Medina v. Westdale Brentmoor, LLC

YAQUELIN MEDINA, Plaintiff, v. WESTDALE BRENTMOOR, LLC,d/b/a BRENTMOOR APARTMENTS, et al., Defendants.

No. 5:19-CV-142-D

UNTIED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA WESTERN DIVISION

February 3, 2020

ORDER

On February 28, 2019, Yaquelin Medina ("Medina" or "plaintiff), on behalf of herself and others similarly situated, filed a complaint against Westdale Brentmoor, LLC, d/b/a Brentmoor Apartments ("Westdale Brentmoor"), Westdale Properties America I, LP, a/k/a Westdale Properties America I, Ltd. ("Westdale Properties"), and Westdale Asset Management, Limited Partnership, a/k/a Westdale Asset Management, Ltd. ("Westdale Asset;" collectively, "defendants") in Wake County Superior Court [D.E. 1-1]. In the complaint, Medina alleged that defendants violated the North Carolina Residential Rental Agreements Act ("RRAA"), N.C. Gen. Stat. § 42-38, et seq., the North Carolina Debt Collection Act ("NCDCA"), N.C. Gen. Stat. § 75-50 et seq., and the North Carolina Unfair and Deceptive Trade Practices Act ("UDTPA"), N.C. Gen. Stat. § 75-1 et seq. See Compl. [D.E. 1-1] ¶¶ 103-148. On April 10, 2019, Westdale Asset timely removed the action to this court [D.E. 1].

On May 17, 2019, Westdale Asset moved to dismiss the complaint for failure to state a claim [D.E. 18] and filed a memorandum in support [D.E. 19]. On the same date, Westdale Brentmoor and Westdale Properties moved to dismiss the complaint for failure to state a claim [D.E. 20] and filed a memorandum in support [D.E. 21]. On July 5, 2019, Medina amended her complaint [D.E. 24]. Medina repeats the allegations and requests of her original complaint and also alleges that defendants made numerous negligent misrepresentations. See Am. Compl. [D.E. 24] ¶¶ 167-236. On August 19, 2019, defendants moved to dismiss the complaint for failure to state a claim [D.E. 26] and filed a memorandum in support [D.E. 27]. On October 14, 2019, Medina responded in opposition [D.E. 31]. On November 4, 2019, defendants replied [D.E. 33]. As explained below, the court grants defendants' motion to dismiss [D.E. 26].

I.

Medina is a former tenant who leased an apartment at Westdale Brentmoor from defendants for a term beginning March 1, 2017, and ending May 31, 2018. See Am. Compl. ¶¶ 8, 97; Pl.'s Ex. 1 [D.E. 24-1] 1, 14; Pl.'s Ex. 6 [D.E. 24-6] 1. Under the lease agreement, Medina paid a total rent amount of $1,338. See Pl.'s Ex. 1 [D.E. 24-1] 1; cf. Am. Compl. ¶ 99. Rent was due on or before the first day of each month, and the agreement provides no grace periods for payment. See Pl.'s Ex. 1 [D.E. 24-1] 1. Failure to pay to rent on time constituted default. See id. at 13 (emphasis omitted). If a tenant defaulted, the lease authorized defendants to file a summary ejectment complaint in state court. See id. at 13. If defendants did so, Medina agreed in the lease to pay the highest of three fees: a complaint filing fee, a court appearance fee, or a second trial fee. See id. at 13-14; cf. id. at 2. Medina also agreed to pay "any and all expenses, damages, and costs (including reasonable attorney's fees and court costs)" as a result of default. See id. at 13 (emphasis omitted).

Medina alleges that defendants follow a regular procedure if a tenant fails to timely pay rent. See Am. Compl. ¶ 38, 59. First, on approximately the sixth day of the month, defendants charge the tenant "late fees." See id. ¶¶ 33, 80; cf. Pl.'s Ex. 6 [D.E. 24-6] 2. Following the tenth day of themonth, defendants charge a separate amount for "eviction fees," at times before filing or serving a complaint for summary ejectment and without a court order. See Am. Compl. ¶¶ 57, 63, 80; cf. Pl.'s Ex. 6 [D.E. 24-6] 2.¹ The "eviction fees" are the complaint-filing fee ($96), the sheriff service fee ($30), and the flat attorney fee. See Am. Compl. ¶¶ 40-42, 45-47, 81.² When defendants assess the "late fees" and "eviction fees," defendants record both in the tenant's apartment account ledger as "Legal Fees." See Am. Compl. ¶ 64; cf. Pl.'s Ex. 6 [D.E. 24-6] 2-3. Following the tenth day of the month, defendants cause written letters or emails ("Collection Letter") to be delivered to the tenant stating that "[c]ourt papers were filed today for eviction/possession of your apartment," and that the only way to prevent eviction is to pay "the full balance and legal fee." See Am. Compl. ¶ 82 (emphasis omitted); cf. Pl.'s Ex. 5 [D.E. 24-5] 1. Once the fees are recorded on a tenant's ledger, plaintiff alleges that tenants owe the fees even if the summary ejectment case is dismissed or a judge orders the fees to be assessed against defendants. See Am. Compl. ¶ 93.

Medina did not timely pay rent on at least two occasions in June and July of 2017. See id. ¶¶ 103, 121. Following the fifth day of both months, defendants recorded a "late fee" of $66.90 in Medina's ledger. See id. Defendants then sent a Collection Letter to Medina on June 12, 2017, for the June default, and on July 11, 2017, for the July default. See id. ¶¶ 104-105, 122-23. On the same dates, defendants recorded the "eviction fees" in Medina's ledger. See id. ¶¶ 106, 124. The June "eviction fees" totaled $231, and the July eviction fees totaled $241. See id. Defendants filed a complaint for summary ejectment on June 15, 2017, for the June default and on July 14, 2017, forthe July default. See id. ¶¶ 114, 128; cf. Pl.'s Ex. 7 [D.E. 24-7]; Pl.'s Ex. 8 [D.E. 24-8].

Medina alleges that, when defendants added the "eviction fees" to her ledger, defendants had not filed a summary ejectment complaint, the court had not charged its filing fee, and defendants had not incurred any costs of serving process. See id. ¶¶ 108-116, 125-133. Medina also alleges that the Collection Letter falsely claims that defendants were entitled to the "eviction fees." See id. ¶¶ 117, 134. Medina cured both instances of default by paying the "eviction fees" and late fees, and defendants voluntarily dismissed the summary ejectment complaints without prejudice. See id. ¶¶ 116-119, 134-137; cf. Pl.'s Ex. 7 [D.E. 24-7]; Pl.'s Ex. 8 [D.E. 24-8]. Medina alleges that she did not settle with defendants. See Am. Compl. ¶¶ 117, 135.

II.

A motion to dismiss under Rule 12(b)(6) tests the complaint's legal and factual sufficiency. See Iqbal, 556 U.S. at 677-80; Twombly, 550 U.S. at 554- 63; Coleman v. Md. Court of Appeals, 626 F.3d 187, 190 (4th Cir. 2010), aff'd, 566 U.S. 30 (2012); Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., 591 F.3d 250, 255 (4th Cir. 2009); Giarratano v. Johnson, 521 F.3d 298, 302 (4th Cir. 2008). To withstand a Rule 12(b)(6) motion, a pleading "must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Iqbal, 556 U.S. at 678 (quotation omitted); see Twombly, 550 U.S. at 570; Giarratano, 521 F.3d at 302. In considering the motion, the court must view the facts and reasonable inferences "in the light most favorable to the [nonmoving party]." Massey v. Ojaniit, 759 F.3d 343, 352 (4th Cir. 2014) (quotation omitted); see Clatterbuck v. City of Charlottesville, 708 F.3d 549, 557 (4th Cir. 2013), abrogated on other grounds by Reed v. Town of Gilbert, 135 S. Ct. 2218 (2015). A court need not accept as true a complaint's legal conclusions, "unwarranted inferences, unreasonable conclusions, or arguments." Giarratano, 521 F.3d at 302 (quotation omitted); see Iqbal, 556 U.S. at 678-79.Rather, a plaintiff's allegations must "nudge[ ] [the] claims," Twombly, 550 U.S. at 570, beyond the realm of "mere possibility" into "plausibility." Iqbal, 556 U.S. at 678-79.

When evaluating a motion to dismiss, a court considers the pleadings and any materials "attached or incorporated into the complaint" E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 448 (4th Cir. 2011); see Fed. R. Civ. P. 10(c); Goines v. Valley Cmty. Servs. Bd., 822 F.3d 159, 165-66 (4th Cir. 2016); Thompson v. Greene, 427 F.3d 263, 268 (4th Cir. 2005). A court also may consider a document submitted by a moving party if it is "integral to the complaint and there is no dispute about the document's authenticity" without converting the motion into one for summary judgment. Goines, 822 F.3d at 166. Additionally, a court may take judicial notice of public records. See, e.g., Fed. R. Evid. 201; Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007); Philips v. Pitt Cty. Mem'l Hosp., 572 F.3d 176, 180 (4th Cir. 2009).

Defendants' motions require the court to consider the Medina's state law claims, and North Carolina law applies. Accordingly, this court must predict how the Supreme Court of North Carolina would rule on any disputed state-law issue. See Twin City Fire Ins. Co. v. Ben Arnold-Sunbelt Beverage Co. of S.C., 433 F.3d 365, 369 (4th Cir. 2005). In doing so, the court must look first to opinions of the Supreme Court of North Carolina. See id.; Stahle v. CTS Corp., 817 F.3d 96, 100 (4th Cir. 2016). If there are no governing opinions from that court, this court may consider the opinions of the North Carolina Court of Appeals, treatises, and "the practices of other states." Twin City Fire Ins. Co., 433 F.3d at 369 (quotation omitted).³ In predicting how the highest court of a state would address an issue, this court must "follow the decision of an intermediate state appellate court unless there [are] persuasive data that the highest court would decide differently." Toloczko,728 F.3d at 398 (quotation omitted); Hicks v. Feiock, 485 U.S. 624, 630 & n.3 (1988). Moreover, in predicting how the highest court of a state would address an issue, this court "should not create or expand a [s]tate's public policy." Time Warner Entm't-Advance/Newhouse P'ship v. Carteret-Craven Elec. Membership Corp., 506 F.3d 304, 314 (4th Cir. 2007) (alteration and quotation omitted); Day & Zimmerman, Inc. v. Challoner, 423 U.S. 3, 4 (1975) (per curiam); see Wade v. Danek Med., Inc., 182 F.3d 281, 286 (4th Cir. 1999).

A.

Medina alleges that defendants violated the 2009...