REGGIE B. WALTON, United States District Judge.
The plaintiff, Olubukunola Osinubepi-Alao ("Alao"), brings this action against Plainview Financial Services, Ltd. ("Plainview"); Herbert A. Rosenthal, Chartered ("HARC"); and two individuals, Herbert A. Rosenthal and Kevin Eddis, asserting claims for violations of: (1) the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 (2012); (2) the District of Columbia Debt Collection Practices Act, D.C.Code § 28-3801-3819 (2012); and (3) the District of Columbia Consumer Protection Procedures Act, D.C.Code § 28-3901-3913 (2012); and also a claim for (4) malicious prosecution or abuse of process. See Amended Complaint ("Am.Compl.") ¶¶ 81-120. Currently before the Court is Defendant Plainview Financial Services, Ltd. and Herbert A. Rosenthal, Chartered's Motion to Dismiss [the] Complaint
The amended complaint contains the following allegations pertinent to the defendants' motion which, for the purposes of this opinion, the Court must accept as true. The defendants, Plainview and HARC, are Maryland corporations, Am. Compl. ¶¶ 5-6, "in the business of junk debt purchasing and debt collection in the District of Columbia," id. ¶ 5; see also id. ¶ 6. "HARC is also a law firm that practices in the District of Columbia." Id. ¶ 6. "[Herbert A.] Rosenthal ... and Kevin Eddis are responsible for making all decisions for both HARC and Plainview, including whether to purchase debt portfolios and whether to initiate litigation." Id. ¶ 13. Furthermore, "[Herbert A.] Rosenthal is Plainview's President and sole shareholder," as well as "the president of HARC." Id. ¶ 12. HARC "use[s] the Plainview entity to create the appearance of legitimacy for [its] business practice of purchasing junk debt and filing lawsuits to collect [junk] debt[] [purchased by Plainview] through the courts." Id. ¶ 21. "Plainview is the alter ego of ... HARC," and therefore "[a]ll actions [the plaintiff] ascribe[s] to Plainview are performed by HARC personnel." Id. ¶¶ 11, 15.
On June 30, 2011, the defendants "allegedly purchased the [plaintiff's Chase Bank USA, N.A. credit card debt] as a distressed debt."
During the Superior Court litigation, Plainview submitted "an unsigned verification to the [c]omplaint by Herbert A. Rosenthal,"
The plaintiff initiated this action on July 19, 2013, and she subsequently filed an amended complaint on July 23, 2013, which was identical to the complaint filed on July 19, 2013, other than providing the correct addresses for each of the defendants. Compare Compl., with Am. Compl. The amended complaint contains four counts. Count I asserts a claim under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, alleging that the defendants used false, deceptive, or misleading tactics to collect the alleged debt, misrepresented themselves, and attempted to collect an alleged debt and attorneys' fees that they were not authorized to receive. Am. Compl. ¶¶ 86-95. Count II asserts a claim under the District of Columbia Debt Collection Practices Act, D.C.Code § 28-3814, alleging that the defendants used fraudulent, deceptive, or misleading means to collect the debt, and attempted to collect
The defendants have now moved for a dismissal of the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), arguing that the plaintiff has failed to state any claims upon which relief may be granted. See generally Defs.' Mem.
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests whether the complaint "state[s] a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). "To survive a motion to dismiss [under Rule 12(b)(6) ], a complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). A claim is facially plausible "when the plaintiff pleads factual content that allows the court to draw [a] reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955). While the Court must "assume [the] veracity" of any "well-pleaded factual allegations" in the complaint, conclusory allegations are not entitled to the assumption of truth." Id. at 679, 129 S.Ct. 1937. In evaluating a Rule 12(b)(6) motion under this framework, "[t]he complaint must be liberally construed in favor of the plaintiff, who must be granted the benefit of all inferences that can be derived from the facts alleged," Schuler v. United States, 617 F.2d 605, 608 (D.C.Cir.1979) (internal quotation marks and citations omitted), and the Court "may consider only the facts alleged in the complaint, any documents either attached to or incorporated in the complaint[,] and matters of which [the Court] may take judicial notice," EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621, 624 (D.C.Cir.1997) (footnote omitted).
Count I of the plaintiff's complaint alleges that the defendants violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, by using false, deceptive, or misleading tactics to collect the alleged debt, misrepresenting themselves, and attempting to collect a debt and attorneys' fees which they were not authorized to receive. Am. Compl. ¶¶ 86-95. "The Fair Debt Collection Practices Act is a consumer protection statute that prohibits certain abusive, deceptive, and unfair debt collection practices," and it "authorizes any aggrieved person to recover damages from `any debt collector who fails to comply with any provision' of the [Act]." Marx v. General Revenue Corp., ___ U.S. ___, 133 S.Ct. 1166, 1171 n. 1, 185 L.Ed.2d 242 (2013) (internal citations omitted). The defendants seek dismissal of this claim on the ground that it is time-barred. Defs.' Mem. at 7-8.
"An action to enforce any liability created by [the Fair Debt Collection Practices
"Because statute of limitations issues often depend on contested questions of fact, dismissal is appropriate only if the complaint on its face is conclusively time-barred." Firestone v. Firestone, 76 F.3d 1205, 1209 (D.C.Cir.1996); see also Turner v. Afro-American Newspaper Co., 572 F.Supp.2d 71, 72 (D.D.C.2008) ("A court should grant a pre-discovery motion to dismiss on limitations grounds only if the complaint on its face is conclusively time-barred, and the parties do not dispute when the limitations period began." (internal citation and quotation makes omitted) (emphasis added)). Therefore, "courts should hesitate to dismiss a complaint on statute of limitations grounds based solely on the face of the complaint," id. (citing Richards v. Mileski, 662 F.2d 65, 73 (D.C.Cir.1981); Jones v. Rogers Mem'l Hosp., 442 F.2d 773, 775 (D.C.Cir.1971)), and "dismissal with prejudice should be granted only when the trial court determines that `the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency,'" Jarrell v. U.S. Postal Serv., 753 F.2d 1088, 1091 (D.C.Cir.1985) (quoting Bonanno v. Thomas, 309 F.2d 320, 322 (9th Cir.1962)).
The defendants argue that any alleged violation of the Fair Debt Collection Practices Act is time-barred because any violation of the statutes commenced on October 30, 2011, when the plaintiff "was served with [process in] the [Superior Court litigation]... that contained the alleged false statements and improper claims upon which her lawsuit is based,"
As an initial matter, the Court notes that the Superior Court docket entry for August 9, 2012, in the Superior Court litigation explicitly states that "[the Superior Court litigation] is closed." See Plainview Fin. Servs., Ltd. v. Osinupebi-Alao, No. 11-7901 (D.C. Aug. 9, 2012 docket entry labeled "Event Resulted"). However, even if listing the case as "closed" on the docket did not terminate the Superior Court litigation for the purposes of the Fair Debt Collection Practices Act, courts have found that the act of placing a lien on a debtor's property is its own separate and discrete violation of the Fair Debt Collection Practices Act commencing a separate statute of limitations calculation. See Fontell v. Hassett, 870 F.Supp.2d 395, 404-05 (D.Md.2012). This is because "it makes sense that the limitations period would begin at the time the lien was placed on [the p]laintiff's property, since this was the definitive action taken by [the d]efendants that is alleged to constitute an abusive debt collection practice." Id.
With this in mind, and construing the complaint in the light most favorable to the plaintiff, the Court cannot agree with the defendants that it can conclude from the face of the plaintiff's complaint that her Fair Debt Collection Practices Act claim is conclusively time barred. In fact, the plaintiff has alleged facts that potentially constitute a renewed violation of the Fair Debt Collection Practices Act within one year of her July 19, 2013 filing of this action. See Am. Compl. ¶ 62 (alleging that on August 29, 2012, "Plainview filed a writ of attachment on [her] wages, salary, and commission."). As pleaded, even if the Superior Court litigation was still ongoing as the defendants assert, the plaintiff has alleged that the defendants took a legal action to collect the debt within the one year limitations period by filing the writ of attachment. See Fontell, 870 F.Supp.2d at 404 (finding two distinct violations of the Fair Debt Collection Practices Act arising from the same collection efforts).
Because dismissal is only appropriate where the complaint, on its face, is time barred, and since the Court finds that the plaintiff's Fair Debt Collection Practices Act claim, as pleaded, is not conclusively time-barred, the Court must deny the defendants' motion to dismiss. Mazza v. Verizon Washington DC, Inc., 852 F.Supp.2d 28, 36-37 (D.D.C.2012) (declining to dismiss a Fair Debt Collection Practices Act claim because there was no agreement that the statute of limitations had expired and the plaintiff had alleged violations that implicated the Act within one year of when his complaint was filed).
Count II of the plaintiff's complaint alleges that the defendants violated the District of Columbia Debt Collection Practices Act ("Debt Collection Practices Act"), D.C.Code § 28-3801-3819, by using fraudulent, deceptive, or misleading tactics to collect the debt, as well as attempting to collect costs not expressly authorized by the cardholder agreement. Am. Compl. ¶¶ 100-03. The defendants do not contest the adequacy of the plaintiff's complaint, but simply assert that the "litigation privilege doctrine" provides an absolute defense to the plaintiff's Debt Collection Practices Act claim. Defs.' Mem. at 8-12. In the District of Columbia, this doctrine provides that "[a]n attorney at law is absolutely privileged to publish defamatory
Because neither the District of Columbia Council nor the District of Columbia Court of Appeals has yet to specifically address this issue, this Court is "required to predict what the District of Columbia's highest court would conclude if presented with this question." 325-343 E. 56th Street Corp. v. Mobil Oil Corp., 906 F.Supp. 669, 676 (D.D.C.1995) (citing Erie R.R. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938)). This predictive assessment does not give the Court carte blanche to create or modify existing state law. See Am. Waste & Pollution Control Co. v. Browning-Ferris, Inc., 949 F.2d 1384, 1386 (5th Cir. 1991) (citing United Parcel Serv., Inc. v. Weben Indus., Inc., 794 F.2d 1005, 1008 (5th Cir.1986) ("When making an Erieguess, in the absence of explicit guidance from the state court, [a court] must attempt to predict the applicable state law, not create or modify it." (emphasis added))). This Court declines to broaden the application of the District of Columbia's litigation privilege doctrine to include the Debt Collection Practices Act, especially under circumstances such as these where the adequacy of the plaintiff's complaint as to her Debt Collection Practices Act claim has not otherwise been challenged. Therefore the defendants' motion to dismiss the plaintiff's District of Columbia Debt Collection Practices Act claim is denied.
Count III of the plaintiff's complaint alleges that the defendants violated the District of Columbia Consumer Protection Procedures Act ("Consumer Protection Procedures Act"), D.C.Code § 28-3901-3913, by engaging in unfair trade practices in the form of misrepresenting material facts. Am. Compl. ¶¶ 107-12. "The purpose of the Consumer Protection Procedure Act is to protect consumers from a broad spectrum of unscrupulous practices by merchants, ... [and] the statute should be read broadly to assure that [its] purposes are carried out." Solomon v. Falcone, 791 F.Supp.2d 184, 190 (D.D.C. 2011) (quoting Modern Mgmt. Co. v. Wilson, 997 A.2d 37, 62 (D.C.2010)). The Consumer Protection Procedure Act applies to merchants "who sell[] consumer credit as well as those entities which take an assignment of the credit account and continue the extension of credit to the consumer." Jackson v. Culinary Sch. of Wash., 788 F.Supp. 1233, 1253 (D.D.C. 1992) (citing D.C.Code § 28-3901(a)(3), (7)). A merchant is engaged in a "trade
The defendants argue that they are not liable under the Act because "[t]he plain and unambiguous definition of `trade practice' does not encompass the act of collecting a debt by an entity that acquired the obligation after default nor does it include efforts by a licensed attorney to collect the debt through litigation." Defs.' Mem. at 13 (quoting and citing the D.C.Code § 28-3901(a)(6)). The defendants further contend that "Plainview acquired [the plaintiff's] debt after default and was not engaged in continuing to extend credit to her." Defs.' Reply at 10. The Court concurs with the defendants that nothing in the plaintiff's complaint plausibly asserts that they were "entities which [took] an assignment of [her] credit," Jackson, 788 F.Supp. at 1253, and then subsequently "furnishe[d], [or] ma[de] available, ... [consumer credit]," D.C.Code § 28-3901(a)(6), (7).
Despite the broad interpretation the Court is required to apply to the Consumer Protection Procedure Act, even painting the plaintiff's complaint with the broadest of strokes, her complaint fails. Nowhere does the plaintiff even hint that the defendants met the previously discussed requirements to be recognized as "merchants" nor is it alleged that the defendants were engaged in a recognized "trade practice" of either extending her credit or alternatively by selling any unrecovered debt to another debt collector. See D.C.Code § 28-3901(a)(6), (7) (defining a "trade practice" as "any act which... effectuate[s] a sale ... or transfer of [consumer credit]"). The plaintiff's complaint does not adequately plead that the defendants' debt collection practices fall within the purview of the District of Columbia Consumer Protection Act and therefore, the Court must grant the defendants' motion to dismiss Count III of the plaintiff's complaint.
The defendants move to dismiss the plaintiff's common law malicious prosecution and abuse of process claims on the grounds that both claims fail on the merits. See Defs.' Mem. at 16-18; Defs.' Reply at 10. Although the plaintiff's fourth claim for relief raises both malicious prosecution and abuse of process as a single claim, the Court addresses them separately. See Am. Compl. ¶¶ 114-120.
Under District of Columbia law, malicious prosecution requires a showing of five elements: that there was a "prosecution of a civil or criminal action, maliciously, and without probable cause, which terminated in favor of the defendant, which caused the ... seizure of the property of the defendant, or a special injury to the defendant which would not necessarily result in suits prosecuted to recover for like causes of action." Weisman v. Middleton, 390 A.2d 996, 1002 (D.C.1978). The defendants' only challenge to the plaintiff's malicious prosecution claim is that there was no probable cause to file their debt collection action against the plaintiff. See Defs.' Mem. at 17.
The complaint alleges that the defendants knew they were submitting deceptive documents in the Superior Court litigation in an attempt to collect a debt from the plaintiff knowing they were not authorized to collect the debt or the related attorneys' fees. Am. Compl. ¶¶ 66-80,
An abuse of process claim requires a showing of two elements: first, an ulterior motive, and second, "that there has been a perversion of the judicial process and achievement of some end not contemplated in the regular prosecution of the charge." Morowitz v. Marvel, 423 A.2d 196, 198 (D.C.1980). In other words, "[t]he critical concern in abuse of process cases is whether process was used to accomplish an end unintended by law, and whether the suit was instituted to achieve a result not regularly or legally obtainable." Id. The defendants argue that "[t]he [p]laintiff has not alleged either of the requisite elements for abuse of process, i.e., the existence of an ulterior motive beyond the regular use of the process and/or an act in the use of the process other than such as would be proper and the regular prosecution of the lawsuit." Defs.' Mem. at 16.
Construing the facts in favor of the plaintiff, if as the plaintiff alleges, the defendants submitted deceptive documents to the Superior Court in an attempt to collect a debt they knew they were not owed, that would establish that the defendants acted with the ulterior motive of collecting the debt and attorneys' fees, an end which would not be otherwise legally obtainable. Morowitz, 423 A.2d at 198-99. Under the standard that governs dismissal under Rule 12(b)(6), the plaintiff has pleaded "sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Iqbal, 556 U.S. at 677-78, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). Therefore, the Court cannot dismiss the plaintiff's abuse of process claims.
For the foregoing reasons, the Court denies Defendant Plainview Financial Services, LTD. and Herbert A. Rosenthal, Chartered's Motion to Dismiss [the] Complaint as to Counts I, II, and IV of the plaintiff's complaint, and grants Defendant Plainview Financial Services, LTD. and Herbert A. Rosenthal, Chartered's Motion to Dismiss [the] Complaint as to Count III of the plaintiff's complaint.
