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Everette v. Mitchem

United States District Court, D. Maryland

November 20, 2015


          For Alicia Everette, Plaintiff: E David Hoskins, LEAD ATTORNEY, The Law Offices of E David Hoskins LLC, Baltimore, MD; Steven B. Isbister, The Law Offices of E. David Hoskins, LLC, Baltimore, MD.

         For Joshua Mitchem, Jeremy D. Shaffer, Defendants: David Bryan Applefeld, LEAD ATTORNEY, Adelberg Rudow Dorf and Hendler LLC, Baltimore, MD; Paul Croker, PRO HAC VICE, Armstrong Teasdale LLP, Kansas City, MO.

         For Scott A. Tucker, Defendant: Paula M Junghans, LEAD ATTORNEY, Zuckerman Spaeder LLP, Washington, DC.

         For Mobiloans, LLC, Defendant: Catherine F Munson, Charles W Galbraith, PRO HAC VICE, Gregory Matthew Jacobs, Kilpatrick Townsend and Stockton LLP, Washington, DC; Mark H Reeves, PRO HAC VICE, Kilpatrick Townsend and Stockton LLP, Augusta, GA.

         For Riverbend Finance, LLC, Defendant: Michael R Sklaire, LEAD ATTORNEY, Thomas John McKee, Jr, Greenberg Traurig LLP, McLean, VA; Robert J Herrington, PRO HAC VICE, Greenberg Traurig LLP, Los Angeles, CA.


         Catherine C. Blake, United States District Judge.

         Alicia Everette seeks to bring a class action lawsuit against Joshua Mitchem; Jeremy Shaffer; Scott Tucker; NDG Financial Corporation; MobiLoans, LLC (" MobiLoans" ); and Riverbend Finance, LLC (" Riverbend" ) on behalf of consumers who received payday loans between May 1, 2012, and May 1, 2015, from the following companies: Action Payday, Bottom Dollar Payday, Ameriloan, United Cash Loans,, MobiLoans, or Riverbend Cash. Everette requests an order certifying this lawsuit as a class action; a judgment against the defendants for violations of various Maryland commercial laws and the Electronic Fund Transfer Act, 15 U.S.C. § 1693; and the costs of litigation and attorney's fees.

         Now pending are MobiLoans' and Riverbend's motions to dismiss for lack of jurisdiction, as well as the plaintiff's motion for discovery. The court will address the remaining motions to dismiss filed by Mitchem, Shaffer, and Tucker in a separate opinion. An order of default was entered against defendant NDG Financial Corporation on August 6, 2015. The issues have been fully briefed, and no hearing is necessary. See Local R. 105.6 (D.Md.2014). For the reasons stated below, Everette's motion for discovery will be denied, and MobiLoans' and Riverbend's motions to dismiss will be granted.


         Everette obtained a loan from MobiLoans, a tribal lending entity wholly owned by the Tunica-Biloxi Tribe of Louisiana, in 2013. (Compl. ¶ ¶ 101, 107, ECF No. 1.) Also in 2013, Everette received two payday loans from Riverbend Cash, which is owned and operated by Riverbend, a tribal lending business owned by the Fort Belknap Indian Community. (Compl. ¶ ¶ 114, 121.) The plaintiff claims that MobiLoans and Riverbend engaged in unlawful consumer lending and collection practices. ( See Compl. ¶ ¶ 27-28, 106-113, 120-128.) MobiLoans and Riverbend filed motions to dismiss for lack of subject matter jurisdiction. Both defendants argue they are " arms of the tribe" entitled to tribal sovereign immunity because tribes created the lending companies under tribal law, tribes have complete ownership and control over the companies, and the companies protect the tribes' sovereignty by funding governmental services for tribal members. In response, the plaintiff argues that Riverbend and MobiLoans are not entitled to tribal sovereign immunity because they are not tribes, traditional government agencies, or casinos, but are instead " mere business[es]" engaging in off-reservation commercial activity; they are limited liability companies, and therefore a judgment against them will not reach the tribes' assets; and granting the defendants sovereign immunity would leave the plaintiff without a judicial remedy. (Pl.'s Opp'n 5-13, ECF No. 40.)


         A motion pursuant to Federal Rule of Civil Procedure 12(b)(1) should be granted " only if the material jurisdictional facts are not in dispute and the moving party is entitled to prevail as a matter of law." Evans v. B.F. Perkins Co., 166 F.3d 642, 647 (4th Cir. 1999); see also United States ex rel. Vuyyuru v. Jadhav, 555 F.3d 337, 347-48 (4th Cir. 2009). The plaintiff bears the burden of proving that subject matter jurisdiction exists. Piney Run Preservation Ass'n v. Cnty. Comm'rs of Carroll Cnty., Md., 523 F.3d 453, 459 (4th Cir. 2008). Moreover, " [w]hen a defendant challenges subject matter jurisdiction via a Rule 12(b)(1) motion to dismiss, the district court may regard the pleadings as mere evidence on the issue and may consider evidence outside the pleadings . . . ." Blitz v. Napolitano, 700 F.3d 733, 736 n.3 (4th Cir. 2012) (quoting Velasco v. Gov't of Indonesia, 370 F.3d 392, 398 (4th Cir. 2004)).

         I. Jurisdictional Discovery

         Both defendant lending companies have provided substantial evidence that they are wholly owned by tribes and were formed under tribal law to raise revenue for the tribes. MobiLoans and Riverbend have filed declarations of tribal members and officers of the companies attesting to the facts stated in this opinion, as well as copies of tribal resolutions that created the companies. Everette has failed to identify any specific facts to support her assertion that tribes do not own, operate, and control MobiLoans and Riverbend. " When a plaintiff offers only speculation or conclusory assertions..., a court is within its discretion in denying jurisdictional discovery." Carefirst of Maryland, Inc. v. Carefirst Pregnancy Centers, Inc., 334 F.3d 390, 402 (4th Cir. 2003); see alsoWhite v. Univ. of California, 765 F.3d 1010, 1025 (9th Cir. 2014) (upholding denial of jurisdictional discovery where the district court concluded that an entity was an " arm of the tribe" and the plaintiff offered " only speculative arguments" that the entity was not entitled to sovereign immunity). Because ...

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