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Smart v. Emerald City Recovery, LLC

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

July 25, 2018

HOLLY SMART, Plaintiff,
v.
EMERALD CITY RECOVERY, LLC, et al., Defendants.

          ORDER

          JOHN C. COUGHENOUR UNITED STATES DISTRICT JUDGE

         This matter comes before the Court on Defendants Reliable Credit Association Inc. (“Reliable Oregon”) and Reliable Credit Association Inc. (WA)'s (“Reliable Washington”) motion to dismiss (Dkt. No. 14). Having thoroughly considered the parties' briefing and the relevant record, the Court hereby GRANTS the motion for the reasons explained herein.

         I. BACKGROUND[1]

         Plaintiff Holly Smart brings this lawsuit against debt collector Emerald City Recovery, LLC (“Emerald City”) and creditors Reliable Oregon and Reliable Washington (collectively “Reliable Credit”) arising from the allegedly wrongful repossession of her car. (Dkt. No. 24-1 at 2-3.) Just after 1:00 a.m. on January 17, 2018, Emerald City towed Plaintiff's Ford Fusion from outside her apartment. (Id. at 4.) While rigging the car for tow, Emerald City caused enough noise to wake up one of Plaintiff's neighbors, who saw the car being taken. (Id.)

         When Plaintiff discovered her car was missing she filed a police report. (Id.) The police informed Plaintiff that her car had been towed by Emerald City for “non-payment” on behalf of Reliable Credit. (Id.) But Plaintiff did not owe a debt to Reliable Credit-she bought her car with a loan from her father. (Id. at 4.) Plaintiff contacted Emerald City and learned that the company took her car by mistake. (Id. at 5.) Emerald City had intended to repossess a car belonging to Plaintiff's neighbor, but took Plaintiff's car after its camera misread the license plate. (Id. at 5.) When Plaintiff eventually recovered her car from Emerald City, it had damage to the right rear quarter panel. (Id. at 6.)

         Plaintiff alleges that Reliable Credit had a contractual relationship with Emerald City for the repossession of vehicles at the time her car was taken. (Id.) Plaintiff alleges that Reliable Credit is liable for conversion, violation of the Washington Consumer Protection Act (“WCPA”), Revised Code of Washington section 19.86 et seq., and breach of the Uniform Commercial Code (“UCC”), Revised Code of Washington section 62A.9A-609. (Id. at 9-12.) Reliable Credit moves to dismiss all claims pursuant to Federal Rule of Civil Procedure 12(b)(6). (Dkt. No. 14.)

         II. DISCUSSION

         A. Legal Standard on Motion to Dismiss

         A defendant may move to dismiss a complaint when a plaintiff “fails to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). In resolving a motion to dismiss, the Court accepts all factual allegations in the complaint as true and construes them in the light most favorable to the nonmoving party. Vasquez v. L.A. County, 487 F.3d 1246, 1249 (9th Cir. 2007). To survive a motion to dismiss, a complaint must contain sufficient factual matter to state a claim for relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009). A claim is facially plausible 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. at 678. However, conclusory allegations of law and unwarranted inferences will not defeat an otherwise proper motion to dismiss. Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001).

         B. Analysis

         1. Reliable Oregon

         Reliable Credit seeks dismissal of all claims against Reliable Oregon because that company has never contracted with or hired Emerald City. (Dkt. No. 14 at 4.) In support of this position, Reliable Credit submitted a declaration by one of the company's branch managers (Dkt. No. 15). On a motion to dismiss pursuant to Rule 12(b)(6), the Court is limited to considering the complaint itself, exhibits attached to the complaint, documents incorporated by reference, and matters subject to judicial notice. Lee v. City of L.A., 250 F.3d 668, 688-89 (9th Cir. 2001). The Court cannot consider Reliable Credit's declaration because it makes a factual challenge to Plaintiff's complaint. See Lee, 250 F.3d 668 (“[F]actual challenges to a plaintiff's complaint have no bearing on the legal sufficiency of the allegations under Rule 12(b)(6).”)

         The first amended complaint alleges that Reliable Credit “had a contractual relationship with Emerald Recovery for repossession of vehicles on its behalf at the time plaintiff's car was taken.” (Dkt. No. 24-1 at 6.) Accepting this allegation as true, Plaintiff alleges sufficient facts to demonstrate Reliable Oregon could be vicariously liable for Emerald City's conduct. Therefore, the Court must assess each of Plaintiff's claims against both Reliable Oregon and Reliable Washington to determine if they state a claim upon which relief can be granted.

         2. Con ...


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