Avent v. Platinum Plus Auto Protection
1:19-cv-01494-BKS-DJS
N.D.N.Y.Feb 23, 2021Background
- Avent (African American) bought a Mercedes and, after a phone solicitation by sales agent Christina Strain (Platinum Plus), paid $395 toward a $4,579 vehicle service agreement (VSA) and entered a PayLink Direct payment plan.
- The written VSA (issued by Palmer, insured by Atlantic) limited coverage, had a 30-day waiting period, a $100 deductible, and a written cancellation/refund procedure (20-day return language for NY).
- Avent alleges Strain misrepresented immediate, comprehensive coverage to induce payment; when he sought a refund/termination he could not reach Platinum Plus and PayLink Direct began collection calls that harmed his credit.
- Claims: 42 U.S.C. § 1981 (racial discrimination), FDCPA violations, state-law fraud in inducement and breach of contract; defendants: Platinum Plus, Atlantic Specialty Insurance Co., Palmer Administrative Services, PayLink Direct, and Christina Strain.
- Procedural posture: Company defendants moved to dismiss; Avent cross-moved for default judgment. Court considered exhibits integral to the complaint and applied pro se solicitude but dismissed several claims and denied default judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| §1981 (racial discrimination) — sufficiency of pleadings | Avent: was targeted due to race and fraudulently induced, denied ability to terminate | Defendants: no specific facts showing racially discriminatory motive or but-for causation | Dismissed — complaint lacks specific facts to plausibly infer discriminatory intent and fails Comcast but-for standard |
| FDCPA — whether Avent incurred a debt | Avent: down payment and payment plan created a consumer debt; collection calls ensued | Defendants: no debt because VSA/payments cancellable and no binding obligation | Complaint alleges a debt sufficiently at pleading stage (court credits allegations) |
| FDCPA — whether defendants are "debt collectors" | Avent: defendants harassed and attempted collection | Defendants: they originated the debt / did not acquire it in default and so are excluded from FDCPA definition | Dismissed — complaint fails to plausibly allege any defendant is a debt collector under FDCPA exclusions |
| State claims & amount-in-controversy (diversity) | Avent: seeks compensatory and punitive damages (large amounts) to meet $75,000 | Defendants: damages not plausible to meet jurisdictional threshold; also attack merits of breach/fraud | Court finds face-of-complaint punitive/compensatory allegations suffice to meet $75,000 burden for jurisdictional purposes; but breach claim dismissed for failure to identify breached terms; fraud claim survives as to Strain/companies (adequately pled) but fraud claim against Atlantic dismissed for lack of specific allegations imputing fraud or control |
| Default judgment motion | Avent: seeks default vs. Strain, Platinum Plus, Atlantic for not answering | Defendants: timely filed motions to dismiss; Strain was not shown served | Denied — Platinum Plus and Atlantic timely moved; no clerk’s default; Strain not served (subject to Rule 4(m) dismissal) |
| Leave to amend | Avent: seeks to proceed on dismissed claims | Defendants: oppose where claims are deficient (FDCPA) | Court grants leave to amend §1981, breach of contract, and fraud claims (30 days); denies leave to amend FDCPA claim as futile |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (establishes pleading plausibility standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (courts need not accept legal conclusions as true)
- Comcast Corp. v. Nat’l Ass’n of African American-Owned Media, 140 S. Ct. 1009 (but-for causation required in discrimination claims)
- Mian v. Donaldson, Lufkin & Jenrette Sec. Corp., 7 F.3d 1085 (elements for §1981 claim)
- Eades v. Kennedy, PC Law Offices, 799 F.3d 161 (FDCPA purpose and scope)
- Kolbasyuk v. Capital Mgmt. Servs., LP, 918 F.3d 236 (definition/amount of debt under FDCPA)
- Vincent v. The Money Store, 736 F.3d 88 (FDCPA debt-collector definition and exclusions)
- Mills v. Polar Molecular Corp., 12 F.3d 1170 (Rule 9(b) particularity for fraud pleading)