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Estep v. Reliable Credit Association, Inc.

United States District Court, W.D. Washington, Tacoma

June 18, 2015

CONNIE ESTEP, Plaintiff,
v.
RELIABLE CREDIT ASSOCIATION, INC., Defendant.

ORDER GRANTING DEFENDANT RELIABLE CREDIT ASSOCIATION, INC.'S MOTION TO DISMISS PURSUANT TO FED R. CIV. P. 12(b)(6)

ROBERT J. BRYAN, District Judge.

THIS MATTER comes before the Court on Defendant Reliable Credit Association, Inc.'s ("Defendant" or "Reliable Credit") Motion to Dismiss Plaintiff Connie Estep's Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted (Dkt. 6) ("Motion"). The Court has considered the Motion, the Complaint, Plaintiff's response (Dkt. 9), Defendant's reply (Dkt. 10), and the remainder of the file therein.

I. BACKGROUND

Plaintiff alleges the following relevant facts in the Complaint (Dkt. 1, at 2-4):

Plaintiff purchased a vehicle from a dealership, Dick Hannah Dealerships, on April 6, 2014. Following Plaintiff's vehicle purchase, Defendant purchased the installment sales contract for the vehicle from the dealership.

Plaintiff called defendant via telephone to inquire about making electronic monthly payments on the vehicle to Defendant, and Defendant sent Plaintiff a copy of an Authorization Agreement for Automatic ACH Payments ("the Authorization Agreement") (Dkt. 1-1). Under the Authorization Agreement, payments were set up as preauthorized electronic fund transfers, to be taken out of Plaintiff's personal bank account on a monthly basis. Plaintiff signed and returned the Authorization Agreement to Defendant.

The Authorization Agreement provides in relevant part:

I understand that Reliable[, Defendant, ] may suspend or terminate electronic payments at any time in its discretion. Otherwise, this authorization will remain in effect until I cancel it. I may cancel through eServices or by telephoning Reliable at the branch that services my loan or retail installment contract. In either case, I must notify Reliable prior to 5:30pm Pacific Time on a scheduled transaction date for the cancellation notice to become effective.

Plaintiff alleges that Defendant violated 15 U.S.C. § 1693(1) of the Electronic Fund Transfer Act ("the EFT Act") by creating an authorization agreement that limited Plaintiff's ability to stop payment by notifying her financial institution as permitted under 15 U.S.C. § 1692(e)(a).

II. STANDARD FOR MOTION TO DISMISS

Fed. R. Civ. P. 12(b) motions to dismiss may be based on either the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory. Balistreri v. Pacifica Police Department, 901 F.2d 696, 699 (9th Cir. 1990). Material allegations are taken as admitted and the complaint is construed in the plaintiff's favor. Keniston v. Roberts, 717 F.2d 1295 (9th Cir. 1983). "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 of action will not do." Bell Atlantic Corp. v. Twombly, 127 S.Ct. 1955, 1964-65 (2007)( internal citations omitted ). "Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Id. at 1965. Plaintiffs must allege "enough facts to state a claim to relief that is plausible on its face." Id. at 1974.

III. DISCUSSION

Congress enacted the EFT Act in part to protect consumers' rights in electronic fund and remittance transfer systems. 15 U.S.C. § 1693(b). One of the EFT Act's protections, an antiwaiver provision, precludes consumers from waiving rights protected under the EFT Act:

No writing or other agreement between a consumer and any other person may contain any provision which constitutes a waiver of any right conferred or cause of action created by this subchapter. Nothing in this section prohibits, however, any writing or other agreement which grants to a consumer a more extensive right or remedy or greater protection than contained in ...

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