United States District Court, S.D. California
DARA MIRAN, individually and on behalf of others similarly situated, Plaintiff,
CONVERGENT OUTSOURCING, INC., Defendant.
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS
PLAINTIFF'S FIRST AMENDED COMPLAINT (Doc. No.
Anthony J, Battaglia United States District Judge
before the Court is Defendant Convergent Outsourcing,
Inc.'s (“Defendant”) motion to dismiss
pursuant to Rule 12(b)(6) of the Federal Rules of Civil
Procedure (“FRCP”). (Doc. No. 26.) Upon review of
the parties' arguments in support and opposition of the
motion, the Court finds the motion suitable for determination
on the papers and without oral argument pursuant to Civil
Local Rule 7.1.d.1. As set forth more fully below,
Defendant's motion is GRANTED.
dispute centers on Defendant's attempt to collect a debt.
In the late 1990's or early 2000's, Plaintiff Dara
Miran (“Plaintiff”) entered into an agreement and
obtained a credit card with Citibank. (Doc. No. 25 ¶
18.) Eventually, Plaintiff defaulted on this credit card and
ended up owing Citibank approximately $9, 679.23.
(Id.) Subsequently, Galaxy Asset Purchasing, LLC
(“Galaxy”) purchased Plaintiff's debt and
became the new creditor on the Citibank account.
after January 14, 2016, Plaintiff received a collection
notice (the “Offer Letter”) from Defendant.
(Id. ¶ 20.) The Offer Letter stated that
Plaintiff owed a past due balance of $9, 679.23 to Galaxy and
offered Plaintiff three different settlement options:
(a) Lump Sum Settlement Offer of 15%;
(b) Settlement Offer of 30% and paid over three months; or
(c) Twelve monthly payments of $806.60 per month.
(Id. ¶¶ 20, 23.) At the bottom of the
reverse page, the Offer Letter stated: “The law limits
how long you can be sued on a debt. Because of the age of
your debt, we will not sue you for it and we will not report
it to any credit reporting agency.” (Id.
alleges that the Offer Letter failed to inform Plaintiff or
any consumer that acceptance of any of the three settlement
offers would create a novation i.e. a new agreement with a
new statute of limitations. (Id. ¶ 25.)
Accordingly, Plaintiff argues that Defendant's statement
that it would not sue is misleading as the new agreement
would allow Galaxy or any subsequent purchaser of the account
to sue on the new obligation. (Id. ¶¶ 25,
January 4, 2017, Plaintiff filed his first amended complaint
(“FAC”). (Doc. No. 25.) Plaintiff claims that
Defendant violated Sections 1692e, 1692e(2)(a), and 1692e(10)
of the Federal Fair Debt Collection Practices Act
(“FDCPA”), pursuant to California Code of Civil
Procedure Section 360 (“Section 360”).
(Id. ¶ 54.) In conjunction with the FDCPA,
Plaintiff also claims violations of California Civil Code
Section 1788.17, also known as the Rosenthal Act
(“Rosenthal Act”). (Id. ¶¶
53-54, 56.) Plaintiff requests statutory damages, reasonable
attorney's fees, and costs of litigation. (Id.
motion to dismiss under Rule 12(b)(6) tests the legal
sufficiency of a plaintiff's complaint. See Navarro
v. Block, 250 F.3d 729, 732 (9th Cir. 2001). A complaint
should not be dismissed for failure to state a claim under
FRCP 12(b)(6) “unless it appears beyond doubt that the
plaintiff [could] prove no set of facts in support of his
claim which would entitle him to relief.” Durning
v. First Boston Corp., 815 F.2d 1265, 1267 (9th Cir.
1987) (citation omitted). In making this determination, a
court reviews the contents of the complaint, accepting all
factual allegations as true, and drawing all reasonable
inferences in favor of the nonmoving party. Cedars-Sinai
Med. Ctr. v. Nat'l League of Postmasters of U.S.,
497 F.3d 972, 975 (9th Cir. 2007). Moreover, a complaint will
survive a motion to dismiss if it contains “enough
facts to state a claim to relief that is plausible on its
face.” Bell Atl. Corp. v. Twombly, 550 U.S.
544, 570 (2007).
“[t]he court may dismiss a complaint as a matter of law
for ‘(1) lack of a cognizable legal theory or (2)
insufficient facts under a cognizable legal
claim.'” SmileCare Dental Grp. v. Delta Dental
Plan of Cal., Inc., 88 F.3d 780, 783 (9th Cir. 1996)
(internal citation omitted). “[C]onclusory allegations
of law and unwarranted inferences, ” however,
“are insufficient to defeat a motion to dismiss for
failure to state a claim.” Epstein v. Wash. Energy
Co., 83 F.3d 1136, 1140 (9th Cir. 1996). It is also
improper for a court to assume “the [plaintiff] can
prove facts that [he or she] has not alleged.”
Associated Gen. Contractors of Cal., Inc. v. Cal. State
Council of Carpenters, 459 U.S. 519, 526 (1983).
Defendant moves to dismiss all of Plaintiff's causes of
action asserted in his FAC. Specifically, Defendant rejects
Plaintiff's claims that acceptance of any of the payment
plans would result in a novation and that a new agreement
would have been created pursuant to Section 360. (Doc. No.
26-1 at 9-13.) As the Court will explain in more detail
below, the Court agrees with Defendants.