payment” has an amount of zero. If the down payment is in fact listed in the “Total Sale Price,”
Defendant should make it known to the Court by delineating how much of the total sale price
includes the down payment and what amount makes up the remainder. While TILA may not require
the down payment to be segregated, there is uncertainty and doubt as to the location and existence
of the down payment that this Court would like clarified.
C. Defendant claims Plaintiff did not allege statutory damages

Defendant argues that Plaintiff must allege “actual injury” regardless of the type of damage
sought. Brown v. Payday Loan Corp. of Illinois, 202 F.3d 987, 989 (7th Cir. 2000). This is not the
case. Statutory damages may be recovered in the absence of actual damages. Hickey v. Great
Western Mortgage Corp., 158 F.R.D. 603, 611 (N.D. Ill. 1994). Section 1640(a) specifically states
recovery for violations of §1635 and §1638(a)(2), (3), (4), (5), 6, (9). Brown, 202 F3d at 991,

Plaintiff alleges statutory damages under TILA and Regulation Z because the down payment
is subject to a finance charge. Under 12 C.F.R. 226.2(a)(18) “a deferred down payment may be
treated as part of the down payment if itis... not subject to a finance charge.” The Promissory Note
signed by Plaintiff is subject to an 18% finance charge. Defendant failed to provide TILA
disclosures in the Promissory Note, including the amount financed, finance charge and APR, in
violation of §1638(a)(2), (3), and (4), respectively. Therefore Plaintiff is entitled to statutory
damages.

CONCLUSION

Accordingly, Defendant’s Motion to Dismiss (doc. #9) is DENIED. This Court’s research

indicates nothing that conclusively states that §1640 and §1638 must be pled in conjunction.

Plaintiff only pleads violation of §1640 in its original complaint; this Court is giving Plaintiff the


Promissory Note submitted by Plaintiff casts doubt on Defendant’s claim. Additionally, there
appears to be a discrepancy as to the actual amount of the down payment. Plaintiff claims it was
$600 as evidenced by the Promissory Note, Defendant claims it was $500. This Court finds that, for
the purposes of this motion, the down payment was indeed financed.
B. Defendant contends that Plaintiff's Complaint does not allege a violation under TILA

In the alternative, Defendant claims that even if the down payment was financed, there was
no violation because the down payment was included in the “Total Amount Financed” portion of the
Agreement, as required by TILA. 15 U.S.C. § 1638(a)(2)(A). To demonstrate that it complied with
this provision, Defendant states that the $1,300 amount reflected in the “Total Sale Price” box
includes the down payment. What is puzzling is that this amount is listed in the agreement submitted
by Plaintiff which Defendant claims is invalid. Additionally, Defendant failed to even address
Plaintiff's contention that the down payment was financed by the Promissory Note.

Plaintiff claims there was in fact a TILA violation because the Promissory Note failed to
comply with the statute’s requirements, The Promissory Note i is for the sum of $600 andi is subject

toa finance charge of 15%. There are no TILA disclosures made in connection with it. TILA must

be liberally construed in favor of the consumer, and the Acti trict liability in the sense that

absolute compliance is required. Rowland v. Magna Millikin Bank of Decatur, NA, 812 F. Supp.
875, 878 (C.D. Ill. 1992). In considering a motion to dismiss, this Court must accept as true all well-
pled allegations in the complaint, and draw all reasonable inferences in Plaintiff's favor. With these
standards in mind, this Court finds that the Promissory Note was executed to finance Plaintiff's
down payment.

Turning to the Actual Agreement, the portion of the form that lists “Less Cash Down


benefit of the doubt by not Dismissing with leave to amend. For clarity’s sake and to preserve any
future claims he may have, it is recommended that Plaintiff file an amended complaint to include the
relevant sections of TILA.

IT IS SO ORDERED.

DATED: June 29, 2001 \

WILLIAM J. HY R, DISTRICT JUDGE


stow Order Form | (0087)
United States District Court, Northern District of Dlinois
na Magistrate Tue Judge Hibbler “Than Asiged age
CASE NUMBER 01. C610 DATE 6/29/2001
CASE Ryan A. Larson vs. Lynch Ford, Inc.
TITLE
[In the following box (a) indicate the party filing the motion, e.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
MOTION: of the motion being presented.]
Defendant’s Motion to Dismiss (doc. #9)
DOCKET ENTRY:
qd) a Filed motion of [ use listing in “Motion” box above.]
(2) a Brief in support of motion due
3) Oo Answer brief to motion due___. Reply to answer briefdue__
(4) Oo Ruling/Hearingon__ssetfor_—_at
(5) im) Status hearing {held/continued to] [set for/re-set for]on__—_—setfor___—__at
(6) oO Pretrial conference [held/continued to] [set for/re-set for]on___—ssetfor__——sat__—S
Q) a Trial [set for/re-set for}on__at
(8) im [Bench/Jury trial] [Hearing] held/continued toa
(9) oO This case is dismissed [with/without] prejudice and without costs [by/agreement/pursuant to]
OFRCP4(m) (General Rule21 OFRCP41(a)(1) OO FRCP41(a)(2).
do) of [Other docket entry]  Defendant’s Motion to Dismiss (doc. #9) is DENIED.

Status hearing set for July 23, 2001 at 9:15 a.m.

(11) +f [For further detail see order attached to the original minute order.]

No notices required, advised in open court.

No notices required.

umber of notices

Notices mailed by judge’s staff. pL 03 2001
Notified counsel by telephone.

date docketed

J | Docketing to mail notices.

Mail AO 450 form. docketing deputy initials

Copy to judge/magistrate judge.

sommeam G1 JUL -2. Pi
JHC deputy’s
initials

O01

Date/time received in
central Clerk's Office

ailing deputy initials



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION
RYAN A. LARSON, )
Plaintiff, )
) CAUSE NO. 01C610
v. )
) JUDGE WILLIAM J. HIBBLER
LYNCH FORD, INC., )
Defendant. 3)
MEMORANDUM AND OPINION

Plaintiff, Ryan Larson, filed his complaint in this Court against Defendant, Lynch Ford, Inc.,
alleging violations of the Truth in Lending Act, 15 U.S.C. 1601 et seq. (“TILA”) in connection with
motor vehicle transactions. Defendants filed a Motion to Dismiss Plaintiff's Complaint (doc. #9).
For the reasons set forth herein, Defendants’ Motion is DENIED.

BACKGROUND

Plaintiff purchased a motor vehicle from Defendant on December 30, 2000. As part of the
transaction Plaintiff claims Defendant violated the Truth in Lending Act by failing to fully provide
required disclosures in connection with the down payment. Plaintiff claims he signed a Promissory
Note for the down payment which failed to conform to TILA requirements. Defendant claims,
among other things, that Plaintiff never financed his down payment, and therefore, has not stated a
cause of action.

MOTION TO DISMISS STANDARD

Motions to dismiss should not be granted “unless it appears beyond reasonable doubt that


the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.”
Conley v. Gibson, 355 U.S. 41, 45-46 (1957). When evaluating these motions, this Court must
accept all well-pleaded allegations made in support of the complaint as true. Jefferson v. Security
Pac. Fin. Servs., Inc., 161 F.R.D. 63, 66 (N.D. Ill. 1995).
ANALYSIS
A. Defendant claims the down payment was not financed

As part of its original complaint, Plaintiff attaches Exhibit A, “Truth In Lending Disclosure
Statement,” he claims to have executed with Defendant to finance the vehicle purchase. This
statement, however, was not signed by both parties. Plaintiff claims that Defendant cannot challenge
the validity of his facts by submitting a different contract to refute the one submitted by Plaintiff.
However Plaintiff is trying to apply an incorrect standard. Where a plaintiff alleges facts that
establish that the defendant is entitled to prevail on a motion to dismiss, the court may find that the
plaintiff has plead himself out of court. McCormick v. City of Chicago, 230 F3d 319, 325 (7th Cir.
2000). Defendant’s attachments to the motion to dismiss must be given as much weight if their
purpose is to refute Plaintiff's complaint. Venture Associates Corp. v. Zenith Data Systems Corp.,
987 F.2d 429, 431-32 (7th Cir. 1993).

As part ofits motion to dismiss, Defendant submitted another statement (“Actual Statement”)
that was executed by both parties. Defendant claims this statement was the actual financing
statement. Defendant claims that the Actual Statement clearly indicates Plaintiff did not finance his
down payment. However, Plaintiff claims the down payment was financed in form of the
Promissory Note. Plaintiff claims this Promissory Note constitutes a “consumer credit transaction”

under TILA, and should therefore conform to its disclosure requirements. This Court finds that the