McMullen v. Synchrony Bank

• Decision Date: 11 January 2018
• Docket Number: Civil Action No. 14–1983 (JEB)
• Citation: 300 F.Supp.3d 292
• Parties: Valerie MCMULLEN, Plaintiff, v. SYNCHRONY BANK, et al., Defendants.
• Court: U.S. District Court — District of Columbia

300 F.Supp.3d 292

Valerie MCMULLEN, Plaintiff,

v.SYNCHRONY BANK, et al., Defendants.

Civil Action No. 14–1983 (JEB)

United States District Court, District of Columbia.

Signed January 11, 2018

Brendan James Klaproth, Klaproth Law PLLC, Christopher J. Regan, Patrick Michael Regan, Salvatore J. Zambri, Regan Zambri & Long, PLLC, Washington, DC, Jesse Colin Klaproth, Klaproth Law PLLC, Philadelphia, PA, for Plaintiff.

Gregory Thomas Jaeger, Stroock & Stroock & LaVan, Andrew Soukup, Carol Anne Szurkowski, Eric C. Bosset, Robert D. Wick, Covington & Burling LLP, Eric Daniel Combs, Comey & Boyd, Evan James Taylor, Michael Kentoff, Combs & Taylor LLP, Washington, DC, Brendan S. Everman, Stroock & Stroock & LaVan LLP, Miami, FL, Julia B. Strickland, Marcos D. Sasso, Stroock & Stroock & LaVan LLP, Los Angeles, CA, for Defendants.

Karim Steward, Washington, DC, pro se.

One World Fitness, Washington, DC, pro se.

Bullen Wellness, Washington, DC, pro se.

MEMORANDUM OPINION

JAMES E. BOASBERG, United States District Judge

As we enter a new year, a top priority is often to get in better shape. Plaintiff Valerie McMullen had that same goal in 2010 and (unlike so many of us) actually followed through. After her favorite trainer left her gym, however, she sought a refund for unused sessions. What she received instead were two bills with new personal-training charges she claims she never incurred. After unsuccessfully trying to straighten out these alleged errors, Plaintiff brought this action against the two creditor banks—Chase and Synchrony—as well as various individuals and companies associated with the gym. The Court previously granted in part the banks' Motion to Dismiss, but left intact McMullen's counts against them alleging fraud, conspiracy to defraud, and violations of D.C. consumer-protection law. See McMullen v. Synchrony Bank, 164 F.Supp.3d 77, 98 (D.D.C. 2016). Plaintiff and Defendant Chase now cross-move for summary judgment on these remaining claims. Finding no genuine issue of material fact for trial, the Court will grant Chase's Motion.

I. Background

In cross-moving for summary judgment here, the parties largely agree on the material facts. The Court, accordingly, recounts those that are undisputed, while noting specific disagreements about others.

A. Factual History

Although Chase is the only Defendant implicated in this Opinion, some background regarding the others is helpful. In 2008, Chase rolled out a program, ChaseHealthAdvance, which offered a revolving line of credit "for the purpose of financing and facilitating the payment of the medical costs of various ... procedures." Def. MSJ, Exh. 1–B (2008 Chase Provider Agreement) at 1; id., Exh. 1 (Declaration of Jennifer Heald), ¶ 5. "ChaseHealthAdvance offered accountholders no-interest financing to obtain services from Chase-accepted providers." Heald Decl., ¶ 6. As part of the application to become a provider, a business listed a doctor's name and valid medical-license number, id., ¶ 9, and also agreed to adhere to certain terms and conditions, including promptly submitting to Chase an invoice for all customer purchases financed through ChaseHealthAdvance. See 2008 Provider Agreement at 1; Heald Decl., Exh. D (2011 Chase Provider Agreement) at 2. The provider could either mail such invoice with the customer's signature, or (as is often the case in the digital age) remit it electronically. See 2008 Provider Agreement at 1. If a provider chose the latter route, it agreed to "retain a copy of the original, signed Invoice for a period of four years from the date of completion or delivery set forth on the Invoice." Id. In the event of a customer dispute regarding a transaction, providers had to submit the signed invoice within ten business days or pay Chase the full amount of the disputed charge. Id.

On November 10, 2008, Chase entered into a provider agreement with Bullen Wellness, a joint venture between two business associates, Karim Steward and Wayne Bullen. See Def. MSJ, Attach. 2 (Defendant's Statement of Undisputed Material Facts), ¶ 3. Steward owned a gym, One World Fitness, and Bullen owned a chiropractic practice, Washington Chiropractic. See Pl. MSJ, Attach. 3 (Plaintiff Statement of Undisputed Material Facts), ¶ 17. Bullen Wellness's provider-enrollment form listed Dr. Bullen's chiropractor license number and the same address and phone number associated with One World Fitness. Id., ¶¶ 22, 24. It should be noted, however, that Chase had no official relationship with the gym. See Def. SUMF, ¶ 78; Def. Reply, Exh. 19 (Deposition of Valerie McMullen) at 259–60.

In September 2010, McMullen began attending personal-training sessions at One World Fitness. See Pl. SUMF, ¶ 63. She purchased 54 sessions in advance at a cost of $5,040 and decided to apply for a ChaseHealthAdvance account to pay for them. Id., ¶ 63. Steward asked her a series of questions, answers to which he entered into the electronic application on his computer's Chase portal. See McMullen Depo. at 78. McMullen was approved with a credit limit of $12,000 and signed a purchase-verification form, per Chase policy. Id. at 82–83. The following month she received a billing statement from Chase with a charge of $5,040 from Bullen Wellness. See McMullen Depo. at 109–10. Plaintiff made payments on her balance without issue. Having exhausted her 54 sessions by December 2010, she then purchased 150 additional training sessions (50 weeks), which she charged on a personal credit card. See Pl. SUMF, ¶ 72.

All was well until September 2011. On September 21, McMullen had a conversation with Steward wherein she stated that she would renew her membership for another year so long as her preferred trainer was working there. See McMullen Depo. at 156:13–18, 161:5–22. (Defendant Steward disputes that this conversation happened, but Chase—the only Defendant in these Motions—does not.) The next day, however, One World Fitness terminated this trainer. See McMullen Depo. at 147. Plaintiff promptly informed the gym the following day that she wished to cancel her membership and requested a refund for the remaining three months for which she had prepaid in December 2010. See Pl. SUMF, ¶ 73. Instead of obtaining a refund, however, when McMullen received her Chase bill the following month, she saw a new charge for $1,000 from Bullen Wellness. See McMullen Depo. at 174:2–5, 182:9–22. Believing this was unauthorized, Plaintiff called Chase on November 1, 2011, to dispute it. See Heald Decl., Exh. U (Call Log). (The parties disagree as to whether McMullen authorized the charge in the first instance. See Def. Reply, Attach. 1 (Response to Plaintiff Statement of Undisputed Material Facts), ¶ 1.) The Chase representative asked her for her email address so that he could email her a dispute form, which he did on November 4. See Def. SUMF, ¶¶ 54, 58. McMullen never returned the dispute form or submitted to Chase any other written grievance. Id., ¶¶ 61, 64. She continued making payments to Chase and paid off the $1,000 balance on June 8, 2012. Id., ¶ 65.

B. Procedural History

On September 12, 2014, Plaintiff filed this suit in the Superior Court for the District of Columbia. See ECF No. 1 (Notice of Removal) at 1. She named Steward and Bullen; their companies (One World Fitness, Bullen Wellness, and Washington Chiropractic); two banks, Synchrony and Chase; and a handful of unnamed individuals and corporate entities as Defendants. Id., Attach. 1 (Complaint), ¶¶ 1, 6–14. The Complaint raised a bevy of claims against these Defendants—viz. , violations of the D.C. Consumer Protection Procedures Act, civil conspiracy, common-law fraud, conversion, breach of contract, breach of good faith and fair dealing, vicarious liability, and punitive damages. Id., ¶¶ 36–83. McMullen later amended her Complaint to include class-action claims, seeking relief on behalf of a putative class of "all One World Fitness customers who received financing from the Bank Defendants." Notice of Removal at 2. Chase then successfully removed the suit to federal court pursuant to the diversity-removal provisions of the Class Action Fairness Act. See ECF No. 55 (Memorandum Opinion and Order denying remand).

On September 23, 2015, Chase moved to dismiss the claims asserted against it—specifically, violations of the CPPA, fraud and conspiracy under D.C. common law, and punitive damages. See ECF No. 57 (MTD). Defendant Synchrony also joined this Motion. See ECF No. 63 (Notice of Joinder). Plaintiff opposed the Motion and sought leave to amend her Complaint a second time. See ECF Nos. 65 (Opposition to MTD), 70 (MTA). On February 16, 2016, the Court granted Plaintiff leave to amend her Complaint, but also granted Chase's Motion to Dismiss as to Count VII (punitive damages). See McMullen, 164 F.Supp.3d at 98. Using the proposed Second Amended Complaint as the operative document, the Court determined that Plaintiff had stated a claim for the substantive counts against the banks—violations of the CPPA (Count I), and fraud and conspiracy to commit fraud (Count III). After nearly a year of discovery, Chase filed this Motion for Summary Judgment. Plaintiff cross-moved, and the Motions are now ripe.

II. Legal Standard

"When faced with cross-motions for summary judgment, th[e C]ourt must review each motion separately on its own merits ‘to determine whether either of the parties deserves judgment as a matter of law.’ " Family Trust of Mass., Inc. v. United States, 892 F.Supp.2d 149, 154 (D.D.C. 2012) (quoting Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th Cir. 2003) ). If the Court determines that one party is not entitled to summary judgment, it "changes tack on the cross motion and gives the unsuccessful movant ‘all of the favorable factual inferences that it has just given to the movant's opponent.’ " Nucap Indus., Inc. v. Robert Bosch LLC, 273 F.Supp.3d 986, 998, 2017 WL 1197104, at *6 (N.D. Ill. 2017) (quoting R.J. Corman Derailment Servs., LLC v. Int'l Union of Operating Engrs., Local...