Huebner v. Nissan Shapiro Law P.C.

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LEVI HUEBNER, on behalf of himself and all other similarly situated consumers, Plaintiff, v. NISSAN SHAPIRO LAW P.C., Defendant.

No. 19-CV-05747 (HG) (PK)

United States District Court, E.D. New York

March 28, 2023

MEMORANDUM & ORDER

HECTOR GONZALEZ, United States District Judge

Plaintiff Levi Huebner brings this putative class action seeking to recover money damages from Defendant Nissan Shapiro Law P.C. for alleged violations of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §§ 1692-1692p. ECF No. 48-1 (Proposed Amended Complaint). Presently before the Court is Defendant's motion to dismiss the complaint. ECF No. 39. For the reasons set forth below, the Court grants the motion.

BACKGROUND

Defendant is a law firm engaged in debt collection. ECF No. 48-1 ¶¶ 4-5. In September 2018, Plaintiff executed a lease for an apartment in Brooklyn. Id. ¶¶ 1, 8, 19-20. Shortly thereafter, Plaintiff permitted another individual, Elie Poltorak, to occupy the apartment. Id. ¶ 10. Plaintiff alleges that his landlord “refused to honor the occupancy of Poltorak” and “orchestrated a scheme to evict Plaintiff for nonpayment.” ECF No. 48-1 ¶ 14. At some point Plaintiff failed to pay rent and this debt for non-payment of rent was referred to Defendant for collection. Plaintiff asserts that the alleged debt for non-payment of rent is a result of the landlord's failure to “deposit[] the [rent] payment that Plaintiff made on October 3, 2018.” Id. ¶ 22.

Plaintiff further alleges that on October 12, 2018, Defendant served Plaintiff with a three-day notice (“Three-Day Notice”)^[1]threatening to evict him for non-payment. Id. ¶ 21. According to Plaintiff, the Three-Day Notice demanded “Legal Fees” in the amount of $200 and “threatened to subject Plaintiff to eviction proceedings” unless the legal fees were paid within three days. Id. ¶¶ 24-25, 37. Plaintiff alleges that the demand for legal fees violates the FDCPA because such fees were not expressly authorized by the lease agreement and, therefore, rendered the information in the Three-Day Notice “false, deceptive[,] or misleading.” Id. ¶¶ 28-29 (citing 15 U.S.C. §§ 1692(e), 1692(f)).

Plaintiff also alleges that the portion of the Three-Day Notice that was required by the FDCPA to inform Plaintiff that he could halt collection of the debt by disputing the debt within 30 days, see 15 U.S.C. § 1962g, was rendered misleading because the Three-Day Notice also said that “nothing” would “prevent the undersigned landlord from commencing summary proceedings under the law should you fail to pay as demanded above.” ECF No. 48-1 ¶¶ 36-40, 45-47. Plaintiff alleges that this language confused him about whether he had the right preemptively to seek an injunction in state court to prevent his eviction. Id. ¶ 42. Plaintiff further alleges that despite “arrang[ing] a new payment” of his rent shortly after receiving the Three-Day Notice Defendant did, in fact, file a “holdover proceeding” against Plaintiff-although Defendant waited more than 30 days after Plaintiff received the Three-Day Notice before doing so. Id. ¶¶ 22-23.^[2] The complaint does not quantify the damages that Plaintiff supposedly incurred as a result of Defendant's alleged violations of the FDCPA. Instead, Plaintiff seeks “[s]tatutory damages provided under the FDCPA,” “[a]ttorney fees, litigation expenses and costs incurred in bringing this action,” and “[a]ny other relief that this Court deems appropriate and just under the circumstances.” ECF No. 48-1 at 12.

On October 10, 2019, Plaintiff filed this action alleging that the Three-Day Notice violated the FDCPA. ECF No. 1.^[3]Before the case was assigned to this Court, the proceedings were delayed significantly by Defendant's initial default, Plaintiff's delays in seeking a default judgment so that he could purportedly pursue discovery related to a potential motion for class certification, and Defendant's eventual, successful motion to vacate its default. ECF Nos. 11, 21, 31, 32. On August 4, 2022, Defendant filed the instant motion to dismiss: (i) for lack of subject matter jurisdiction on the ground that Plaintiff lacks standing under Rule 12(b)(1); (ii) for failure to state a claim on which relief can be granted under Rule 12(b)(6); and (iii) for judgment on the pleadings under Rule 12(c). ECF No. 39. Plaintiff subsequently filed his opposition and a proposed amended complaint on September 22, 2022.^[4]ECF Nos. 48, 48-1. On October 6, 2022, Defendant filed its reply. ECF No. 49.

LEGAL STANDARD

“A case 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. It is well-settled that the plaintiff bears the burden of proving subject matter jurisdiction by a preponderance of the evidence.” Wewe v. Mount Sinai Hospital, 518 F.Supp.3d 643, 647 (E.D.N.Y. 2021).^[5]A lack of standing constitutes a jurisdictional defect and may be addressed through a motion to dismiss for lack of subject matter jurisdiction. See SM Kids, LLC v. Google LLC, 963 F.3d 206, 210 (2d Cir. 2020) (“A motion to dismiss for lack of Article III standing challenges the subject-matter jurisdiction of a federal court and, accordingly, is properly brought under Fed.R.Civ.P. 12(b)(1).”). When a defendant makes a facial challenge to the sufficiency of the allegations in a plaintiff's complaint related to subject matter jurisdiction, rather than offering extrinsic evidence that attempts to rebut those allegations, the Court must still “accept[] the allegations in the complaint as true and draw[] all reasonable inferences in favor of the plaintiff.” Palmer v. Amazon.com, Inc., 51 F.4th 491, 503 (2d Cir. 2022).

DISCUSSION

For the reasons explained below, the Court lacks subject matter jurisdiction over Plaintiff's FDCPA claims because the allegations in Plaintiff's complaint do not amount to a concrete injury sufficient to confer standing.

I. Plaintiff Fails to Establish Standing

Defendant asserts that Plaintiff fails to establish Article III standing because he did not sufficiently allege an injury in fact. ECF No. 39 at 17-19. Plaintiff argues that Defendant's actions amount to, among other things, a “threat of extortion,” harassment, and a breach of contract, all of which resulted in fear, stress, mental anguish, and suffering, and is sufficient to establish standing. ECF No. 48 at 14-19; ECF No. 48-1 ¶ 34 (Proposed Amended Complaint). Plaintiff further argues that “subjecting Plaintiff to a holdover proceeding” despite having paid rent, injures Plaintiff because “landlords . . . deny tenancy to anyone who has been subject to a holdover proceeding,” and places those tenants on “blacklists.” ECF No. 48 at 17-18; ECF No. 48-1 ¶ 43 (Proposed Amended Complaint).

To establish standing, “a plaintiff must show (i) that he suffered an injury in fact that is concrete, particularized and actual or imminent; (ii) that the injury was likely caused by the defendant; and (iii) that the injury would likely be redressed by judicial relief.” TransUnion LLC v. Ramirez, 141 S.Ct. 2190, 2203 (2021). The Supreme Court has emphasized that a plaintiff must establish standing by demonstrating a “concrete harm” with “a close historical or commonlaw analogue for their asserted injury,” rather than merely a “defendant's violation of [a] statutory prohibition or obligation” established by Congress. Id. at 2204-05. The Court explained that Congress cannot “enact an injury into existence” simply by passing a statute that affords an otherwise “uninjured plaintiff” the right to sue for statutory damages. Id. at 2205-06. The Second Circuit has interpreted TransUnion's “concrete harm” requirement to mean “that in suits for damages plaintiffs cannot establish Article III standing by relying entirely on a statutory violation or risk of future harm.” Maddox v. Bank of N.Y. Mellon Tr. Co., N.A., 19 F.4th 58, 64 (2d Cir. 2021).

Plaintiff's allegations fail because he has not adequately alleged that he suffered a “concrete, particularized” harm as a result of Defendant's alleged violations of the FDCPA. TransUnion, 141 S.Ct. at 2203. Plaintiff's allegation that he suffered “fear, stress, mental anguish, emotional stress, acute embarrassment and suffering,” ECF No. 48-1 ¶ 34, as a result of the Three-Day Notice is insufficient to establish a concrete harm. “The alleged harms are not expenses, costs, any specific lost credit opportunity, or specific emotional injuries .... [S]tress and confusion-without accompanying physical manifestation-do not suffice for standing.” Gross v. TransUnion, 607 F.Supp.3d 269, 273 (E.D.N.Y. 2022) (remanding to state court Fair Credit Reporting Act claims based on insufficient standing allegations); see also Maddox, 19 F.4th at 66 (“A perfunctory allegation of emotional distress especially one wholly incommensurate with the stimulant, is insufficient to plausibly allege constitutional standing.”). Plaintiff does not allege that he ever paid the legal fees described in the Three-Day Notice nor that he was evicted from his apartment as a result of that notice, and he does not explain how Defendant's demand for legal fees caused him any financial or physical harm. “As several courts in this district have recognized, the distress or anxiety caused by simply mailing a collection letter, even if erroneous, is a far cry from extreme and outrageous conduct required to assert a cognizable claim for emotional harm.” Clarke, 2022 WL 3030347, at *3 (emphasis added) (dismissing FDCPA claims and denying leave to amend). This is especially true where, as here, Plaintiff was not even living in the apartment from which Defendant threatened eviction and, therefore, could not have experienced the stress that comes with the...