Izquierdo v. Easy Loans Corp.

RAMON IZQUIERDO, Plaintiff, v. EASY LOANS CORP., Defendant.

Case No. 2:13-cv-1032-MMD-VCF

UNITED STATES DISTRICT COURT DISTRICT OF NEVADA

DATED: June 18, 2014

ORDER

(Def.'s Motion to Reconsider - dkt. no. 20)

I. SUMMARY

Before the Court is Defendant Easy Loans Corporation's ("Easy Loans") Motion to Reconsider. (Dkt. no. 20.) The Court has also considered Plaintiff Ramon Izquierdo's ("Plaintiff") opposition and Easy Loans' reply. For the reasons discussed below, the Motion for Reconsideration is denied.

II. BACKGROUND

This case arises out of alleged violations of the Fair Debt Collections Practices Act. Plaintiff incurred a financial obligation to First USA Bank, N.A. Chase (the "Creditor") for a credit card the Creditor provided to Plaintiff pursuant to a Cardmember Agreement. (Dkt. no. 1 ¶ 1.) The Cardmember Agreement specifically contained a Delaware choice of law provision. (Dkt. no. 8, Ex. 2 at 3.) The choice of law provision reads:

The terms and enforcement of this agreement and your account shall be governed and interpreted in accordance with Federal law and, to the extent state law applies, the law of Delaware, without regard to conflict-of-law principles. The law of Delaware, where we and your account are located, will apply no matter where you live or use the account.

(Id.)

Plaintiff defaulted on the debt in June 2006. (Dkt. no. 1 ¶ 17.) The Creditor either sold, assigned, or transferred the debt to Easy Loans for collection; or, alternatively, the Creditor employed Easy Loans to collect the debt. (Id. ¶ 12.)

On November 12, 2012, Easy Loans sued Plaintiff in Las Vegas Justice Court ("Justice Court Complaint"), attempting to collect the debt. (Id. ¶ 14.) At the time Easy Loans filed the Justice Court Complaint, Easy Loans knew or should have known that both California and Nevada law time-barred the suit. (Id. ¶¶ 19, 21.) Regardless, Easy Loans brought the suit in an attempt to harass Plaintiff into repaying a debt he was no longer responsible to pay. (Id. ¶ 23.)

On June 11, 2013, Plaintiff filed this action alleging violations of the Fair Debt Collections Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq., under multiple sections of the statute, including § 1692d, § 1692e(2, 5, 7, 10), and § 1692f(1). Plaintiff sought actual and statutory damages under § 1692k(a)(1-2).

Easy Loans moved to dismiss the Complaint arguing, among other things, that the Justice Court Complaint was not time-barred under Nevada's six-year statute of limitations for contract claims. In response, Plaintiff argued that California's four-year statute of limitations applied, or alternatively Nevada's four-year statute of limitations for open accounts for goods applied. However, the Court found that Delaware's three-year statute of limitations applied because of the Cardmember Agreement's Delaware choice of law provision. Easy Loans now moves for reconsideration of that determination.

III. LEGAL STANDARD

Although not mentioned in the Federal Rules of Civil Procedure, motions for reconsideration may be brought under Rules 59(e) and 60(b). Rule 59(e) provides that any motion to alter or amend a judgment shall be filed no later than 28 days after entry of the judgment. The Ninth Circuit has held that a Rule 59(e) motion for reconsideration should not be granted "absent highly unusual circumstances, unless the district court is presented with newly discovered evidence, committed clear error, or if there is an intervening change in the controlling law." Marlyn Nutraceuticals, Inc. v. Mucos PharmaGmbH & Co., 571 F.3d 873, 880 (9th Cir. 2009) (quoting 389 Orange Street Partners v. Arnold, 179 F.3d 656, 665 (9th Cir. 1999)).

Under Rule 60(b), a court may relieve a party from a final judgment, order or proceeding only in the following circumstances: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence; (3) fraud; (4) the judgment is void; (5) the judgment has been satisfied; or (6) any other reason justifying relief from the judgment. Stewart v. Dupnik, 243 F.3d 549, 549 (9th Cir. 2000).

A motion for reconsideration must set forth the following: (1) some valid reason why the court should revisit its prior order; and (2) facts or law of a "strongly convincing nature" in support of reversing the prior decision. Frasure v. United States, 256 F. Supp. 2d 1180, 1183 (D. Nev. 2003). On the other hand, a motion for reconsideration is properly denied when the movant fails to establish any reason justifying relief. Backlund v. Barnhart, 778 F.2d 1386, 1388 (9th Cir. 1985) (holding that a district court properly denied a motion for reconsideration in which the plaintiff presented no arguments that were not already raised in his original motion). Motions for reconsideration are not "the proper vehicles for rehashing old arguments," Resolution Trust Corp. v. Holmes, 846 F.Supp. 1310, 1316 (S.D. Tex. 1994) (footnotes omitted), and are not "intended to give an unhappy litigant one additional chance to sway the judge." Durkin v. Taylor, 444 F.Supp. 879, 889 (E.D. Va. 1977). Additionally, it is not appropriate for a party to raise a new argument on a motion for reconsideration. See 389 Orange Street Partners v. Arnold, 179 F.3d 656, 665 (9th Cir. 1999).

IV. DISCUSSION

Easy Loans argues that the Court made an error in its earlier decision and also tries to improperly raise new arguments in its reconsideration motion.

First, Easy Loans argues that the Court's determination that Delaware's statute of limitations applies was incorrect because "neither Plaintiff or (sic) Defendant briefed this issue or raised it as a (sic) argument in the papers." (Dkt. no. 20, at 2.) Easy Loans is wrong. The issue of which state's statute of limitations applied was properly before theCourt. The fact that neither party recognized that the contract contained an explicit Delaware choice of law provision, which is otherwise facially applicable, is of no consequence. Determining which state's statute of limitations applies was a question of law squarely within the purview of this Court and ripe for adjudication. Thus, to the extent that Easy Loans challenges the propriety of the Court's determination that both parties were incorrect, that argument has no merit. The Court is not bound to choose which of two incorrect arguments is less incorrect.

Second, Easy Loans improperly attempts to raise, for the first time in its Motion for Reconsideration, new arguments to support its contention that the Court should have applied Nevada's statute of limitations. These arguments were ripe at the time of Easy Loans' Motion to Dismiss, yet were not raised by Easy Loans. To be sure, Easy Loans was the party to offer the Cardmember Agreement and argued "the subject credit card account was clearly and unequivocally founded upon an instrument in writing." (Dkt. no. 7, at 8.) Easy Loans asserted that Nevada's statute of limitations for contracts applied but offered no argument or explanation why Nevada law should apply, rather than Delaware law pursuant to the Cardmember Agreement's choice of law provision. Easy Loans offers no newly discovered evidence, intervening change in the controlling law, or any other reason justifying reconsideration of the Court's prior Order. Instead, Easy Loans now argues, for the first time, that the Court committed clear error in not applying Nevada's statute of limitations and, alternatively, that if Delaware's statute applies, the Court "failed to recognize Delaware's tolling statute." (Dkt. no. 20, at 2.)

The Court need not consider these new arguments because they are raised improperly on a reconsideration motion. However, in the interest of judicial efficiency and justice, the Court considers Easy Loans' new arguments and again determines that, based on the assumed true allegations of the Plaintiff's Complaint, Easy Loans' underlying Justice Court Complaint was time-barred under Delaware law.

The analysis of Easy Loans' challenge hinges on two successive inquiries: (1) under Nevada's choice of law statutes, does Delaware's limitations period apply? and (2)if Delaware's limitation period applies, does Delaware's tolling statute toll that period until defendant becomes subject to service of process in Delaware? The Court finds that Delaware's limitations period applies and is not tolled.

A. Nevada's Choice of Law Statutes

Federal courts must apply the choice of law rules of the forum state. See Klaxon v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941); Fields v. Legacy Health Sys., 413 F.3d 943, 950 (9th Cir. 2005). Generally, Nevada follows the Restatement (Second) of Conflict of Laws (1971) in determining choice-of-law questions involving contracts. See Progressive Gulf Ins. Co. v. Faehnrich, 130 Nev. Adv. Op. 19, 2014 WL 1258808 *2 (Nev. Mar. 27, 2014) (citing Ferdie Sievers & Lake Tahoe Land Co. v. Diversified Mortgage Investors, 603 P.2d 270, 273 (Nev. 1979) (applying Restatement (Second) of Conflict of Laws § 187 to a contractual choice-of-law clause).

Under the Restatement (Second) of Conflict of Laws ("Restatement"), "[a]n action will be maintained if it is not barred by the statute of limitations of the forum, even though it would be barred by the statute of limitations of another state," with few exceptions. Restatement (Second) of Conflict of Laws § 142. However, where a contract includes a choice of law provision, "[t]he validity of a contractual provision limiting the time in which an action may be brought under the contract is determined by the law selected by application of" Restatement sections 187 and 188, not section 142. See id. at cmt. C relating to contractual provisions.

Under Restatement section 187, the parties' choice of law encompasses any issue "the parties could have resolved by an explicit provision in their agreement directed to that issue." Restatement (Second) of Conflict of Laws § 187 (emphasis added). This broad recognition of Nevada law allows parties to contractually agree to shorter limitations...