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Anhar v. Citibank, N.A.

United States District Court, E.D. California

September 24, 2019

MICHAEL N. ANHAR, Plaintiff,
v.
CITIBANK, N.A., subsidiary of bank holding company Citigroup Inc., Defendant.

          FINDINGS AND RECOMMENDATIONS, RECOMMENDING THAT THIS ACTION PROCEED ON PLAINTIFF’S CLAIMS FOR BREACH OF CONTRACT AND CIVIL VIOLATIONS OF THE TRUTH IN LENDING ACT AND THE FAIR CREDIT BILLING ACT; AND THAT THE CLAIMS FOR CRIMINAL VIOLATIONS BE DISMISSED WITH PREJUDICE (ECF NO. 1)

          Robert S. Lasnik, United States District Judge

         Plaintiff, Michael N. Anhar, is proceeding pro se and in forma pauperis, in this action alleging claims against Defendant, Citibank, N.A., for breach of contract, violations of the Truth in Lending Act, and violations of the Fair Credit Billing Act. (ECF No. 1.) Plaintiff filed the complaint commencing this action on April 17, 2019. (Id.)

         For the reasons described below, the Court recommends finding that, viewing the facts alleged in the Complaint liberally and in the light most favorable to Plaintiff, and for purposes of screening only, Plaintiff has stated claims against Defendant for civil violations of the Truth in Lending Act, for civil violations of the Fair Credit Billing Act, and for breach of contract. The Court recommends dismissing with prejudice the claims for criminal violations of the Truth in Lending Act and the Fair Credit Billing Act because Plaintiff does not have standing to pursue these claims.

         I. SCREENING REQUIREMENT

         Under 28 U.S.C. § 1915(e)(2), in any case in which a plaintiff is proceeding in forma pauperis, the Court must conduct a review of the complaint to determine whether it “state[s] a claim on which relief may be granted, ” is “frivolous or malicious, ” or “seek[s] monetary relief against a defendant who is immune from such relief.” If the Court determines that the complaint fails to state a claim on which relief may be granted, it must be dismissed. Id. Similarly, if the Court determines the complaint is frivolous or malicious, it must be dismissed. Id. An action is deemed to be frivolous if it is “of little weight or importance: having no basis in law or fact” and malicious if it was filed with the “intention or desire to harm another.” Andrews v. King, 398 F.3d 1113, 1121 (9th Cir. 2005). Leave to amend may be granted to the extent that the deficiencies of the complaint can be cured by amendment. Cato v. United States, 70 F.3d 1103, 1106 (9th Cir. 1995).

         A complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief . . . .” Fed.R.Civ.P. 8(a)(2). Detailed factual allegations are not required, but “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Plaintiff must set forth “sufficient factual matter, accepted as true, to ‘state a claim that is plausible on its face.’” Iqbal, 556 U.S. at 663 (quoting Twombly, 550 U.S. at 555). While factual allegations are accepted as true, legal conclusions are not. Id. at 678.

         In determining whether a complaint states an actionable claim, the Court must accept the allegations in the complaint as true, Hosp. Bldg. Co. v. Trs. of Rex Hospital, 425 U.S. 738, 740 (1976), construe pro se pleadings liberally in the light most favorable to the Plaintiff, Resnick v. Hayes, 213 F.3d 443, 447 (9th Cir. 2000), and resolve all doubts in the Plaintiff’s favor. Jenkins v. McKeithen, 395 U.S. 411, 421 (1969). Pleadings of pro se plaintiffs “must be held to less stringent standards than formal pleadings drafted by lawyers.” Hebbe v. Pliler, 627 F.3d 338, 342 (9th Cir. 2010) (holding that pro se complaints should continue to be liberally construed after Iqbal).

         II. SUMMARY OF PLAINTIFF’S ALLEGATIONS

         The Complaint (ECF No. 1) alleges that on August 25, 2018, Plaintiff attempted four times to make a cash payment of $120 on his Citibank credit card at Citibank ATMs, but his payment was refused, and the message on the ATM stated: “I can’t do that right now. For assistance, please call Customer Service.” Plaintiff contacted Citibank customer service about his inability to make a cash payment and was eventually informed that his credit card account had been suspended because, when Citibank applied the August 2018 interest charge to Plaintiff’s credit card account, that interest charge caused the account to exceed the credit limit by $24.93.

         Plaintiff had a second credit card with Citibank that had also exceeded the credit limit as a result of Citibank’s application of the August 2018 interest charge, yet that second account was not suspended, and Plaintiff was able to make a cash payment on that account. Further, Citibank’s charging of interest on both of Plaintiff’s Citibank credit card accounts had, on 35 previous occasions, caused the credit cards to exceed the credit limit, and Citibank had not on those previous occasions suspended Plaintiff’s credit card accounts. If Citibank had accepted the $120 cash payment Plaintiff attempted to make on the suspended account, the account would have gone back under the credit limit.

         Plaintiff closed both of his credit card accounts and promptly filed a CFPB[1] complaint. Citibank responded to the CFPB complaint as follows:

The error you received when attempting to make your payment at the ATM for your account ending in 1276 was due to the amount of the balance that exceeded your credit limit, which resulted in the suspension of your account. Although your account ending in 2471 also exceeded the credit limit, this account was not suspended at the time your $40.00 payment was received.

(ECF No. 1 at 7.)

         Plaintiff alleges that this refusal to accept the payment violated the terms of the agreement between Plaintiff and Defendant:

Citibank’s refusal to accept and credit Mr. Anhar’s conforming payment was in direct contravention of its revised cash-payment policy as established in its 05/08/18 Update and reaffirmed in its 06/22/18 June Statement, 07/23/18 July Statement, and 09/17/18 Account Update. When read concurrently with the governing 10/23/16 Card Agreement, the revised cash-payment policy serves to amend the agreement. Under these combined and undisputed contractual elements and written provisions, Mr. Anhar’s repeatedly proffered $120 cash payment constituted a conforming payment. Thus, Citibank’s refusal to accept and credit that payment constitutes intentional failure to perform, which means Citibank materially breached its own agreement. Once Citibank breached the contract, it became void, and the debt thereunder became invalid.

(ECF No. 1 at 8-9.)

         Plaintiff alleges that, over the next seven months, Defendant continued to treat the debt as valid and committed nearly 25 Truth in Lending Act and Fair Credit Billing Act violations:

[Citibank] has made prohibited collections calls to Mr. Anhar’s home, sent him barred dunning letters, [2] issued fraudulent monthly billing statements, manufactured hundreds of dollars in finance charges, and created lasting harm to his creditworthiness by falsely reporting to the credit bureaus that his account is seriously delinquent. Citibank’s willful, knowing, and persistent wrongful billing on, dunning of, and third-party reporting of an account that’s closed, a debt that’s invalid, and a contract that’s void, amounts to fraud and oppression.

(ECF No. 1 at 9 (footnote added); see ECF No. 1 at 10-18 (providing detailed allegations).)

         Plaintiff brings claims against Citibank for breach of contract (Claim 1); criminal and civil violations of the Truth in Lending Act (Claims 2 through 9), and criminal and civil violations of the Fair Credit Billing Act (Claims 10 through 25).

         III. DISCUSSION

         A. Claims for Civil Violations of the Truth in Lending Act (Claims 2-9)

         1. Claims 2-8

         In claims 2 through 8, Plaintiff alleges that Defendant committed civil violations of sections 127(b)(3) and (7) of the Truth in Lending Act (“TILA”), [3] 15 U.S.C. § 1637(b)(3) and (7), which provide:

(b) Statement required with each billing cycle.
The creditor of any account under an open end consumer credit plan shall transmit to the obligor, for each billing cycle at the end of which there is an outstanding balance in that account or with respect to which a finance charge is imposed, a statement setting forth each of the following items to the extent applicable:
. . . .
(3) The total amount credited to the account during the ...

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