Opinion
No. 1:15-cv-01555-DAD-SKO
02-29-2016
DALE HENSARLING, an individual, TONYA HENSARLING, an individual, Plaintiffs, v. WELLS FARGO BANK, N.A., a corporation; and DOES 1 through 10, inclusive, Defendants.
ORDER
This matter is before the court on a motion to dismiss filed by defendant Wells Fargo Bank, N.A. Mot., ECF No. 4. Plaintiffs Dale and Tonya Hensarling opposed. Opp'n, ECF No. 12. Defendant replied. Reply, ECF No. 14. On December 4, 2015, the court held a hearing on the motion: Octavio Cardona-Loya appeared for plaintiffs and Courtney Wenrick appeared for defendant. Plaintiffs subsequently filed a second amended complaint, ECF No. 19, without defendant's written consent or leave of the court. Defendant filed a motion to strike in response. ECF No. 20.
Because Judge Mueller presided over the motion hearing, she issues this order. In light of the case subsequently being assigned to Judge Dale A. Drozd, all future proceedings will be before him.
As explained below, the court GRANTS IN PART defendant's motion to dismiss. The court also GRANTS defendant's motion to strike.
I. INTRODUCTION
A. Procedural History
Plaintiffs commenced this action on August 25, 2014 in the California Superior Court for the County of Stanislaus. See generally ECF No. 1-1. The parties stipulated to plaintiffs' filing the first amended complaint, adding the third claim alleging defendant violated the Telephone Consumer Protection Act ("the TCPA"). Compl. ("FAC"), ECF No. 1-1 ¶¶ 33-36. In sum, the First Amended Complaint alleges the following claims against defendant: (1) violations of the Rosenthal Act, Cal. Civ. Code § 1788, (2) common law tort of intrusion into private affairs and (3) violations of the TCPA, 47 U.S.C. § 227(b)(1)(A)(iii). See generally FAC.
On October 9, 2015, defendant removed the case to this court. ECF No. 1. On October 16, 2015, defendant filed the pending motion to dismiss the new third claim.
B. Factual Background
Plaintiffs' third claim challenges an alleged campaign of phone calls made to plaintiffs by defendant to collect payments due on a mortgage loan ("the Loan"). Plaintiffs allege defendant contacted them both separately on multiple occasions within a twenty-four hour period, with four or more calls a day, on consecutive days, and at times every day of the week. FAC ¶¶ 11, 13. Specifically, on May 21, 2014, defendant called Mr. Hensarling five times, and four times each day on May 16, 19, and 20, 2014. Id. ¶ 12. Defendant made the calls to Mr. Hensarling's cell phone and home phone numbers. Id. ¶ 10.
Mr. Hensarling asked defendant not to call on Sundays as he is a pastor, but defendant continued its calls. Id. ¶ 15. Between May 22, 2014 and June 4, 2014, plaintiffs estimated defendant called Mr. Hensarling at least forty-eight times. Id. ¶ 16. Between both plaintiffs, it is estimated, at times, they would receive about fifteen collection calls in one day. Id. ¶ 18. During the time period of some of defendant's collection calls, Mr. Hensarling was actually current on his loan payments. Id. ¶ 17. Defendant's calls never ceased despite being informed plaintiffs had retained an attorney. Id. ¶¶ 19-20.
II. LEGAL STANDARDS
A. Motion to Dismiss
A complaint need contain only a "short and plain statement of the claim showing that the pleader is entitled to relief," Fed. R. Civ. P. 8(a)(2), not "detailed factual allegations," Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). But this rule demands more than unadorned accusations; "sufficient factual matter" must make the claim at least plausible. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In the same vein, conclusory or formulaic recitations of a cause's elements do not alone suffice. Id. (quoting Twombly, 550 U.S. at 555).
A party may thus move to dismiss for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). The motion may be granted only if the complaint lacks a "cognizable legal theory" or if its factual allegations do not support a cognizable legal theory. Hartmann v. Cal. Dep't of Corr. & Rehab., 707 F.3d 1114, 1122 (9th Cir. 2013). In making this context-specific evaluation, this court "must presume all factual allegations of the complaint to be true and draw all reasonable inferences in favor of the nonmoving party." Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987).
Under Rule 15(a) of the Federal Rules of Civil Procedure, leave to amend "shall be freely given when justice so requires," bearing in mind "the underlying purpose of Rule 15 to facilitate decision on the merits, rather than on the pleadings or technicalities." Lopez v. Smith, 203 F.3d 1122, 1127, 1140 (9th Cir. 2000) (en banc) (internal quotation marks and alterations omitted). /////
B. Motion to Strike
Federal Rule of Civil Procedure 12(f) provides "[t]he court may strike from a pleading . . . any redundant, immaterial, impertinent, or scandalous matter." "'Immaterial' matter is that which has no essential or important relationship to the claim for relief or the defenses being pleaded[, and] [i]mpertinent matter consists of statements that do not pertain, and are not necessary, to the issues in question." Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993) (citation omitted), rev'd on other grounds by 510 U.S. 517 (2004).
A Rule 12(f) motion to strike serves "to avoid the expenditure of time and money that must arise from litigating spurious issues by dispensing with those issues prior to trial . . . ." Sidney-Vinstein v. A.H. Robins Co., 697 F.2d 880, 885 (9th Cir. 1983). The granting of a motion to strike "may be proper if it will make trial less complicated or eliminate serious risks of prejudice to the moving party, delay, or confusion of the issues." Taheny v. Wells Fargo Bank, N.A., No. 10-2123, 2011 WL 1466944, at *2 (E.D. Cal. Apr. 18, 2011) (citing Fantasy, 984 F.2d at 1527-28).
III. ANALYSIS
A. Motion to Dismiss
The TCPA prohibits making any call "using any automatic telephone dialing system or an artificial or prerecorded voice" to a wireless number. 47 U.S.C. § 227(b)(1)(A). Specifically, the TCPA provides:
It shall be unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States—47 U.S.C. § 227(b)(1)(A)(iii).
(A) to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice—
. . .
(iii) to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call . . .
As used in this section, the term "automatic telephone dialing system" ("ATDS") means equipment that has the capacity "to store or produce telephone numbers to be called, using a random or sequential number generator . . . to dial such numbers." 47 U.S.C. § 227(a)(1). A "random or sequential number generator" refers to the genesis of the list of numbers, not an "order to be called." Telephone Consumer Protection Act of 1991, § 3(a), 47 U.S.C.A. § 227(a)(1); Marks v. Crunch San Diego, LLC, 55 F. Supp. 3d 1288, 1292 (S.D. Cal. 2014).
However, under the plain language of the statute, an ATDS "need not actually store, produce, or call randomly or sequentially generated telephone numbers, it need only have the capacity to do it." Satterfield v. Simon & Schuster, Inc., 569 F.3d 946, 951 (9th Cir. 2009).
There are three elements to a TCPA claim based on use of an ATDS: (1) the defendant called a cellular telephone number (2) using an ATDS, or an artificial or prerecorded voice, (3) without the recipient's prior express consent. Meyer v. Portfolio Recovery Assocs., LLC, 707 F.3d 1036, 1043 (9th Cir. 2012); see also Iniguez v. The CBE Group, 969 F. Supp. 2d 1241, 1247 (E.D. Cal. 2013), reconsideration denied (Dec. 5, 2013) (a violation may occur if an ATDS, an artificial voice, or a prerecorded voice is used to make the call); Flores v. Adir International, LLC, No. 15-00076, 2015 WL 4340020, at *4 (C.D. Cal. July 15, 2015) (artificial or prerecorded voice used to make calls are independent basis for liability under the TCPA).
Here, plaintiff alleges defendant called plaintiffs using an ATDS. Defendant does not dispute the third prong of the TCPA claim; instead, defendant argues plaintiff fails to allege the first and second prongs. With respect to the first prong, plaintiff alleges in the First Amended Complaint that: "[d]efendant made calls to [p]laintiffs' cell phones." FAC ¶ 34. Plaintiff alleges sufficient fact under the first prong, and, contrary to defendant's argument, Mot. at 2, does not need to allege the cell phone number(s) at issue.
The court thus moves on next to discuss the second prong, whether plaintiffs allege sufficient facts to say defendant used an ATDS.
1. ATDS
With respect to the second prong, defendant argues plaintiffs have merely restated the law in their pleading rather than alleged facts to say plaintiffs were called using an ATDS. Plaintiffs contend "[n]either section 227(b)(1)(A)(iii) nor Federal Rule of Civil Procedure 8 requires [p]laintiffs to plead [their] claim with particularity." 47 U.S.C. § 227(a)(1); Kramer v. Autobytel, Inc., 759 F. Supp. 2d 1165, 1172 (N.D. Cal. 2010). Rather, plaintiffs argue, courts should consider whether, "read as a whole, the complaint contains sufficient facts to show that it is plausible that [d]efendant[ ] used [an ATDS]." Id. at 1171. Under Iqbal, plaintiff needs to make out a sufficiently-pled claim that is "plausible on its face." 556 U.S. at 678. A claim is plausible when the plaintiff pleads factual content that allows the court to draw reasonable inferences the defendant is liable for the alleged misconduct. Id. Here, plaintiffs have not pled facts that allow the court to draw such inferences.
As noted, plaintiffs generally allege defendant called multiple times over several days, and, on occasions, multiple times within one day. FAC ¶¶ 12-18. Plaintiffs specifically allege defendant violated the TCPA "by repeatedly making calls using an [ATDS], to the [p]laintiffs' cell phones . . . without [p]laintiffs' express consent and to the expense of [p]laintiffs." FAC ¶ 35. Plaintiffs point to Iniguez, supra, in which a sister court in this district denied the defendant's motion to dismiss a claim alleging the use of ATDS, as an analogous case. However, the plaintiff in Iniguez alleges the use of both ATDS and artificial voice. 969 F. Supp. 2d at 1247. As the court in Flores v. Adir International, LLC, explained, 47 U.SC. § 227(b)(1)(A) is written in the disjunctive form; thus, a violation may be found based on either the use of ATDS or calls made using an artificial or prerecorded voice. 2015 WL 4340020, at *4. The court in Iniguez found plaintiffs had sufficiently stated a TCPA claim based on use of an artificial or prerecorded voice and did not decide whether the plaintiff also stated a claim based on use of an ATDS. 969 F. Supp. 2d at 1246; see also Flores, 2015 WL 4340020, at *4. Here, plaintiffs' TCPA claim can advance only if plaintiffs have alleged sufficient facts regarding the use of an ATDS.
Plaintiffs point to Thomas v. Dun & Bradstreet Credibility Corp., 100 F. Supp. 3d 937, 945-46 (C.D. Cal. 2015) and Knutson v. Reply!, Inc., No. 10-1267, 2011 WL 1447756, at *1 (S.D. Cal. Apr. 13, 2011) to support their argument they have stated a claim under the TCPA based on the use of an ATDS. Opp'n at 4-5. In Thomas, the plaintiff provided additional facts including a "pause" characteristic of the ATDS used, and defendant's likely need for a "sophisticated phone system." 2015 WL 4698398, at *6. Similarly, the plaintiff in Knutson also provided additional facts, allowing the court to draw reasonable inferences regarding the defendant's alleged use of an ATDS, namely details such as: when the plaintiff called the number from which he received the call, there were no rings or responses, and when the plaintiff picked up the calls there also was no response after which the line would change over to another party a few seconds later. 2011 WL 1447756, at *1. In contrast, plaintiffs' First Amended Complaint does not allege facts that allow this court to draw reasonable inference regarding defendant's use of an ATDS. See Iqbal, 556 U.S. at 678.
2. Random Calls
Defendant further argues in order to state a claim under TCPA based on the use of an ATDS, plaintiffs also need to allege that "calls to their cell phones were made in a random or sequential fashion." Mot. at 4. In Iniguez, a sister court rejected the same argument where the defendant contended the debt collector was "obviously trying to reach a particular person, not make random calls." 969 F. Supp. 2d at 1247. The court in Iniguez found whether the system randomly generates a phone number is not determinative, because the system only needs to have that capability under the TCPA without necessarily using it. Id. The TCPA in fact defines an ATDS as "equipment which has the capacity . . . to store or produce telephone numbers to be called, using a random or sequential number generator [and] to dial such numbers." 47 U.S.C. § 227(a)(1).
The court finds defendant's argument that plaintiffs need to allege the calls were made in a random fashion unpersuasive.
At hearing, plaintiffs stated if allowed leave to amend, they would provide more factual allegations to support their TCPA claim. Accordingly, to the extent defendant's motion to dismiss plaintiffs' TCPA claim is based on insufficient allegations that defendant used an ATDS, or an artificial or prerecorded voice, the motion is GRANTED with leave to amend. However, to the extent defendant's motion to dismiss plaintiffs' TCPA claim is based on failure to allege defendant made the calls to plaintiffs' cell phone and that the calls were random, the motion is DENIED.
B. Motion to Strike
On December 21, 2015, plaintiffs filed a second amended complaint without defendant's written consent or the court's leave.
The Federal Rule of Civil Procedure 15(a) states, in relevant parts:
(a) Amendments Before Trial.Fed. R. Civ. P. 15(a).
(1) Amending as a Matter of Course. A party may amend its pleading once as a matter of course within:
(A) 21 days after serving it, or
(B) if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or (F), whichever is earlier.
(2) Other Amendments. In all other cases, a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires.
Plaintiffs can amend their complaint "once as a matter of course" if they comply with Rule 15(a)(1). Their first amended complaint was deemed served on September 9, 2015, ECF No. 1-1, at 88, and defendant subsequently filed its motion to dismiss on October 16, 2015, Mot. at 1. Under Rule 15(a)(1)(B), the twenty-one-day deadline has already passed. Other amendments require the written consent of the opposing party or the court's leave, neither of which plaintiffs obtained.
The court therefore GRANTS defendant's motion to strike plaintiffs' second amended complaint.
IV. CONCLUSION
For the foregoing reasons, the court GRANTS IN PART defendant's motion to dismiss plaintiffs' TCPA claim, without prejudice, and GRANTS defendant's motion to strike the second amended complaint plaintiffs filed on December 21, 2015.
Plaintiffs shall now have twenty-one (21) days to file an amended complaint.
IT IS SO ORDERED. DATED: February 29, 2016.
/s/_________
UNITED STATES DISTRICT JUDGE