TAYLOR v. PINNACLE CREDIT Serv. LLC.

• Decision Date: 04 April 2011
• Docket Number: No. C-10-05164 JCS,C-10-05164 JCS
• Parties: MARLENE TAYLOR, Plaintiff, v. PINNACLE CREDIT SERVICES, LLC, Defendant.
• Court: U.S. District Court — Northern District of California

MARLENE TAYLOR, Plaintiff,

v.PINNACLE CREDIT SERVICES, LLC, Defendant.

No. C-10-05164 JCS

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

Dated: April 04, 2011

ORDER GRANTING DEFENDANT'S MOTION TO DISMISS FIRST AMENDED COMPLAINT PURSUANT TO F.R.C.P. 12(b)(6) [Docket No. 7]

I. INTRODUCTION

Plaintiff alleges that a collection letter that was sent to her by Defendant violated the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692 et seq., and the Rosenthal Fair Debt Collection Practices Act ("Rosenthal Act"), Cal. Civ. Code §§ 1788 et seq., which prohibit debt collectors from engaging in abusive, deceptive, and unfair debt collection practices. Defendant brings a Motion to Dismiss First Amended Complaint Pursuant to Federal Rule of Civil Procedure 12(b)(6) ("the Motion"). The parties have consented to the jurisdiction of a United States magistrate judge, pursuant to 28 U.S.C. § 636(c). A hearing on the Motion was held on Friday, April 1, 2011 at 9:30 a.m. For the reasons stated below, the Motion is GRANTED.

II. BACKGROUND

A. First Amended Complaint¹

Plaintiff Marelene Taylor is a resident of Sebastopol, California. First Amended Complaint ("FAC"), ¶ 3. She alleges that she is a "consumer" as defined by the FDCPA and a "debtor," as defined under the Rosenthal Act. Id. Plaintiff further alleges that Defendant, Pinnacle Credit Services, LLC, "was a company engaged, by use of the mails and telephone, in the business of collecting a debt from Plaintiff which qualifies as a 'debt,' as defined by 15 U.S.C. § 1692a(5), and a 'consumer debt,' as defined by Cal. Civ. Code § 1788.2(f)." Id., ¶ 4. According to Plaintiff, "Defendant regularly attempts to collect debts alleged to be due another, and therefore is a 'debt collector' as defined by the FDCPA . . . and [the Rosenthal Act]." Id.

Plaintiff alleges that "at various and multiple times prior to the filing of the instant complaint, including within the one year preceding the filing of this complaint, Defendant contacted Plaintiff in an attempt to collect an alleged outstanding debt." Id., ¶ 5. In her First Amended Complaint, Plaintiff specifically identifies one such communication, a letter received by Plaintiff on June 28, 2010 ("the June 28 Letter"), which was not filed as an attachment to the original complaint or the First Amended Complaint . Id., ¶ 6. In the First Amended Complaint, Plaintiff alleges as follows:

6. On or about June 28, 2010, Plaintiff received a letter regarding an alleged debt owed to Defendant. In that letter, Defendant is represented by an alleged attorney from New Jersey, who has no license in California. Plaintiff alleges that Defendant used an attorney's office in an attempt to intimidate and harass Plaintiff.

7. In the June 28, 2010 [letter], Defendant's counsel demanded payment in full because according to him, ' . . . you have had ample time to pay your creditor." Plaintiff received the letter via fax, and the fax cover sheet labels the letter '1st demand.' Plaintiff alleges that Defendant uses such language as a threat to Plaintiff.

Id., ¶¶ 6-7.

Based on these allegations, Plaintiff asserts claims under the FDCPA and the Rosenthal Act, asserting that Defendants have violated these statutes in "multiple ways," including but not limited to:

a) Threatening to take an action against Plaintiff that cannot be legally taken or that was not actually intended to be taken (§ 1692e(5));

b) Falsely representing that an individual is an attorney (§ 1692e(3));

c) Using false representations and deceptive practices in connection with collection of an alleged debt from Plaintiff (§ 1692e(10)); d) Engaging in conduct the natural consequences of which is to harass, oppress, or abuse Plaintiff (§ 1692d);

e) In connection with collection of a debt, using language the natural consequences of which was to abuse Plaintiff (§ 1692d(2));

f) Using false, deceptive, or misleading representations or means in connection with collection of a debt (§ 1692e));

g) Falsely representing or implying that nonpayment of Plaintiffs debt would result in the seizure, garnishment, attachment, or sale of Plaintiffs property or wages, where such action is not lawful or Defendant did not intend to take such action (§ 1692e(4));

h) Falsely representing or implying that Plaintiff had committed a crime or other conduct, in order to disgrace Plaintiff (§ 1692e(7));

i) Using unfair or unconscionable means against Plaintiff in connection with an attempt to collect a debt (§ 1692f));

j) Threatening Plaintiff that nonpayment of Plaintiffs debt may result in the arrest of Plaintiff or the seizure, garnishment, attachment or sale of any property or the garnishment or attachment of wages of Plaintiff, where such action was not in fact contemplated by the debt collector and permitted by the law (Cal Civ Code § 1788.10(e));

k) Threatening to take an action against Plaintiff that is prohibited by § 1788 of the California Civil Code (Cal Civ Code § 1788.10(f)); and

l) Falsely representing that a legal proceeding has been, is about to be, or will be instituted unless payment of a consumer debt is made (Cal Civ Code § 1788.13(j)).

Id., ¶ 8 (cited verbatim, including punctuation and citations). Plaintiff requests declaratory judgment, actual and statutory damages, and attorneys' fees and costs under both the FDCPA and the Rosenthal Act. Id. at 5-6.

B. The Motion to Dismiss

In the Motion, Defendant asserts that Plaintiffs claims should be dismissed under Rule 12(b)(6) of the Federal Rules of Civil Procedure because the "sparse factual allegations" in the First Amended Complaint do not constitute a violation of any federal or state debt collection law and therefore, do not satisfy the requirements of Bell Atlantic Corp. v. Twombley, 550 U.S. 544, 555 (2007). Memorandum of Points and Authorities at 2. In addition, to the extent that Plaintiffs claims are based on the June 28 Letter, Defendant argues, these claims fail because it is not a violation of state or federal law to use an attorney who is not licensed in California for purposes of debt collection in California, and the First Amended Complaint does not allege any specific facts suggesting that the June 28 Letter: 1) threatens litigation; 2) is threatening, abusive or harassing; or 3) contains any kind of misrepresentation. Id. at 2-3.² In support of its positions, Defendant cites, inter alia, Depuy v. Weltman, 442 F. Supp. 2d 822, 826 (N.D. Cal. 2006) ("[t]he use of law firm letterhead has been found insufficient by itself to imply a threat of litigation"), and Greco v. Trauner, Cohen & Thomas, LLP, 412 F.3d 360, 363 (2d Cir. 1993) (holding that collection letter on law firm letterhead did not misrepresent nature of attorney involvement where letter included a "clear disclaimer" of attorney involvement stating that "[a]t this time, no attorney with this firm has personally reviewed the particular circumstances of your account").

In her Opposition, Plaintiff argues that her claims are sufficiently pled, for the purposes of surviving a Rule 12(b)(6) motion, because she has complied with the requirements of Rule 8(a)(2) of the Federal Rules of Civil Procedure, requiring only a "short and plain statement of the claim showing that the pleader is entitled to relief." Opposition at 2. Because Defendant clearly understands the nature of Plaintiffs claims, Plaintiff asserts, this standard has been satisfied and Defendant's motion is, at best, premature. Id. at 3-4. Plaintiff further asserts that the language used in the June 28 Letter is sufficient to show a threat of litigation, citing a case decided by Magistrate Judge Zimmerman, of this Court, in which the plaintiff prevailed on summary judgment in an FDCPA case involving a letter that Plaintiff asserts is similar to the June 28 Letter. Id. at 5 (citing Celeste Robertson v. Richard J. Boudreau & Assocs., LLC, 2009 WL 5108479 (N.D. Cal. Dec. 18, 2009) ("Robertson'")). In that case, Plaintiff notes, the court distinguished Greco on the basis that the language in the collection letter deceptively implied attorney involvement, notwithstanding a disclaimer that no attorney had reviewed the recipient's account, by including statements that overshadowed the disclaimer, such as a statement that the law firm had been "retained," implying that the attorneys had been hired to initiate litigation even though they were not licensed in California and therefore could not commence litigation against the recipient. Id. at 6. Even if the Court concludes that Plaintiffs claims are insufficiently pled, Plaintiff asserts, Plaintiff should be granted leave to amend her claims.

Concurrent with her Opposition brief, Plaintiff filed a request that the Court take judicial notice of the June 28 Letter and the Roberston decision cited above. The June 28 Letter is on letterhead stationary listing "Laurence A. Heckler, Attorney at Law" at the top center, along with an address, fax number and toll-free telephone number. Plaintiffs Request for Judicial Notice, Ex. B. On the top left-hand side of the letter are the words "Member of NJ Bar." Id. The subject heading lists: 1) the creditor, Pinacle Credit Services, LLC; 2) the original creditor, Citibank South Dakota NA; 3) the original account number; and 4) the amount due. Id. The letter states as follows:

Dear Marlene S Taylor

This office represents the above named client, PINNACLE CREDIT SERVICES, LLC, who has placed the above-styled matter for collection. This is a demand for full payment because you have had ample time to pay your creditor. Sometimes we can arrange installment payments but you must contact this office for arrangements. At this time, no attorney with this firm has personally reviewed the particular circumstances of your account. Please issue payment to APM Financial.

NOTICE OF IMPORTANT RIGHTS

UNLESS YOU, THE CONSUMER, WITHIN THIRTY DAYS AFTER RECEIPT OF THIS NOTICE, DISPUTE THE VALIDITY OF THE DEBT, OR...