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Johnson v. Ace Cash Express Inc.

United States District Court, D. Delaware

July 17, 2015

ROSALYN JOHNSON, Plaintiff,
v.
ACE CASH EXPRESS INC., Defendant.

Richard H. Cross, Jr., Christopher Page Simon, Cross & Simon LLC, Wilmington, DE, Alexander J. Pires, Jr., Pires Cooley, Washington D.C., Attorneys for Plaintiff.

Arthur G. Connolly, III, Christos Theodore Adamopoulos, Connolly Gallager LLP, Wilmington, DE, Claudia Callaway, Hatten Muchin Rosenman LLP, Washington D.C. Attorneys for Defendant.

MEMORANDUM OPINION

LEONARD P. STARK, District Judge.

Pending before the Court is Defendant Ace Cash Express Inc.'s ("Defendant") motion to dismiss Plaintiff Rosalyn Johnson's ("Plaintiff') Second Amended Complaint. (D.I. 28) The Court had previously denied without prejudice Defendant's motion to dismiss Plaintiffs Amended Complaint and granted Plaintiffs request for leave to file the Second Amended Complaint. (D.I. 24, 25)[1] For the reasons stated below, the Court will grant Defendant's motion.

I. BACKGROUND[2]

Plaintiff obtained a $450 loan from Defendant on June 16, 2013. (D.I. 27 at 2) Defendant is engaged in the business of marketing, advertising, and making short-term loans, including payday and installment loans. (Id. at 3)

Plaintiff filed her initial Complaint on July 3, 2013 (D.I. 1) and her Amended Complaint on August 9, 2013 (D.I. 14). Following briefing and oral argument, the Court on July 24, 2014 issued a Memorandum Opinion identifying deficiencies in the Amended Complaint and granting Plaintiff leave to attempt to correct those deficiencies in a Second Amended Complaint. ( See D.I. 24, 25)

The Second Amended Complaint is materially identical to the earlier Complaint and Amended Complaint. Essentially, it alleges:

Plaintiff borrowed $450 to cover a cash flow problem. At the time she borrowed the principal, she did not understand fully the financial or legal terms of her loan document, contained in a 17-page, single-spaced document written in what appears to be 10-point font. She did not understand that she had a right of rescission, or a right to decline ACH authorization. She did not understand that she was committing to mandatory arbitration unless she opted out. She did not understand how to opt out of the arbitration clause. She had no knowledge of her legal rights, or the statutory obligations of the Defendants.

(D.I. 27 at 10) Plaintiff adds in the Second Amended Complaint the allegation that "Defendant performs no underwriting before issuing loans." (Id. at 12)

II. LEGAL ST AND ARDS

A. Rule 12(b)(6)

When presented with a motion to dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6), courts conduct a two-part analysis. See Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009). First, courts separate the factual and legal elements of a claim, accepting "all of the complaint's well-pleaded facts as true, but [disregarding] any legal conclusions." Id. at 210-11. This first step requires courts to draw all reasonable inferences in favor of the non-moving party. See Maio v. Aetna, Inc., 221 F.3d 472, 500 (3d Cir. 2000). However, the Court is not obligated to accept as true "bald assertions, " Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir.1997), "unsupported conclusions and unwarranted inferences, " Schuylkill Energy Res., Inc. v. Pa. Power & Light Co., 113 F.3d 405, 417 (3d Cir. 1997), or allegations that are "self-evidently false, " Nami v. Fauver, 82 F.3d 63, 69 (3d Cir. 1996).

Second, courts determine "whether the facts alleged in the complaint are sufficient to show that the plaintiff has a plausible claim for relief.'" Fowler, 578 F.3d at 211 (quoting Ashcroft v. Iqbal, 556 U.S. 662, 679 (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." Iqbal, 556 U.S. at 678. This is a context-specific determination, requiring the court "to draw on its judicial experience and common sense." Id. at 679. At bottom, "[t]he complaint must state enough facts to raise a reasonable expectation that discovery will ...


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