Opinion
No. C 02-5755 SI.
June 16, 2003.
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS
On May 22, 2003 the Court heard argument on defendant's motion to dismiss. Having carefully considered the arguments of the parties and the papers submitted, the Court GRANTS defendant's motion to dismiss.
BACKGROUND
Plaintiff Alma Strozier was a class member in Providian Credit Card Cases, J.C.C.P. No. 4085 (San Francisco Superior Court (Pollak, J.)), a class action on behalf of Providian credit card customers whose accounts were assessed fees, interest, finance charges and/or other charges between March 19, 1995 and December 14, 2000. See Declaration of Caryn Becker, ¶ 2. Defendant Lieff, Cabraser, Heimann Bernstein LLP ("Lieff") was one of four law firms appointed Plaintiffs' Co-Lead Counsel in that case, and one of two firms appointed Plaintiffs' Co-Lead Counsel in the federal MDL action, In re Providian Financial Corp. Credit Card Terms Litig., M.D.L. No. 1301 (E.D. Pa. (Yohn, J.)). Becker Decl. ¶ 3. The Providian cases were resolved by settlement.
Shortly after the preliminary approval of the settlement, a Notice of Settlement was sent out by direct mail to all class members at the class member's last known address contained in Providian's computerized files. Becker Decl. ¶ 8; Exhibit A to Becker Decl. This Notice states "individual payments are estimated to be less than $20 in most cases." Exhibit A to Becker Decl. at 3. Ms. Strozier's benefits under the settlement totaled $14.51. Becker Decl. ¶ 11. This benefit was set off from the amount that she owed to Providian. Id. Class members were entitled to opt out of the settlement by sending a notice to that effect by July 23, 2001. On November 8, 2001, Judge Pollak granted final approval to a settlement awarding over $100 million in cash and credits to class members. Exhibit B. to Becker Decl. Ms. Strozier neither objected to nor opted out of the class settlement. Becker Decl. ¶ 4.
Ms. Strozier filed her complaint with this Court on December 10, 2002, alleging that she was told by Lieff that "she would be fully compensated for the losses that she incurred" and that she "has yet to receive appropriate compensation." Complaint ¶¶ 6-7. Lieff has not yet been formally served with the summons and complaint, and was alerted to the complaint on April 8, 2003, by a voice mail message from Ms. Strozier to a paralegal at Lieff.
Now before the Court is defendant's motion to dismiss for lack of subject matter jurisdiction, failure to state a claim, failure to satisfy notice pleading requirements, and lack of standing.
LEGAL STANDARD
A. Rule 12(b)(1)
"It is a fundamental principle that federal courts are courts of limited jurisdiction. The limits upon federal jurisdiction, whether imposed by the Constitution or by Congress, must be neither disregarded nor evaded." Owen Equipment Erection Co. v. Kroger, 437 U.S. 365,374,98 S.Ct. 2396, 2403 (1978). "A federal court is presumed to lack jurisdiction in a particular case unless the contrary affirmatively appears." General Atomic Co. v. United Nuclear Corp., 655 F.2d 968,969 (9th Cir. 1981). Accordingly, the burden rests on the party asserting federal subject matter jurisdiction to prove its existence. California ex rel. Younger v. Andrus, 608 F.2d 1247, 1249 (9th Cir. 1979).
B. Rule 12(b)(6)
Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if it fails to state a claim upon which relief can be granted. The question presented by a motion to dismiss is not whether the plaintiff will prevail in the action, but whether the plaintiff is entitled to offer evidence in support of the claim. See Scheuer v. Rhodes, 416 U.S. 232, 236 (1974), overruled on other grounds by Davis v. Scherer, 468 U.S. 183, 104 S.Ct. 3012 (1984).
In answering this question, the Court must assume that the plaintiffs allegations are true and must draw all reasonable inferences in the plaintiffs favor. See Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987). Even if the face of the pleadings suggests that the chance of recovery is remote, the Court must allow the plaintiff to develop the case at this stage of the proceedings. See United States v. City of Redwood City, 640 F.2d 963, 966 (9th Cir. 1981).
If the Court dismisses the complaint, it must then decide whether to grant leave to amend. The Ninth Circuit has "repeatedly held that a district court should grant leave to amend even if no request to amend the pleading was made, unless it determines that the pleading could not possibly be cured by the allegation of other facts." Lopez v. Smith, 203 F.3d 1122, 1130 (9th Cir. 2000) (citations and internal quotation marks omitted).
C. Rule 8(a)
Federal Rule of Civil Procedure 8(a) states that pleadings shall contain:
(1) a short and plain statement of the grounds upon which the court's jurisdiction depends, unless the court already has jurisdiction and the claim needs no new grounds of jurisdiction to support it, (2) a short and plain statement of the claim showing that the pleader is entitled to relief, and (3) a demand for judgment for the relief the pleader seeks.
D. Standing
There are both constitutional and prudential dimensions to the standing question. The constitutional prerequisites to standing are (1) an injury in fact which is concrete and not conjectural; (2) a causal connection between the injury and defendant's conduct or omissions, and a likelihood that the injury will be redressed by a favorable decision. Lujan v. Defenders of Wildlife, 112 S.Ct. 2130 (1992). The prudential limitations require (1) that the plaintiff's claim must fall within the zone of interests to be protected or regulated by the statute or constitutional guarantee in question; (2) that the claim must be for injury to the plaintiffs own legal rights and interests, rather than the legal rights and interests of third parties; and (3) that the injury be individualized or confined to a discrete group as opposed to a generalized grievance. Valley Forge Christian College v. Americans United for Separation of Church and State, 102 S.Ct. 752 (1982).
DISCUSSION
Defendant asserts that this complaint should be dismissed: a) for lack of subject matter jurisdiction; b) for failure to state a claim; c) for failure to satisfy notice pleading requirements; and d) lack of standing. Each of these bases on its own is dispositive in favor of the defendants. The Court will address each of these concerns in turn.
A. Subject Matter Jurisdiction
Defendant contends that plaintiff's complaint is subject to dismissal under Federal Rule of Civil Procedure 12(b)(1), which allows dismissal for "lack of jurisdiction over the subject matter." Defendant maintains that plaintiff has alleged no federal claim, and thus there is no federal question under 28 U.S.C. § 1331. Furthermore, defendant contends that there is no diversity jurisdiction under 28 U.S.C. § 1331 because plaintiff has not and cannot demonstrate that the amount in controversy exceeds $75,000. Defendant is correct that plaintiff has not alleged a federal claim and that plaintiff has not demonstrated that the amount in controversy exceeds $75,000. Plaintiff actually received benefits of $14.51 as a result of the settlement, apparently offset against other amounts she owed Provident. Plaintiff complains, in her opposition papers, that she was discriminated against because representative plaintiffs received as much as $2500. Since these higher amounts were authorized by the Court in advance, and effectively represented compensation to the representative plaintiffs for their time and effort spent on the case, the higher amounts do not reflect any damage to plaintiff. In any event, from the facts alleged by plaintiff, both in her complaint and in her papers filed in opposition to the motion to dismiss, it is clear that the amount in controversy "could not possibly" reach or exceed $75,000.Lopex v. Smith, 203 F.3d at 1130. Therefore, this Court finds that plaintiffs claim fails for lack of subject matter jurisdiction and that any amendment would be futile. Accordingly, leave to amend is not granted.
B. Failure to State a Claim
Defendant further alleges that the complaint should be dismissed because plaintiff has failed to state a claim upon which relief can be granted. Judge Pollak granted the final approval of the settlement after three days of extensive hearings. See Exhibit B to Becker Decl. It is clear from Ms. Strozier's complaint that she was aware of the settlement and knew how to contact class counsel, particularly since she alleges that she spoke with someone at Lieff in April 2002. Complaint ¶ 6; Letter of Alma Strozier to Court, filed March 21,2003. While defendant denies that anyone from the firm had any conversation with Ms. Strozier about this case, or told her that she would get more than "$20.00 or $14.51," as she alleges, defendant states that even if such a conversation had occurred, such information would have had no effect on plaintiff's rights, as by April 2002, the opt out date for the settlement (July 23, 2001) had long since passed.
While plaintiff s opposition to this motion more specifically states her assertion that she has been discriminated against and that she spoke with a Ms. Kelly (presumably of defendant's law firm) on April 22, 2002, this is not enough to cure the defects in her complaint. By April of 2002 any claims that plaintiff may have had would be subject to the class release contained in the Class Settlement. Therefore, the Court finds that plaintiff fails to state a claim for which relief can be granted.
C. Failure to Comply with Notice Pleading Requirements
Defendant further contends that plaintiff has failed to comply with the notice pleading requirements contained in Rule 8(a). Defendant alleges that plaintiff has neither given defendant "fair notice of what the plaintiff's claim is and the ground upon which it rests," under Moore v. United States, 193 F.R.D. 647, 651 (N.D. Cal. 2000), nor set forth a "short and plain statement" of her claims or why she is entitled to relief. Defendant is correct that plaintiffs claim fails to comply with the notice pleading requirements.
D. Lack of Standing
Finally, defendant contends that plaintiff lacks standing to bring suit in this court. Defendant argues that plaintiff has not alleged that she has suffered or will suffer an injury in fact, or that she could demonstrate a causal connection between her alleged injury and defendant's conduct. Defendant is correct that plaintiff has failed to allege that she suffered an actual or imminent injury, that there is a causal connection between the injury and defendant's conduct, and that the injury will likely be redressed by a favorable decision from this Court.
CONCLUSION
For the foregoing reasons, the Court GRANTS defendant's motion to dismiss. Because the amount in controversy clearly does not equal or exceed the jurisdictional minimum, leave to amend is not granted. This action is DISMISSED; the clerk shall close the file.