Roberts v. Ebay Inc., C/A No. 6:14-cv-4904-HMH-MGB

CourtUnited States District Courts. 4th Circuit. United States District Court of South Carolina
Writing for the CourtMARY GORDON BAKER UNITED STATES MAGISTRATE JUDGE
Decision Date28 December 2016
PartiesBrian T. Roberts, PLAINTIFF, v. EBay Inc., Auction Insurance Agency, Centennial Casualty Insurance, Visa Inc., Thomas Adams, Jr., PayPal Inc., Steven Tisland, Alabama Department of Insurance, Jeff Cregger, DEFENDANTS.
Docket NumberC/A No. 6:14-cv-4904-HMH-MGB

Brian T. Roberts, PLAINTIFF,
v.
EBay Inc., Auction Insurance Agency,
Centennial Casualty Insurance, Visa Inc.,
Thomas Adams, Jr., PayPal Inc.,
Steven Tisland, Alabama Department of
Insurance, Jeff Cregger, DEFENDANTS.

C/A No. 6:14-cv-4904-HMH-MGB

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF SOUTH CAROLINA CHARLESTON DIVISION

December 28, 2016


Report & Recommendation

The Plaintiff, proceeding pro se and in forma pauperis, filed the instant action on December 30, 2014 under diversity jurisdiction. (Dkt. No. 1.) On February 4, 2016, this court issued its Order allowing the Plaintiff to amend his Complaint. (Dkt. No. 40.) The Amended Complaint added Defendants Centennial Casualty Insurance, Visa Inc., Thomas Adams, Jr., PayPal Inc., Steven Tisland, Alabama Department of Insurance, and Jeff Cregger.1 Now before the court are the following motions to dismiss filed under Rule 12 of the Federal Rules of Civil Procedure:

1. Motion to Dismiss filed by Defendant Steven Tisland (Dkt. No. 63.)

2. Motion to Dismiss of Visa Inc. (Dkt. No. 80.)

3. Defendant PayPal Inc.'s Motion to Dismiss (Dkt. No. 100.)

4. Motion to Dismiss on Behalf of the Alabama Department of Insurance (Dkt. No. 123.)

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Pursuant to the provisions of Title 28, United States Code, Section 636(b)(1) and Local Rule 73.02(B)(2)(e), D.S.C., all pretrial matters in cases involving pro se litigants are referred to a United States Magistrate Judge for consideration.

Alleged Facts2

The Plaintiff's allegations revolve around the sales of a boat and a van he sold in August of 2014 on eBay.com. The Plaintiff used eBay as a sales channel for various items and as his primary source of income.

The Boat

The Plaintiff advertised and sold a 2008 Howard Deck Boat in "as is, where is" condition to Jeff Cregger for $59,995.00 on August 20, 2014. Following the sale of the boat, Mr. Cregger filed a claim through eBay's "Buyer Protection Program" ("BPP") because he was not satisfied with the boat. Defendant Auction Insurance Agency ("AIA") intervened on eBay's behalf. On or about November 13, 2014, the Plaintiff's eBay account was indefinitely suspended. At the time of the suspension, the Plaintiff had over 350 positive reviews on eBay. On or about December 9, 2014, AIA paid Mr. Cregger $20,000 to settle his claim. The Plaintiff told AIA that he did not want the settlement paid to Cregger because the boat was sold in "as is, where is" condition. Funds used to indemnify Mr. Cregger "were drawn on an account in the name of Defendant Centennial Casualty Company" ("CCC"). (Dkt. No. 42 at 5.)

Defendant Thomas Adams, Jr. is the president of CCC and AIA. The Plaintiff alleges that he "conspired" with eBay to use AIA and CCC to defraud users of eBay out of millions of dollars by illegally insuring transactions and caused "irreparable harm" to the Plaintiff. (Dkt. No. 42 at 5.)

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CCC is an insurance company licensed in the state of Alabama. CCC paid the funds for Mr. Cregger's BPP claim on behalf of AIA. The Plaintiff alleges that EBay's website disclaims that the BPP is not an insurance policy, but, despite this disclaimer, the BPP mirrors an insurance policy. The Plaintiff alleges that eBay pays a fee to AIA for every transaction on eBay. The fee is a premium payment. Defendants AIA, CCC, and eBay are not licensed to insure transactions in all fifty (50) states.

The Plaintiff has "exposed the acts" of AIA, CCC, and eBay to the Alabama Department of Insurance ("the Department"). (Dkt. No. 42 at 6.) The Department has not stopped these acts and has not rectified the past negligent acts. The Department's failure to act for an extended time period has caused irreparable harm to the Plaintiff.

The Van

The Plaintiff advertised and sold a Mazda MPV van in "as is, where is" condition to Defendant Tisland for $2,500.00 on August 22, 2014. The purchaser of the van left the Plaintiff positive feedback on eBay. On or about September 16, 2014, the purchaser of the van sent the Plaintiff an email stating that the van required repairs and that he expected the Plaintiff to pay for them. The Plaintiff replied that the van was sold "as is, where is" and that there was no warranty. Several weeks later, Defendant Tisland filed a "chargeback" to recoup the funds for the van. On or about September 23, 2014, PayPal recovered approximately $2500.00 from the Plaintiff's PayPal account. The Plaintiff informed PayPal that the van had been sold in "as is, where is" condition and that Defendant Tisland had retained possession and title of the van. The Plaintiff told PayPal he had incurred financial loss due to PayPal's negligent and irresponsible actions. The Plaintiff does not possess the van or title to the van. The Plaintiff has tried to recover the funds on multiple occasions without success. The Plaintiff was told by PayPal that

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the chargeback was initiated by Defendant Visa and that Visa had recovered the funds from PayPal.

On or around August 13, 2014, the Plaintiff contacted eBay in reference to receiving a refund of fees that the Plaintiff had been charged for sales that were not completed. EBay agreed to refund the Plaintiff $1200.00 in fees. On September 22, 2014, the Plaintiff called eBay concerning his refund. He was told by the eBay representative that eBay had made a mistake and was not issuing a refund. On or about September 23, 2014, eBay contacted the Plaintiff and offered the Plaintiff $300.00 in lieu of the $1,200.00. The Plaintiff rejected eBay's offer and did not receive any funds.

Motion to Dismiss filed by Defendant Steven Tisland (Dkt. No. 63.)

This court recommends that Defendant Tisland's Motion to Dismiss (Dkt. No. 63) be denied. Defendant Tisland argues that the claims against him should be dismissed for three reasons. Defendant Tisland argues under Rule 12(b)(1) of the Federal Rules of Civil Procedure that this court lacks jurisdiction over the claims because the amount in controversy does not meet the $75,000 threshold as required by 28 U.S.C § 1332. (Dkt. No. 63.) Defendant Tisland argues under Rule 12(b)(6) of the Federal Rules of Civil Procedure that the Plaintiff has failed to plead a claim upon which relief may be granted because the Plaintiff has failed to plead the existence of a valid contract. (Dkt. No. 63.) Lastly, Defendant Tisland argues that the Plaintiff did not serve him in accordance with Rule 4(m) of the Federal Rules of Civil Procedure, and therefore he is entitled to dismissal under Rule 41(b).

28. U.S.C. § 1332 imparts the district court with original jurisdiction of all civil actions where the account in controversy exceeds $75,000 and complete diversity exists between the parties. Defendant Tisland does not dispute the diversity between the parties, and the Amended

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Complaint reflects such diversity. (Dkt. No. 42.) Defendant Tisland argues that the Plaintiff's claims against him all relate to sale of the Mazda MPV van through eBay for $2,500. (Dkt. No. 63.) Defendant Tisland argues that the alleged breach of contract by Defendant Tisland could only result in damages of $2,500. (Id.)

Generally, the amount claimed by the Plaintiff in the complaint determines whether the $75,000 threshold is met. JTH Tax, Inc. v. Frashier, 624 F.3d 635, 638 (4th Cir. 2010) (citing St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288 (1938)). "If the plaintiff claims a sum sufficient to satisfy the statutory requirement, a federal court may dismiss only if it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed." Id. (internal quotations omitted). When the Plaintiff claims an amount above $75,000, a defendant seeking to dismiss by arguing the amount in controversy is too low "must show 'the legal impossibility of recovery' to be 'so certain as virtually to negative the plaintiff's good faith in asserting the claim.'" Id. (quoting Wiggins v. N. Am. Equitable Life Assurance Co., 644 F.2d 1014, 1017 (4th Cir.1981)).

"[P]ro se complaints...are held to a less stringent standard than those drafted by attorneys,...and a federal district court is charged with liberally construing a complaint or petition filed by a pro se litigant to allow the development of a potentially meritorious case." Stout v. Robnett, 107 F. Supp. 2d 699, 702 (D.S.C. 2000) (internal quotations and citations omitted). In the Amended Complaint, the Plaintiff claims $100,000 in damages against Defendant Tisland along with punitive damages. (Dkt. No. 45 at 10.) Broadly reading the complaint, the Plaintiff brings claims against Defendant Tisland for breach of contract

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accompanied by a fraudulent act3 and for unjust enrichment.4 The Plaintiff alleges he sold the van to Defendant Tisland. (Dkt. No. 42.) Defendant Tisland paid for the van and received possession of the van and title to the van. (Id.) The Plaintiff alleges that Defendant Tisland then recouped the money he paid the Plaintiff through a "PayPal chargeback." (Id.) Under South Carolina law, a plaintiff in an action for breach of contract accompanied by a fraudulent act may recover punitive damages. See Floyd v. Country Squire Mobile Homes, Inc., 287 S.C. 51, 53, 336 S.E.2d 502, 503 (Ct. App. 1985) (citing Welborn v. Dixon, 70 S.C. 108, 49 S.E. 232 (1904)).

Defendant Tisland has not met his burden to show the legal impossibility of the Plaintiff recovering $75,000 against him. Defendant Tisland's motion devotes only one (1) paragraph to his argument that the $75,000 threshold cannot be met. The Defendant does not address punitive damages at all. The Plaintiff alleges that Defendant Tisland's chargeback led, in part, to Defendant eBay's revocation of his ability to sell on eBay. While it is not immediately clear if such damages could be imputable to Defendant Tisland, he has not addressed such damages at all.

Additionally, Defendant Tisland does not address this court's supplemental jurisdiction in his Motion to Dismiss. (Dkt. No. 63.) 28 U.S.C. § 1367 states in part that:

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in any civil
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