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Conway v. Portfolio Recovery Assocs., LLC

United States District Court, E.D. Kentucky, Central Division

March 31, 2014

SEAN CONWAY, Plaintiff,

For Sean Conway, Plaintiff: James Hays Lawson, LEAD ATTORNEY, Lawson at Law, PLLC, Louisville, KY; Kenneth J. Henry, LEAD ATTORNEY, Henry & Associates, PLLC, Louisville, KY.

For Portfolio Recovery Associates, LLC, Defendant: Elizabeth M. Shaffer, Sarah Billiter Cameron, LEAD ATTORNEYS, Dinsmore & Shohl, LLP - Cincinnati OH, Cincinnati, OH; Joseph N. Tucker, LEAD ATTORNEY, Dinsmore & Shohl, LLP - Louisville KY, Louisville, KY.


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Gregory F. Van Tatenhove, United States District Judge.

This matter is before the Court upon the Motion to Dismiss [R. 7] filed by Defendant Portfolio Recovery Associates, LLC, and the Motion to Strike filed by Plaintiff Sean Conway, [R. 11] which is related to the Reply brief associated with the Motion to Dismiss. As will be explained below, this case turns on where the breach of contract to pay a debt occurred. Conway argues that the contract was breached in the location where the payment was supposed to be received (Virginia), while PRA contends that the breach occurred when and where Conway made the decision not to pay his debt (presumably Kentucky). For the reasons set forth herein, both motions are DENIED.


The relevant factual background is the same for both motions. The Defendant, Portfolio Recovery Associates, LLC (" PRA" ), filed suit against Sean Conway in Shelby District Court of Shelby, Kentucky, on March 28, 2012, seeking to collect an alleged debt on a credit card. [R. 1 at 2; R. 8 at 2.] At all times relevant to this dispute Conway was a citizen and resident of Shelby County, Kentucky. [R. 7 at 2.] Capital One Bank (USA), N.A. (" Capital One" ) issued a credit card to Plaintiff Conway in September, 2006, and Mr. Conley subsequently used the credit card to make personal purchases. [R. 7 at 2.] Conley made his last payment on his Capital One credit card on February 29, 2008, [R. 1-1 at 3] and failed to make the next payment in March, 2008, or any further payments afterward. In October, 2008, Capital One charged off Conway's balance of $1,288.89. PRA then purchased Conway's account from Capital One on November 17, 2008.

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The parties do not dispute that PRA is the legitimate assignee of Capital One, thereby retaining all claims and defenses against Conway that Capital One would have had. [ See R. 7 at 2; R. 8 at 2.] The parties also do not dispute that PRA acquired Capital One's cause of action against Conway, nor do they dispute that this cause of action accrued no later than late March, 2008, and no earlier than February 29, 2008. [ See R. 8 at 2, 5.]

In March, 2012, approximately four years after PRA's cause of action against Conley accrued, PRA filed a debt collection lawsuit against Conley in district court in Shelby County, KY. On October 18, 2012, the parties filed a Joint Stipulation of Dismissal in Shelby District court, dismissing all claims against Conway. Conway then filed suit in this Court, alleging that PRA had violated the Fair Debt Collections Practices Act (" FDCPA" ), 15 U.S.C. § § 1692 et seq. by bringing a collection suit against Conway that was time-barred by the statute of limitations. [R. 1.] Conway also brings this suit on behalf of all other persons in Kentucky similarly situated. Conway's complaint seeks statutory damages for the alleged violation of the Act, attorney's fees, litigation costs, and any other relief the Court deems appropriate.

PRA has filed a motion to dismiss Conway's claims pursuant to Fed.R.Civ.P. 12(b)(6), contending that Conway has failed to state a claim upon which relief may be granted because Conway relies upon the Virginia statute of limitations instead of Kentucky's statute. According to PRA, there has been no violation of the FDCPA because PRA brought the collection suit against Conway within Kentucky's five-year statute of limitations, and thus the suit was not time-barred. [R. 7 at 1-3.] Conway responded by arguing that Kentucky's borrowing statute is applicable in this case, and that under Kentucky's borrowing statute, Virginia's three-year statute of limitations should apply instead of Kentucky's. Thus, the issue before the Court is whether Kentucky's borrowing statute requires the application of Kentucky's or Virginia's statute of limitations. Because Conley's complaint is based entirely on the premise that PRA brought a time-barred collection suit against him, if PRA's suit was within the statute of limitations, then Conway has failed to state a claim that can survive a 12(b)(6) motion.



In a motion to dismiss brought pursuant to Rule 12(b)(6), " [t]he defendant has the burden of showing that the plaintiff has failed to state a claim for relief." DirecTV, Inc. v. Treesh, 487 F.3d 471, 476 (6th Cir. 2007) (citing Carver v. Bunch, 946 F.2d 451, 454-55 (6th Cir. 1991)). When reviewing a Rule 12(b)(6) motion, the Court " construe[s] the complaint in the light most favorable to the plaintiff, accept[s] its allegations as true, and draw[s] all inferences in favor of the plaintiff." Id. (citation omitted). Such a motion " should not be granted unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Id. (quoting Ricco v. Potter, 377 F.3d 599, 602 (6th Cir. 2004)). The Court, however, " need not accept as true legal conclusions or unwarranted factual inferences." Id. (quoting Gregory v. Shelby County, 220 F.3d 433, 446 (6th Cir. 2000)).

Moreover, the facts that are pled must rise to the level of plausibility, not just possibility-- a complaint containing " facts that are merely consistent with a defendant's liability . . . stops short of the line between possibility and plausibility." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct.

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1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 557, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (internal quotation marks omitted)). " A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is ...

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