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Deitemyer v. Ryback

United States District Court, D. Maryland

August 6, 2019

ALEXANDRA DEITEMYER Plaintiff
v.
STEVEN RYBACK, ESQ., et al. Defendants.

          MEMORANDUM OPINION

          ELLEN L. HOLLANDER UNITED STATES DISTRICT JUDGE

         This case arises under of the Fair Debt Collection Practices Act (“FDCPA”), as amended, 15 U.S.C. § 1692 et seq. See ECF 1-3 (the “Complaint”). Plaintiff Alexandra Deitemyer, who is self-represented, sued defendants Steven Ryback, Esq.; Jonathan W. Bierer, Esq.; Bierer Law Group, P.A. (“BLG”) (collectively, the “Attorney Defendants”); Transworld Systems, Inc. (“Transworld” or “TSI”), and 10 unnamed defendants, alleging multiple violations of the FDCPA. According to plaintiff, the Attorney Defendants violated 15 U.S.C. § 1692c(b) by communicating with third parties about the debt, without plaintiffs consent, ECF 1-3, ¶¶ 34-35, 38-42; they violated § 1692i(b), by bringing an unauthorized legal action against her, id. ¶ 35; the Attorney Defendants violated § 1692e by misrepresenting the identity of plaintiff s “creditor”, id. ¶¶ 36, 51; and they violated § 1692g(a) by failing to provide plaintiff with a validation notice within five days of their first communication. Id. ¶¶ 37, 51. Plaintiff also alleges that TSI is vicariously liable for the conduct of the Attorney Defendants. Id. ¶¶ 48, 51.

         The Attorney Defendants filed a “Motion To Dismiss, Or In The Alternative, Motion For Summary Judgment” (ECF 4), supported by a memorandum of law (ECF 4-2) (collectively, the “Motion”) and several exhibits. See ECF 4-3 to ECF 4-10. Transworld joined the Motion. ECF 6. Deitemyer opposes the Motion. ECF 8 (the “Opposition”). The Attorney Defendants have replied. ECF 9 (the “Reply”).

         The Motion is fully briefed and no hearing is needed to resolve it. See Local Rule 105.6. For the reasons that follow, I shall grant the Motion in part and deny it in part. In particular, I shall grant the Motion as to plaintiff's claims under 15 U.S.C. § 1692c(b) and § 1692i(b), and deny the Motion as to plaintiff's claims under 15 U.S.C. § 1692e and § 1692g(a).

         I. Factual Background [1]

         BLG is a professional association that maintains its principal office in Baltimore, Maryland. ECF 1-3, ¶ 5. Bierer, an attorney licensed in Maryland, is lead counsel for BLG. Id. ¶ 6. Ryback is also an attorney licensed in Maryland, and he is an associate attorney for BLG. Id. ¶ 7. Plaintiff alleges that Bierer and Ryback are “debt collectors” under § 1692a(6). Id. ¶¶ 6-7. The Attorney Defendants are counsel for TSI, a corporation formed under the laws of California, with its principal office in Santa Rosa, California. Id. ¶¶ 8, 32. Accordingly, plaintiff asserts that Transworld is vicariously liable for the conduct of the Attorney Defendants. Id. ¶¶ 48, 54.

         On August 24, 2005, Deitemyer executed a promissory note (the “Note”) and credit agreement in the principal amount of $16, 042.78 in connection with a student loan made to her by JP Morgan Chase Bank, N.A. (“JP Morgan”). Id. ¶ 11.[2] Deitemyer alleges that an anonymous investor (the “Investor”) invested in the Note, “became creditor, ” and appointed Transworld to service the Note. Id. ¶ 15.

         In turn, JP Morgan allegedly “lodged” the Note in an irrevocable trust (“Intermediate Trust”) for the benefit of the Investor. Id. ¶ 16. JP Morgan, “the investor, the custodian/services, and TSI, were privies to the Intermediate Trust having duties as trustees, co-trustees, their servicers or partners.” Id. According to Deitemyer, if she defaulted on the Note, the Intermediate Trust would transfer the Note to a Delaware statutory trust called National Collegiate Student Loan Trust 2005-3 (“NCSLT”). Id. ¶¶ 13, 16. NCSLT “would then receive transfer and assignment of the defaulted debt solely to facilitate collection for the investor.” Id. ¶ 16. Plaintiff claims that the use of the Intermediate Trust provided JP Morgan and NCSLT with the benefits of “tax avoidance, bankruptcy remoteness, protection from creditors, and privacy[.]” Id.

         Deitemyer defaulted on the Note on December 3, 2012. Id. ¶ 36. She alleges that the Note was not “deposited into the NCSLT 2005-3 by any express Deposit and Sale Agreement or Pool Supplement (whether describing either past or future events), by any signature pages by the NCSLT 2005-3, or reflected in any documents uploaded to the SEC website, or any loan schedules, if any.” Id. ¶ 14. Yet, by unspecified means, the Intermediate Trust transferred the Note to NCSLT on February 6, 2017. Id. ¶ 17. The right to collect on the debt for NCSLT was transferred to Transworld. Id.

         On April 6, 2017, the Attorney Defendants, on behalf of their client, NCSLT, filed suit against Deitemyer in the District Court of Maryland for Montgomery County, alleging that she defaulted on her student loan obligations in the amount of $22, 220.94. Id. ¶ 35; see National Collegiate Student Loan Trust 2005-3 v. Alexandra Marino, No. D-111-CV-18-000575 (Apr. 6, 2017); see also ECF 4-9 (Docket for No. D-111-CV-18-000575).

         Plaintiff contends that on November 21, 2017, the Attorney Defendants sent her a “first communication, ” in which Dudley Turner, a Transworld employee, stated that “the debt balance of $22, 220.94 [on the Note] was ‘charged off'” on December 3, 2012. ECF 1-3, 36. Plaintiff claims that Turner falsely “purports to list, as proof of the NCSLT 2005-3's ownership of the debt, successive owners and intermediate transfers of the Note, ” while failing to “mention the transfer [of the debt] to the Intermediate Trust nor . . . whether he or TSI has information related to the debt that was not included” in his statement. Id. Further, Deitemyer alleges that after this initial communication, defendants did not provide her with a written notice regarding the debt, as required by the FDCPA. Id. ¶ 37.

         On January 11, 2018, the Attorney Defendants moved to transfer their suit to the District Court of Maryland for Frederick County. Id. ¶ 38. In so doing, they allegedly conveyed information regarding plaintiff's debt. Id.

         Then, on February 20, 2018, Deitemyer sent the Attorney Defendants a letter stating that “the NCSLT 2005-3 is not her creditor under § 1692a(4) and that their pleadings and their contents are susceptible to [suit under 15 U.S.C.] §§ 1692c and 1692e.” Id. ¶ 39; see also ECF 4-6 (Deitemyer's notice to BLG). With the letter, she also enclosed an invoice dated February 19, 2018, for $137, 426.16 in damages. See ECF 4-6 at 4.

         On February 21, 2018, the Attorney Defendants mailed Deitemyer a copy of their “Motion to Set on Affidavit Trial Docket.” ECF 1-3, ¶ 40. In response, on March 1, 2018, Deitemyer filed a “Notice of Intention to Defend.” Id.; see ECF 4-9. On April 20, 2018, the Attorney Defendants moved for sanctions and entry of a default judgment against plaintiff regarding her debt. ECF 1-3, ¶ 41. The underlying litigation proceeded to trial in State court on June 11, 2018. Id. at 2, 5. However, plaintiff failed to appear, and judgment was entered in favor of NCSLT, in the amount of $22, 477.16. Id.; ECF 4-9 at 2.

         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). In re Birmingham, 846 F.3d 88, 92 (4th Cir. 2017); 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, 569 U.S. 221 (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 facts alleged by a plaintiff 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). That rule 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; see Ashcroft v. Iqbal, 556 U.S. 662, 684 (2009) (citation omitted) (“Our decision in Twombly expounded the pleading standard for ‘all civil actions' . . . .”); see also Paradise Wire & Cable Defined Benefit Pension Plan v. Weil, 2019 WL 1105179, at *3 (4th Cir. Mar. 11, 2019); Willner v. Dimon, 849 F.3d 93, 112 (4th Cir. 2017). To be sure, 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, Miss., 574 U.S. 10, ____, 135 S.Ct. 346, 346 (2014) (per curiam). But, mere “‘naked assertions' of wrongdoing” are generally insufficient to state a claim for relief. Francis v. Giacomelli, 588 F.3d 186, 193 (4th Cir. 2009) (citation omitted).

         In other words, 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. “[A]n unadorned, the-defendant-unlawfully-harmed-me accusation” does not state a plausible claim of relief. Iqbal, 556 U.S. at 678. 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 quotation marks 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. MTA, 845 F.3d 564, 567 (4th Cir. 2017); 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); Glassman v. Arlington Cty., 628 F.3d 140, 146 (4th Cir. 2010). “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, 566 U.S. 937 (2012).

         Courts ordinarily 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, 178 F.3d at 243 (quoting Republican Party v. Martin, 980 F.2d 943, 952 (4th Cir. 1992)). However, “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, 553 F.3d 334, 336 (4th Cir. 2009). 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).

         “Generally, when a defendant moves to dismiss a complaint under Rule 12(b)(6), courts are limited to considering the sufficiency of allegations set forth in the complaint and the ‘documents attached or incorporated into the complaint.'” Zak v. Chelsea Therapeutics Int'l, Ltd., 780 F.3d 597, 606 (4th Cir. 2015) (quoting E.I. du Pont de Nemours & Co., 637 F.3d at 448). The court “may not consider any documents that are outside of the complaint, or not expressly incorporated therein . . . .” Clatterbuck v. City of Charlottesville, 08 F.3d 549, 557 (4th Cir. 2013); see Bosiger v. U.S. Airways, Inc., 510 F.3d 442, 450 (4th Cir. 2007).

         But, under limited circumstances, when resolving a Rule 12(b)(6) motion, a court may consider documents beyond 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 those attached to the complaint as exhibits.” Goines, 822 F.3d at 166 (citation omitted); see also Six v. Generations Fed. Credit Union, 891 F.3d 508, 512 (4th Cir. 2018); Anand v. Ocwen Loan Servicing, LLC, 754 F.3d 195, 198 (4th Cir. 2014); U.S. ex rel. Oberg v. Pa. Higher Educ. Assistance Agency, 745 F.3d 131, 136 (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)). Of import here, “[w]hen 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.

         A court may also “consider a document submitted by the movant that [is] not attached to or expressly incorporated in a complaint, so long as the document was integral to the complaint and there is no dispute about the document's authenticity.” Goines, 822 F.3d at 166 (citations omitted); see also Woods v. City of Greensboro, 855 F.3d 639, 642 (4th Cir. 2017), cert. Denied, ____ U.S. ____, 138 S.Ct. 558 (2017); Oberg, 745 F.3d at 136; Kensington Volunteer Fire Dep't. v. Montgomery Cty., 684 F.3d 462, 467 (4th Cir. 2012).

         To be “integral, ” a document must be one “that by its ‘very existence, and not the mere information it contains, gives rise to the legal rights asserted.'” Chesapeake Bay Found., Inc. v. Severstal Sparrows Point, LLC, 794 F.Supp.2d 602, 611 (D. Md. 2011) (citation omitted) (emphasis in original). See also Fed. R. Civ. P. 10(c) (“A copy of a written instrument that is an exhibit to a pleading is a part of the pleading for all purposes.”).

         In addition, “a court may properly take judicial notice of ‘matters of public record' and other information that, under Federal Rule of Evidence 201, constitute ‘adjudicative facts.'” Goldfarb, 791 F.3d at 508; see also Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007); Katyle v. Penn Nat'l Gaming, Inc., 637 F.3d 462, 466 (4th Cir. 2011), cert. denied, 565 U.S. 825 (2011); Philips v. Pitt Cty. Mem. Hosp., 572 F.3d 176, 180 (4th Cir. 2009). But, under Fed.R.Evid. 201, a court may take judicial notice of adjudicative facts only if they are “not subject to reasonable dispute, ” in that they are “(1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.”

         In the context of a motion to dismiss, “[a] court may take judicial notice of docket entries, pleadings and papers in other cases without converting a motion to dismiss into a motion for summary judgment.” Brown v. Ocwen Loan Servicing, LLC, PJM-14-3454, 2015 WL 5008763, at *1 n. 3 (D. Md. Aug. 20, 2015), aff'd, 639 Fed.Appx. 200 (4th Cir. May 6, 2016); cf. Anderson v. Fed. Deposit Ins. Corp., 918 F.2d 1139, 1141 n. 1 (4th Cir. 1990) (holding that a district court may “properly take judicial notice of its own records”). However, “these facts [must be] construed in the light most favorable” to the non-movant. Clatterbuck v. City of Charlottesville, 708 F.3d 549, 557 (4th Cir. 2013) (abrogated on other grounds by Reed v. Town of Gilbert, Ariz., 576 U.S. ____, 135 S.Ct. 2218 (2015), as recognized in Cahaly v. Larosa, 796 F.3d 399 (4th Cir. 2015)).

         The Attorney Defendants submitted seven exhibits related to NCSLT's State court suit against Deitemyer. Three of the exhibits are integral to and explicitly discussed in the Complaint: NCSLT's complaint against plaintiff (ECF 4-3); plaintiff's “Notice of Intention to Defend” (ECF 4-4); and a letter from Deitemyer to the attorney defendants and NCSLT (ECF 4-6). See ECF 1-3, ¶ 35 (NCSLT's complaint); id. ¶ 39 (letter from Deitemyer to the Attorney Defendants); id. ¶ 40 (Notice of Intention to Defend). Accordingly, I may consider them without converting the Motion to one for summary judgment.

         The other four exhibits related to the State court suit are public records: plaintiff's opposition to NCSLT's “Motion to Set on Affidavit Trial Docket” (ECF 4-5); Deitemyer's “Motion to Strike Plaintiff's Affidavit and Certification of Dudley Turner” (ECF 4-7); the State court's judgment of June 11, 2018 (ECF 4-8); and the docket from the State suit. ECF 4-9. Although they are not integral to the Complaint, the Court may take judicial notice of them. See Philips, 572 F.3d at 180 (“In reviewing a Rule 12(b)(6) dismissal, we may properly take judicial notice of matters of public record.”).

         The Attorney Defendants also submitted an Affidavit of Jonathan Bierer, Esq. (ECF 4-10), regarding BLG's policies and practices in debt collection cases. The Affidavit is not integral to the Complaint. Accordingly, I may not consider it at this juncture.

         Because plaintiff is self-represented, the Court must construe the Complaint liberally. But, there are limits. In granting a motion to dismiss a complaint brought by a self-represented plaintiff, Judge Bennett explained in Jackson v. Experian Fin. Servs., RDB-13-1758, 2014 WL 794360, at *1 (D. Md. Feb. 26, 2014) (alterations in Jackson):

As this Court has held, “‘the proper length and level of clarity for a pleading cannot be defined with any great precision and is largely a matter for the discretion of the trial court.'” Stone v. Warfield, 184 F.R.D. 553, 555 (D. Md. 1999) (quoting Charles A. Wright & Arthur R. Miller, 5 Federal Practice & Procedure § 1217 (2d ed. 1990)). Although a pro se plaintiff is generally given more leeway than a party represented by counsel, this Court “has not hesitated to require even pro se litigants to state their claims in an understandable and efficient manner.” Id. (citing Anderson v. Univ. of Md. Sch. of Law, 130 F.R.D. 616, 617 (D. Md. 1989), aff'd, 900 F.2d 249, 1990 WL 41120 (4th Cir. 1990) (unpublished table decision)). To that end, a district court “is not obliged to ferret through a [c]omplaint, searching for viable claims.” Wynn-Bey v. Talley, No. RWT-12-3121, 2012 WL 5986967, at *2 (D. Md. Nov. 28, 2012). Rather, a court “may dismiss a complaint that is so confused, ambiguous, vague or otherwise unintelligible that its true substance, if any, is well disguised.” Id. (quoting Salhuddin v. Cuomo, 861 F.2d 40, 42 (2d Cir. 1988)).

         And, in Green v. United States, GLR-15-2026, 2016 WL 7338408 (D. Md. Dec. 19, 2016), Judge Russell dismissed a suit, sua sponte, and explained, id. at *1:

The instant Complaint “places an unjustifiable burden on defendants to determine the nature of the claim against them and to speculate on what their defenses might be” and imposes a burden on the court to sort out the factual basis of any claims fairly raised, making dismissal under Rule 8 appropriate. Holsey v. Collins, 90 F.R.D. 122 (D. Md. 1981); see also Spencer v. Hedges, 838 F.2d 1210 (Table) (4th Cir. 1988). To comply with the rule, a Plaintiff must provide enough detail to illuminate the nature of the claim and allow Defendants to respond. See Erickson v. Pardus, 551 U.S. 89, 94 (2007). Although district courts have a duty to construe self-represented pleadings liberally, Plaintiff must nevertheless allege facts that state a ...

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