Marshall v. Bank

KERRY MARSHALL, Plaintiff,

v.WEBSTER BANK, N.A., and nLINDA N. MAYO, Defendants.

CIVIL CASE NO. 3:10-cv-908 (JCH)

UNITED STATES DISTRICT COURT DISTRICT OF CONNECTICUT

DATED: January 20, 2011

RULING RE: DEFENDANTS' MOTION TO DISMISS (DOC. NO. 21) & PLAINTIFF'S MOTION TO STRIKE (DOC. NO. 35)

I. INTRODUCTION

Proceeding pro se, Kerry Marshall asserts federal and state law claims against Webster Bank, N.A. ("Webster") and Linda Mayo, an attorney for Webster. Marshall alleges that Webster deducted money from his bank account, closed that account, and reported to a third party that he was suspected of fraud activity. Marshall alleges that Mayo colluded with Webster and took inappropriate actions to deny him any recourse. Defendants filed a Motion to Dismiss (Doc. No. 21) pursuant to Fed. R. Civ. P. 12(b)(1) and 12(b)(6). After the Motion was briefed, Marshall filed a Motion to Strike (Doc. No. 35) defendants' Reply Memorandum. For the following reasons, defendants' Motion to Dismiss is granted in part and denied in part. Marshall's Motion to Strike is denied.

II. LEGAL STANDARD

A. Motion to Dismiss for Lack of Subject Matter Jurisdiction

A motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(1) challenges the court's subject matter jurisdiction. "Determining the existence of subject matter jurisdiction is athreshold 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." Arar v. Ashcroft, 532 F.3d 157, 168 (2d Cir. 2008). "A plaintiff asserting subject matter jurisdiction has the burden of proving by a preponderance of the evidence that it exists." Morrison v. Nat'l Australia Bank, 547 F.3d 167, 170 (2d Cir. 2008) (quotation omitted). "The court must take all facts alleged in the complaint as true and draw all reasonable inferences in favor of plaintiff, but jurisdiction must be shown affirmatively, and that showing is not made by drawing from the pleadings inferences favorable to the party asserting it." Id. (citation and quotations omitted). The court "may resolve the disputed jurisdictional fact issues by reference to evidence outside the pleadings, such as affidavits." Zappia Middle E. Constr. Co. v. Emirate of Abu Dhabi, 215 F.3d 247, 253 (2d Cir. 2000); see also Morrison, 547 F.3d at 170.

The court's inquiry is limited to those legal requirements that pertain to the court's authority to adjudicate the case, as opposed to those that identify threshold requirements, or other substantive elements, of a claim for relief. A failure to plead or establish an element of the latter kind does not warrant dismissal for lack of subject matter jurisdiction. See Reed Elsevier, Inc. v. Muchnick, 130 S. Ct. 1237, 1243-44 (2010) (criticizing "'drive by jurisdictional rulings, ' which too easily can miss the 'critical difference[s]' between true jurisdictional conditions and nonjurisdictional limitations on causes of action" (citations omitted)); Arbaugh v. Y&H Corp., 546 U.S. 500, 515-16 (2006) (holding that failure to establish that defendant had 15 employees, as required for a claim under Title VII, did not warrant dismissal for lack of subject matter jurisdiction). To identify statutory jurisdictional requirements, the court applies a "readilyadministrable bright line" test:

If the Legislature clearly states that a threshold limitation on a statute's scope shall count as jurisdictional, then courts and litigants will not be left to wrestle with the issue. But when Congress does not rank a statutory limitation on coverage as jurisdictional, courts should treat the restriction as nonjurisdictional in character.

Arbaugh, 546 U.S. at 515-16 (footnote and citation omitted); accord Reed Elsevier, 130 S. Ct. at 1244.

B. Motion to Dismiss for Failure to State a Claim

Upon a motion to dismiss pursuant to Rule 12(b)(6), the court must determine whether the plaintiff has stated a legally-cognizable claim by making allegations that, if true, would show he is entitled to relief. See Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 557 (2007) (interpreting Rule 12(b)(6), in accordance with Rule 8(a)(2), to require allegations with "enough heft to 'sho[w] that the pleader is entitled to relief'"). The court takes the factual allegations of the complaint to be true, Hemi Group, LLC v. City of New York, 130 S. Ct. 983, 986-87 (2010), and from those allegations, draws all reasonable inferences in the plaintiff's favor, Fulton v. Goord, 591 F.3d 37, 43 (2d Cir. 2009).

To survive a motion pursuant to Rule 12(b)(6), "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, 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atlantic 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. The plausibility standard is not akin to a 'probability requirement, ' but it asks for more than a sheer possibility that a defendanthas acted unlawfully." Iqbal, 129 S. Ct. at 1949 (2009) (quoting Twombly, 550 U.S. at 556).

The plausibility standard does not impose an across-the-board, heightened fact pleading standard. Boykin v. KeyCorp, 521 F.3d 202, 213 (2d Cir. 2008). The plausibility standard does not "require[ ] a complaint to include specific evidence [or] factual allegations in addition to those required by Rule 8." Arista Records, LLC v. Doe 3, 604 F.3d 110, 119 (2d Cir. 2010); see also Erickson v. Pardus, 551 U.S. 89, 94 (2007) (holding that dismissal was inconsistent with the "liberal pleading standards set forth by Rule 8(a)(2)"). However, the plausibility standard does impose some burden to make factual allegations supporting a claim for relief. As the Iqbal court explained, it "does not require detailed factual allegations, but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation. A pleading that offers labels and conclusions or a formulaic recitation of the elements of a cause of action will not do. Nor does a complaint suffice if it tenders naked assertions devoid of further factual enhancement." Iqbal, 129 S. Ct. at 1949 (citations and internal quotations omitted). Under the Second Circuit's gloss, the plausibility standard is "flexible, " obliging the plaintiff "to amplify a claim with some factual allegations in those contexts where such amplification is needed to render the claim plausible." Boykin, 521 F.3d at 213 (citation omitted); accord Arista Records, 604 F.3d at 120.

C. Application of Standards to Pro Se Submissions

Regardless of the basis for a motion to dismiss, "the submissions of a pro se litigant must be construed liberally and interpreted to raise the strongest arguments that they suggest." Triestman v. Federal Bureau of Prisons, 470 F.3d 471, 474 (2d Cir. 2006) (emphasis in original, quotation omitted). This principle has not been undercut by the announcement of the plausibility standard in Twombly. After deciding Twombly, the Supreme Court reaffirmed that a "document filed pro se is to be liberally construed, and a pro se complaint, however inartfully pleaded, must be held to less stringent standards than formal pleadings drafted by lawyers." Erickson, 551 U.S. at 94. The Erickson Court held that the lower court's "departure from the liberal pleading standards set forth by Rule 8(a)(2)" was "more pronounced" because the plaintiff had been proceeding without counsel. Id. Thus, "even after Twombly, dismissal of a pro se claim as insufficiently pleaded is appropriate only in the most unsustainable of cases." Boykin, 521 F.3d at 216.

Where a pro se complaint must be dismissed due to a pleading deficiency, the court should generally provide leave to amend. Watts v. Services for the Underserved, 309 F. App'x 533, 535 (2d Cir. 2009) ("[W]here the ground for dismissal is quite narrow and the plaintiff appears pro se, it was error to enter judgment... rather than permitting plaintiff at least one chance to cure a pleading defect."); Gomez v. USAA Fed. Sav. Bank, 171 F.3d 794, 795 (2d Cir.1999) ("Certainly the court should not dismiss without granting leave to amend at least once when a liberal reading of the [pro se] complaint gives any indication that a valid claim might be stated.").

III. FACTS

The Complaint alleges that Marshall opened a checking account with Webster Bank on December 4, 2007. At that time, Webster Bank representatives checked Marshall's record with "ChexSystems" and permitted him to open an account.¹Complaint ¶ 8. On or about February 13, 2008, a Webster Bank representative fraudulently and "unlawfully access[ed] and remov[ed] monies" from Marshall's checking account, using a "manufactured setoff" of an "alleged $233 debt" as a pretext for doing so. Id. ¶¶ 9, 14. Marshall's account was then closed by Webster Bank. Id. ¶ 9.

On or about July 21, 2009, Marshall became aware that Webster had reported to ChexSystems that Marshall was "suspected of fraud activity." Id. ¶¶ 10, 16. Marshall alleges that this report was inaccurate and libelous, that Webster Bank failed to investigate the matter prior to reporting it, and that Webster Bank failed to notify him of the negative report within 30 days. ki Marshall also alleges that Webster Bank failed to provide any procedure for resolving these issues, but instead colluded with Attorney Mayo to deny him recourse. Id. ¶¶ 11, 12. The Complaint alleges that Mayo engaged in "bad faith and harassing litigation conduct" and "asserted a defense without probable cause." Id. ¶ 12. The only indication of where this conduct occurred comes in a footnote, where the Complaint refers to an "underlying" state court action in which Mayo allegedly "court[ed] favor with the trier of fact and/or court clerks."² Id.¶ 12.

Marshall alleges that Webster took some or all of these actions in...