Suk v. JM Bullion, Inc.
| Decision Date | 17 October 2022 |
| Docket Number | 3:22-cv-01085-SB |
| Parties | SAMUEL SUK, Plaintiff, v. JM BULLION, INC., a Delaware corporation, Defendant. |
| Court | U.S. District Court — District of Oregon |
Plaintiff Samuel Suk (“Plaintiff”) filed this action against defendant JM Bullion, Inc. (“Defendant”) alleging a claim for breach of contract. Defendant moves to dismiss Plaintiff's complaint on the ground that he fails to state a claim upon which relief can be granted. See FED. R. CIV. P. 12(b)(6). The Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332(a)(1), and the parties have consented to the jurisdiction of a magistrate judge pursuant to 28 U.S.C § 636(c). For the reasons explained below, the Court denies Defendant's motion to dismiss.
BACKGROUND [1]
Plaintiff is a resident of Beaverton, Oregon, and Defendant is a Delaware corporation and online retail seller of precious metals. (Compl. ¶¶ 1-2.) On August 31, 2018 Plaintiff, acting on behalf of his elderly mother, ordered six ten-ounce gold bars on Defendant's website and paid Defendant $73,719.20.[2] (Id. ¶¶ 3-6.) While doing so, Plaintiff accepted Defendant's website's terms and conditions and provided Defendant with a Beaverton shipping address. .
That same day, August 31, 2018, Defendant accepted the order and shipped the gold bars in three packages via the United States Postal Service (“USPS”). (Id. ¶¶ 5, 8.) On September 4, 2018, the packages arrived at a USPS service center in Hillsboro, Oregon, where they “were waiting to be delivered to the [s]hipping [a]ddress.” (Id. ¶ 9.) Before they went out for delivery, an unknown third party, using a fictitious name, picked up the packages at the service center. (Id. ¶ 10.)
The following day, September 5, 2018, Plaintiff contacted the USPS and Hillsboro Police Department (“HPD”) and filed a claim with Defendant on his mother's behalf. (Id. ¶¶ 11-12.) Also on September 5, 2018, Plaintiff's mother submitted a declaration that Defendant “requested relating to the theft of the [g]old [b]ars,” and consistent with section ten of Defendant's terms and conditions, Defendant's claims department informed Plaintiff that Defendant fully insures all of its shipments and Defendant's insurance covers packages during transit. (Id. ¶¶ 13-14.)
Although Plaintiff and Plaintiff's mother “generally cooperated” with Defendant, Defendant's insurer, and the HPD, Plaintiff's mother never recovered the gold bars she purchased, and Defendant refused to reimburse Plaintiff's mother for the purchase price. (Id. ¶¶ 15-18.) As a result, Plaintiff's mother assigned her claims pertaining to the order to Plaintiff, who submitted a claim for arbitration to the American Arbitration Association (“AAA”) on January 12, 2022, pursuant to the agreed-upon terms and conditions on Defendant's website. (Id. ¶¶ 19-21.)
On May 19, 2022, AAA issued a letter closing Plaintiff's case file, noting that AAA had to decline to administer the case because it did not receive the required signed waiver and fees from Defendant. (Id. ¶ 22.) AAA also informed Plaintiff that because it declined to administer his case, he was entitled to submit his dispute to the appropriate court for resolution. (Id.)
Plaintiff did so on June 21, 2022, when he filed the present action against Defendant in Multnomah County Circuit Court, alleging that Defendant breached its contract by failing to participate in the AAA arbitration and failing to deliver the gold bars to the shipping address. (Id. ¶¶ 23-28; Def.'s Notice Removal ¶¶ 1-2.) After Plaintiff served Defendant on June 27, 2022, Defendant timely removed the case to this court on July 26, 2022. (Id. ¶ 3.) Defendant's motion to dismiss the complaint followed on August 2, 2022. (Def.'s Mot. Dismiss (“Def.'s Mot.”) at 18, ECF No. 5.) The Court heard oral argument on October 11, 2022.
Defendant moves to dismiss Plaintiff's complaint pursuant to Federal Rule of Civil Procedure (“Rule”) 12(b)(6), arguing that Plaintiff did not file his complaint within the applicable statute of limitations and therefore he fails to state a plausible claim. (Def.'s Mot. at 2, 5-8.)
A statute of limitations is an affirmative defense. See Lasko v. Caliber Home Loans, No. 20-17181, 2022 WL 728820, at *1 (9th Cir. Mar. 10, 2022) (). Although “[p]laintiffs are generally not required to ‘plead around affirmative defenses,'” Ortega v. Santa Clara Cnty. Jail, No. 19-17547, 2021 WL 5855066, at *1 (9th Cir. Dec. 9, 2021) (quoting U.S. Commodity Futures Trading Comm'n v. Monex Credit Co., 931 F.3d 966, 972 (9th Cir. 2019)), it is well settled that “a court may address a statute-of-limitations defense when ruling on a [Rule] 12(b)(6) motion.” Finato v. Fink, 803 Fed.Appx. 84, 88 n.2 (9th Cir. 2020) (citation omitted).
“[D]ismissal under Rule 12(b)(6) on the basis of an affirmative defense is proper only if the defendant shows some obvious bar to securing relief on the face of the complaint.” Ortega, 2021 WL 5855066, at *1 (quoting ASARCO, LLC v. Union Pac. R.R. Co., 765 F.3d 999, 1004 (9th Cir. 2014)). “A complaint showing that the governing statute of limitations has run on the plaintiff's claim for relief is the most common situation in which the affirmative defense appears on the face of the pleading and provides a basis for a motion to dismiss under Rule 12(b)(6)[.]” Rivera v. Peri & Sons Farms, Inc., 735 F.3d 892, 902 (9th Cir. 2013) (simplified). However, “[i]f, from the allegations of the complaint as well as any judicially noticeable materials, an asserted defense raises disputed issues of fact, dismissal under Rule 12(b)(6) is improper.” ASARCO, 765 F.3d at 1004 (citing Scott v. Kuhlmann, 746 F.2d 1377, 1378 (9th Cir. 1984) (per curiam)).
Defendant moves to dismiss this case on the ground that Plaintiff did not timely file his complaint. As explained below, Plaintiff timely filed his complaint, and therefore the Court denies Defendant's motion.
Plaintiff asserts a breach of contract claim, premised on Defendant's alleged failure to comply with its website's terms and conditions and failure to deliver the gold bars to the shipping address. (Compl. ¶¶ 23-31.) The website's terms and conditions are attached as Exhibit A to Plaintiff's complaint, and provide that the order and the parties' agreement is “governed by, and interpreted in accordance with, the laws of the State of Texas, without regard to conflict of laws principles.”[3] (Id. Ex. A at 1, 8) (bold omitted). The parties agree that Texas law governs Plaintiff's breach of contract claim. (See Def.'s Mot. at 5 n.3; Pl.'s Resp. at 5-11; Def.'s Reply at 2, ECF No. 7).
The Texas Civil Practice and Remedies Code includes a default statute of limitations: “Every action for which there is no express limitations period, except an action for the recovery of real property, must be brought not later than four years after the day the cause of action accrues.” TEX. CIV. PRAC. & REM. CODE § 16.051. The Texas Civil Practice and Remedies Code also contemplates that a stipulation, contract, or agreement may establish an express limitations period of less than four years, as long as the limitations period is not shorter than two years. See TEX. CIV. PRAC. & REM. CODE § 16.070(a) (making “void in [Texas]” any “stipulation, contract, or agreement that establishes a limitations period that is shorter than two years”).
Thus, “[a] party asserting a breach of contract claim must [typically] sue no later than four years after the day the claim accrues.” Stine v. Stewart, 80 S.W.3d 586, 592 (Tex. 2002) . . “[A] breach of contract claim accrues when the contract is breached.” Id. (citing Smith v. Fairbanks, Morse & Co., 102 S.W. 908, 909 (Tex. 1907)); see also TEX. BUS. & COM. CODE § 2.725(b) ().
Although the Texas Legislature's enactment of § 16.051 “provided a default limitations period of four years [for situations where there is] no express limitations period . . . specified for a particular cause of action,” the Texas Supreme Court has recognized that when the Texas Legislature has enacted a statute establishing “an express limitations period, . . . the more specific time limit controls.” Valdez v. Hollenbeck, 465 S.W.3d 217, 227 (Tex. 2015) (citations omitted). In Texas, there are “a multitude of statutory alterations to [§ 16.051's] residual four-year limitations period.” Id. (citing Williams v. Khalaf, 802 S.W.2d 651, 654 n.3 (Tex. 1990)). They include Texas Business and Commerce Code § 2.725. See Williams, 802 S.W.2d at 654 n.3 () (simplified).
Article Two of the Uniform Commercial Code is codified as Chapter Two of the Texas Business and Commerce Code. See Selectouch Corp. v. Perfect Starch, Inc., 111 S.W.3d 830, 834 (Tex Ct. App. 2003) (citation omitted). “The four-year limitations period of [Texas Business and Commerce Code §] 2.725 applies to an action for the breach of contract for the sale of goods.” Tarrant Cnty. Hosp. Dist. v. GE Auto. Servs., Inc., 156 S.W.3d 885, 893 (Tex. Ct. App. 2005) (citing Big D Serv....
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