd-3_13-cv-03061-0/pdf.json

Nature of Suit Code: 480
Nature of Suit: Consumer Credit
Cause of Action: 15:1681 Fair Credit Reporting Act

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

KRISTIANE SMITH,

Plaintiff,

CASE NO. 13cv3061-WQH

(BGS)

vs. ORDER

LAW OFFICES OF PATENAUDE &

FELIX, A.P.C.,

Defendant.

HAYES, Judge:

The matter before the Court is the Motion to Dismiss filed by Defendant Law

Offices of Patenaude & Felix A.P.C. (ECF No. 8). 

BACKGROUND

On December 17, 2013, Plaintiff initiated this action by filing a Complaint

against Defendant Law Offices of Patenaude & Felix, A.P.C. (ECF No. 1). On

February 3, 2014, Plaintiff filed a First Amended Complaint alleging violations of the

Fair Credit Reporting Act, 15 U.S.C. § 1681b (“FCRA”), the Fair Debt Collection

Practices Act, 15 U.S.C. § 1692g(a) (“FDCPA”), and the Rosenthal Fair Debt

Collection Practices Act, Cal. Civ. Code § 1788.15(a) (“RFDCPA”). (ECF No. 6). 

On February 17, 2014, Defendant filed a Motion to Dismiss for Failure to State

a Claim. (ECF No. 8). On March 3, 2014, Plaintiff filed a response to the Motion to

Dismiss. (ECF No. 9). On March 10, 2014, Defendant filed a reply. (ECF No. 10). 

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ALLEGATIONS OF THE FIRST AMENDED COMPLAINT

Plaintiff alleges that on April 25, 2013, Defendant initiated a “hard pull of

Plaintiff’s credit report from TransUnion without permissible purpose, thereby reducing

her credit score” and violating the FCRA. (ECF No. 6 at ¶ 7). Plaintiff alleges that

Defendant violated the FDCPA because it “did not act in accordance with the

provisions and definitions in regards to the term ‘account’,” and “failed to provide a 30

day validation notice to the Plaintiff.” Id. at ¶¶ 7-8. Plaintiff alleges that Defendant

violated the RFDCPA when it “attempted to collect on consumer debt when service of

process was not legally effected” and that she had no contractual agreement with

Defendant. Id. at ¶¶ 9-10. Plaintiff demands $1,000 in damages for violation of each

statute, totaling $3,000 in damages. Id. at ¶¶ 14, 19, 26. 

DISCUSSION

I. Request for Judicial Notice

Defendant has submitted a request for judicial notice of the summons and

complaint filed on June 19, 2013, in the Superior Court of California for the County of

Sacramento, entitled TD Bank USA, N.A., As Successor in Interest to Target National

Bank v. Kristiane Smith, case number 34-2013-00146865. (ECF No. 8-1). Federal Rule

of Evidence 201 provides that “a judicially noticed fact must be one not subject to

reasonable dispute in that it is ... capable of accurate and ready determination by resort

to sources whose accuracy cannot reasonably be questioned.” Fed R. Evid. 210(b). 

Courts may take judicial notice of their own records, and may also take judicial notice

of other courts’ proceedings if they “directly relate to matters before the court.” Hayes

v. Woodford, 444 F. Supp. 2d 1127, 1136-37 (S.D. Cal. 2006); see also United States

ex rel. Robinson Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th

Cir. 1992). The unopposed request for judicial notice is granted.

II. Contentions of the Parties

Defendant contends that “Plaintiff obtained and used a credit card issued by TD

Bank, U.S.A., N.A., as successor in interest to Target National Bank, and failed to pay

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it.” (ECF No. 8 at 3). Defendant contends that it is a debt collector who was retained

by Target National Bank (“Target”) to collect Plaintiff’s delinquent credit card debts. 

Defendant contends that it pulled Plaintiff’s credit report for the purpose of collection

on the account, a permissible purpose under the FCRA. Defendant contends Plaintiff’s

First Amended Complaint fails to allege sufficient facts to state a claim and dismissal

without leave to amend is warranted because the defects of the First Amended

Complaint are incurable.

Plaintiff contends she was not aware of Defendant’s “hard pull” of her credit

report until November 10, 2013 after reviewing her credit report. (ECF No. 9 at 2). 

Plaintiff contends that Defendant failed to send a demand request, filed suit without

notice, and failed to send initial communication to Plaintiff. Id. at 4-5. Plaintiff

contends she never received the initial demand letter and that Defendant has no

evidence to prove the initial demand letter was mailed to her, including proof of mailing

or receipt. Id. at 5. Plaintiff contends Defendant obtained her credit report without a

permissible purpose. Id. at 4. Plaintiff contends Defendant violated the RFDCPA by

concealing the state court suit and refusing “to legally serve the Summons on the

Plaintiff.” Id. at 6.

III. Standard of Review

Federal Rule of Civil Procedure 12(b)(6) permits dismissal for “failure to state

a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). To sufficiently

state a claim for relief and survive a Rule 12(b)(6) motion, a complaint “does not need

detailed factual allegations” but the “[f]actual allegations must be enough to raise a right

to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555

(2007). “[A] plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to

relief’ requires more than labels and conclusions, and a formulaic recitation of the

elements of a cause of action will not do.” Id. (quoting Fed. R. Civ. P. 8(a)(2)). When

considering a motion to dismiss, a court must accept as true all “well-pleaded factual

allegations.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 1950 (2009). For

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purposes of reviewing dismissal for failure to state claim, all allegations of material fact

are taken as true and construed in the light most favorable to the nonmoving party. 

Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-338 (9th Cir. 1996). However, a court

is not “required to accept as true allegations that are merely conclusory, unwarranted

deductions of fact, or unreasonable inferences.” Sprewell v. Golden State Warriors, 266

F.3d 979, 988 (9th Cir. 2001). “In sum, for a complaint to survive a motion to dismiss,

the non-conclusory factual content, and reasonable inferences from that content, must

be plausibly suggestive of a claim entitling the plaintiff to relief.” Moss v. U.S. Secret

Serv., 572 F.3d 962, 969 (9th Cir. 2009) (quotations omitted).

IV. Federal Law Claims

A. FCRA

The FCRA imposes civil liability against “[a]ny person who obtains a consumer

report from a consumer reporting agency under false pretenses or knowingly without

a permissible purpose....” 15 U.S.C. §§ 1681n(b). A consumer report is “any

information by a consumer reporting agency bearing on a consumer’s credit

worthiness....” 15 U.S.C. § 1681a(d)(1). The FCRA lists several permissible purposes

for obtaining a consumer report, including that a consumer reporting agency may

provide a consumer report to “a person which it has reason to believe ... intends to use

the information in connection with a credit transaction involving the consumer on

whom the information is to be furnished and involving the extension of credit to, or

review or collection of an account of, the consumer....” 15 U.S.C. §1681b. 

“A collection agency is permitted to obtain a consumer report if the agency is

doing so for the purposes of collecting a debt.” Pyle v. First Nat. Collection Bureau,

No. 1:12cv288-AWI-SKO, 2012 WL 1413970, at *3 (E.D. Cal. Apr. 23, 2012)

(concluding that plaintiff’s allegations that he “never at anytime had any business

dealing or accounts with the Defendant” were vague and conclusory and failed to

establish that Defendant’s activities were impermissible.). “Where a permissible

purpose for obtaining the credit information is demonstrated, then as a matter of law,

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the information cannot have been obtained under false pretenses.” Perretta v. Capital

Acquisitions & Mgmt Co., No. C-02-05561 RMW, 2003 WL 21383757, at *5 (N.D.

Cal. May 5, 2003) (granting a motion to dismiss an FCRA claim because “defendant

obtained plaintiff’s consumer report ... in connection with an effort to collect a debt.”)

(citations omitted). 

The First Amended Complaint’s allegation that Defendant “violated the FCRA

by initiating a hard pull of Plaintiff’s credit report from TransUnion without permissible

purpose, thereby reducing her credit score” (ECF No. 6 at ¶ 7) is conclusory and

insufficient to state a claim without additional factual allegations. See Twombly, 550

U.S. at 555. The Court finds that the First Amended Complaint fails to allege sufficient

facts to show that Defendant violated the FCRA. The Motion to Dismiss the FCRA

claim is granted.

B. FDCPA

Congress enacted the FDCPA to “eliminate the recurring problem of debt

collectors dunning the wrong person or attempting to collect debts which the consumer

has already paid.” Swanson v. Southern Oregon Credit Serv., Inc., 869 F.2d 1222, 1225

(9th Cir. 1988). Section 1692g(a) requires that the initial communication with a

consumer in connection with a debt contain: (1) the amount of the debt; (2) the name

of the creditor; (3) a statement that if the consumer, within thirty days after receipt of

the notice disputes the validity of the debt, or any portion thereof, the debt will be

assumed to be valid by the debt collector; (4) a statement that if the consumer disputes

the debt, the debt collector will mail the consumer verification of the debt or a copy of

a judgment; and (5) a statement that, upon the consumer’s written request, the debt

collector will provide the consumer with the name and address of the original creditor,

if different from the current creditor. 15 U.S.C. § 1692g(a)(1)-(5); see also Terran v.

Kaplan, 109 F.3d 1428, 1431 (9th Cir. 1997). The term communication means “the

conveying of information regarding a debt directly or indirectly to any person through

any medium.” 15 U.S.C. § 1692a(2). The initial communication need only be sent by

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the debt collector who is under no obligation to establish receipt by the debtor. Mahon

v. Credit Bureau of Placer Cnty. Inc., 171 F.3d 1197, 1201 (9th Cir. 1999). Under the

common law Mailbox Rule, “proper and timely mailing of a document raises a

rebuttable presumption that it is received by the addressee.” Id. at 1202. To overcome

this rebuttable presumption of mailing and receipt, a debtor must prove “by clear and

convincing evidence that the mailing was not, in fact, accomplished.” In re Bucknum,

951 F.2d 204, 207 (9th Cir. 1991); see also Grant v. Unifund CCR Partners, 842 F.

Supp. 2d 1234, 1241 (finding debtor’s only evidence—that she never received the

letter—insufficient to overcome the rebuttable presumption).

The First Amended Complaint’s allegation that Defendant “violated the FDCPA

when [it] failed to provide a 30 day validation notice to the Plaintiff” (ECF No. 6 ¶¶

8, 19) is conclusory and insufficient to state a claim without additional factual

allegations. See Twombly, 550 U.S. at 555. The Court finds that the First Amended

Complaint fails to allege sufficient facts to show that Defendant violated the FDCPA. 

The Motion to Dismiss the FDCPA claim is granted.

V. State Law Claim

The federal supplemental jurisdiction statute provides: “[I]n any civil action of

which the district courts have original jurisdiction, the district courts shall have

supplemental jurisdiction over all other claims that are so related to claims in the action

within such original jurisdiction that they form part of the same case or controversy

under Article III of the United States Constitution.” 28 U.S.C. § 1367(a). A district

court may decline to exercise supplemental jurisdiction over a state law claim “if ... the

district court has dismissed all claims over which it has original jurisdiction.” 28 U.S.C.

§1367(c)(3). In this case, the Court has dismissed the federal claims. The Court

declines to exercise supplemental jurisdiction over the remaining state law claim, which

alleges a violation of the RFDCPA. See Ove v. Gwinn, 264 F.3d 817, 826 (9th Cir.

2001) (“A court may decline to exercise supplemental jurisdiction over related state-law

claims once it has dismissed all claims over which it has original jurisdiction.”).

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CONCLUSION

IT IS HEREBY ORDERED that the Motion to Dismiss (ECF No. 6) is

GRANTED. The First Amended Complaint is DISMISSED without prejudice. No

later than thirty days from the date this Order is filed, Plaintiff may file a motion for

leave to amend the First Amended Complaint accompanied by a proposed second

amended complaint. The second amended complaint must be complete in itself and

may not incorporate by reference prior versions of the complaint or other filings in this

action. If Plaintiff does not file a motion for leave to amend, this case shall remain

closed without further order of the Court.

DATED: July 23, 2014

WILLIAM Q. HAYES

United States District Judge

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