Arku v. Wells Fargo Bank, N.A.

621 F.Supp.3d 602

Josephine ARKU, Plaintiff, v. WELLS FARGO BANK, NATIONAL ASSOCIATION, Defendant.

3:22-cv-00225-RJC-DCK

United States District Court, W.D. North Carolina, Charlotte Division

Signed August 15, 2022

Pamela A. Hunter, Law Office of Pamela A. Hunter, Charlotte, NC, for Plaintiff.

Kevin Joseph Dalton, Mary Grace Miller, Fisher & Phillips, LLP, Charlotte, NC, for Defendant.

ORDER

Robert J. Conrad, Jr., United States District Judge

THIS MATTER comes before the Court on Defendant's Motion to Dismiss Plaintiff's Complaint. (DE 5). For the reasons stated herein, the Court denies Defendant's Motion to Dismiss.

I. BACKGROUND

A. Factual Background

Plaintiff Josephine Arku filed this action against Defendant Wells Fargo Bank, National Association ("Wells Fargo") seeking compensatory damages for allegedly informing Plaintiff's prospective employers that she owed Wells Fargo an overpayment which caused her to lose several job opportunities. (DE 1-1 at ¶9).

Accepting the well-pleaded factual allegations of the Complaint as true, Plaintiff worked for Wells Fargo for more than twenty years when she needed to take paid leave from work. (Id. at ¶3). Thereafter, in February 2016, she was subject to a corporate layoff and received a severance package which included continuation of her salary for eleven months. (DE 1-2 at 2). Wells Fargo calculated the number of benefits that Plaintiff received. (DE 1-1 at ¶4). In August 2016, Plaintiff accepted short-term employment for five months through Wells Fargo and then started to apply for other job opportunities. (DE 1-2 at 2). Potential employers notified Plaintiff that Wells Fargo reported her as owing an overpayment to Wells Fargo. (DE 1-1 at ¶6). Once Plaintiff became aware of the overpayment, she contacted Wells Fargo and paid back the overpayment with the understanding that Wells Fargo would remove the overpayment information from her record. (Id. at ¶7). After receiving payment, Wells Fargo failed to remove the overpayment information from Plaintiff's record, despite numerous requests to do so. (Id. at ¶¶8, 10). Between 2018 and 2020, Plaintiff applied to employers and believes, due to the overpayment listing on her record, that she lost various job opportunities. (Id. at ¶9). Plaintiff alleges that Wells Fargo's failure to correct the adverse employment information caused her to lose $135,000 in income and resulted in a $100,000 increase in interest payments regarding her home and vehicle loans. (DE 1-2 at 3).

B. Procedural Background

Plaintiff filed the instant Complaint on April 1, 2022, in Mecklenburg County, alleging two counts: breach of contract and negligent misrepresentation. (DE 1-1 at 3, 5). On May 20, 2022, Wells Fargo removed the case to the Western District Court of North Carolina. (DE 1). Wells Fargo now moves to dismiss both counts of the Complaint. (DE 6).

II. STANDARD OF REVIEW

The standard of review for a motion to dismiss under Fed. R. Civ. P. 12(b)(6) for failure to state a claim is well known. "A motion to dismiss under Rule 12(b)(6) 'challenges the legal sufficiency of a complaint,' including whether it meets the pleading standard of Rule 8(a)(2)." Fannie Mae v. Quicksilver LLC, 155 F. Supp. 3d 535, 542 (M.D.N.C. 2015) (quoting Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. 2009)). A complaint attacked by a Rule 12(b)(6) motion to dismiss will survive if it contains enough facts "to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A motion to dismiss, "serves 'to test the formal sufficiency of the state of the claim for relief; it is not a procedure for resolving a contest about the facts or the merits of the case.' " Adkins v. Holland, 216 F. Supp. 2d 576, 579 (S.D.W. Va. 2002), aff'd, 87 Fed. Appx. 886 (4th Cir. 2004), and aff'd, 87 Fed. Appx. 886 (4th Cir. 2004). Facial plausibility means allegations that allow the court to draw the reasonable inference that defendant is liable for the misconduct alleged. Ashcroft v. Iqbal, 556 U.S. 662, 663, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. at 678, 129 S.Ct. 1937.

Federal Rule of Civil Procedure 8(a)(2) requires only "a short and plain statement of the claim showing that the pleader is entitled to relief." FED. R. CIV. P. 8(a)(2). Therefore, "a Rule 12(b)(6) motion should only be granted if, after accepting all well-pleaded allegations in the plaintiff's complaint as true and drawing all reasonable factual inferences from those facts in the plaintiff's favor, it appears certain that the plaintiff cannot prove any set of facts in support of [her] claim entitling [her] to relief." Ruttenberg v. Jones, 283 Fed. Appx. 121, 128 (4th Cir. 2008) (quoting Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th Cir. 1999)). Specific facts are not necessary; the statement need only "give the defendant fair notice of what the . . . claim is and the grounds upon which it rests." Twombly, 550 U.S. at 555, 127 S.Ct. 1955. Additionally, when ruling on a motion to dismiss, a court must accept as true all of the factual allegations contained in the complaint. Erickson v. Pardus, 551 U.S. 89, 93-94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007). Nonetheless, a court is not bound to accept as true legal conclusions couched as factual allegations. Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986). "Courts cannot weigh the facts or assess the evidence at this stage, but a complaint entirely devoid of any facts supporting a given claim cannot proceed." Potomac Conference Corp. of Seventh-Day Adventists v. Takoma Acad. Alumni Ass'n, Inc., 2 F. Supp. 3d 758, 767-68 (D. Md. 2014). Furthermore, the court "should view the complaint in a light most favorable to the plaintiff." Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993). Lastly, "[i]n addition to the Complaint's specific allegations, the Court may also consider any materials 'attached or incorporated into the complaint.' " Hunter v. Amazon.com Servs., LLC, No. 321-CV-00258-FDW-DSC, 2021 WL 5291912, at *2 (W.D.N.C. Nov. 12, 2021); E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 448 (4th Cir. 2011); see FED. R. CIV. P. 10(c); Thompson v. Greene, 427 F.3d 263, 268 (4th Cir. 2005).

III. DISCUSSION

In the Motion to Dismiss, Wells Fargo argues (1) it is immune from civil liability; (2) Plaintiff failed to state a claim for breach of contract; (3) the breach of contract claim is barred by the statute of limitations; (4) and Plaintiff did not meet the heightened pleading standard for a negligent misrepresentation claim. (DE 6).

A. Civil Immunity

Under N.C. Gen. Stat. § 1-539.12, Wells Fargo asserts that it is immune from liability for both the breach of contract and negligent misrepresentation claims. Wells Fargo cites to subsection (a) of the statute, which states:

An employer who discloses information about a current or former employee's job history or job performance to a prospective employer of the current or former employee upon request of the prospective employer or upon request of the current or former employee is immune from civil liability and is not liable in civil damages for the disclosure or any consequences of the disclosure.

The statute further defines "job performance" as "(1) [t]he suitability of the employee for re-employment; (2) [t]he employee's skills, abilities, and traits as they may relate to suitability for future employment; and (3) [i]n the case of a former employee, the reason for the employee's separation." N.C. GEN. STAT. ANN. § 1-539.12(b) (1-3).

Relying on this statute, Wells Fargo argues that it has civil immunity because reporting the overpayment information is akin to disclosing Plaintiff's job history and performance to a prospective employer. In particular, Wells Fargo argues that the information relates to Plaintiff's suitability for re-hire. Plaintiff disagrees, arguing that overpayment information is not correlated to an employee's job performance.

The statute appears incongruent with the facts of this case. The statute only provides immunity when a former employer provides information to a prospective employer regarding an employee's job performance or job history. Here, the information that Wells Fargo disclosed about Plaintiff was her failure to pay an overpayment that she received from Wells Fargo. It is unclear how this information pertains to her job performance or job history. For example, the best and worst employee could receive an overpayment from the same employer and disclosing this information would provide no insight into the abilities or job performance of either employee.

Moreover, the facts do not show that Wells Fargo disclosed the overpayment information "upon request of the prospective employer." N.C. GEN. STAT. § 1-539.12. It appears that Wells Fargo reported this information to a Credit Bureau. (DE 7 at 4). There are no facts that Wells Fargo provided any information about Plaintiff directly to a prospective employer upon that prospective employer's request as required under the statute.

Regardless, even if the statute does apply to information about an employee's failure to pay back an overpayment, it does not provide immunity when the information is false. Hunter v. Amazon.com Servs., LLC, No. 3:21-CV-00258-FDW-DSC, 2021 WL 5291912, at *5 (W.D.N.C. Nov. 12, 2021) ("N.C. Gen. Stat. § 1-539.12(a), which provides civil liability to 'an employer who discloses information about a current or former employee's job history or job performance' " does not apply when "the disclosed information was false."). Here, Plaintiff alleges that Wells Fargo failed to remove the overpayment information even after she repaid it, and that she lost potential employment because of this. Plaintiff thus alleges that she lost employment opportunities because of false information that ...