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Phillips v. United States Department of Education

United States District Court, M.D. Tennessee

November 9, 2017

RANETTA MARSHELL PHILLIPS, Plaintiff
v.
UNITED STATES DEPARTMENT OF EDUCATION, et al., Defendants

          THE HONORABLE ALETA A. TRAUGER

          REPORT AND RECOMMENDATION

          JOE B. BROWN United States Magistrate Judge.

         For the reasons stated below the Magistrate Judge recommends that the pending motions to dismiss for failure to state a claim by the Defendants ConServe and the University of Phoenix (Docket Entries 7[1] and 8) be granted and the claims against these two Defendants be dismissed with prejudice and that any appeal therefrom not be certified as taken in good faith.

         BACKGROUND

         The Plaintiff filed her complaint in forma pauperis on July 11, 2017 (Docket Entries 1 and 2). The matter was referred to me for case management and for a report and recommendation as to any dispositive matters (Docket Entry 4).

         The complaint is rather brief. In paragraph 1 the Plaintiff states that the grounds for filing the case in federal court are:

I'm filing this case because I didn't take out these student loans in 2011. I did not attend the University of Phoenix. But now my Social Security income is being offset for the repayment of the loans, plus interest and fees. Not only is this unlawful, it's causing me and my family a lot of stress and hardship.
The claim itself is stated as:
On or around December 18, 2011 somebody used my name and social security number to obtain 2 different student loans in my name. The Department of Education sent this money to University of Phoenix. One loan was for $3, 985 and the other loan was for $4, 155. These loans were then consolidated and sent to ConServe, which is a collection agency. These loans have since accrued interest and fees, and now ConServe is offsetting my social security benefits for more than $13, 000. I did not apply for the loans. I did not attend the University of Phoenix. And I want the Department of Education to compensate me for all my pain and suffering as well as wages.

         After these motions were filed on September 6. 2017, the undersigned addressed some deficiencies in service on the Department of Education and noted that the Defendants had filed motions to dismiss and directed the Plaintiff to respond to the motions by October 6, 2017, with either an amended complaint or reasons why the current complaint was sufficient (Docket Entry 11). As of the date of this report and recommendation the Plaintiff has neither filed an amended complaint or a response to the motions to dismiss.

         LEGAL DISCUSSION

         In the initial review of the complaint (Docket Entry 4) the District Court found that although the Plaintiff did not identify the legal basis for her claims, construing the complaint liberally, the Court found that it may state a claim against the Defendants under Fair Debt Collections Process Act, 15 U.S.C. § 1692e (FDCPA), et seq.

         In their motion and memorandum (Docket Entry 7 and 7-1) ConServe notes that the Plaintiff did not seek any specific relief against ConServe. ConServe argues the Court lacks jurisdiction because the Plaintiff has failed to identify a specific basis for the Court's jurisdiction and the case is therefore subject to dismissal under Federal Rule of Civil Procedure 12(b)(1). The Magistrate Judge will reject this argument since the District Judge noted in the initial review, after giving the Plaintiff the benefit of the doubt, that the Plaintiff had alleged the complaint under 18 U.S.C. § 1692e of the FDCPA. It appears, therefore, that the Court would have jurisdiction to hear the case since the Plaintiff has alleged a federal violation. The Plaintiff does allege that ConServe is a collection agency and that ConServe is offsetting her Social Security benefits. This appears to at least minimally trigger federal jurisdiction.

         Turning to the second part of the motion to dismiss, the Magistrate Judge agrees that now that it has been challenged, the complaint fails to state a cause of action in accordance with Federal Rule of Civil Procedure 12(b)(6). To survive, a motion to dismiss “A complaint must contain sufficient factual matters, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009), quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). As they point out in their brief a claim which merely states a ...


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