Tommy Arzola v. Synchrony Bank et al

NOTICE OF MOTION AND MOTION to Dismiss Case Or Alternative Motion for More Definite Statement

C.D. Cal.July 5, 2017

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e Raffi Kassabian (SBN 260358) Email: rkassabian@reedsmith.com REED SMITH LLP 355 South Grand Avenue, Suite 2900 Los Angeles, CA 90071-1514 Telephone: +1 213 457 8000 Facsimile: +1 213 457 8080 Attorneys for Defendant Synchrony Bank UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA TOMMY ARZOLA, Plaintiff, vs. SYNCHRONY BANK and PORTFOLIO RECOVERY ASSOCIATES, Defendants. Case No.: 5:17-cv-1054-SJO (JPRx) [Removed from Superior Court of California, County of San Bernardino-Fontana District, Small Claims Division, Case No. SMCFS1701565] NOTICE OF MOTION AND MOTION TO DISMISS, OR ALTERNATIVE MOTION FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF Date: August 7, 2017 Time: 10:00 a.m. Courtroom: 10C [Fed. R. Civ. Proc. 12(b)(6)] [Filed concurrently with [Proposed Order] Action Filed: February 22, 2017 Honorable S. James Otero Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 1 of 16 Page ID #:90 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 1 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that on August 7, 2017 at 10:00 a.m. in Courtroom 10C of the above-entitled court located at 350 W. 1st Street, Los Angeles, CA 90012, Defendant Synchrony Bank (“Synchrony”) will move the Court to dismiss the Complaint filed by Plaintiff Tommy Arzola (“Plaintiff”) pursuant to Federal Rules of Civil Procedure 12(b)(6) on the grounds that the Complaint fails to state a claim upon which relief can be granted. At a minimum, Synchrony requests that Plaintiff be ordered to provide further factual detail regarding the basis for his claim asserted against Synchrony, pursuant to Federal Rules of Civil Procedure 12(e). The motion will be based on this Notice of Motion, the Memorandum of Points and Authorities filed herewith, and the pleadings and papers filed herein. This motion is made following Synchrony’s counsel’s attempt to hold a conference pursuant to L.R. 7-3. After Synchrony’s counsel was unable to reach Plaintiff by phone, on June 26, 2017, Synchrony’s counsel overnight mailed to Plaintiff a letter outlining the arguments it intends to raise on a motion to dismiss. To date, Synchrony has not received a response from the Plaintiff. DATED: July 5, 2017 REED SMITH LLP /s/ Raffi Kassabian Raffi Kassabian Attorney for Defendant Synchrony Bank Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 2 of 16 Page ID #:91 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - i - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e TABLE OF CONTENTS Page I. Introduction .......................................................................................................... 1 II. Factual Allegations ............................................................................................... 1 III. Standard of Review .............................................................................................. 1 IV. Argument .............................................................................................................. 3 A. Plaintiff’s FCRA Claim Fails As a Matter of Law Because it Is Legally Insufficient .................................................................................... 3 1. Plaintiff Has No Private Right of Action under 15 U.S.C. § 1681s-2(a) ........................................................................................ 3 2. Plaintiff’s Claim under 15 U.S.C. § 1681s-2(b) Is Insufficiently Pled ............................................................................ 4 B. Plaintiff’s CCRAA Claim Fails As a Matter of Law ................................. 6 1. Plaintiff’s CCRAA Claim Is Preempted by the FCRA ................... 6 2. Plaintiff’s CCRAA Claim Under Section 1785.25(a) Is Insufficiently Pled ............................................................................ 8 C. In The Event That The Court Denies The Motion To Dismiss Plaintiff’s Complaint In Its Entirety, Synchrony Alternatively Moves For A More Definite Statement Regarding Plaintiff’s Claims Pursuant To Rule 12(e) .................................................................. 8 V. CONCLUSION .................................................................................................. 10 Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 3 of 16 Page ID #:92 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - ii - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e TABLE OF AUTHORITIES Page(s) Cases Advanced Cardiovascular Sys., Inc. v. Scimed Life Sys., Inc., 988 F.2d 1157 (Fed. Cir. 1993) ................................................................................. 2 Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009) ............................................................................................... 2 Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876 (9th Cir. 2010) ..................................................................................... 5 Cellars v. Pacific Coast Packaging, Inc., 189 F.R.D. 575 (N.D. Cal. 1999) .............................................................................. 7 Clegg v. Cult Awareness Network, 18 F.3d 752 (9th Cir. 1994) ....................................................................................... 2 Davis v. Maryland Bank, N.A., No. 00-04191, 2002 WL 32713429 (N.D. Cal. June 19, 2002) ............................... 5 Dumas v. Kipp, 90 F.3d 386 (9th Cir. 1996) ....................................................................................... 2 Famolare, Inc. v. Edison Bros. Stores, Inc., 525 F. Supp. 940 (E.D. Cal. 1981) ............................................................................ 7 Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147 (9th Cir. 2009) ................................................................................... 3 Ileto v. Glock Inc., 349 F.3d 1191 (9th Cir. 2003) ................................................................................... 2 Lovejoy v. Bank of America, N.A., No. C 13-1638 DMR, 2013 WL 3360898 (N.D. Cal. July 3, 2013) ........................ 6 McGlinchy v. Shell Chem. Co., 845 F.2d 802 (9th Cir. 1988) ..................................................................................... 2 Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 4 of 16 Page ID #:93 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - iii - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e McHenry v. Renne, 84 F.3d 1172 (9th Cir. 1996) ..................................................................................... 7 Navarro v. Block, 250 F.3d 729 (9th Cir. 2001) ..................................................................................... 1 Neitzke v. Williams, 490 U.S. 319 (1989)................................................................................................... 1 Nelson v. Equifax Information Servs., LLC, 522 F. Supp. 2d 1222 (C.D. Cal. 2007) ................................................................. 3, 4 Prosser v. Navient Solutions, Inc., No. 15-cv-01036-SC, 2015 WL 5168635 (N.D. Cal. Sept. 03, 2015) .................... 5 Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530 (9th Cir. 1984) ..................................................................................... 1 Sagan v. Apple Computer, Inc., 874 F. Supp. 1072 (C.D. Cal. 1994) .......................................................................... 6 Self Directed Placement Corp. v. Control Data Corp., 908 F.2d 462 (9th Cir. 1990) ..................................................................................... 7 Stafford v. Cross Country Bank, 262 F. Supp. 2d 776 (W.D. Ky. 2003) ...................................................................... 5 Wang v. Asset Acceptance, LLC, No. C 09-4797 SI, 2010 WL 4321565 (N.D. Cal. Nov. 1, 2010) ............................. 6 Young v. Gannon, 97 Cal. App. 4th 209 (2002) ...................................................................................... 6 Statutes 15 U.S.C. § 1681s-2 ................................................................................................ 2, 3, 5 15 U.S.C. § 1681s-2(7)(A)(i) .......................................................................................... 5 15 U.S.C. § 1681s-2(a) ............................................................................................... 2, 3 15 U.S.C. § 1681s-2(a)(1)(A) ......................................................................................... 5 Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 5 of 16 Page ID #:94 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - iv - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e 15 U.S.C. § 1681s-2(a)(3) ............................................................................................... 3 15 U.S.C. § 1681s-2(b) ........................................................................................... 2, 3, 4 15 U.S.C. § 1681s-2(c)(1) ............................................................................................... 3 15 U.S.C. § 1681t(b)(1)(F) ............................................................................................. 5 Cal. Civ. Code § 1785 ..................................................................................................... 4 Cal. Civ. Code § 1785.25(a) ........................................................................................... 6 Cal. Civ. Code § 1785.25(b) ....................................................................................... 5, 6 Cal. Civ. Code § 1785.25(c) ....................................................................................... 5, 6 Rules Fed. R. Civ. P. 8 .............................................................................................................. 7 Fed. R. Civ. P. 12(b)(6) .................................................................................................. 1 Fed. R. Civ. P. 12(e) ................................................................................................... 6, 7 Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 6 of 16 Page ID #:95 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 1 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION In his scant Small Claims Complaint, Tommy Arzola (“Plaintiff”) alleges that Defendant Synchrony Bank is reporting the same debt to credit reporting agencies as co-Defendant Portfolio Recovery Associates. 1 This, he concludes, constitutes a violation of the Fair Credit Reporting Act (“FCRA”) and a violation of the California Consumer Credit Reporting Agencies Act (“CCRAA”). However, Plaintiff’s claims are fatally flawed because they both lack sufficient factual averments to support either cause of action - particularly since Plaintiff fails to allege that he filed a dispute with any credit reporting agency. As such, the Complaint should be dismissed in its entirety with prejudice, or Plaintiff ordered to file more definite statement regarding his claims against Synchrony. II. FACTUAL ALLEGATIONS Plaintiff’s Complaint is a one-page form in which he alleges: “[t]wo different companies reporting the same debt on credit. This is not accurate. Violates state law, CA Civ 1785. The Debt Buyer violates the same law for an additional reason.” See ECF No. 1, Ex. A, Complaint, ¶ 3 (“Compl”). No further factual or contextual allegations are made. III. STANDARD OF REVIEW 1 This Motion to Dismiss or Motion for More Definite Statement is filed on behalf of Synchrony Bank only. Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 7 of 16 Page ID #:96 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 2 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e A motion to dismiss under Federal Rules of Civil Procedure 12(b)(6) tests the sufficiency of the complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). Dismissal is warranted under Rule 12(b)(6) where the complaint lacks a cognizable legal theory, or where it presents a cognizable legal theory yet fails to plead essential facts to support that theory. Neitzke v. Williams, 490 U.S. 319, 326 (1989); Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 533-34 (9th Cir. 1984). The purpose of a Rule 12(b)(6) motion to dismiss is “to allow the court to eliminate actions that are fatally flawed in their legal premises and destined to fail, and thus spare litigants the burdens of unnecessary pretrial and trial activity.” Advanced Cardiovascular Sys., Inc. v. Scimed Life Sys., Inc., 988 F.2d 1157, 1160 (Fed. Cir. 1993). While all material allegations must be taken as true, “conclusory allegations without more are insufficient to defeat a motion to dismiss for failure to state a claim.” McGlinchy v. Shell Chem. Co., 845 F.2d 802, 810 (9th Cir. 1988); Ileto v. Glock Inc., 349 F.3d 1191, 1200 (9th Cir. 2003). Indeed, the Supreme Court has confirmed the requirement that pleadings must contain more than labels and unsupported conclusions, and emphasized that conclusory allegations are not entitled to be assumed true. See Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949-52 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A court is not required to “accept legal conclusions cast in the form of factual allegations if those conclusions cannot reasonably be drawn from the facts alleged.” Clegg v. Cult Awareness Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 8 of 16 Page ID #:97 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 3 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e Network, 18 F.3d 752, 754-55 (9th Cir. 1994). When it would be futile to amend the complaint’s deficiencies, dismissal may be ordered with prejudice. Dumas v. Kipp, 90 F.3d 386, 393 (9th Cir. 1996). IV. ARGUMENT A. Plaintiff’s FCRA Claim Fails As a Matter of Law Because it Is Legally Insufficient Plaintiff alleges that Synchrony violated the FCRA by providing inaccurate information concerning his debt. Compl., ¶3. This claim fails because Plaintiff, as a private party, has no cause of action under 15 U.S.C. § 1681s-2(a), and any claim under 15 U.S.C. § 1681s-2(b) is insufficiently pled. 1. Plaintiff Has No Private Right of Action under 15 U.S.C. § 1681s-2(a) The FCRA imposes obligations on persons or entities, such as creditors, who furnish information to credit reporting agencies and divides those obligations into two components. See 15 U.S.C. § 1681s-2. Section 1681s-2(a) requires a furnisher of information to, among other things, report “accurate information” to the credit reporting agencies, correct and update information, and provide notice to a credit reporting agency that the consumer disputes reported information. Under subsection (b) of Section 1681s-2, a furnisher must conduct an investigation in response to a notice of dispute from a credit reporting agency. Although furnishers of information have obligations under both subsections, only subsection (b) contains a private right of action. See Gorman v. Wolpoff & Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 9 of 16 Page ID #:98 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 4 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e Abramson, LLP, 584 F.3d 1147, 1162 (9th Cir. 2009) (holding that plaintiff had no private right of action under 15 U.S.C. § 1681s-2(a)(3) to proceed against reporting entity for its failure to notify credit reporting agencies that he disputed charges); Nelson v. Equifax Information Servs., LLC, 522 F. Supp. 2d 1222, 1230 (C.D. Cal. 2007) (“Nelson’s FCRA Section 1682s-2(a) claim is barred because there is no private right of action for violations of that section of the statute.”); 15 U.S.C. § 1681s-2(c)(1) (“Except [for circumstances not relevant here], sections 1681n and 1681o of this title do not apply to any violation of ... subsection (a) of this section, including any regulations issued thereunder.”). Therefore, Plaintiff cannot state a claim under 15 U.S.C. § 1681s-2(a). 2. Plaintiff’s Claim under 15 U.S.C. § 1681s-2(b) Is Insufficiently Pled To the extent that Plaintiff’s Complaint is construed as attempting to assert a claim under Section 1681s-2(b), that claim is also legally insufficient. 15 U.S.C. § 1681s-2(b) provides: After receiving notice pursuant to section 1681i(a)(2) of this title of a dispute with regard to the completeness or accuracy of any information provided by a person to a consumer reporting agency, the person shall-- (A) conduct an investigation with respect to the disputed information; (B) review all relevant information provided by the consumer reporting agency pursuant to section 1681i(a)(2) of this title; (C) report the results of the investigation to the consumer reporting agency; (D) if the investigation finds that the information is incomplete or inaccurate, report those results to all other consumer reporting agencies to which the person furnished the information and that compile and maintain files on consumers on a nationwide basis; and Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 10 of 16 Page ID #:99 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 5 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e (E) if an item of information disputed by a consumer is found to be inaccurate or incomplete or cannot be verified after any reinvestigation under paragraph (1), for purposes of reporting to a consumer reporting agency only, as appropriate, based on the results of the reinvestigation promptly-- (i) modify that item of information; (ii) delete that item of information; or (iii) permanently block the reporting of that item of information. 15 U.S.C. § 1681s-2(b). Notably, the obligations imposed on a furnisher of information under Section 1681s-2(b) are triggered only “[a]fter receiving notice pursuant to section 1681i(a)(2) of this title.” 15 U.S.C. § 1681s-2(b); see Nelson, 522 F. Supp. 2d at 1231 (“[t]he Ninth Circuit has specifically held that the furnisher’s Section 1681s-2(b) duty to investigate is triggered only after the consumer notifies the CRA, and the CRA then notifies the furnisher of credit.”) (citing Nelson v. Chase Manhattan Mortg. Corp., 282 F.3d 1057, 1060 (9th Cir. 2002)). In the present case, Plaintiff alleges only that Synchrony has reported inaccurate information. Compl., ¶ 3. He does not allege that he ever notified a credit reporting agency of a dispute, that any credit reporting agency sent Synchrony a notice of a dispute, or that Synchrony failed to take the actions specified in section 1681s-2(b). Unless and until Plaintiff alleges that he took the affirmative steps clearly outlined in the FCRA, Synchrony had no obligations under 15 U.S.C. § 1681s-2(b) and, therefore, cannot be liable for a violation of that provision as a matter of law. Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 11 of 16 Page ID #:100 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 6 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e Accordingly, Plaintiff’s FCRA claim fails as a matter of law and should be dismissed with prejudice. B. Plaintiff’s CCRAA Claim Fails As a Matter of Law Next, Plaintiff appears to claim that Synchrony violated the CCRAA, Section 1785 by reporting inaccurate information. Compl., ¶ 3. As with Plaintiff’s FCRA claim, this claim also fails as a matter of law. 1. Plaintiff’s CCRAA Claim Is Preempted by the FCRA To the extent that Plaintiff claims a violation of California Civil Code § 1785.25(b) and (c), the claim fails as a matter of law because the FCRA expressly prohibits a private cause of action under any section of the CCRAA “relating to the responsibilities of persons who furnish information to consumer credit reporting agencies.” 15 U.S.C. § 1681t(b)(1)(F); see Davis v. Maryland Bank, N.A., No. 00- 04191, 2002 WL 32713429, at *11 (N.D. Cal. June 19, 2002) (stating that “Section 1681t of the FCRA governs the preemptive scope of the FCRA”); Stafford v. Cross Country Bank, 262 F. Supp. 2d 776, 785-89 (W.D. Ky. 2003) (stating that section 1681t(b)(1)(F) “provides furnishers absolute immunity when fulfilling their obligations under § 1681s-2”). The only exception to the FCRA’s general preemption provision relates to a claim brought under “section 1785.25(a) of the California Civil Code . . .” Id.; Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 888-89 (9th Cir. 2010) (“Because section 1785.25(a) is the only substantive CCRAA furnisher Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 12 of 16 Page ID #:101 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 7 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e provision specifically saved by the FCRA, Carvalho’s section 1785.25(f) claim is preempted.”). Here, to the extent Plaintiff is attempting to claim a violation of California Civil Code sections 1785.25(b) and (c), those claims are preempted because they are premised on conduct that is expressly regulated by Section 1681s-2 of the FCRA. See generally Compl. In particular, Section 1681s-2 of the FCRA, which addresses the responsibilities of furnishers of credit information, prohibits credit furnishers from furnishing “any information relating to a consumer to any consumer reporting agency if the person knows or has reasonable cause to believe that the information is inaccurate” (see 15 U.S.C. § 1681s-2(a)(1)(A)) and also states that a financial institution that furnishes negative credit information to a consumer reporting agency “shall provide notice of such furnishing of negative information in writing, to the customer.” 15 U.S.C. § 1681s-2(7)(A)(i); see Prosser v. Navient Solutions, Inc., No. 15-cv-01036-SC, 2015 WL 5168635, at *6 (N.D. Cal. Sept. 03, 2015) (“Insofar as the Plaintiff makes claims under 1785.25(b) and (c), SCA ¶ 42, those claims are preempted.”); Lovejoy v. Bank of America, N.A., No. C 13-1638 DMR, 2013 WL 3360898, at *6 (N.D. Cal. July 3, 2013) (holding that Section 1785.25(c) is preempted by the FCRA); Wang v. Asset Acceptance, LLC, No. C 09-4797 SI, 2010 WL 4321565, at *2 (N.D. Cal. Nov. 1, 2010) (same). To the extent Plaintiff’s claims are Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 13 of 16 Page ID #:102 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 8 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e construed as arising under Section 1785.25(b) and (c), they are preempted by the FCRA and, therefore, fail as a matter of law. 2. Plaintiff’s CCRAA Claim Under Section 1785.25(a) Is Insufficiently Pled To the extent that Plaintiff’s Complaint can be read as asserting a claim for a violation of California Civil Code § 1785.25(a), that claim is legally insufficient. Specifically, any claim under Section 1785.25(a) fails because there are no specific allegations as to how any alleged credit report was incomplete or inaccurate. Plaintiff alleges that Synchrony reported the same debt on credit as the Co-Defendant. Compl., ¶ 3. Plaintiff fails to allege sufficient facts showing how that information is inaccurate. Plaintiff also fails to allege any specific facts showing that Synchrony knew or should have known any information was inaccurate. In the absence of such allegations, Plaintiff’s vague and conclusory statements that Synchrony reported inaccurate information on his account are insufficient to state a cause of action under Section 1785.25(a). See Young v. Gannon, 97 Cal. App. 4th 209, 220 (2002) (holding that in determining whether the complaint states facts sufficient to constitute a cause of action, the trial court . . . may not consider contentions, deductions, or conclusions of fact or law”). C. In The Event That The Court Denies The Motion To Dismiss Plaintiff’s Complaint In Its Entirety, Synchrony Alternatively Moves For A More Definite Statement Regarding Plaintiff’s Claims Pursuant To Rule 12(e) Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 14 of 16 Page ID #:103 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 9 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e A motion for more definite statement, pursuant to Rule 12(e) of the Federal Rules of Civil Procedure, is proper when a complaint is so indefinite that the defendant cannot ascertain the nature of the claim being asserted. See Sagan v. Apple Computer, Inc., 874 F. Supp. 1072, 1077 (C.D. Cal. 1994). At a minimum, a complaint must provide sufficient detail to provide the defendant and the court a fair idea of the legal grounds for recovery. Self Directed Placement Corp. v. Control Data Corp., 908 F.2d 462, 466 (9th Cir. 1990); McHenry v. Renne, 84 F.3d 1172, 1179-80 (9th Cir. 1996) (litigants and court must be able to determine who is being sued and for what). Furthermore, a motion for a more definite statement under Rule 12(e) is appropriate where the complaint is so indefinite that defendant cannot reasonably fashion an appropriate response to it. Fed. R. Civ. Proc. 12(e), Cellars v. Pacific Coast Packaging, Inc., 189 F.R.D. 575, 578 (N.D. Cal. 1999); Famolare, Inc. v. Edison Bros. Stores, Inc., 525 F. Supp. 940, 949 (E.D. Cal. 1981). Even though the Federal Rules favor brevity in pleadings, the “short and plain statement of the claim” required by Rule 8 mandates enough particularity so that defendants can ascertain and respond to claims against them. As set forth more fully above, Plaintiff’s Complaint is devoid of factual allegations with the exception of a single sentence alleging a violation of the FCRA by Synchrony. As a result, Synchrony is left only to speculate as to the bases for Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 15 of 16 Page ID #:104 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 10 - SYNCHRONY BANK’S NOTICE OF MOTION AND MOTION TO DISMISS OR FOR MORE DEFINITE STATEMENT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e Plaintiff’s claims against it without even basic information indicating the nature of its alleged wrongdoing. In the event that the Court denies Synchrony’s 12(b)(6) motion, Synchrony requests that the Court require Plaintiff to provide a more definite statement pursuant to Rule 12(e) so that it can properly respond to Plaintiff’s claims. V. CONCLUSION It is clear from the scant allegations of the Complaint that Plaintiff does not have any viable claim against Synchrony. For all the reasons discussed above, Synchrony respectfully requests that the Court grant its Motion to Dismiss and dismiss the Complaint in its entirety with prejudice. In the alternative, Synchrony respectfully requests that the Court enter an order pursuant to Rule 12(e) that: (1) requires Plaintiff to file a complaint that conforms with the requirements set forth in the Federal Rules of Civil Procedure; (2) dismisses the present lawsuit with prejudice should Plaintiff fail to file a complaint in the time allotted by the Court; and (3) grants to Synchrony such other relief as the Court may deem appropriate. DATED: July 5, 2017 REED SMITH LLP /s/ Raffi Kassabian Raffi Kassabian Attorney for Defendant Synchrony Bank Case 5:17-cv-01054-SJO-JPR Document 11 Filed 07/05/17 Page 16 of 16 Page ID #:105 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 [PROPOSED] ORDER R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e Raffi Kassabian (SBN 260358) Email: rkassabian@reedsmith.com REED SMITH LLP 355 South Grand Avenue, Suite 2900 Los Angeles, CA 90071-1514 Telephone: +1 213 457 8000 Facsimile: +1 213 457 8080 Attorneys for Defendant Synchrony Bank UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA TOMMY ARZOLA, Plaintiff, vs. SYNCHRONY BANK and PORTFOLIO RECOVERY ASSOCIATES, Defendants. Case No.: 5:17-cv-1054-SJO (JPRx) [Removed from Superior Court of California, County of San Bernardino-Fontana District, Small Claims Division, Case No. SMCFS1701565] [PROPOSED] ORDER GRANTING SYNCHRONY BANK’S MOTION TO DISMISS PLAINTIFF’S COMPLAINT, OR MOTION FOR MORE DEFINITE STATEMENT Action Filed: February 22, 2017 Case 5:17-cv-01054-SJO-JPR Document 11-1 Filed 07/05/17 Page 1 of 2 Page ID #:106 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 1 - [PROPOSED] ORDER R E E D S M IT H L L P A l im it ed l ia b il it y p ar tn er sh ip f o rm ed i n t h e S ta te o f D el aw ar e [PROPOSED] ORDER Defendant Synchrony Bank’s Motion to Dismiss the Complaint of Plaintiff Tommy Arzola (“Plaintiff”), or Motion for More Definite Statement (the “Motion”) came for hearing on August 7, 2017 at 10:00 a.m. in Courtroom 10C of the above- entitled Court located at 350 W. 1 st Street, Los Angeles, CA 90012. Having considered Synchrony Bank’s Motion to Dismiss, or Motion for More Definite Statement and supporting arguments and GOOD CAUSE APPEARING, the Court hereby orders as follows: Synchrony Bank’s Motion to Dismiss the Complaint of Plaintiff is GRANTED WITHOUT LEAVE TO AMEND. As a matter of law, the Complaint fails to set forth facts sufficient to state a valid cause of action against Synchrony Bank. Plaintiff’s Complaint is DISMISSED WITH PREJUDICE. Plaintiff shall take nothing by way of his claims against Synchrony Bank and Synchrony Bank is entitled to recover its costs of suit. [In the alternative, Synchrony’s Bank’s Motion for More Definite Statement is GRANTED. Plaintiff is ordered to file a complaint that conforms with the requirements set forth in the Federal Rules of Civil Procedure within thirty (30) days of this order. Should Plaintiff fail to file a complaint in the time allotted by the Court, Plaintiff’s complaint will be dismissed with prejudice.] IT IS SO ORDERED. DATED: _______________. _____________________________ Honorable S. James Otero Case 5:17-cv-01054-SJO-JPR Document 11-1 Filed 07/05/17 Page 2 of 2 Page ID #:107 Case 5:17-cv-01054-SJO-JPR Document 11-2 Filed 07/05/17 Page 1 of 1 Page ID #:108