Mendez v. Moonridge Neighborhood Ass'n, Inc.

• Decision Date: 26 January 2021
• Docket Number: Case No. 1:19-cv-00507-DCN
• Parties: RAUL MENDEZ, Plaintiff, v. MOONRIDGE NEIGHBORHOOD ASSOCIATION, INC.; DEVELOPMENT SERVICES, INC.; SHELLI DAYLONG; STEPHANIE CHAMBERLAIN; SHURI URQUIDI, and any other agencies and employees of DEVELOPMENT SERVICES, INC.; JOHN HOXSEY, as an individual and any other past and present board members of the MOONRIDGE NEIGHBORHOOD ASSOCIATION, INC., Defendants.
• Court: U.S. District Court — District of Idaho

RAUL MENDEZ, Plaintiff, v. MOONRIDGE NEIGHBORHOOD ASSOCIATION, INC.; DEVELOPMENT SERVICES, INC.;SHELLI DAYLONG; STEPHANIE CHAMBERLAIN; SHURI URQUIDI, and any other agencies andemployees of DEVELOPMENT SERVICES, INC.; JOHN HOXSEY, as an individual andany other past and present board members of theMOONRIDGE NEIGHBORHOOD ASSOCIATION, INC., Defendants.

Case No. 1:19-cv-00507-DCN

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF IDAHO

January 26, 2021

MEMORANDUM DECISION AND ORDER

I. INTRODUCTION

Pending before the Court are two motions: Defendants' Motion to Dismiss (Dkt. 14) and Plaintiff Raul Mendez's Motion for Sanctions (Dkt. 17). Having reviewed the record and the briefs, the Court finds that the facts and legal arguments are adequately presented. Accordingly, in the interest of avoiding further delay, and because the Court finds the decisional process would not be significantly aided by oral argument, the Court will decide the motions without oral argument. Dist. Idaho Loc. Civ. R. 7.1(d)(1)(B). For the reasons set forth below, the Court GRANTS in part and DENIES in part the Motion to Dismiss and DENIES the Motion for Sanctions.

II. BACKGROUND

On December 23, 2019, Mendez initiated this lawsuit. Dkt. 2. Mendez alleges that he is a member of Moonridge Neighborhood Association's ("Moonridge") Homeowners' Association ("HOA"), which is managed by Development Services, Inc. ("Development"). The individually named Defendants are purportedly employees and/or board members of the two entities. Mendez accuses Defendants of violating provisions of the Fair Debt Collections Practices Act ("FDCPA"), 15 U.S.C. §§ 1692 to 1692p. Dkt. 12, at 12. Additionally, Mendez brings Idaho state law claims for breach of contract; breach of the implied covenant of good faith and fair dealing; unjust enrichment; intentional infliction of emotional distress; a violation of the Idaho Collection Agency Act ("ICAA"), Idaho Code § 26-2221, et seq.; a violation of the Idaho Consumer Protection Act ("ICPA"), specifically Idaho Code § 48-603; and fraud. Id. at 12-20. Mendez alleges that Defendants are unlawfully both collecting HOA fees and seeking to collect certain unpaid HOA fees.

Mendez's claims significantly stem from Defendants' attempts to collect HOA fees for maintenance of the HOA's common area. In particular, Mendez alleges that Defendants have been repeatedly attempting to collect his unpaid fees since around the beginning of 2018. Id. at 4. Two attempts are especially pertinent to this matter. Mendez alleges, and Court filings reflect, that Moonridge filed a small claims action against Mendez to collect the fees on January 25, 2019. Id. at 10; Dkt. 14-3, at 1. Mendez further alleges that, on October 2, 2019, Development attempted to collect the fees by sending him an invoice.Mendez's claims also arise from his allegations that Defendants are violating the HOA's conditions, covenants, and restrictions ("CC&Rs") by misappropriating the common area maintenance fees for their own use.

On January 28, 2020, the Court issued its Initial Review Order granting Mendez in forma pauperis status and allowing him to proceed with his case. Dkt. 5. As is required for cases brought by litigants who seek in forma pauperis status, the Court screened Mendez's Complaint. See 28 U.S.C. § 1915(e)(2). In doing so, the Court stated that it was engaging in "an initial review of Mendez's Complaint to ensure it me[t] the minimum required standards." Id. at 1. As is typical of these reviews, the Court assessed the Complaint "[a]t face value" and concluded that it was "sufficient to survive initial review." Id. at 2, 4. The Court concluded that jurisdiction was "preliminarily met, and the state-law claims associated with the FDCPA violations [we]re preliminarily contained under supplemental jurisdiction." Id. at 5.

On June 5, 2020, Defendants filed a Motion to Dismiss. Dkt. 10. Mendez did not respond, but he instead filed an Amended Complaint. Dkt. 12. Defendants withdrew their Motion to Dismiss, but, one week later, Defendants filed the instant Motion to Dismiss arguing that Mendez has failed to state claims upon which relief may be granted. Dkt. 13, 14. Mendez responded (Dkt. 16), and Defendants replied (Dkt. 18). In addition to responding to the Motion to Dismiss, Mendez filed the instant Motion for Sanctions. Dkt. 17. Defendants in turn responded (Dkt. 19), and Mendez replied (Dkt. 20). The Court will discuss the two pending motions in turn.

III. DISCUSSION

A. Motion to Dismiss (Dkt. 14)

1. Legal Standard

Federal Rule of Civil Procedure 12(b)(6) permits a court to dismiss a claim if the plaintiff has "fail[ed] to state a claim upon which relief can be granted." "A Rule 12(b)(6) dismissal may be based on either a 'lack of a cognizable legal theory' or 'the absence of sufficient facts alleged under a cognizable legal theory.'" Johnson v. Riverside Healthcare Sys., LP, 534 F.3d 1116, 1121 (9th Cir. 2008) (citation omitted). Federal Rule of Civil Procedure 8(a)(2) requires that a complaint contain "a short and plain statement of the claim showing that the pleader is entitled to relief," in order to "give the defendant fair notice of what the claim is and the grounds upon which it rests." See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 554 (2007) (cleaned up). "This is not an onerous burden." Johnson, 534 F.3d at 1122.

A complaint "does not need detailed factual allegations," but it must set forth "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555 (citations omitted). If the facts pleaded are "merely consistent with a defendant's liability," or if there is an "obvious alternative explanation" that would not result in liability, the complaint has not stated a claim for relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 678, 682 (2009) (cleaned up).

In deciding whether to grant a motion to dismiss, the court must accept as true all well-pleaded factual allegations made in the pleading under attack. Id. at 678. A court is not, however, "required to accept as true allegations that are merely conclusory,unwarranted deductions of fact, or unreasonable inferences." Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001). In cases decided after Iqbal and Twombly, the Ninth Circuit has continued to adhere to the rule that a dismissal of a complaint without leave to amend is inappropriate unless it is beyond doubt that the complaint could not be saved by an amendment. See Harris v. Amgen, Inc., 573 F.3d 728, 737 (9th Cir. 2009).

2. Analysis

Defendants argue that Mendez fails to state any claims upon which relief may be granted. Before addressing the specifics of each of Mendez's claims, the Court first addresses Mendez's procedural arguments. Mendez first asserts that "it is wholly inappropriate to file a Motion to Dismiss this early in this case and when no [d]iscovery has taken place."¹ Dkt. 16. In addition, Mendez contends that Defendants violated Federal Rule of Civil Procedure 8(b) by filing their Motion to Dismiss instead of an Answer. Mendez also argues that Defendants' Motion to Dismiss is improper since the Court already allowed this case to proceed upon screening Mendez's Complaint. These arguments gravely misconceive the Federal Rules of Civil Procedure ("Rules").

Prior to discovery is precisely when a motion to dismiss is supposed to be filed. The Rules not only allow a party to respond to a complaint by filing a motion to dismiss before filing an answer, they require the motion to precede the answer. See Fed. R. Civ. P. 12(a)(4) (explaining that serving a motion under Rule 12 alters the periods to file a responsivepleading); Fed. R. Civ. P. 12(b) ("A motion asserting any of these defenses must be made before pleading if a responsive pleading is allowed.").

Additionally, the screening or review of a complaint under 28 U.S.C. § 1915 is preliminary in nature. Complaints reviewed under that standard must pass only a very low threshold of scrutiny imposed by the Court. Section 1915 reviews in no way preclude defendants from filing subsequent motions to dismiss. See Cusmano v. Sobek, 604 F. Supp. 2d 416, 434-35 & n.29 (N.D.N.Y. 2009) (rejecting the party's argument that "the Court is essentially estopped from dismissing [a] claim under 28 U.S.C. § 1915(e)(2)(B)(ii), 1915A(b), because it reviewed and accepted [the] Complaint"). To the contrary, as Defendants point out, a motion to dismiss is completely congruent with the statute because it is aimed at the same goal of dismissing cases that fail to state claims, which is the Court's ongoing duty. See 28 U.S.C. § 1915(e)(2)(B)(ii). Moreover, the language of the Initial Review Order itself indicated it was only an initial review by mentioning that it was "an initial review of Mendez's Complaint to ensure it me[t] the minimum required standards" and that the Court would retain the case "preliminarily." Dkt. 5, at 1, 5 (emphasis added). Simply put, the Initial Review Order did not prohibit Defendants from filing dispositive motions in this case.

In short, Mendez's procedural arguments are without merit. That leaves the particulars of each cause of action. Before the Court addresses those, however, the Court notes that Mendez's Amended Complaint is very unclear as to who violated what and how, and in many respects fails to clearly allege the bases for his claims. See Fed. R. Civ. P. 8(a)(2) (a pleading must contain "a short and plain statement of the claim showing that thepleader is entitled to relief"); Twombly, 550 U.S. at 555 (explaining that Rule 8 requires the complaint to "give the defendant fair notice of what the claim is and the grounds upon which it rests" (cleaned up)); McHenry v. Renne, 84 F.3d 1172, 1177-78 (9th Cir. 1996) (stating that if "one cannot determine from the complaint who is being sued, and for what relief, and on what theory," then the complaint violates Rule 8). Unfortunately,...