Ghafourifar v. Cmty. Trust Bank, Inc.

Decision Date27 August 2014
Docket NumberCase No.: 3:14-cv-01501
CourtU.S. District Court — Southern District of West Virginia

On December 12, 2013, Plaintiff Pedram Ghafourifar (Plaintiff) filed a pro se complaint alleging eight claims against Defendant Community Trust Bank, Inc., (Defendant) in Cabell County Circuit Court. (ECF No. 1-1). Defendant then filed a notice of removal to this Court based on diversity jurisdiction pursuant to 28 U.S.C. § 1441. (ECF No. 1 at 4). Currently pending before the Court are Defendant's Motion to Dismiss Counts I, IV, V, VI, VII and VIII, (ECF No. 3), and Defendant's Motion to Dismiss or Alternatively Motion for Summary Judgment, (ECF No. 4). Plaintiff has filed a response in opposition to both motions, (ECF No. 7), and Defendant has filed a reply. (ECF No. 11). After the initial status conference was held, the undersigned allowed both parties to conduct limited discovery and submit supplemental briefs in support of their positions, (ECF No. 18 at 1-2), and both parties did so. (ECF No. 38; ECF No. 39). This matter is assigned to the Honorable Robert C. Chambers, United States District Judge, and is referred to the undersigned United States Magistrate Judge for submission of proposed findings of fact and recommendations for disposition pursuant to 28 U.S.C. § 636(b)(1)(B).

The undersigned has reviewed the materials supplied by the parties and finds the issues to be clear. Accordingly, oral argument is not necessary for resolution of the motions. For the reasons set forth herein, the undersigned RECOMMENDS that Defendant's Motion to Dismiss Counts I, IV, V, VI, VII and VIII, (ECF No. 3), be GRANTED; Defendant's Motion to Dismiss or Alternatively Motion for Summary Judgment, (ECF No. 4), be GRANTED; Plaintiff's complaint be DISMISSED, with prejudice; and that this action be removed from the docket of the Court.

I. Relevant Facts

Plaintiff, as a managing member of Tri-State C-P System, LLC, (Tri-State) obtained a commercial loan on behalf of Tri-State from Defendant in 2009. (ECF No. 1-1 at 5; ECF No. 39-3 at 10). Plaintiff personally guaranteed the $950,000 loan and used his home as collateral to secure the loan. (ECF No. 1-1 at 5). The unconditional guarantee signed by Plaintiff stated that Defendant could "at any time, without notice, without [Plaintiff's consent], . . . [s]ubstitute or release any of the Collateral, whether or not [Defendant] receive[d] anything in return." (ECF No. 39-7 at 2). The loan was also secured by a $150,000 certificate of deposit (CD) supplied by Kevin Severson, who held a fifteen-percent ownership interest in Tri-State. (Id.; ECF No. 39-6 at 6-7). In order to grant Defendant a security interest in the CD, Mr. Severson executed a hypothecation agreement. (ECF No. 11-2 at 1-2). The hypothecation agreement set forth both Mr. Severson's and Defendant's rights and responsibilities as to the CD. (Id.) Mr. Severson was required to grant Defendant a security interest in the CD, and in return, Defendant was to "exercise reasonable care in the custody and preservation of the CD." (Id. at 1).

In 2011, Plaintiff asked Defendant to modify the loan agreement in order to reduce the monthly loan payment that Tri-State was required to make. (ECF No. 1-1 at 7). In response, Defendant had Wesley Agee, an attorney from Jenkins Fenstermaker, PLLC, revise the loan documents to provide for a lower monthly payment. (Id.) According to Plaintiff, Defendant and Mr. Agee represented to him that the loan documents were the same as those signed in 2009 except for some revised dates and the monthly-payment reduction. (Id.) However, Plaintiff alleges that the loan documents actually were "significantly different."1 (Id.) Ultimately, Plaintiff signed the revised loan documents in late 2011 after a correction to a venue provision was made by Mr. Agee. (ECF No. 7 at 5; ECF No. 7-1 at 10; ECF No. 39-1 at 6; ECF No. 39-4 at 2).

In November 2012, a teller at Defendant's Pikeville branch mistakenly released the CD to Mr. Severson, after Mr. Severson allegedly made fraudulent representations to the teller about the propriety of releasing the CD. (ECF No. 39-6 at 10). The erroneous release of the CD was not discovered until March 2013, and at that point, Defendant demanded that Mr. Severson return the CD as required by the terms of the hypothecation agreement. (Id. at 11). Mr. Severson refused, and Defendant brought suit to recover the CD in this Court. (Id.) That suit was later dismissed by presiding District Judge for lack of personal jurisdiction. Community Trust Bank, Inc. v. Severson, No. 3:14-7168, 2014 WL 3700482, at *1 (S.D.W.Va. July 17, 2014).

In July 2013, Tri-State was forced to close. (ECF No. 1-1 at 5). Both Tri-State and Plaintiff filed for bankruptcy that same month. (Id. at 6). Defendant asserted claims in both bankruptcy actions. (ECF No. 3 at 2). Defendant then sought to take Plaintiff'sdeposition in relation to the Tri-State bankruptcy action. (ECF No. 1-1 at 6). After a process server hired by Defendant attempted a number of times to serve Plaintiff with a deposition subpoena at his home address and was unsuccessful, Defendant's attorney in the Tri-State bankruptcy action filed a motion to compel in November 2013.2 (ECF No. 7-1 at 31-34). In that motion, Defendant's counsel asserted that Plaintiff seemed to be "evading service" and ignoring the bankruptcy court's order that granting Defendant leave to take Plaintiff's deposition. (Id. at 34). Plaintiff maintains that he did not receive the motion to compel because Defendant's attorney sent it to the wrong address. Instead of sending it to Plaintiff's home address, the attorney mailed the documents to Tri-State's business address, which was vacant, and to Beverly McGhee, another former owner of Tri-State. (ECF No. 1-1 at 11; ECF No. 7 at 8-9).

In August 2013, as a result of Tri-State's default on the commercial loan, Defendant asked a residential appraiser to conduct an exterior-0nly appraisal of Plaintiff's home. (ECF No. 39 at 3; ECF No. 39-8 at 1). According to Plaintiff, when the appraisal was performed, the appraiser entered onto his property and took photographs of the property without permission. (ECF No. 1-1 at 15). Defendant has supplied an affidavit from the appraiser wherein he attests that he never entered Plaintiff's home or property when conducting the appraisal and only took photographs of the exterior of the home. (ECF No. 39-8 at 2).

As of February 21, 2014, Plaintiff's personal bankruptcy action was still pending. (ECF No. 11-3 at 7). By that time, Plaintiff had filed two summaries of schedule, and in both, Plaintiff failed to list his current claims against Defendant as contingent and unliquidated assets. (ECF No. 4-2 at 4; ECF No. 4-3 at 4). No evidence has been presented that Plaintiff's bankruptcy plan has been confirmed by the bankruptcy court or that Plaintiff's debts have been discharged by the court.

II. Complaint, Motion to Dismiss, and Motion for Summary Judgment

Plaintiff alleges eight causes of action in his complaint: (1) bad faith; (2) breach of contract; (3) discrimination; (4) negligence; (5) fraud; (6) defamation; (7) trespass; and (8) invasion of privacy. (ECF No. 1-1 at 6-15). Plaintiff's bad faith claim has two components—first, Defendant allegedly acted in bad faith by attempting to unilaterally amend the loan documents, and second, Defendant allegedly acted in bad faith by releasing the CD without Plaintiff's knowledge or consent and after Defendant assured Plaintiff that the CD would not be released. (Id. at 6-8). Plaintiff's breach of contract and discrimination claims also relate to the release of the CD. (Id. at 9-10). Plaintiff asserts that Defendant breached the loan agreement by releasing the CD and discriminated against him by refusing to also release his real property as collateral. (Id. at 9-10).

In his negligence claim, Plaintiff alleges that Defendant acted unreasonably "with respect to sending documents" to him, in apparent reference to the purported failure of Defendant's attorney to send the motion to compel to Plaintiff's home address instead of the vacant Tri-State property and Ms. McGhee. (Id. at 11; ECF No. 7 at 8-9). Plaintiff's fraud claim also relates to his deposition in the Tri-State bankruptcy proceedings. He further asserts that Defendant's attorneys provided the bankruptcy court with false information when they alleged in their motion to compel that Plaintiff was evadingservice and ignoring the court's deposition order. (Id. at 11-13). Plaintiff also claims that Defendant, through its attorneys, committed fraud by informing the bankruptcy court that it tried to serve Plaintiff at his places of business when he never informed Defendant that he had a place of business after Tri-State closed. (Id. at 12-13). Plaintiff's related defamation claim contains two components—first, that Defendant made "defaming statements" to the bankruptcy court, and second, that Defendant made "defaming statements to another LLC owner." (Id. at 14). Finally, Plaintiff contends that an agent of Defendant (presumably the appraiser) trespassed on his property and invaded his privacy by taking photographs in August 2013. (Id. at 14-15).

In response, Defendant has filed a motion to dismiss the bad faith, negligence, fraud, defamation, trespass, and invasion of privacy claims based on the facial insufficiency of the complaint. (ECF No. 3 at 3). First, Defendant asserts that the bad faith claim related to the loan document amendments is barred by the statute of limitations. (Id. at 4). Second, Defendant insists that it possessed no duty related to the mailing of documents to Plaintiff, and as such, Plaintiff's negligence claim must fail. (Id. at 6). Third, Defendant argues that Plaintiff's fraud and defamation claims must fail because the statements made by Defendant...

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