Lee v. Toyota Motor Sales USA Inc
3:16-cv-03195
N.D. Cal.Sep 6, 2016Background
- Pro se plaintiff Alik Yusef Lee sued Toyota Motor Sales U.S.A., Millennium Capital & Recovery Corp., and Digital Dog Auto Recovery after his 2011 Toyota Camry was repossessed on June 2, 2016; he alleges repossession occurred before his payment was due (payment due June 5).
- Plaintiff attached a repossession inventory showing DD as recovery company and Millennium/Toyota as client; personal effects were returned the next day.
- Plaintiff alleges driveway and possible vehicle damage, sent demand letters to defendants, and filed claims for wrongful conversion/repossession (state law) and violations of the Fair Debt Collection Practices Act (FDCPA).
- Plaintiff seeks >$20,000 (value of car, emotional distress, punitive damages), injunctive relief (return car cleaned), and jury trial. He was granted in forma pauperis status.
- Court conducted preliminary review under 28 U.S.C. § 1915(e)(2)(B) and evaluated subject-matter jurisdiction (federal question via FDCPA) and sufficiency of claims; dismissed parts of complaint with leave to amend.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether court has federal subject-matter jurisdiction | Lee asserts FDCPA claim so federal-question jurisdiction exists | Defendants implied lack of diversity and challenge whether FDCPA applies | Court: jurisdiction exists because FDCPA claim plausibly stated against Millennium and DD, allowing supplemental jurisdiction over related state claims |
| Whether Millennium and DD are "debt collectors" under the FDCPA | Lee alleges Millennium and DD acted to repossess before right to possession — thus are debt collectors and violated §1692f(6) | Defendants would argue repossession was lawful or they are not FDCPA debt collectors | Court: allegations suffice to plausibly treat Millennium and DD as debt collectors and to state an FDCPA §1692f(6) claim |
| Whether Toyota is a "debt collector" under the FDCPA | Lee includes Toyota as defendant for FDCPA violations | Toyota likely is the original creditor and thus exempt from FDCPA as a debt collector | Court: complaint fails to allege facts showing Toyota is a debt collector; plaintiff given leave to amend to plead facts or drop Toyota from FDCPA claim |
| Whether conversion/wrongful repossession claim is pled | Lee contends he had right to possession (payment not due) and repossession was wrongful causing damages | Defendants would contend repossession was authorized or lawful | Court: conversion claim adequately pled against all three defendants for preliminary review; wrongful repossession can constitute conversion |
Key Cases Cited
- Cedars-Sinai Med. Ctr. v. Nat’l League of Postmasters of U.S., 497 F.3d 972 (9th Cir.) (standard for accepting factual allegations on Rule 12 review)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (legal conclusions need not be accepted as true)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard)
- Romine v. Diversified Collection Servs., Inc., 155 F.3d 1142 (9th Cir.) (scope of "debt collector" under FDCPA for third parties)
- Heintz v. Jenkins, 514 U.S. 291 (1995) (FDCPA applies to attorneys collecting debts)
- Montgomery v. Huntington Bank, 346 F.3d 693 (6th Cir.) (repossession agencies may be treated as debt collectors in limited circumstances)
- Vantu v. Echo Recovery, L.L.C., 85 F. Supp. 3d 939 (N.D. Ohio) (repossession that breaches the peace can render §1692f(6) claim viable)
- Lee v. Hanley, 61 Cal.4th 1225 (Cal.) (elements and standard for conversion claim)