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Helen Truong, and Cuong K. Truong v. Mountain Peaks Financial Services

February 5, 2013

HELEN TRUONG, AND CUONG K. TRUONG PLAINTIFFS,
v.
MOUNTAIN PEAKS FINANCIAL SERVICES, INC., DEFENDANT.



The opinion of the court was delivered by: Hayes, Judge:

ORDER

The matters before the Court are the Motion to Dismiss (ECF No. 9) and the Motion for Attorneys' Fees (ECF No. 10) filed by Defendant Mountain Peaks Financial Services, Inc.

PROCEDURAL HISTORY

On July 6, 2012, Plaintiffs Helen Truong and Cuong K. Truong ("Plaintiffs") initiated this action by filing a Complaint against Defendant Mountain Peaks Financial Services, Inc. (ECF No.1). Plaintiffs asserted two claims alleging fraudulent and misleading debt collection practices: (1) a state law claim for violation of the Rosenthal Fair Debt Collection Practices Act ("RFDCPA"), Cal. Civ. Code § 1788, et seq.; and (2) a federal law claim for violation of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692, et seq. Id. at 6.

On August 29, 2012, Defendant filed a Motion to Strike Plaintiff's RFDCPA claim pursuant to California's anti-SLAPP (strategic lawsuit against public participation) statute. (ECF No. 5-1 at 4 (citing Cal. Code Civ. P. § 425.16)).

On August 29, Defendant filed a Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 6).

On September 4, 2012, Plaintiffs filed a First Amended Complaint, which is the operative complaint in this case. (ECF No. 7). In the First Amended Complaint, Plaintiff asserted a federal law claim for fraudulent and misleading debt collection practices in violation of the FDCPA. Id. at 7. Plaintiff did not assert a state law claim for violation of the RFDCPA in the First Amended Complaint.

On September 9, 2012, the Court denied the Motion to Strike (ECF No. 5) and Motion to Dismiss (ECF No. 7) as moot in light of the First Amended Complaint. (ECF No. 8).

On September 18, 2012, Defendant filed a Motion to Dismiss for lack of jurisdiction and for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6) (ECF No. 9), and a Motion for Attorneys' Fees pursuant to California's anti-SLAPP statute. (ECF No. 10). On October 8, 2012, Plaintiffs filed oppositions to both motions. (ECF Nos. 11, 12). On October 15, 2012, Defendant filed replies in support of both motions. (ECF Nos. 14, 13). On October 18, 2012, Plaintiffs filed an objection (ECF No. 15) to the reply filed by Defendant in support of its Motion to Dismiss. On October 18, 2012, Defendant filed a response to Plaintiff's objection. (ECF No. 16). On November 6, 2012, Defendant filed a Request for Judicial Notice in support of its Motion to Dismiss. (ECF No. 17).

MOTION TO DISMISS

I. Allegations of the Complaint

... 16. On or about 2005, Plaintiffs are alleged to have incurred certain financial obligations.

17. These financial obligations were primarily for personal, family or household purposes and are therefore a 'debt' as that term is defined by 15 U.S.C. §1692a(5).

18. Sometime thereafter, but before 2005, Plaintiffs allegedly fell behind in the payments allegedly owed on the alleged debt. Plaintiffs currently take no position as to the validity of this alleged debt.

19. Subsequently, but before 2005, the alleged debt was assigned, placed, or otherwise transferred, to Defendant for collection.

20. Subsequently, in an attempt to develop a payment plan between the two parties, Plaintiffs and Defendant entered into a stipulation agreement, signed by both parties in October of 2005.

21. The stipulation entered into by the parties was drafted in its entirety by Defendant and purportedly outlined the parameters regarding payment, and rules regarding default.

22. The stipulation included an ability to 'cure' any default, upon Defendant's written notice, in the event of a default on payment.

23. The stipulation allowed Plaintiffs to cure within ten days of being notified of any alleged delinquency by Defendant.

24. The stipulation was drafted by Defendant in such a way that it appeared to the least sophisticated consumer to define such a 'cure' as the reinstatement of defaulted payments then in default, and no more.

25. This apparent written arrangement also mimicked what Plaintiff was previously told by Defendants, orally.

26. In reality, the stipulation was written by Defendant in such a way that it was vague and ambiguous, and was written with the intent to provide Defendant with the ability to demand from least sophisticated consumers immediate payment in full upon a month default when such payment was not what was agreed to, nor the intent of the parties.

27. Through this conduct, Defendant used false representations or deceptive means to collect or attempt to collect a debt or to obtain information concerning a consumer. Consequently, Defendant violated 15 U.S.C. § 1692e and 15 U.S.C. § 1692e(10).

28. Through this conduct, Defendant was collecting an amount (including any interest, fee, charge, or expense incidental to the principal obligation) when such amount was not expressly authorized by the agreement creating the debt or permitted by law. Consequently, Defendant violated 15 U.S.C. § 1692f(1).

29. On or about April 17, 2012 Plaintiffs were informed that they had supposedly defaulted on their monthly payment.

30. On or before April 27, 2012 in order to cure the apparent default, and in a show of good faith, Plaintiffs sent Defendant a check in the amount of $3,150.00, an amount far in excess of the $150.00 minimum required to cure.

31. On May 1, 2012 Plaintiffs received a letter from Defendant both rejecting the $3,150.00 payment and making a demand that Plaintiffs pay the unpaid balance of $28,438.50 in full, immediately....

32. The purpose of this sham was to force Plaintiff to pay funds that were not owed, as well as increase the amount of money Plaintiffs supposedly owed Defendant.

33. Through this conduct, Defendant used a false, deceptive, or misleading representation or means in connection with the collection of a debt. Consequently, Defendant violated 15 U.S.C. § 1692e and 15 U.S.C. § 1692e(10).

34. Through this conduct, Defendant used an unfair or unconscionable means to collect or attempt to collect any debt. Consequently, Defendant violated 15 U.S.C. § 1692f.

35. Through this conduct, Defendant was collecting an amount (including any interest, fee, charge, or expense incidental to the principal obligation) when such amount was not expressly authorized by the agreement creating the debt or permitted by ...


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