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Hartley v. 21st Mortgage Corp.

United States District Court, S.D. West Virginia, Huntington Division

September 28, 2017

JEFF HARTLEY, Plaintiff,
v.
21ST MORTGAGE CORPORATION, Defendant.

          MEMORANDUM OPINION AND ORDER

          ROBERT C. CHAMBERS, UNITED STATES DISTRICT JUDGE.

         Pending before the Court are three motions: (1) Defendant 21st Mortgage Corporation's Motion to Dismiss (ECF No. 16); (2) Defendant 21st Mortgage Corporation's Motion to Stay (ECF No. 31); and (3) Plaintiff's Motion to Compel Deposition and Extend the Deadlines. ECF No. 35. For the following reasons, the Court GRANTS, in part, and DENIES, in part, the Motion to Dismiss, DENIES WITHOUT PREJUDICE Defendant's Motion to Stay, and DENIES AS MOOT Plaintiff's Motion to Compel Depositions and Extend the Deadlines.

         I.

         FACTUAL AND PROCEDURAL HISTORY

         This action originally was filed in the Circuit Court of Putnam County, West Virginia on February 25, 2016, alleging violations of various state laws regarding the collection of a debt. On January 11, 2017, Plaintiff filed an Amended Complaint, which added a federal claim under the Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227, and a violation of a bankruptcy stay and discharge. Thereafter, Defendant timely removed the action to this Court based upon federal question jurisdiction. 28 U.S.C. § 1331.

         On February 6, 2017, Plaintiff filed a Second Amended Complaint. In his Second Amended Complaint, Plaintiff states that he fell behind on payments on a loan that originated as a mortgage loan with Chase Mortgage. On April 19, 2001, Plaintiff filed for Chapter 7 bankruptcy, and his personal liability for the debt was discharged on August 10, 2001.[1] Plaintiff alleges that three or four years after the discharge, the loan was transferred from Chase Mortgage to Defendant 21st Mortgage Corporation. Thereafter, Plaintiff and his wife divorced, and she received the house and the accompanying mortgage as part of a property settlement agreement. Plaintiff states that, although he told Defendant he no longer resided in the house and his debt was discharged, Defendant began a relentless campaign of calling him. Plaintiff asserts he withdrew his consent for Defendant to contact him.

         In May 2015, Plaintiff states he began receiving written communications attempting to collect the debt. Thereafter, Plaintiff asserts he mailed Defendant a letter stating he retained an attorney, and he provided Defendant with his attorney's contact information. According to Plaintiff, Defendant continued to call him and left messages demanding payments without disclosing its name. These telephone calls included unauthorized calls to his cellphone. Plaintiff alleges he was called multiple times a day from what he believes was an “Automatic Telephone Dialing System.” Plaintiff alleges Defendant called him in excess of 300 times.[2] Sec. Am. Compl., at ¶ 45.

         Based upon these allegations, Plaintiff alleges seven claims against Defendant: (1) Violations of the West Virginia Consumer Credit and Protection (WVCCPA) (Count 1); (2) Violation of the West Virginia Consumer Computer Crime and Abuse Act (WVCCAA) (Count II); (3) Violation of the Telephone Harassment Statute (Count III); (4) Negligence (Count IV); (5) Invasion of Privacy (Count V); (6) Violation of the Automatic Stay and Discharge (Count VI); and (7) Violations of the TCPA (Count VII). In its motion, Defendant argues that all Plaintiff's claims, other than the TCPA claim, should be dismissed.

         II.

         STANDARD OF REVIEW

         In Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), the United States Supreme Court disavowed the “no set of facts” language found in Conley v. Gibson, 355 U.S. 41 (1957), which was long used to evaluate complaints subject to 12(b)(6) motions. 550 U.S. at 563. In its place, courts must now look for “plausibility” in the complaint. This standard requires a plaintiff to set forth the “grounds” for an “entitle[ment] to relief” that is more than mere “labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. at 555 (internal quotation marks and citations omitted). Accepting the factual allegations in the complaint as true (even when doubtful), the allegations “must be enough to raise a right to relief above the speculative level . . . .” Id. (citations omitted). If the allegations in the complaint, assuming their truth, do “not raise a claim of entitlement to relief, this basic deficiency should . . . be exposed at the point of minimum expenditure of time and money by the parties and the court.” Id. at 558 (internal quotation marks and citations omitted).

         In Ashcroft v. Iqbal, 556 U.S. 662 (2009), the Supreme Court explained the requirements of Rule 8 and the “plausibility standard” in more detail. In Iqbal, the Supreme Court reiterated that Rule 8 does not demand “detailed factual allegations[.]” 556 U.S. at 678 (internal quotation marks and citations omitted). However, a mere “unadorned, the-defendant-unlawfully-harmed-me accusation” is insufficient. Id. “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Id. (quoting Twombly, 550 U.S. at 570). Facial plausibility exists when a claim contains “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citation omitted). The Supreme Court continued by explaining that, although factual allegations in a complaint must be accepted as true for purposes of a motion to dismiss, this tenet does not apply to legal conclusions. Id. “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. (citation omitted). Whether a plausible claim is stated in a complaint requires a court to conduct a context-specific analysis, drawing upon the court's own judicial experience and common sense. Id. at 679. If the court finds from its analysis that “the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not ‘show[n]'-‘that the pleader is entitled to relief.'” Id. (quoting, in part, Fed.R.Civ.P. 8(a)(2)). The Supreme Court further articulated that “a court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth. While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations.” Id.

         III.

         DISCUSSION

         A.

         Whether Plaintiff qualifies as a consumer under the WVCCPA?

         Defendant first argues that Plaintiff's claim under the WVCCPA must be dismissed because Plaintiff no longer qualifies as a “consumer” under the Act and, therefore, lacks standing to bring a claim.[3] The WVCCPA defines a “consumer” as “any natural person obligated or allegedly obligated to pay any debt.” W.Va. Code § 46A-2-122(a). Defendant argues that, although the debt still exists, Plaintiff is no longer obligated to pay because his personal liability was discharged in bankruptcy. Thus, Defendant insists Plaintiff does not meet the definition of a “consumer.” In support, Defendant cites Fabian v. Home Loan Center, Inc., No. 5:14-CV-42, 2014 WL 1648289 (N.D. W.Va. Apr. 24, 2014).

         As here, the lender in Fabian argued that the plaintiffs could not bring a claim of unconscionability under the WVCCPA because their personal obligation to pay a debt was discharged in bankruptcy. 2014 WL 1648289, at *5. The plaintiffs argued they qualified as “consumers” under the Act because they remained “allegedly obligated” to pay the debt to avoid foreclosure on their house. However, the court disagreed and held that the plaintiffs' choice to make payments so they could retain their house “does not give rise to an ‘alleged obligation.'” Id. (citation omitted). In making this holding, the court distinguished the facts before it from Croye v. GreenPoint Mortgage Funding, Inc., 740 F.Supp.2d 788 (S.D. W.Va. 2010).

         In Croye, the plaintiffs alleged, inter alia, violations of the WVCCPA by the servicer of mortgage loans obtained by Cheryl Croye. The servicer sought summary judgment against William Croye because he did not execute the loans and, therefore, the servicer argued he did not qualify as a “consumer” as he had no obligation to pay the debts. 740 F.Supp.2d at 796.[4]In rejecting this argument, the court cited Mr. Croye's claim that the servicer telephoned him more than thirty times to collect on the mortgages. Id. at 797. The court held that the ...


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