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Richard A. Hadsell v. Mandarich Law Group

April 3, 2013


The opinion of the court was delivered by: M. James Lorenz United States District Court Judge


On January 30, 2012, Plaintiff Richard Hadsell commenced this action against Defendants CACH, LLC and Mandarich Law Group, LLP alleging various violations of the federal Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. On October 15, 2012, Plaintiff filed a Second Amended Complaint ("SAC"). Defendants now move to dismiss Plaintiff's claim relating to the "Account Stated Activity." Plaintiff opposes.

The Court found this motion suitable for determination on the papers submitted and without oral argument. See Civ. L.R. 7.1(d.1). (Doc. 31.) For the following reasons, the Court GRANTS Defendants' motion to dismiss.


Sometime before December 2011, Plaintiff is alleged to have incurred "certain financial obligations" to MBNA, a nationwide credit provider. (SAC ¶ 16.) Sometime thereafter, but before December 2011, Plaintiff allegedly fell behind in payments on the debt. (Id. at ¶ 18.) Bank of America acquired MBNA and later sold the debt to FIA Card Services, Inc., who then allegedly sold the debt to CACH, LLP. (Id. at ¶¶ 16--19.) Mandarich Law Group is a law firm retained by CACH to help collect debts. (Id. at ¶ 20.)

On December 30, 2011, Defendants commenced an action to collect the debt in the San Diego Superior Court ("State Action") alleging a cause of action for breach of contract and a common count for account stated. (SAC at ¶ 28.) According to Defendants' State Action complaint (or "SA Complaint"), MBNA provided Plaintiff with a credit card subject to written terms and conditions. (SA Compl. ¶ 5 [Doc. 28-3].) Plaintiff used the credit card to make purchases or cash transfers, but he failed to make payments as agreed and neglected monthly statements itemizing the amounts due. (Id. at ¶¶ 8--10.) As of March 8, 2011, Plaintiff owed $5,606.24 with interest thereon. (Id. at ¶ 11.) Defendants alleged that Plaintiff breached the terms and conditions of the account by failing to pay the amounts due and alleged a common for account stated for the amount due. (Id. at ¶ 16.)

Plaintiff now alleges that Defendants violated various provisions of the FDCPA when alleged an accounts-stated cause of action against him in the State Action. (SAC ¶¶ 38--39, 49, 52.) Specifically, Plaintiff states that Defendants fabricated the accounts-stated cause of action with no evidentiary support in order to deliberately deceive and mislead Plaintiff and the state judge, and to deny Plaintiff of his contractual rights to engage in arbitration or recover attorney's fees. (Id. at ¶¶ 31, 35.) Plaintiff further alleges that such "false, deceptive, and misleading behavior" denied him of his ability to engage an attorney, conduct discovery, retain experts, and properly defend himself without fear of incurring considerable expenses in such activities. (Id. at ¶ 48.) He additionally alleges that Defendants' account-stated claim has no merit or evidentiary support. (Id. at ¶ 49.)

On January 30, 2012, Plaintiff commenced this action against Defendants, alleging various violations of the FDCPA. Plaintiff amended his complaint twice, the most recent amendment occurring on October 15, 2012 when he filed his SAC. Defendants now move to dismiss Plaintiff's claim relating to the "Account Stated Activity." Plaintiff opposes.


The court must dismiss a cause of action for failure to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). The court must accept all allegations of material fact as true and construe them in light most favorable to the nonmoving party. Cedars-Sanai Med. Ctr. v. Nat'l League of Postmasters of U.S., 497 F.3d 972, 975 (9th Cir. 2007). Material allegations, even if doubtful in fact, are assumed to be true. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). However, the court need not "necessarily assume the truth of legal conclusions merely because they are cast in the form of factual allegations." Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1139 (9th Cir. 2003) (internal quotation marks omitted). In fact, the court does not need to accept any legal conclusions as true. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

"While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitlement to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause action will not do." Twombly, 550 U.S. at 555 (internal citations omitted). Instead, the allegations in the complaint "must be enough to raise a right to relief above the speculative level." Id. Thus, "[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. "The plausibility standard is not akin to a 'probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully."

A complaint may be dismissed as a matter of law either for lack of a cognizable legal theory or for insufficient facts under a cognizable theory. Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 534 (9th Cir. 1984).

Generally, courts may not consider material outside the complaint when ruling on a motion to dismiss. Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n.19 (9th Cir. 1990). However, documents specifically identified in the complaint whose authenticity is not questioned by parties may also be considered. Fecht v. Price Co., 70 F.3d 1078, 1080 n.1 (9th Cir. 1995) (superceded by statutes on other grounds). Moreover, the court may consider the full text of those documents, even when the complaint quotes only selected portions. Id. It may also consider material properly subject to judicial notice without converting the motion into one for summary judgment. Barron v. Reich, 13 F.3d 1370, 1377 (9th Cir. 1994). Defendants request judicial notice of their state-court complaint and summons relating to the underlying State Action. (Docs. 28-2, 28-3.) Plaintiff has not opposed. Accordingly, ...

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