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Bisrat Mekuria v. Bank of America

September 23, 2011

BISRAT MEKURIA, PLAINTIFF,
v.
BANK OF AMERICA, DEFENDANT.



The opinion of the court was delivered by: James E. Boasberg United States District Judge

MEMORANDUM OPINION

Plaintiff Bisrat Mekuria, a black male of Ethiopian descent, was a long-time customer of Defendant Bank of America. Following a dispute over a series of deposits Plaintiff made with the Bank in May and June 2009, the Bank elected to close his accounts. Without providing any explanation for why he believes the Bank's actions were racially motivated, Plaintiff has nonetheless brought this suit for racial discrimination, as well as two ancillary state common-law claims. Because of the dearth of factual support in Plaintiff's Amended Complaint, the Court must dismiss his suit.

I.Factual Background

According to his Amended Complaint, Plaintiff is the owner of a business -- the Family Food Market -- in the District of Columbia. See Am. Compl., ¶ 4. For approximately five years, he maintained a number of bank accounts for his business with Defendant Bank of America. Id., ¶¶ 7, 12. He alleges that in May 2009, he deposited a check into one of his accounts, but that the Bank refused to credit his account until he verified the check in person. Id., ¶ 8. Plaintiff further alleges that on June 3 and 29, 2009, he made deposits that included checks in the amounts of $1,651 and $2,000. Id., ¶¶ 9, 10. Although he received computer-generated receipts for each of these deposits, id., the Bank later notified Plaintiff that "'deposit corrections' had been made on both deposits." Id., ¶ 11. The Bank advised him that "the $1,651.00 check . . . was not 'enclosed' with the June 3 deposit," and that there was "an 'error in addition'" with respect to the June 29 deposit. Id. Plaintiff alleges that "to date, [the Bank] has refused to credit him with those deposits." Id.

The Bank then notified Plaintiff on July 16, 2009, that it had "'elect[ed] to close' all five of his business accounts." Id., ¶ 12. Plaintiff alleges that the Bank "refused to immediately release any funds owned by Mekuria and required for the continued operation of his small family business. BOA proffered no explanation of [the] basis for the closing of Mr. Mekuria's accounts and referred him to BOA's 'Risk Identification Support Center.'" Id. On July 31 and September 2, 2009, the Bank sent Plaintiff cashier's checks in the amounts of $27,044.20 and $1,678.41, respectively, "representing the fund balance of his accounts." Id., ¶ 17.

On August 6, 2010, Plaintiff filed suit against the Bank, asserting claims of racial discrimination under 42 U.S.C. § 1981 and the District of Columbia Human Rights Act, breach of contract, and breach of the implied covenant of good faith and fair dealing. ECF No. 1. On December 30, 2010, Bank of America moved to dismiss for failure to state a claim. ECF No. 5. A day after filing his Opposition to the Bank's Motion, Plaintiff moved for leave to file an Amended Complaint, which the Court granted on April 14, 2011. ECF Nos. 8, 9, 12. Plaintiff's Amended Complaint contains three counts: racial discrimination under § 1981 (Count I), breach of contract (Count II), and breach of the implied covenant of good faith and fair dealing (Count III). The Bank has again moved to dismiss under Rule 12(b)(6). The Court now considers this Motion.*fn1

II.Legal Standard

Rule 12(b)(6) provides for the dismissal of an action where a complaint fails "to state a claim upon which relief can be granted." In evaluating Defendant's Motion to Dismiss, the Court must "treat the complaint's factual allegations as true . . . and must grant plaintiff 'the benefit of all inferences that can be derived from the facts alleged.'" Sparrow v. United Air Lines, Inc., 216 F.3d 1111, 1113 (D.C. Cir. 2000) (quoting Schuler v. United States, 617 F.2d 605, 608 (D.C. Cir. 1979)) (internal citation omitted); see also Jerome Stevens Pharms., Inc. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir. 2005). The notice pleading rules are "not meant to impose a great burden on a plaintiff," Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 347 (2005), and he must thus be given every favorable inference that may be drawn from the allegations of fact. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 584 (2007).

Although "detailed factual allegations" are not necessary to withstand a Rule 12(b)(6) motion, id. at 555, "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (quoting Twombly, 550 U.S. at 570). Plaintiff must put forth "factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged."

Id. The Court need not accept as true "a legal conclusion couched as a factual allegation," nor an inference unsupported by the facts set forth in the Complaint. Trudeau v. Fed. Trade Comm'n, 456 F.3d 178, 193 (D.C. Cir. 2006) (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986) (internal quotation marks omitted). Though a plaintiff may survive a 12(b)(6) motion even if "recovery is very remote and unlikely," Twombly, 550 U.S. at 555 (citing Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)), the facts alleged in the complaint "must be enough to raise a right to relief above the speculative level." Id.

III.Analysis

In Count I of his Amended Complaint, Plaintiff alleges that, in refusing to credit his accounts in the amounts of the disputed deposits and in summarily closing his accounts, the Bank "denied [him] the contractual rights and privileges secured under the Civil Rights Act because of his race." Id., ¶ 21. In Count II, he alleges that "by withholding credit of deposits duly presented, terminating his contract[,] and denying him access to cleared deposits held in trust," the Bank breached its customer contract with him "because of his race." Id., ¶ 26. In Count III, he alleges that these actions similarly constitute a breach of the implied covenant of good faith and fair dealing owed to him by the Bank. Id., ¶ 32.

The Court will address Plaintiff's federal and state common-law claims in turn. A. Discrimination Claim Section 1981, previously § 1 of the Civil Rights Act of 1866, 14 Stat. 27, as amended by the Civil Rights Act of 1991, Pub. L. No. 102-166, 105 Stat. 1071, prohibits private parties from engaging in racial discrimination in the making and enforcing -- including the performance, modification, and termination -- of contracts. 42 U.S.C. § 1981. This includes contracts between individuals and commercial entities such as banks. See Banks v. Bank of America, N.A., 505 F. Supp. 2d 159 (D.D.C. 2007).

To state a claim under § 1981, Plaintiff must identify first, "an impaired 'contractual relationship,' § 1981(b), under which [he] has rights," followed by "injuries flowing from a racially motivated breach" of that contractual relationship. Domino's Pizza, Inc. v. McDonald, 546 U.S. 470, 476, 480 (2006). In other words, "Section 1981 offers relief when . . . racial discrimination impairs an existing contractual relationship." Id. at 476. Section 1981 "can be ...


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