Feldheim v. Fin. Recovery Servs., Inc.

257 F.Supp.3d 361

Felix FELDHEIM, Plaintiff,

v.FINANCIAL RECOVERY SERVICES, INC., Defendant.

No. 16-CV-3873 (KMK).

United States District Court, S.D. New York.

Signed June 28, 2017

Filed June 29, 2017

Edward B. Geller, Esq., Edward B. Geller, Esq., P.C., Bronx, NY, Counsel for Plaintiff.

Michael T. Etmund, Esq., Moss & Barnett, Minneapolis, MN, Counsel for Defendant.

Matthew B. Spergel, Esq., Scott A. Schechter, Esq., Kaufman Borgeest & Ryan, LLP, Valhalla, NY, Counsel for Defendant.

Patrick Stoltz, Esq., Landman Corsi Ballaine & Ford PC, New York, NY, Counsel for Defendant.

OPINION & ORDER

KENNETH M. KARAS, UNITED STATES DISTRICT JUDGE

Plaintiff Felix Feldheim ("Plaintiff") brings this putative class action against Financial Recovery Services, Inc. ("FRS" or "Defendant"), alleging violations of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692, et seq. (See Am. Compl. (Dkt. No. 17).) Before the Court is Defendant's Motion To Dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) (the "Motion"). (See Dkt. No. 26.) For the reasons to follow, Defendant's Motion is granted.

I. Background

A. Factual Background

The following facts are taken from Plaintiff's Amended Complaint and are assumed true for the purpose of resolving the instant Motion.

Plaintiff alleges that Defendant, "on behalf of a third-party or itself ... began efforts to collect an alleged consumer debt from Plaintiff." (Am. Compl. ¶ 22.) "On or about January 26[,] 2016[,] Plaintiff received a mass-produced notice from Defendant ... [bearing] a heading stating: "Tax Season Settlement Reduction Offer." (Id. ¶¶ 24–25.) The notice alerted Plaintiff that "the current creditor was Discover Bank" and that Plaintiff owed $4,414.61. (Id. ¶ 27.) The notice also provided three reduction options to Plaintiff: (1) "a reduction of 75% for a lump sum payment of $1[,]003[.]65"; (2) "a reduction of 68.50[%] for a [two] time payment of $1,434[.]74"; and (3) "a reduction of 60% for a three time payment of $1,765.83." (Id. ¶ 28.) Finally, the notice stated that "[a]s of the date of this notice[,] you owe [$]4,414.61 ...." (Id. ¶ 29 (internal quotation marks omitted).) Plaintiff avers that this language "implie [d] that the balance w[ould] change on a daily bas[i]s and interest [wa]s being charged." (Id. )

As a result of Defendant's alleged violations of the FDCPA, Plaintiff seeks actual damages, statutory damages, attorney's fees and costs, and "a declaration that ... Defendant's practices violated the FDCPA." (Id. at unnumbered 7.)

B. Procedural History

Plaintiff filed the initial Complaint in this Action on May 24, 2016. (See Dkt. No. 1.) At a conference before the Court on September 13, 2016, Plaintiff was granted leave to file an Amended Complaint by no later than October 13, 2016. (See Dkt. (minute entry for Sept. 13, 2016).) Plaintiff failed to file an Amended Complaint within the time permitted and accordingly, on October 19, 2016, the Court issued an Order To Show Cause, ordering Plaintiff to show cause why the Action should not be dismissed for failure to prosecute. (See Dkt. No. 14.) In a letter filed the following day, counsel for Plaintiff notified the Court that he "did not file an Amended Complaint"—despite the Court's directive—"because [he] was waiting to first hear from Defendant regarding [a settlement] demand." (See Dkt. No. 15.) The Court granted Plaintiff an extension of time to file an Amended Complaint, (see Dkt. No. 16), and Plaintiff filed the Amended Complaint on October 27, 2016, (see Dkt. No. 17).

Pursuant to a Scheduling Order dated December 13, 2016, (see Dkt. No. 25), Defendant filed the instant Motion To Dismiss and accompanying memorandum of law on January 17, 2017, (see Dkt. Nos. 26–27). On February 22, 2017, two days before Plaintiff's opposition was due, Plaintiff's counsel requested an extension, (see Dkt. No. 28), which the Court granted the following day, (see Dkt. No. 29). On April 14, 2017, Defendant filed a letter informing the Court that while "[t]here was no [m]emorandum in [o]pposition filed electronically by Plaintiff ..., a copy was e-mailed to [Defendant's counsel's] office on March 24, 2017." (See Dkt. No. 30.) The letter also informed the Court that Defendant did not intend to file papers in reply. (See id. ) Without explanation for Plaintiff's failure to timely file his opposition with the Court, Plaintiff filed his opposition on April 17, 2014. (See Dkt. No. 31.)

II. Discussion

A. Standard of Review

Defendant moves to dismiss Plaintiff's Amended Complaint pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). (See Def.'s Mem. of Law in Supp. of Mot. for Dismissal Pursuant to Fed. R. Civ. P. 12(b)(1) & 12(b)(6) ("Defs.' Mem.") 1 (Dkt. No. 27).)

"The standards of review for a motion to dismiss under Rule 12(b)(1) for lack of subject matter jurisdiction and under 12(b)(6) for failure to state a claim are substantively identical." Gonzalez v. Option One Mortg. Corp. , No. 12-CV-1470, 2014 WL 2475893, at *2 (D. Conn. June 3, 2014) (internal quotation marks omitted); see also Neroni v. Coccoma , No. 13-CV-1340, 2014 WL 2532482, at *4 (N.D.N.Y. June 5, 2014) (same), aff'd , 591 Fed.Appx. 28 (2d Cir. 2015). "In deciding both types of motions, the Court must accept all factual allegations in the complaint as true, and draw inferences from those allegations in the light most favorable to the plaintiff." Gonzalez , 2014 WL 2475893, at *2 (internal quotation marks omitted); see also Seemann v. U.S. Postal Serv. , No. 11-CV-206, 2012 WL 1999847, at *1 (D. Vt. June 4, 2012) (same). However, "[o]n a Rule 12(b)(1) motion, ... the party who invokes the Court's jurisdiction bears the burden of proof to demonstrate that subject matter jurisdiction exists, whereas the movant bears the burden of proof on a motion to dismiss under Rule 12(b)(6)." Gonzalez , 2014 WL 2475893, at *2 ; see also Sobel v. Prudenti , 25 F.Supp.3d 340, 352 (E.D.N.Y. 2014) ("In contrast to the standard for a motion to dismiss for failure to state a claim under Rule 12(b)(6), a plaintiff asserting subject matter jurisdiction has the burden of proving by a preponderance of the evidence that it exists." (internal quotation marks omitted)). This allocation of the burden of proof is "[t]he only substantive difference" between the standards of review under these two rules. Smith v. St. Luke's Roosevelt Hosp. , No. 08-CV-4710, 2009 WL 2447754, at *9 n.10 (S.D.N.Y. Aug. 11, 2009), adopted by 2009 WL 2878093 (S.D.N.Y. Sept. 2, 2009) ; see also Fagan v. U.S. Dist. Court for S. Dist. of N.Y. , 644 F.Supp.2d 441, 446–47 & n.7 (S.D.N.Y. 2009) (same).

1. Rule 12(b)(1)

"A federal court has subject matter jurisdiction over a cause of action only when it has authority to adjudicate the cause pressed in the complaint." Bryant v. Steele , 25 F.Supp.3d 233, 241 (E.D.N.Y. 2014) (internal quotation marks omitted). "Determining the existence of subject matter jurisdiction is a threshold inquiry[,] and a claim is properly dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or constitutional power to adjudicate it." Morrison v. Nat'l Austl. Bank Ltd. , 547 F.3d 167, 170 (2d Cir. 2008) (internal quotation marks omitted), aff'd , 561 U.S. 247, 130 S.Ct. 2869, 177 L.Ed.2d 535 (2010) ; see also Butler v. Ross , No. 16-CV-1282, 2016 WL 3264134, at *3 (S.D.N.Y. June 14, 2016) (same). Nevertheless, "[u]nlike Article III standing, which ordinarily should be determined before reaching the merits, statutory standing may be assumed for the purposes of deciding whether the plaintiff otherwise has a viable cause of action." Coan v. Kaufman , 457 F.3d 250, 256 (2d Cir. 2006) (citation omitted). While a district court resolving a motion to dismiss under Rule 12(b)(1)"must take all uncontroverted facts in the complaint ... as true, and draw all reasonable inferences in favor of the party asserting jurisdiction," "where jurisdictional facts are placed in dispute, the court has the power and obligation to decide issues of fact by reference to evidence outside the pleadings, such as affidavits," in which case "the party asserting subject matter jurisdiction has the burden of proving by a preponderance of the evidence that it exists." Tandon v. Captain's Cove Marina of Bridgeport, Inc. , 752 F.3d 239, 243 (2d Cir. 2014) (alteration and internal quotation marks omitted); see also Ray Legal Consulting Grp. v. Gray , 37 F.Supp.3d 689, 696 (S.D.N.Y. 2014) ("[W]here subject matter jurisdiction is contested a district court is permitted to consider evidence outside the pleadings, such as affidavits and exhibits.").

2. Rule 12(b)(6)

"While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of his [or her] entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (citations, alteration, and internal quotation marks omitted). Indeed, Rule 8 of the Federal Rules of Civil Procedure"demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). "Nor does a complaint suffice if it tenders naked assertions devoid of further factual enhancement." Id. (alteration and internal quotation marks omitted). Instead, a complaint's "[f]actual allegations must be enough to raise a right to relief above the speculative level." Twombly , 550 U.S. at 555, 127 S.Ct. 1955. Although "once a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint," id. at 563, 127 S.Ct. 1955, and a plaintiff must allege "only enough facts to state a claim to relief that is plausible on its face," id. at 570, 127 S.Ct. 1955, if...