James v. Ford Motor Credit Co.

• Decision Date: 07 February 1994
• Docket Number: Civ. No. 4-93-656.
• Citation: 842 F. Supp. 1202
• Parties: Stephanie Ann JAMES and Roland James, Plaintiffs, v. FORD MOTOR CREDIT COMPANY, a foreign corporation, Special Agents Consultants, Inc., a Minnesota corporation, Robert Klave, an individual, Jane Doe and John Doe, individuals, Defendants.
• Court: U.S. District Court — District of Minnesota

842 F. Supp. 1202

Stephanie Ann JAMES and Roland James, Plaintiffs, v. FORD MOTOR CREDIT COMPANY, a foreign corporation, Special Agents Consultants, Inc., a Minnesota corporation, Robert Klave, an individual, Jane Doe and John Doe, individuals, Defendants.

Civ. No. 4-93-656.

United States District Court, D. Minnesota, Fourth Division.

February 7, 1994.

COPYRIGHT MATERIAL OMITTED

Thomas J. Lyons, Lyons Sawicki & Neese, Richard Gregory Nadler, Nadler Law Office, St. Paul, MN, and Mary C. Ivory, Consumer Law Center, Maplewood, MN, for Stephanie Ann James and Roland James.

C. Blaine Harstad and Jonathan M. Redgrave, Gray, Plant, Mooty, Mooty & Bennett, Minneapolis, MN, for Ford Motor Credit Co.

Donna Dunkelberger Geck and Ann E. Betts, Arthur, Chapman, McDonough, Kettering & Smetak, and Daniel Scott McGrath, Flakne Law Office, Minneapolis, MN, for Special Agents Consultants, Inc. and Robert Klave.

ORDER

DOTY, District Judge.

This matter is before the court on defendants' motion for dismissal for lack of subject matter jurisdiction. Based on a review of the file, record and proceedings herein, the court grants defendants' motion.

BACKGROUND

Plaintiffs Stephanie and Roland James purchased a new Ford Escort from Tousley Ford on November 24, 1989. The purchase was financed through defendant Ford Motor Credit Company ("Ford"). Through Ford, plaintiffs also obtained a credit disability insurance policy, issued by Globe Life Insurance. Starting in March 1992, plaintiffs began falling behind in their monthly loan payments. Ford sent plaintiffs a notice of default and intent to repossess dated May 19, 1992. Stephanie James ("James") claims that on May 18, 1992, she was injured and subsequently unable to work for several months. She claims that she informed Ford and requested insurance claim forms.

On June 24, 1992, before any benefits were paid by Globe, Ford contacted James regarding the late payments. Ford informed her that the car would be repossessed if payment was not made. It is undisputed that James specifically told Ford that she did not want the car repossessed and that Ford could not take the car. On June 29, 1992, defendant Robert Klave ("Klave"), an employee of defendant Special Agents Consultants ("Special Agents"), acting on behalf of Ford, removed plaintiffs' car from a parking lot. Klave reported by telephone to Ford that he had repossessed the car and received instructions to deliver it to Minneapolis AutoAuction. Approximately one hour later and several miles away from the parking lot, James saw Klave driving the car. She entered the car and an altercation ensued. Klave drove the car into a parking lot where the struggle continued inside the car, then outside the car and finally inside the car again. James gained control of the car and drove it home. Klave reported the incident to the police, accusing James of assault, theft and damage to property. Klave reported the car as stolen. Defendants contend that because Klave was in possession of the car for approximately one hour on June 29, 1992, that date serves as the date on which the car was repossessed.

On July 8, 1992, police officers observed the car being driven in Minneapolis. The car was stopped and the officers identified James as a passenger in the car. James was arrested on a complaint made by a Minneapolis Police Sergeant. Klave then repossessed the car. During discovery Special Agents produced at least three documents which specifically list July 8, 1992, as alternately "repo date," "date of repossession," or "date repossessed." Plaintiffs contend that this is the date of repossession.

Plaintiffs claim that the actions of defendants Klave and Special Agents violated the Fair Debt Collections Practices Act ("FDCPA"), 15 U.S.C. 1692-1692o. Plaintiffs further claim that Ford is liable for the actions of Klave and Special Agents who acted as its agents in repossessing the car. Neither party contends that Ford is itself directly subject to FDCPA because it does not collect debts owed to any party other than itself. See 15 U.S.C. § 1692a(6). Defendants claim that FDCPA also does not apply generally to Klave and Special Agents because, rather than being debt collectors, they are in the repossession business. Although defendants admit that through certain statutory exceptions repossession companies may be brought within the scope of FDCPA, they argue that under the facts of this case the statute does not apply to Klave and Special Agents. Accordingly, defendants contend that there is no federal statute conferring jurisdiction on this court to decide this matter. 28 U.S.C. § 1331. Furthermore, because Klave and Special Agents are residents of Minnesota, there is no complete diversity of citizenship which would confer jurisdiction on this court. 28 U.S.C. § 1332. Defendants argue that this court is therefore without any jurisdiction to decide this matter and move for dismissal under Rule 12 of the Federal Rules of Civil Procedure. Plaintiffs argue that Klave and Special Agents are within the statutory exceptions and therefore subject to FDCPA, thus conferring jurisdiction on this court.

Defendants further contend that even if they are subject to FDCPA, plaintiffs' claim is barred because it was brought after the one year period prescribed by FDCPA for the bringing of claims. Plaintiffs contend that their suit is timely. Plaintiffs have also moved for partial summary judgment on wrongful repossession.

DISCUSSION

Generally, on a Rule 12 motion to dismiss, the court must construe the complaint in the light most favorable to the plaintiffs, Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974); Fusco v. Xerox Corp., 676 F.2d 332, 334 (8th Cir.1982), and the allegations in its complaint must be accepted as true. Hughes v. Rowe, 449 U.S. 5, 10, 101 S.Ct. 173, 176, 66 L.Ed.2d 163 (1980) (per curiam); Cruz v. Beto, 405 U.S. 319, 322, 92 S.Ct. 1079, 1081, 31 L.Ed.2d 263 (1972) (per curiam); Sixel v. Transp. Communications, 708 F.Supp. 240, 242 (D.Minn.1989). In addition, the court must resolve any ambiguities concerning the sufficiency of the plaintiffs' claims in favor of the plaintiffs, see e.g., Hughes, 449 U.S. at 10, 101 S.Ct. at 176; Cruz, 405 U.S. at 322, 92 S.Ct. at 1081, and give them "the benefit of every reasonable inference" drawn from the "well-pleaded" facts and allegations in their complaint. Retail Clerks Int'l Ass'n v. Schermerhorn, 373 U.S. 746, 753 n. 6, 83 S.Ct. 1461, 1465-66 n. 6, 10 L.Ed.2d 678 (1963). Thus, the court may not dismiss the plaintiffs' claims "merely because the court doubts that the plaintiffs will be able to prove all of the necessary factual allegations." Fusco, 676 F.2d at 334. Rather, the "court may dismiss the plaintiff's complaint only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations." Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 2232, 81 L.Ed.2d 59 (1984) (citing Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957)).

Because defendants raise issues which question the court's ability to exercise subject matter jurisdiction over this action, the court may look beyond the pleadings and examine affidavits and other documents in resolving the issues before it concerning subject matter jurisdiction. Osborn v. United States, 918 F.2d 724, 730 (8th Cir.1990) (citation omitted). The court may weigh the evidence submitted in support of the Rule 12(b)(1) motion and use that evidence to evaluate the merits of the motion. The Eighth Circuit stated in Osborn that:

The ... court may proceed as it never could under 12(b)(6) or Fed.R.Civ.P. 56. Because at issue in a factual 12(b)(1) motion is the trial court's jurisdiction — its very power to hear the case — there is substantial authority that the trial court is free to weigh the evidence and satisfy itself as to the existence of its power to hear the case. In short, no presumptive truthfulness attaches to the plaintiff's allegations, and the existence of disputed material facts will not preclude the trial court from evaluating for itself the merits of jurisdictional claims. Moreover, the plaintiff will have the burden of proof that jurisdiction does in fact exist.

Id. (footnote omitted from the original) (quoting Mortensen v. First Federal Savings and Loan Ass'n, 549 F.2d 884, 891 (3d Cir.1977)). Once the evidence is submitted, the court may "not simply rule that there is or is not enough evidence to have a trial on the issue." Id. (citation omitted). The court must decide whether it has jurisdiction. Id. "The only exception is in instances when the jurisdictional issue is `so bound up with the merits that a full trial on the merits may be necessary to resolve the issue.'" Id. (quoting Crawford v. United States, 796 F.2d 924, 929 (7th Cir.1986)). Accordingly, with the standards set forth at hand, the court will consider defendants' motion to dismiss.

1. Fair Debt Collection Practices Act

Plaintiffs bring this action alleging violations of FDCPA by defendants Klave and Special Agents acting as agents for defendant Ford. FDCPA specifically grants federal district courts subject matter jurisdiction over claims arising under the act. 15 U.S.C. § 1692k(d). If there is no subject matter jurisdiction conferred by FDCPA, this action must be dismissed because plaintiffs and defendants Klave and Special Agents are all Minnesota residents and therefore there is a lack of complete diversity of parties. 28 U.S.C. § 1332.

The FDCPA is Congress's response to what it saw as "the abusive, deceptive, and unfair debt collection practices used by many debt collectors." 15 U.S.C. 1692(a). The statute applies almost exclusively to those who collect debts owed to others. The statute defines "debt collector" as

"any person who uses any instrumentality of interstate commerce or the mails in any business the principle purpose of which is the

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