MARCO A. HERNANDEZ, District Judge.
Plaintiff Adi Fairbank brings this action to compel arbitration for violations of the Fair Debt Collection Practices Act ("FDCPA") and the Fair Credit Reporting Act ("FCRA"). Defendants move to dismiss for failure to state a claim upon which relief can be granted (#18, 20). I grant the motions.
Defendant Citibank filed a collection action in state court to recover, $3,909.28, the balance of a credit card account belonging to Plaintiff.
Arbitration before the AAA then proceeded. Plaintiff did not participate in the arbitration, despite being properly notified. Ex. C at 5 (Dkt. #22). The arbitrator found in favor of Citibank and awarded $3,909.28. The arbitrator made Citibank responsible for the AAA filing fees and the arbitrator fees.
Before the state court ruled on the motion to vacate, Plaintiff filed the present action. In claim one, Plaintiff alleges that Defendants failed to arbitrate and seeks an order compelling arbitration with JAMS. Compl. 4. In claim two, Plaintiff alleges a violation of FDCPA against Defendants Nancy A. Smith & Associates ("Smith") and James Underwood, attorneys who represented Citibank in the state proceeding against Plaintiff.
A motion to dismiss for failure to state a claim may be granted only when there is no cognizable legal theory to support the claim or when the complaint lacks sufficient factual allegations to state a facially plausible claim for relief.
A motion to dismiss under Rule 12(b)(6) will be granted if plaintiff alleges the "grounds" of his "entitlement to relief" with nothing "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action[.]"
To survive a motion to dismiss, the complaint "must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face[,]" meaning "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged."
Pro se pleadings are held to a less stringent standard than those drafted by lawyers.
As an initial matter, a clarification regarding Plaintiff's complaint is necessary. Although Plaintiff pled three claims, Plaintiff is adamant that only the first claim—failure to arbitrate in violation of 9 U.S.C. § 4—is before this court. Plaintiff states that the FDCPA and FCRA claims (claims two and three) "are not properly decided by this court at this time. Plaintiff listed these claims merely to show that this court had jurisdiction to compel arbitration under 9 U.S.C. § 4." Pl.'s Objection Mot. Dismiss, 2. Later, Plaintiff states again that "Plaintiff merely asks this court to compel Defendants to arbitrate
Plaintiff alleges that Defendants failed to arbitrate with JAMS, a violation of 9 U.S.C. § 4. Defendant Citibank argues that res judicata and the
I first address the issue of res judicata. "[S]tate proceedings need do no more than satisfy the minimum procedural requirements of the Fourteenth Amendment's Due Process Clause in order to qualify for the full faith and credit guaranteed by [28 U.S.C. § 1738]. It has long been established that § 1738 does not allow federal courts to employ their own rules of res judicata in determining the effect of state judgments.
In Oregon, a plaintiff is barred on res judicata grounds from bringing a second action against the same defendant, where plaintiff has brought a first action against the defendant to final judgment and "the claim in the second action . . . is based on the same factual transaction that was at issue in the first [action], seeks a remedy additional or alternative to the one sought earlier, and . . . could have been joined in the first action."
Here, Plaintiff's request to compel arbitration before JAMS has already been decided in state court. The arbitrator found that the AAA properly had jurisdiction and the state court agreed. Ex. E at 2 (Dkt. # 22). Defendant Citibank asserts res judicata against Plaintiff via the AAA arbitration and prior state court proceeding that confirmed the AAA award. Citibank argues that Plaintiff's FCRA claim should have been raised during the AAA arbitration, in which Plaintiff voluntarily decided to not participate. Citibank Reply 2. I agree that Plaintiff's FCRA claim against Citibank should have been raised during the AAA arbitration. Contrary to Plaintiff's argument, the FCRA claim is based on the same factual transaction, namely Plaintiff's delinquent credit card account. The FCRA claim would not exist but for Citibank's attempt to collect the balance of Plaintiff's credit card account, and thus arises from the same transaction. Plaintiff's FCRA claim against Citibank should have been raised in the prior proceedings.
Plaintiff further argues that the AAA arbitration only had jurisdiction to hear Citibank's claims against Plaintiff, not Plaintiff's FCRA claim against Citibank. Pl.'s Objection Mot. Dismiss, 5. Plaintiff is incorrect, and notably does not cite to any authority in support of his position. Plaintiff put his FCRA claim at risk of being barred by res judicata when he failed to participate in the AAA arbitration.
Regarding Plaintiff's FDCPA claim against Defendants Smith and Underwood, Plaintiff is not entitled to compel arbitration. It is true that "where the contract contains an arbitration clause, there is a presumption of arbitrability in the sense that `[an] order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute."
In light of my previous findings, I need not address Defendants' argument regarding the
Based on the foregoing, Defendant Citibank's motion to dismiss (#18) is granted and Defendants' Smith and Underwood's motion to dismiss (#20) is granted. Plaintiff's complaint is dismissed.
IT IS SO ORDERED.