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Dove v. Educap Inc.

United States District Court, District of Columbia

July 20, 2016

DUSTIN DOVE, Plaintiff
v.
EDUCAP, INC., et al., Defendants

          MEMORANDUM OPINION

          COLLEEN KOLLAR-KOTELLY United States District Judge.

         This case stems from an action to collect on a debt that was filed in the District of Columbia Superior Court by EduCap, Inc., who was represented in that action by Weinstock, Friedman & Freidman, PA. ("Weinstock"), against Dustin Dove. That case was subsequently dismissed with prejudice. Plaintiff Dustin Dove, the debtor in the Superior Court action-which the parties refer to as the collection case-brings four claims against Defendants EduCap and Weinstock, essentially claiming that it was unlawful to bring the Superior Court collection case. Specifically, Plaintiff asserts claims under the federal Fair Debt Collection Practices Act; the District of Columbia Debt Collection Law, D.C. Code § 28-14 et seq.; the District of Columbia Consumer Protection Procedures Act, D.C. Code § 28-3904 et seq.; and an abuse of process claim under the common law of the District of Columbia.

         Before the Court is Defendants' [16] Motion to Dismiss. Defendants argue that each of the claims in the Complaint fails because the original collection case was timely filed in the Superior Court. Defendants also argue that each of the individual claims in this case is barred as a matter of law for additional independent reasons. Upon consideration of the pleadings, [1] the relevant legal authorities, and the record for purposes of this motion, the Court GRANTS Defendants' [16] Motion to Dismiss. The Court agrees with Defendants that the collection case was timely filed and that, therefore, each of the claims in this case fails as a matter of law. Accordingly, the Court does not reach Defendants' other arguments as to why each of the four claims must be dismissed for one or more independent reasons. The claims in this case are dismissed with prejudice, and this action is dismissed in its entirety.

         I. BACKGROUND

         For the purposes of the motion before the Court, the Court accepts as true the well-pleaded allegations in Plaintiffs Complaint. The Court does "not accept as true, however, the plaintiffs legal conclusions or inferences that are unsupported by the facts alleged." Ralls Corp. v. Comm. on Foreign Inv. in U.S., 758 F.3d 296, 315 (D.C. Cir. 2014). The Court recites only the background necessary for the Court's resolution of the pending Motion to Dismiss.

         As noted above, this case stems from the collection case filed in the Superior Court captioned EduCap, Inc., v Dustin Dove, Civil Action No. 2015 CA 007783 C. See Compl. ¶ 11; PL's Opp'n, Ex. A, EduCap's Opp'n to Def.'s Mot. to Dismiss, at l.[2] EduCap brought that case on behalf of HSBC Bank, N.A., and was represented by the law firm Weinstock. See PL's Opp'n, Ex. B ("Verified Complaint"), ECF No. 17-2, at 5.[3] The Verified Complaint indicates that Plaintiff sued "the Defendant for $32, 548.16, pre-judgment interest in the amount of $11, 281.27, attorney's fees in the amount of $750.00, balance due and owing for student loan by the Plaintiff to the Defendant at the Defendant's request on open account." Id.

         Plaintiff alleges that the disclosure statement attached to the Verified Complaint in that case shows that on August 21, 2007, a loan in the amount of $25, 573 was disbursed to Dove. Compl. ¶ 12. Plaintiff further alleges that monthly payments in the amount of $399.87 were due beginning on January 6, 2011. Id. The Truth in Lending Disclosure Statement (Itemization of Amount Financed and Loan Terms), which was attached to the Verified Complaint in the collection case and subsequently attached to Defendant's Motion to Dismiss and Plaintiffs Opposition in this case, appears to be the "note disclosure statement" referenced in Plaintiff's complaint. See Verified Compl., ECF No. 17-2, at 26. The Truth in Lending Disclosure Statement shows a loan amount of $25, 573, as alleged by Plaintiff, and a payment schedule of 46 monthly payments of $399.87, due beginning on January 6, 2011, followed by 192 monthly payments of $388.86, beginning on January 6, 2015. Id. The Truth in Lending Disclosure Statement shows that the lender is HSBC Bank, N.A. Id. The statement also refers to the Promissory Note associated with the loan for "any additional information about nonpayment, default, any required payment in full before the scheduled date and prepayment refunds and penalties." Id. The Promissory Note includes an acceleration clause, which allows the lender to accelerate payments due on the loan upon non-payment by the borrower. PL's Opp'n, Ex. B, at 16 ("Promissory Note"), ¶12(a) ("Notwithstanding any other provisions of this Note, I [the borrower] will be in default, and upon giving any notice to me required by the law, you [the lender] will have the right to declare the entire outstanding Loan Amount, accrued interest, and all other amounts payable to you under the terms of this Notice, immediately due and payable in full, if... (a) I fail to pay any schedule payment when due ... ."). The Promissory Note also includes a choice of law clause, stating that "[t]his Notice is governed by federal law, and to the extent not preempted by federal law, the law of the State of Delaware." Id. ¶ 17(d).

         Plaintiff alleges that, according to EduCap, no payments were made by Dove until July 2, 2015, when a $50 payment was remitted by telephone. Compl. ¶ 13. Plaintiff further alleges that, according to EduCap, Dove remitted a second payment in the amount of $10, by telephone, on October 16, 2015. Meanwhile, the docket for the collection case shows that the case was filed in the Superior Court on October 9, 2015. See District of Columbia Courts, Cases Online (docket for 2015 CA 007783 C); see also PL's Opp'n, Ex. B, at 4 (summons issued on October 9, 2015). Finally, the Superior Court docket shows that, on February 19, 2016, EduCap's motion to dismiss with prejudice was granted; Dove's motion to dismiss was granted; and Dove motion for sanctions was denied as moot; and the case was closed. See District of Columbia Courts, Cases Online (docket for 2015 CA 007783 C). As far as the Court can glean from the Superior Court docket and from the parties' pleadings in this case, there was no ruling on the merits in the collection case regarding the statute of limitations or any other substantive matter.

         II. LEGAL STANDARD

         Pursuant to Federal Rule of Civil Procedure 12(b)(6), a party may move to dismiss a complaint on the grounds that it "fail[s] to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). "[A] complaint [does not] suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.' "Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007)). Rather, a complaint must contain sufficient factual allegations that, if accepted as true, "state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. In deciding a Rule 12(b)(6) motion, a court may consider "the facts alleged in the complaint, documents attached as exhibits or incorporated by reference in the complaint, " or "documents upon which the plaintiff's complaint necessarily relies even if the document is produced not by the plaintiff in the complaint but by the defendant in a motion to dismiss." Ward v. District of Columbia Dep't of Youth Rehab. Servs., 768 F.Supp.2d 117, 119 (D.D.C. 2011) (citations omitted).

         III. DISCUSSION

         Defendants argue that each of the claims asserted in the Complaint fails as a matter of law because the collection case in the Superior Court was timely filed. As explained below, the Court agrees that the collection case was timely filed. For that reason alone, all the claims asserted in the Complaint must be dismissed, and the Court need not address Defendants' other arguments in favor of dismissal.

         Each of the claims presented by Plaintiff in this case is premised on the assertion that the collection case was filed after the applicable statute of limitations had expired. See Compl. ¶¶ 33-37 (Fair Debt Collection Practices Act claim); id. ¶¶ 40-42 (D.C. Debt Collection Law claim); id. ¶¶ 46-47 (D.C. Consumer Protection Procedures Act claim); id. ¶ 53 (D.C. abuse of process claim). Specifically, the claims are premised on the assertion that a three-year statute of limitations is applicable to the collection case and that the collection case was filed outside of the applicable three-year window. See Id. Defendants argue that the collection case was timely filed and that, therefore, each claim in this case fails a matter of law. Plaintiff does not contest the premise of Defendants' argument that, "the collection case was timely filed, each of their claims fails. See PL's Opp'n at 1-3, 9-13. They do, however, contest Defendants' argument that the case was timely filed. The timeliness of the filing of the collection case, therefore, is the primary legal question before the Court. The Court now addresses that question.

         Plaintiff argues that the three-year statute of limitations under District of Columbia law was applicable to the collection case because it is the law of the forum in which the collection case was brought. PL's Opp'n at 16. Specifically, Plaintiff emphasizes that, under District of Columbia choice of law principles, the law of the forum governs procedural matters. See Id. (citing Huang v.D 'Albora,644 A.2d 1, 4 (D.C. 1994) ("[T]he laws of the forum ... apply to matters of procedure"). Plaintiff further emphasizes that a statute of limitations is considered procedural. See Id. (citing Namerdy v. Generalcar,217 A.2d 109, 113 (D.C. 1966)); see also A.I. Trade Fin., Inc. v.Petra Int'l Banking Corp.,62 F.3d 1454, 1458 (D.C. Cir. 1995). While Defendants do not concede that a three-year statute of limitations is applicable, they argue that, even under a three-year statute of limitations, the filing of case was timely.[4]See Defs.' Mot. at 6-8; Defs.' Reply at 8. The Court now turns to the dispute between the parties about whether the ...


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