Archer v. Nissan Motor Acceptance Corp., Civil Action No. 3:03cv906-DPJ-JCS.

• Decision Date: 04 September 2007
• Docket Number: Civil Action No. 3:03cv906-DPJ-JCS.
• Citation: 633 F.Supp.2d 259
• Parties: Fannie ARCHER, Demetrius String-fellow, Wilma Butler, Stanley Walsh, Floyd Nelson, individually and on behalf of all others similarly situated, Plaintiffs v. NISSAN MOTOR ACCEPTANCE CORPORATION, et al., Defendants.
• Court: U.S. District Court — Southern District of Mississippi

633 F.Supp.2d 259

Fannie ARCHER, Demetrius String-fellow, Wilma Butler, Stanley Walsh, Floyd Nelson, individually and on behalf of all others similarly situated, Plaintiffs v. NISSAN MOTOR ACCEPTANCE CORPORATION, et al., Defendants.

Civil Action No. 3:03cv906-DPJ-JCS.

United States District Court, S.D. Mississippi, Jackson Division.

September 4, 2007.

COPYRIGHT MATERIAL OMITTED

Suzanne Griggins Keys, Katrina M. Gibbs, Byrd, Gibbs & Martin, PLLC, Precious Tyrone Martin, Precious Martin, Sr. and Associates, PLLC, Hiawatha Northington, II, Northington Chambers & Gaylor, PLLC, Jackson, MS, for Plaintiffs.

James Bruinsma—PHV, Myers, Nelson, Dillon & Shierk, PLLC, Grand Rapids, MI, April D. Reeves, Douglas T. Miracle, Vikki J. Taylor, Watkins Ludlam Winter & Stennis, P.A., Jackson, MS, for Defendants.

MEMORANDUM OPINION AND ORDER

DANIEL P. JORDAN, District Judge.

This discriminatory lending case is before the Court on Defendant Nissan Motor Acceptance Corporation's (NMAC) motion for summary judgment. Plaintiffs Fannie Archer, Demetrius Stringfellow, Wilma Butler, Stanley Walsh and Floyd Nelson responded in opposition and filed a motion for class certification. The Court, having considered the parties' submissions and the relevant authorities, concludes that Plaintiffs failed to meet their burden of showing that the statute of limitations should be tolled. Defendant's motion is therefore granted.

I. Facts/Procedural History

This action arises from a common automobile industry lending practice wherein lenders, such as NMAC, provide on-site financing for automobiles purchased from car dealers. Dealership personnel act as intermediaries by taking information from the customer, passing it on to NMAC, and conveying NMAC's response back to the customer. The customer does not meet with or discuss his or her request for credit with NMAC.

NMAC makes its decision regarding the customer's creditworthiness, advises the dealership of the interest rate at which it is willing to finance the customer's purchase, and authorizes the dealership to complete the loan transaction on its behalf. Unknown to the customer, the dealership receives a financial benefit by closing the loan at an interest rate that is higher than the lowest rate for which the customer qualifies. Plaintiffs assert that this practice discriminates against African Americans by charging interest rates that are higher on average than the rates offered to white purchasers.

Each plaintiff financed a vehicle with NMAC between 1993 and 1996 at interest rates that ranged from 17.90% to 18.90%. Each plaintiff testified that dealership personnel told them that they were receiving the "best" interest rate available and that they would not have financed their cars with NMAC but for this alleged misrepresentation. On December 26, 2002, six years after the last loan transaction, Plaintiffs filed suit asserting discrimination claims under the Equal Credit Opportunity Act (ECOA) in addition to state law claims of fraud, negligent misrepresentation negligent supervision, violation of the Mississippi Unfair and Deceptive Practices Act, Miss.Code Ann. § 75-24-5, and conspiracy.

II. Analysis

NMAC argues that all of Plaintiffs' claims are time-barred. However, Plaintiffs maintain that (1) their ECOA claims survive because the applicable statute of limitations was tolled by the discovery rule and (2) their state law claims are timely because NMAC fraudulently concealed their claims.

A. The ECOA

The ECOA prohibits discrimination in borrowing and credit transactions on the basis of race (among other things). 15 U.S.C. § 1691(a) (2004). The statute contains a general two-year statute of limitations which runs from the date the statute is violated with an additional year for violations that are discovered as a result of government enforcement proceedings.¹

Because Plaintiffs completed their loans with NMAC well over two years before bringing this action, their claims are time-barred under the ECOA's general limitations period and the provision for the additional year is inapplicable. Plaintiffs contend, however, that their claims are subject to tolling due to the discovery rule.

Under an injury discovery accrual rule, the clock starts when a plaintiff knows or should have known of his injury. Rotella v. Wood, 528 U.S. 549, 553, 120 S.Ct. 1075, 1080, 145 L.Ed.2d 1047 (2000). The ECOA does not contain a general discovery rule. Accordingly, the Court must interpret the statute to determine whether Congress nevertheless intended such a rule. See United States v. Flores, 135 F.3d 1000, 1003 (5th Cir.1998) ("It is axiomatic that the touchstone of statutory construction is legislative intent."). As "in all cases involving statutory construction, our starting point must be the language employed by Congress, ... and we assume that the legislative purpose is expressed by the ordinary meaning of the words used." Custom Rail Employer Welfare Trust Fund v. Geeslin, 491 F.3d 233 (5th Cir.2007) (quoting INS v. Phinpathya, 464 U.S. 183, 189, 104 S.Ct. 584, 78 L.Ed.2d 401 (1984) (quotation marks and citations omitted)). In this case, review of the plain meaning of the statute's language reveals no general discovery rule.

The only way to find Congressional intent to apply the discovery rule to the ECOA is through intrinsic or extrinsic aides of construction. Some courts have inferred congressional intent to include a general discovery rule (in other statutes) "when a statute is silent on the issue." Rotella, 528 U.S. at 555, 120 S.Ct. at 1081. However, the United States Supreme Court has not adopted such a per se rule of construction. See TRW, Inc. v. Andrews, 534 U.S. 19, 27-28, 122 S.Ct. 441, 446, 151 L.Ed.2d 339 (2001) ("[B]eyond doubt, we have never endorsed the ... view that Congress can convey its refusal to adopt a discovery rule only by explicit command, rather than by implication from the structure or text of the particular statute.").

In the present case, the statute is not completely silent on the tolling issue due to the one year tolling period for claims subject to administrative enforcement. In Andrews, the Supreme Court faced a similar issue concerning the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq. (1994). Section 1681p of the FCRA provides a two-year statute of limitations along with tolling for discovery of misrepresented facts.² Although the language of the FCRA differs from that of the ECOA, the provisions are similar, and the Court's analysis in Andrews applies with equal force to the ECOA. According to the Supreme Court:

Where Congress explicitly enumerates certain exceptions to a general prohibition, additional exceptions are not to be implied, in the absence of evidence of a contrary legislative intent. Congress provided in the FCRA that the two-year statute of limitations runs from "the date on which the liability arises," subject to a single exception for cases involving a defendant's willful misrepresentation of material information. The most natural reading of § 1681p is that Congress implicitly excluded a general discovery rule by explicitly including a more limited one.

Andrews, 534 U.S. at 28, 122 S.Ct. at 447 (internal citations and quotations omitted). The Court further observed: "We doubt that Congress, when it inserted a carefully worded exception to the main rule, intended simultaneously to create a general discovery rule that would render that exception superfluous." 534 U.S. at 33, 122 S.Ct. at 450. In other words, the Court in Andrews invoked the cannon "expressio unius est exclusio alterius" (the expression of one thing is the exclusion of another). Id. (citing Leatherman v. Tarrant County Narcotics Intelligence and Coordination Unit, 507 U.S. 163, 168, 113 S.Ct. 1160, 122 L.Ed.2d 517 (1993)). The same logic applies to Congress' decision to include an exception to the two-year statute of limitations under the ECOA and omit a general discovery rule. Had Congress desired a general discovery rule, it could have easily included such language.

Another well known rule of statutory construction applied in Andrews (and applicable here) is that courts must avoid a reading which renders some words altogether redundant or superfluous. See United States v. Menasche, 348 U.S. 528, 538-539, 75 S.Ct. 513, 519-520, 99 L.Ed. 615 (1955). Andrews noted: "At least equally telling, incorporating a general discovery rule into § 1681p would not merely supplement the explicit exception contrary to Congress' apparent intent; it would in practical effect render that exception entirely superfluous in all but the most unusual circumstances." 534 U.S. at 29, 122 S.Ct. at 447. In this case, Congress provided a limited tolling mechanism under § 1691e(f) that would be nullified in many instances by a general discovery rule. Simply put, had Congress intended a general discovery rule, there would be no need for § 1691e(f). As such, the Court concludes that the one-year tolling provision reflects Congress' intent to exclude a general discovery rule from the ECOA.

Extrinsic evidence further supports this construction. Although the Court finds no need to review the legislative history because the statute's language is not ambiguous, Toibb v. Radloff, 501 U.S. 157, 162, 111 S.Ct. 2197, 115 L.Ed.2d 145 (1991), the history reflects no intent to imply a general discovery rule.

As originally enacted, the ECOA provided that actions must be brought no later than "one year from the date of the occurrence of the violation." In 1976, Congress amended the ECOA to increase the statute of limitations from one to two years and to add the limited exception for claims discovered as a result of enforcement actions brought by administrative agencies and the Attorney General. Several courts have examined the following language from the Senate report that accompanied the 1976 amendments to the ECOA:

The Committee also recommends a change in the statute of limitations applicable...