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Juliette Murdoch v. Rosenberg & Associates

July 11, 2012

JULIETTE MURDOCH, PLAINTIFF,
v.
ROSENBERG & ASSOCIATES, LLC, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Richard W. Roberts United States District Judge

MEMORANDUM OPINION AND ORDER

Plaintiff Juliette Murdoch brings claims against defendants Rosenberg & Associates, LLC ("the Firm") and its managing member and named partner Diane Rosenberg ("the named partner") alleging that the defendants sent her and other consumers form debt collection notices threatening legal action before properly verifying the creditors' claims, in violation of the federal Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq., the Maryland Consumer Protection Act, Md. Code Ann., Com. Law § 13-301 et seq., the Maryland Consumer Debt Collection Act, Md. Code Ann., Com. Law § 14-201 et seq., and the District of Columbia Consumer Protection and Procedures Act, D.C. Code § 28-3901 et seq. Both defendants have moved to dismiss for improper venue and failure to state a claim. The District of Columbia is not an appropriate venue for Murdoch's claims. However, because the District of Maryland is an appropriate venue and a transfer is in the interest of justice, the case will be transferred to that district.

BACKGROUND

Murdoch owns properties in Maryland and resided in Maryland at all times relevant to this suit. (Compl. ¶¶ 2-3.) Murdoch entered into mortgage debts secured by her properties and later defaulted on one of those debts. (Id. ¶¶ 12-13, 15.) The defaulted debt was referred to the defendants for collection and foreclosure (id. ¶ 15), and they sent Murdoch a form debt collection letter (id., ¶ 16 & Ex. A). Murdoch alleges that the letter fails to comply with applicable debt collection and consumer protection law. (Id. ¶¶ 17-44.) She alleges that the defendants sent the form notice to "thousands of protected consumers in the District of Columbia, Maryland, and Virginia" (id. ¶ 17), and "seeks to represent two subclasses of consumers under state consumer protection laws in Maryland and the District of Columbia" (id. ¶ 1; see also id. ¶¶ 45-57 ("Class Allegations")).

The Firm has its principal place of business in Maryland and is organized under Maryland law. (Rosenberg & Associates, LLC's Mot. to Dismiss, Ex. 1, Declaration of Diane S. Rosenberg, Esq. ("Rosenberg Decl.") ¶ 3; see also Compl., Ex. A, Debt collection letter listing firm address in Maryland.) In the District of Columbia, the Firm is a foreign entity authorized to do business and has a registered agent. (Pl.'s Mem. of P. & A. in Opp'n to Rosenberg & Associates, LLC's Mot. to Dismiss ("Pl.'s Opp'n"), Ex. I.) The named partner resides solely in Maryland. (Rosenberg Decl. ¶ 5.)

The Firm and the named partner have each moved to dismiss under Federal Rule of Civil Procedure 12(b)(3) for improper venue.*fn1 The Firm argues that "Murdoch's claims have no connection whatsoever to the District of Columbia," pointing to the facts that the named parties are all Maryland residents, the property at issue is located in Maryland, the notice regarding Murdoch's property and debt was sent in connection with a foreclosure proceeding under Maryland law, and the notice was sent directly to Murdoch in Maryland. (Rosenberg & Associates, LLC's Mem. of P. & A. in Supp. of Mot. to Dismiss ("Rosenberg & Associates' Mem.") at 1.) Although Murdoch seeks to certify a class that includes District of Columbia residents, the Firm maintains that "only . . . the events giving rise to the named plaintiff's claims" are relevant "in determining whether venue for a putative class action is proper." (Id. at 6.) The Firm further argues that Murdoch's assertion that venue is proper in this district conflates personal jurisdiction with venue by relying on the Firm's general business connections and contacts rather than the events giving rise to Murdoch's claim. (Rosenberg & Associates, LLC's Reply at 2.)

Murdoch alleges that venue is proper because "a substantial part of the events and omissions giving rise to the claims occurred in this judicial district," and because the defendants are subject to personal jurisdiction in the District of Columbia since they "regularly conduct[] business in this judicial district." (Compl. ¶ 11.) Although all of the correspondence related to Murdoch's claims was sent to her at an address in Maryland, she alleges that debt collection notices and threatening letters were also sent to potential class members in the District of Columbia. (Id. ¶ 17.) Murdoch provides further evidence of the defendants' business activities in the District of Columbia, submitting records of their involvement in over 1,000 foreclosure proceedings and their limited power of attorney in real property matters in the District. (Pl.'s Opp'n, Exs. A-D, F-H.)

DISCUSSION

A court may dismiss a case where it finds venue to be improper. Fed. R. Civ. P. 12(b)(3); see also Darby v. U.S. Dep't of Energy, 231 F. Supp. 2d 274, 276 (D.D.C. 2002). Although courts must accept the plaintiff's "well-pled factual allegations" as true, drawing all reasonable inferences from the allegations in the plaintiff's favor and resolving all factual conflicts in the plaintiff's favor, they need not treat the plaintiff's legal conclusions with similar deference. Id. at 276-77 (citing 2215 Fifth St. Assocs. v. U-Haul Int'l, Inc., 148 F. Supp. 2d 50, 54 (D.D.C. 2001)). In this circuit, courts carefully examine challenges to venue to protect against plaintiffs manufacturing venue in the District of Columbia, Baez v. Connelly, 734 F. Supp. 2d 54, 57 (D.D.C. 2010) (citing Cameron v. Thornburgh, 983 F.2d 253, 256 (D.C. Cir. 1993)), and may consider materials beyond the pleadings, Haley v. Astrue, 667 F. Supp. 2d 138, 140 (D.D.C. 2009). The plaintiff bears the burden to establish that venue is proper. Hill v. Napolitano, Civil Action No. 11-34 (RWR), 2012 WL 892633, at *2 (D.D.C. Mar. 16, 2012). If a court finds proper venue lacking, the court "shall dismiss, or if it be in the interest of justice, transfer" the case to a proper venue. 28 U.S.C. § 1406(a). "The decision to transfer an action [under § 1406(a)] is left to the discretion of the Court." Baez, 734 F. Supp. 2d at 58.

A civil action that may be brought in the district courts of the United States may be brought in:

(1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located;

(2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred . . . or

(3) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court's personal jurisdiction with respect to such action.

28 U.S.C. § 1391(b).*fn2 Murdoch does not argue that the first or third alternative for establishing venue applies here, and indeed neither of these options is available. Venue is not proper under § 1391(b)(1) because not all of the defendants reside in the District of Columbia -- the named partner resides solely in Maryland (Rosenberg Decl. ¶ 5), a fact that Murdoch does not contest. In addition, venue is not proper under § 1391(b)(3) because Murdoch "has not shown that there is no other district in which the action could have been brought," Atwal v. Lawrence Livermore Nat'l Sec., LLC, 786 F. ...


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