Caldwell v. Redstone Fed. Credit Union
| Decision Date | 20 July 2018 |
| Docket Number | Case No.: 2:15-cv-01923-JHE |
| Court | U.S. District Court — Northern District of Alabama |
| Parties | DEMETRIUS D. CALDWELL, et al., Plaintiffs, v. REDSTONE FEDERAL CREDIT UNION, et al., Defendants. |
On January 30, 2018, Defendants Redstone Federal Credit Union ("Redstone") and the Law Office of C. Howard Grisham ("Grisham") moved for partial dismissal of Plaintiffs' Second Amended Class Action Complaint, (doc. 75), under Fed. R. Civ. P. 12(b)(6) for failure to state a claim as to six of the eight named plaintiffs. (Docs. 76 & 79). Plaintiffs filed a response opposing both motions, (doc. 84), and both Defendants replied, (docs. 87 & 88). Plaintiffs have also moved for leave to file a sur-reply, (doc. 89), which is opposed by Defendants, (docs. 91 & 92). Plaintiffs moved for, (doc. 93), and were granted, (doc. 94), leave to file a supplemental opposition brief, (doc. 95), and Defendants have filed supplemental replies, (docs. 96 & 97). Finally, Plaintiffs have moved for leave to file a sur-reply to their supplemental opposition brief, (doc. 98), which Defendants also oppose, (docs. 99 & 100).
The motions are fully briefed and ripe for review. For the reasons stated more fully below, the motions to dismiss are GRANTED IN PART and DENIED IN PART.
Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." "[T]he pleading standard Rule 8 announces does not require 'detailed factual allegations,' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 1949 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955 (2007)). Mere "labels and conclusions" or "a formulaic recitation of the elements of a cause of action" are insufficient. Iqbal, 556 U.S. at 678, 129 S. Ct. at 1949 (citations and internal quotation marks omitted). "Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Id. (citing Bell Atl. Corp., 550 U.S. at 557, 127 S. Ct. 1955). Additionally, "[i]n alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake." Fed. R. Civ. P. 9(b).
Federal Rule of Civil Procedure 12(b)(6) permits dismissal when a complaint fails to state a claim upon which relief can be granted. "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Iqbal, 556 U.S. at 678, 129 S. Ct. at 1949 (citations and internal quotation marks omitted). A complaint states a facially plausible claim for relief "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citation omitted). The complaint must establish "more than a sheer possibility that a defendant has acted unlawfully." Id.; see also Twombly, 550 U.S. at 555, 127 S. Ct. at 1965 ().Ultimately, this inquiry is a "context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Iqbal, 556 U.S. at 679, 129 S. Ct. at 1950.
The court accepts all factual allegations as true on a motion to dismiss under Rule 12(b)(6). See, e.g., Grossman v. Nationsbank, N.A., 225 F.3d 1228, 1231 (11th Cir. 2000). However, legal conclusions unsupported by factual allegations are not entitled to that assumption of truth. Iqbal, 556 U.S. at 678, 129 S. Ct. at 1950.
On October 29, 2015, Plaintiffs Demetrius and Sabrina Caldwell (the "Caldwells") initiated this action on behalf of themselves and a purported class against Redstone and Grisham, alleging five counts including a bankruptcy count of contempt for violating discharge injunctions2 and a count for violations of the Fair Debt Collection Practices Act ("FDCPA"). (Doc. 1). Defendants moved to dismiss the Caldwells' claims, (docs 7 & 10), and the undersigned granted those motions in part and denied them in part on October 17, 2016, dismissing all but the two claims identified above. (Doc. 30).
On June 14, 2017, Plaintiffs amended their complaint, adding six additional named plaintiffs: Jane B. Locklin, Bart Reeves, Davis A. Mitchell, Jeremy D. Holland, Jessalyn Hooper, and Lorondo Brazelton (collectively, the "New Plaintiffs"). (Doc. 48 at ¶¶ 5-10). While the Amended Complaint alleged generally that the New Plaintiffs had been subjected to Defendants'attempts to collect debts discharged in bankruptcy, it did not identify how Defendants had done so. Both Defendants moved to dismiss. (Docs. 51 & 53). Granting Defendants' alternative motions for a more definite statement, the undersigned ordered Plaintiffs to file an amended complaint "which should include the factual basis for the New Plaintiffs' claims that Defendants wrongfully attempted to collect the debts they discharged in bankruptcy." (Doc. 73 at 8). On January 30, 2018, Plaintiffs filed their Second Amended Complaint, containing the facts below. (Doc. 75).
Each of the New Plaintiffs filed a Chapter 7 bankruptcy petition in the Northern District of Alabama. (Doc. 75 at ¶ 14). Each owed money to Redstone and/or Grisham. (Id. at ¶ 15). Each Plaintiff received a discharge from the Bankruptcy Court. (Id. at 18). Nevertheless, Redstone—which had been mailed a copy of the discharge orders in each case—used Grisham to attempt to collect the discharged debt. (Id. at ¶¶ 19-20).
Redstone obtained a judgment against Locklin on June 17, 2005, and recorded the judgment on June 27, 2005. (Id. at ¶ 26). Locklin filed for Chapter 7 bankruptcy on January 8, 2007, and received a discharge of Redstone's debt on April 18, 2007. (Id. at ¶¶ 27-28). Defendants revived the judgment on March 17, 2015, and later recorded the revived judgment in the MadisonCounty Probate Office. (Id. at ¶ 29). In April 2015, Defendants sent Locklin correspondence demanding payment of the debt. (Id. at ¶ 30).
Redstone recorded a judgment against Reeves on January 10, 2010, in the Morgan County Probate Court. (Id. at ¶ 31). Reeves filed for Chapter 7 bankruptcy on August 26, 2011, receiving a discharge of Redstone's debt on November 29, 2011. (Id. at ¶¶ 32-33). Defendants have neither satisfied the judgment nor filed pleadings with any probate court or the Circuit Court of Madison County indicating that Reeves's debt was discharged in bankruptcy. (Id. at ¶ 34).
Redstone recorded a judgment in the Morgan County Probate Court on December 22, 2008.4 (Id. at ¶ 35). Mitchell filed for Chapter 7 bankruptcy on May 18, 2013, and received a discharge of Redstone's debt on August 14, 2013. (Id. at ¶¶ 36-37). As with Reeves, Defendants have not satisfied the judgment, nor have they filed pleadings in the Circuit Court of Morgan County or any probate court indicating the debt was discharged. (Id. at ¶ 38). Additionally, the judgment has attached to real property Mitchell acquired after the discharge of his debt. (Id. at ¶ 39).
Defendants recorded a judgment against Holland in the Morgan County Probate Court on June 1, 2011. (Id. at ¶ 40). Holland filed for Chapter 7 bankruptcy on December 27, 2011. (Id. at ¶ 41). He then received a discharge of Redstone's debt on March 27, 2012. (Id. at ¶ 42). Defendants have not satisfied the judgment or filed pleadings in the Circuit Court of MorganCounty or any probate court reflecting the debt was discharged in bankruptcy, and Holland's credit report reflects he still owes the $22,867 amount of the judgment. (Id. at ¶ 43).
Hooper, formerly known as "Jessalyn N. Mobley," filed for Chapter 7 bankruptcy on June 8, 2005, and received a discharge of a judgment recorded against him by Defendants on May 3, 2005 in the Madison County Probate Court. (Id. at ¶¶ 44-46). Defendants have not satisfied the judgment or filed pleadings in the District Court of Madison County or any probate court to reflect that the debt has been discharged. (Id. at ¶ 47). As with Mitchell, Hooper obtained real property after the discharge to which the judgment has attached. (Id. at ¶ 48).
Defendants recorded a judgment against Brazleton in the Madison County Probate Court on May 1, 2007. (Id. at ¶ 49). Brazleton filed for Chapter 7 bankruptcy on August 1, 2007, and received a discharge of Redstone's debt on November 14, 2007. (Id. at ¶¶ 50-51). Defendants have not satisfied the judgment or filed pleadings in the District Court of Madison County or any probate court indicating the debt has been discharged. (Id. at ¶ 52).
Defendants contend the New Plaintiffs have failed, for various reasons, to articulate actionable violations of the discharge injunctions and the FDCPA. As a preliminary matter, though, the undersigned will address Plaintiffs' motions for leave to file sur-replies.
Plaintiffs have moved for leave to file a sur-reply to Defendants' replies to the original motion, (doc. 89), and to Defendants' responses to their supplemental opposition brief, (doc. 98).
In their first motion for leave to file a sur-reply, (doc. 89), Plaintiffs contend they should be allowed to file the proposed sur-reply attached to their motion, (doc. 89-1), because Defendants have raised additional issues in their reply briefs, mischaracterized the holding of a case, and misinterpreted the law on lien enforcement. (Doc. 89 at ¶ 1). Defendants point out that the reply briefs contain no new issues and that, to the extent they are arguably incorrect on the...
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