Davis v. CenturyLink, Inc.

VERONICA L. DAVIS, et al., Plaintiffs. v. CENTURYLINK, INC., et al., Defendants.

Civil Action No. 3:22-cv-00038

United States District Court, S.D. Texas, Galveston Division

February 21, 2023

MEMORANDUM AND RECOMMENDATION

ANDREW M. EDISON UNITED STATES MAGISTRATE JUDGE

Defendants DIRECTV, LLC (“DIRECTV”) and AT&T Corp. (“AT&T) have filed a Motion to Dismiss Plaintiffs' Second Amended Original Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) (“Motion to Dismiss”). See Dkt. 44. Having reviewed the briefing and the applicable law, I recommend that the motion be GRANTED, and that all claims brought by Plaintiffs Veronica L. Davis (“Davis”), Jeff Kitchen (“Kitchen”), and the Charlie Brown Heritage Foundation (“Charlie Brown”) against DIRECTV and AT&T be dismissed.

BACKGROUND

Davis is an attorney. She previously represented her co-plaintiffs Kitchen and Charlie Brown, in separate lawsuits. Kitchen and Charlie Brown lost both of those cases on summary judgment at the trial court level, and also on appeal. See Kitchen v BASF, 343 F.Supp.3d 681 (S.D. Tex. 2018) aff'd, 952 F.3d 247 (5th Cir. 2020); Charlie Brown Heritage Found. v. Columbia Brazoria Ind. Sch Dist., No. 3:15-cv-346, 2018 WL 2059203 (S.D. Tex. May 3, 2018), aff'd, 771 Fed.Appx. 536 (5th Cir. 2019). Davis blames those losses on poor internet service, claiming that she was unable to timely file summary judgment evidence in both cases because her internet service was down. Had her internet service been working, Davis claims, her clients would have avoided summary judgment, prevailed at trial, and won more than $1 million in damages.

In February 2022, Plaintiffs filed the instant case against CenturyTel Broadband Services, LLC, Central Telephone Company of Texas, and Lumen Technologies, Inc. (collectively, “CenturyLink”), DIRECTV, AT&T, and two debt collection agencies: Credence Resource Management, LLC (“Credence”) and Sequeim Asset Solutions, LLC (“Sequeim”). In a recent summary judgment ruling, I held that Davis's claims against CenturyLink are barred by a class action settlement and principles of res judicata. See Davis v. CenturyLink, Inc., No. 3:22-cv-00038, 2023 WL 1111830, at *1 (S.D. Tex. Jan. 30, 2023). I now address DIRECTV and AT&T's efforts to have Plaintiffs' claims dismissed.

With respect to the claims brought against DirecTV and AT&T, the Second Amended Complaint is far from a picture of clarity. For the most part, Davis attempts to hold DIRECTV and AT&T liable, as principals, for the actions of their alleged agents: CenturyLink, Credence, and Sequeim. In essence, Davis claims that CenturyLink acted on behalf of DIRECTV in using improper sales tactics and incorrectly billing Davis; DIRECTV and AT&T improperly reported Davis to the credit bureau after she discontinued her services; DIRECTV or AT&T improperly turned her account over to Credence and Sequeim for collection; and DIRECTV and AT&T were deceptive in disclosing information related to prices and services.

The Second Amended Complaint contains the following causes of action: (1) violations of the Truth-in-Billing Requirements contained in 47 C.F.R. § 64.2401 (the “TIB Requirements”); (2) fraud and fraudulent inducement; (3) breach of contract; (4) negligent misrepresentation; (5) breach of the Fair Debt Collection Practices Act (“FDCPA”); (6) breach of the Fair and Accurate Credit Transaction Act (“FACA”); (7) breach of the Fair Credit Reporting Act (“FCRA”); and (8) violations of the Texas Deceptive Trade Practices Act (“DTPA”). See Dkt. 38 at 8.

DIRECTV and AT&T seek to dismiss the Second Amended Complaint for a variety of reasons. These include that: (1) Kitchen and Charlie Brown fail to properly assert a single cause of action against DIRECTV and AT&T; (2) Davis fails to adequately allege an agency relationship with any co-defendant to state a valid claim against DIRECTV and AT&T; (3) Davis fails to allege her fraud and fraudulent inducement claims with the required specificity; (4) Davis fails to allege the necessary elements of her breach of contract claim; (5) DIRECTV and AT&T are excluded from Davis's federal consumer protection statutory claims; and (6) Davis's DTPA claims are barred by the two-year statute of limitations.

RULE 12(b)(6) STANDARD

Rule 12(b)(6) authorizes dismissal of a complaint when the plaintiff has failed to state a claim upon which relief can be granted. See FED. R. CIV. P. 12(b)(6). “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.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting BellAtl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “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.” Id. “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. At this initial pleading stage, I am required to accept as true all well-pleaded factual allegations in the Second Amended Complaint. See Twombly, 550 U.S. at 555-56.

ANALYSIS

A. Kitchen and Charlie Brown Fail to State a Cause of Action Against DIRECTV or AT&T

DIRECTV and AT&T first argue that Kitchen and Charlie Brown do not bring any causes of action against them in the Second Amended Complaint. In response, Plaintiffs readily concede this point. See Dkt. 46 at 10 (“Plaintiffs agree that same is true.”). Because Kitchen and Charlie Brown do not state a plausible claim against DIRECTV and AT&T in the Second Amended Complaint, DIRECTV and AT&T's Motion to Dismiss should be granted as far as Kitchen and Charlie Brown are concerned.

Although not necessary, I do think it is helpful to explain precisely why the Second Amended Complaint fails to raise any plausible claim against DIRECTV and AT&T on behalf of Kitchen and Charlie Brown. The Second Amended Complaint states on its very first page that “[a]ll references to Plaintiff shall be to Veronica L. Davis. References to the other Plaintiffs will be designated as Plaintiff, followed by the name of said Plaintiff.” Dkt. 38 at 1 n.1. In the lengthy Claims for Relief section, there are 77 references to Plaintiff, but not a single specific reference to Kitchen or Charlie Brown. This clearly indicates that Davis is the only party bringing claims against DirecTV and AT&T.

The Claims for Relief section of the Second Amended Complaint does include two references to “Plaintiffs,” but this is not anywhere near enough to survive a Rule 12(b)(6) challenge. The breach of contract claim simply states that “Plaintiffs entered into a contract with Defendant,” while the DTPA claim casually mentions that “the Plaintiffs are entitled to treble damages.” Dkt. 38 at 32, 44. As DIRECTV and AT&T correctly note: “As to Kitchen and [Charlie Brown], these two allegations fail to adequately plead the required elements of breach of contract and DTPA violations and are entirely conclusory.” Dkt. 44 at 7.

B. Davis Fails to Sufficiently Allege an Agency Relationship

Davis brings almost all of her claims against DIRECTV and AT&T based on agency principles. The premise of the Second Amended Complaint is that DIRECTV and AT&T are liable for the conduct of other co-defendants, who were allegedly acting as their agents. “Agency is the consensual relationship between two parties when one, the agent, acts on behalf of the other, the principal, and is subject to the principal's control.” Indian Harbor Ins. Co. v. Valley Forge Ins. Grp., 535 F.3d 359, 364 (5th Cir. 2008) (quotation omitted). An agency relationship “requires both the principal's control over the agent and both parties' consent to the agent's acting on the principal's behalf.” Christiana Tr. v. Riddle, 911 F.3d 799, 803 (5th Cir. 2018) (citing Meyer v. Holley, 537 U.S. 280, 286 (2003)).

In the Motion to Dismiss, DIRECTV and AT&T argue that Davis's claims for affirmative relief should be dismissed because she fails to sufficiently allege-or even mention-the fundamental element of agency: control.

In response, Davis accuses DIRECTV and AT&T of claiming that she must “prove” that an agency relationship exists at this early stage of litigation. But DirecTV and AT&T are doing no such thing. Dkt. 46 at 7. Rather, DIRECTV and AT&T correctly note that in order to plead-not prove or establish-agency, Davis must properly allege that an agency relationship exists between the defendants. Merely stating that an entity is an agent does not get a litigant across the goal line. See Maung Ng We v. Merrill Lynch & Co., No. 99-cv-9687, 2000 WL 1159835, at *5 (S.D.N.Y. Aug. 15, 2000) (“[P]laintiffs' conclusory statements that MLIB and Teoh and Elias were ‘agents' of MLC, MLG and/or MLIFC do not allege an agency relationship sufficient to withstand dismissal under [Rule 12(b)(6)]. Plaintiffs must do more than state the legal conclusion that MLIB was the defendants' agent, it must plead facts that support a finding that such agency existed.” (citations omitted)). As explained below, I agree with DIRECTV and AT&T that Davis fails to plead sufficient facts that either CenturyLink, Credence, or Sequeim acted as DIRECTV and AT&T's agent.

Credence and Sequeim: The Second Amended Complaint contains several conclusory paragraphs alleging that DIRECTV and AT&T are liable, as principals, for the actions of Credence and Sequeim for violations of the FDCPA, the FACA and the FCRA:^[1]

[A]n agency relationship existed between [DirecTV]/ATT and Sequeim and [Credence], as Defendants [DirecTV] and ATT retained the services of said debt collectors to collect debts on its behalf.

***

[DirectTV] or ATT (creditor) furnished information to its

...