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JORDAN v. COX v. SHELL OIL COMPANY

United States District Court, S.D. California


October 20, 2005.

CHARLES R. JORDAN, an individual, Plaintiff,
v.
COX v. SHELL OIL COMPANY, PLUMBING RECOVERY CENTER; Manager, KATHY CHENOWETH; Claims Manager, JANICE CHASE; and DOES 1 through 10 inclusive, Defendant.

The opinion of the court was delivered by: MARILYN HUFF, Chief Judge

ORDER DISMISSING PLAINTIFF'S ACTION PURSUANT TO FED. R. CIV. P. 12(b)(1), AND ALTERNATIVELY, GRANTING DEFENDANTS' MOTION TO DISMISS
On August 24, 2005, pro se Plaintiff Charles R. Jordan filed a petition for reimbursement of expenses, relating to Defendant Consumer Plumbing Recovery Center's ("CPRC") administration of claims pursuant to a settlement agreement reached in the matter of Cox v. Shell Oil, Civ. A. No. 18844, 1995 WL 775363 (Tenn.Ch. Nov. 17, 1997). On September 19, 2005, Defendants CPRC (erroneously sued as Cox v. Shell Oil, Plumbing Recovery Center), Kathy Chenoweth, and Janice Chase (collectively "Defendants") filed a Rule 12(b) motion to dismiss, or in the alternative, for a more definite statement. The motions are submitted on the papers without oral argument pursuant to Civil Local Rule 7.1(d)(1). For the reasons given below, the Court dismisses the action under Federal Rule of Civil Procedure 12(b)(1) with leave to amend, and alternatively, the Court GRANTS Defendants' motion to dismiss with leave to amend if Plaintiff is able to cure the deficiencies of his pleading.

  Factual Background

  According to Plaintiff's petition, Plaintiff owns a single family residence in the Emerald Point Development in Oceanside, California. (Pet. at 1-2.) Plaintiff contacted Defendants on June 7, 2005 to report a sudden burst of polybutylene pipes in Plaintiff's home. (Id. at 1.) Plaintiff had filed complaints with Defendant CPRC on three earlier occasions in 1992, 1993, and 1995. (Id. at 2.) Defendant CPRC denied Plaintiff's claims on each occasion. (Id.) The Court takes judicial notice of the Final Order in Cox v. Shell Oil, Civ. A. No. 18844, 1995 WL 775363 (Tenn.Ch. Nov. 17, 1997) that approved settlement of a nationwide class action lawsuit regarding polybutylene pipes. (Doc. No. 6, Ex. A.) Plaintiff alleges a denial of his right to due process, fraud, and breach of contract against Defendants who were in charge of managing and releasing funds to replace polybutylene piping under the Cox state court settlement. (Pet. at 2.)

  Discussion

  A. Federal Rule of Civil Procedure 12(b)(1)

  Federal Rule of Civil Procedure 12(b)(1) states that a complaint may be dismissed for "lack of jurisdiction over the subject matter." Fed.R.Civ.P. 12(b)(1). District courts have subject matter jurisdiction to hear cases only when a federal question is presented, 18 U.S.C. § 1331, or when there is diversity of citizenship between the parties and the matter in controversy meets the minimum amount required by statute. 18 U.S.C. § 1332.

  In evaluating whether a sufficient federal question has been presented, typically a failure to state a federal claim is not a jurisdictional defect, but one based on the insufficient merits of the claim. Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 89 (1998). Nonetheless, dismissal based on a lack of federal question jurisdiction may be appropriate where the claim is "so insubstantial or implausible . . . as to not involve a federal controversy." Id. (quoting Oneida Indian Nation of New York v. Oneida County, 414 U.S. 661, 666 (1974)); see also Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir. 1987).

  Here, based on the facts alleged in the Plaintiff's complaint, the Court lacks jurisdiction over the case. Plaintiff fails to allege any state action that would give rise to a sufficient federal question. Plaintiff's mere discussion of the importance of due process under the federal Constitution is "too attenuated or collateral to provide federal [question] jurisdiction." Smith v. Grimm, 534 F.2d 1346, 1351 (9th Cir. 1976). Regarding federal jurisdiction through diversity, the Plaintiff alleges that as of the time of his filing, he has suffered damages in the amount of $41,204.60. This amount fails to meet the amount in controversy requirement stated in 18 U.S.C. 1332 (a). Therefore, because Plaintiff fails to raise a substantial federal question or meet the requirements for diversity jurisdiction, the Court does not have subject matter jurisdiction over the case.

  B. Federal Rule of Civil Procedure 12(b)(6)

  A motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of the claims in the complaint. A claim will only be dismissed if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Allegations of material fact in plaintiff's complaint shall be "taken as true and construed in the light most favorable to the nonmoving party." Parks Sch. of Bus. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995); Tanner v. Heise, 879 F.2d 572, 576 (9th Cir. 1989). In considering whether the plaintiff has stated a claim which would entitle him to relief, the Court may consider matters of public record. Shaw v. Hahn, 56 F.3d 1128, 1129n. 1 (9th Cir. 1995).

  With these standards in mind, the Court now turns its attention to Plaintiff's allegations contained in his complaint. a. Lack of State Action in Due Process Claim

  Plaintiff first alleges that Defendants "violated [his] civil rights to federal due process." (Pet. at 1.) The Fourteenth Amendment of the U.S. Constitution provides that "[n]o state shall . . . deprive any person of life, liberty, or property, without due process of law." US. Const. amend. XIV, § 1. Central to the protection provided under the Due Process clause is that it only applies to state governmental entities, and does not apply to conduct of private actors. Apao v. Bank of New York, 324 F.3d 1091, 1093 (9th Cir. 2003). In fact, the Plaintiff's complaint acknowledges the necessity of state action, noting that "[t]he state must afford the opportunity to be heard at a meaningful time and in a meaningful manner." (Pet. at 2.)

  Here, Plaintiff alleges that CPRC denied him due process in its administration of his claims for damages. (Id.) In doing so, however, Plaintiff fails to allege that CPRC is acting under the color of state law. The Court takes judicial notice that CPRC is a private, nonprofit corporation, certified by the State of Texas. Shaw, 56 F.3d at 1129n. 1. (Doc. No. 6, Ex. D.) Therefore, because Plaintiff fails to allege that the CPRC was acting under the color of state authority in denying him due process, the Court grants the motion to dismiss the due process claim.

  b. Fraud

  Plaintiff next alleges fraud. In order to properly allege fraud under the Federal Rules of Civil Procedure, a plaintiff must state the conditions of the alleged fraud "with particularity." Fed.R.Civ.P. 9(b). The Ninth Circuit interprets Federal Rule of Civil Procedure 9(b) to mean that the allegations must be "specific enough to give defendants notice of the particular misconduct which is alleged to constitute the fraud charged so that they can defend against the charge and not just deny that they have done anything wrong." Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir. 1985). While statements of the "time, place and nature" of the alleged fraudulent activity are sufficient, mere "conclusory" allegations of fraud are not. Moore v. Kayport Package Express, 885 F.2d 531, 540 (9th Cir. 1989). Plaintiff fails to meet the standards for a properly alleged claim of fraud. In his complaint, Plaintiff fails to state any of the circumstances of the alleged fraudulent activity. Plaintiff's discussion of the alleged fraud instead is limited to a mere "conclusory" allegation. Id. Therefore, because Plaintiff fails to allege fraud with particularity, the Court grants the Defendants' motion to dismiss.

  c. Breach of Contract

  Plaintiff's final allegation is for breach of contract. Generally, the elements for a breach of contract cause of action are: (1) the existence of a contract between the parties; (2) performance by the plaintiff or excuse for nonperformance; (3) breach by the defendant; and (4) damages. See, e.g., First Commercial Mortgage v. Reece, Cal. App. 4th 731, 745 (2001).

  Plaintiff fails to allege any facts to support a breach of contract claim. In his complaint, Plaintiff simply alleges that Defendants have breached a contract. He does not state the existence of a specific contract, the performance due under the contract, or how such a contract has been breached. Lacking such factual allegations, the Court must dismiss Plaintiff's claim for breach of contract.

  Additionally, it is worth noting that even if Plaintiff were able to plead sufficient facts for a breach of contract claim, absent some independent basis for federal jurisdiction, the Court does not have general jurisdiction over a breach of a state court settlement agreement. Kokkonen v. Guardian Life Ins., 511 U.S. 375, 381-82 (1994). Therefore, the Court dismisses Plaintiff's claim for breach of contract because he fails to state sufficient factual allegations and because he does not allege some independent basis for federal jurisdiction.

  C. Federal Rule of Civil Procedure 15(a)

  Under Federal Rule of Civil Procedure 15(a), "a party may amend the party's pleading once as a matter of course at any time before a responsive pleading is served." Fed.R.Civ.P. 15(a). Therefore, Plaintiff may file an amended complaint to address the insufficiencies of his complaint. Conclusion

  For the reasons discussed, the Court dismisses Plaintiff's petition under Federal Rule of Civil Procedure 12(b)(1). Alternatively, the Court GRANTS Defendants' motion to dismiss with leave to amend to see if Plaintiff, pro se, can allege a set of facts necessary to state a claim. Plaintiff may submit an amended complaint that addresses the deficiencies of the pleading set forth above no later than 30 days from the date this Order is stamped "Filed."

  IT IS SO ORDERED.

20051020

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