Vanco v. J.P. Morgan Chase Bank, N.A.

• Decision Date: 14 April 2017
• Docket Number: Civil Action No. ELH-16-3682
• Parties: DANIELA VANCO, et al. Plaintiffs, v. J.P. MORGAN CHASE BANK, N.A. Defendant.
• Court: U.S. District Court — District of Maryland

DANIELA VANCO, et al. Plaintiffs, v. J.P. MORGAN CHASE BANK, N.A. Defendant.

Civil Action No. ELH-16-3682

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND

April 14, 2017

MEMORANDUM

On September 14, 2016, plaintiffs Daniela and Bohumil Vanco (the "Vancos") brought suit in the Circuit Court for Baltimore County against defendant "J.P. Morgan Chase Bank, National Association" ("Chase").¹ ECF 2. The suit is rooted in a temporary freeze on the proceeds of a cashier's check issued by Chase and deposited into plaintiffs' joint account at Bank of America, N.A. ("BOA"). ECF 13. According to plaintiffs, the hold was made at the direction of Chase. Id. ¶ 3. Plaintiffs filed an Amended Complaint in State court on or about October 7, 2016. ECF 3; see ECF 1, ¶ 2. Thereafter, on November 10, 2016, Chase removed the case to this Court. ECF 1.²

Chase moved to dismiss the case on November 11, 2016, pursuant to Fed. R. Civ. P. 12(b)(6). ECF 11. On November 22, 2016, while the first motion to dismiss was pending, theVancos filed a Second Amended Complaint. ECF 13.³ In the Second Amended Complaint, the Vancos assert two statutory counts against Chase: breach of the Expedited Funds Availability Act ("EFAA"), as amended, 12 U.S.C. § 4001, et seq. (Count I), and breach of Md. Code (2013 Repl. Vol., 2016 Supp.), Titles 3 and 4 of the Commercial Law Article ("C.L.") (Count II). ECF 13, ¶¶ 6-18.⁴

Now pending is Chase's second motion to dismiss (ECF 18), which is supported by a memorandum of law. ECF 18-1 (collectively, "Motion"). The Vancos oppose the Motion (ECF 19, "Opposition") and Chase has replied. ECF 24 ("Reply").

The Motion is fully briefed and no hearing is necessary to resolve it. See Local Rule 105.6. For the reasons that follow, I shall grant the Motion.

I. Factual Background

On June 3, 3016, Chase issued a cashier's check (check no. 9590201040 "Check") to Daniela Vanco in the amount of $851,552.00. ECF 13, ¶ 1; see ECF 13-1 (Check). The next day, June 4, 2016, the Check was deposited into plaintiffs' joint checking account with Bank of America. ECF 13, ¶ 2. June 4, 2016, was a Saturday. Plaintiffs allege, id.: "After the Plaintiffs deposited the Check into their BOA checking account, BOA sent the Check to Chase for payment. Chase paid the Check by transferring the funds to BOA."

According to plaintiffs, the Check was credited to the their joint checking account at BOA on June 6, 2016. Id. ¶ 3. That date was a Monday.⁵ Plaintiffs transferred "the majority ofthe funds from their joint checking account to their joint savings account" on June 13, 2016. Id. Around that time, the Vancos became "unable to access their funds as BOA had wrongfully 'frozen' the money held in both the checking and savings accounts." Id. The Vancos claim that the hold on the accounts "was at the demand of Chase or as a result of information given by Chase to BOA about the Check." Id.

II. Standard of Review

A defendant may test the legal sufficiency of a complaint by way of a motion to dismiss under Rule 12(b)(6). Goines v. Valley Cmty. Servs. Bd., 822 F.3d 159, 165-66 (4th Cir. 2016); McBurney v. Cuccinelli, 616 F.3d 393, 408 (4th Cir. 2010), aff'd sub nom. McBurney v. Young, ___ U.S. ___, 133 S. Ct. 1709 (2013); Edwards v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999). A Rule 12(b)(6) motion constitutes an assertion by a defendant that, even if the well-pleading allegations are true, the complaint fails as a matter of law "to state a claim upon which relief can be granted." Whether a complaint states a claim for relief is assessed by reference to the pleading requirements of Fed. R. Civ. P. 8(a)(2). It provides that a complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." The purpose of the rule is to provide the defendants with "fair notice" of the claims and the "grounds" for entitlement to relief. Bell Atl., Corp. v. Twombly, 550 U.S. 544, 555-56 (2007).

To survive a motion under Fed. R. Civ. P. 12(b)(6), a complaint must contain facts sufficient to "state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570; seeAshcroft v. Iqbal, 556 U.S. 662, 684 (2009) ("Our decision in Twombly expounded the pleading standard for 'all civil actions' . . . ." (citation omitted)); see also Hall v. DirecTV, LLC, ___F.3d ___, No. 15-1857, 2017 WL 361065, at *4 (4th Cir. Jan. 25, 2017). But, a plaintiff need not include "detailed factual allegations" in order to satisfy Rule 8(a)(2). Twombly, 550 U.S. at 555. Moreover, federal pleading rules "do not countenance dismissal of a complaint for imperfect statement of the legal theory supporting the claim asserted." Johnson v. City of Shelby, ___ U.S. ___, 135 S. Ct. 346, 346 (2014) (per curiam).

Nevertheless, the rule demands more than bald accusations or mere speculation. Twombly, 550 U.S. at 555; see Painter's Mill Grille, LLC v. Brown, 716 F.3d 342, 350 (4th Cir. 2013). If a complaint provides no more than "labels and conclusions" or "a formulaic recitation of the elements of a cause of action," it is insufficient. Twombly, 550 U.S. at 555. Rather, to satisfy the minimal requirements of Rule 8(a)(2), the complaint must set forth "enough factual matter (taken as true) to suggest" a cognizable cause of action, "even if . . . [the] actual proof of those facts is improbable and . . . recovery is very remote and unlikely." Twombly, 550 U.S. at 556 (internal quotations omitted).

In reviewing a Rule 12(b)(6) motion, a court "'must accept as true all of the factual allegations contained in the complaint'" and must "'draw all reasonable inferences [from those facts] in favor of the plaintiff.'" E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011) (citations omitted); see Semenova v. Maryland Transit Admin., 845 F.3d 564, 567 (4th Cir. 2017); Belmora LLC v. Bayer Consumer Care AG, 819 F.3d 697, 705 (4th Cir. 2016); Houck v. Substitute Tr. Servs., Inc., 791 F.3d 473, 484 (4th Cir. 2015); Kendall v. Balcerzak, 650 F.3d 515, 522 (4th Cir. 2011), cert. denied, 565 U.S. 943 (2011). But, a court is not required to accept legal conclusions drawn from the facts. See Papasan v. Allain, 478 U.S.265, 286 (1986). "A court decides whether [the pleading] standard is met by separating the legal conclusions from the factual allegations, assuming the truth of only the factual allegations, and then determining whether those allegations allow the court to reasonably infer" that the plaintiff is entitled to the legal remedy sought. A Society Without a Name v. Virginia, 655 F.3d 342, 346 (4th. Cir. 2011), cert. denied, ___ U.S. ___, 132 S. Ct. 1960 (2012).

In general, courts do not "resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses" through a Rule 12(b)(6) motion. Edwards v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999). The purpose of the rule is to ensure that defendants are "given adequate notice of the nature of a claim" made against them. Twombly, 550 U.S. at 555-56 (2007). But, "in the relatively rare circumstances where facts sufficient to rule on an affirmative defense are alleged in the complaint, the defense may be reached by a motion to dismiss filed under Rule 12(b)(6)." Goodman v. Praxair, Inc., 494 F.3d 458, 464 (4th Cir. 2007) (en banc); accord Pressley v. Tupperware Long Term Disability Plan, 533 F.3d 334, 336 (4th Cir. 2009); see also U.S. ex rel. Oberg v. Penn. Higher Educ. Assistance Agency, 745 F.3d 131, 148 (4th Cir. 2014). However, because Rule 12(b)(6) "is intended [only] to test the legal adequacy of the complaint," Richmond, Fredericksburg & Potomac R.R. Co. v. Forst, 4 F.3d 244, 250 (4th Cir. 1993), "[t]his principle only applies . . . if all facts necessary to the affirmative defense 'clearly appear[ ] on the face of the complaint.'" Goodman, 494 F.3d at 464 (quoting Forst, 4 F.3d at 250) (emphasis added in Goodman ).

Under limited exceptions, a court may consider documents outside the complaint, without converting the motion to dismiss to one for summary judgment. Goldfarb v. Mayor & City Council of Baltimore, 791 F.3d 500, 508 (4th Cir. 2015). In particular, a court may properly consider documents that are "explicitly incorporated into the complaint by reference and thoseattached to the complaint as exhibits . . . ." Goines, 822 F.3d at 166 (citations omitted); see U.S. ex rel. Oberg, 745 F.3d at 136 (quoting Philips v. Pitt Cty Memorial Hosp., 572 F.3d 176, 180 (4th Cir. 2009)); Anand v. Ocwen Loan Servicing, LLC, 754 F.3d 195, 198 (4th Cir. 2014); Am. Chiropractic Ass'n v. Trigon Healthcare, Inc., 367 F.3d 212, 234 (4th Cir. 2004), cert. denied, 543 U.S. 979 (2004); Phillips v. LCI Int'l Inc., 190 F.3d 609, 618 (4th Cir. 1999).

However, "before treating the contents of an attached or incorporated document as true, the district court should consider the nature of the document and why the plaintiff attached it." Goines, 822 F.3d at 167 (citing N. Ind. Gun & Outdoor Shows, Inc. v. City of S. Bend, 163 F.3d 449, 455 (7th Cir. 1998)). "When the plaintiff attaches or incorporates a document upon which his claim is based, or when the complaint otherwise shows that the plaintiff has adopted the contents of the document, crediting the document over conflicting allegations in the complaint is proper." Goines, 822 F.3d at 167. Conversely, "where the plaintiff attaches or incorporates a document for purposes other than the truthfulness of the document, it is inappropriate to treat the contents of that document as true." Id.

III. Discussion

In the Motion, Chase argues that each count of the Second Amended Complaint fails to state a claim upon which relief can be granted. I review each, in turn.

A. Count I - EFAA

In Count I of the Second Amended Complaint, the Vancos assert that Chase violated the EFAA by sending "wrong, illegal, incomplete and erroneous information and/or communications to BOA which caused BOA to freeze the Plaintiffs' accounts." ECF...