Nix v. Welch & White, P.A. , 55 F. App'x 71 ( 2003 )

Opinions of the United
2003 Decisions States Court of Appeals
for the Third Circuit
1-8-2003
Nix v. Welch White
Precedential or Non-Precedential: Non-Precedential
Docket 01-3186
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Recommended Citation
"Nix v. Welch White" (2003). 2003 Decisions. Paper 894.
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 01-3186
THEOPHILUS R. NIX, SR.; LULU MAE NIX,
Husband and Wife
v.
WELCH & WHITE, P.A.;
JEFFREY S. WELCH
Theophilus R. Nix, Sr. and Lulu Mae Nix,
Appellants
On Appeal from the United States District Court
for the District of Delaware
D.C. Civil Action No. 00-cv-00669
(Honorable Joseph J. Farnan, Jr.)
Submitted Pursuant to Third Circuit LAR 34.1(a)
September 17, 2002
Before: BECKER, Chief Judge, SCIRICA and McKEE, Circuit Judges
(Filed: January 8, 2003)
OPINION OF THE COURT
SCIRICA, Circuit Judge.
Plaintiffs sued a lawyer and his law firm under the Fair Debt Collection Practices
Act, 15 U.S.C. 1692 et seq. ("FDCPA"). Their complaint was dismissed under Fed. R.
Civ. P. 12(b)(6) for failure to properly plead a claim. We will reverse.
I.
In 1997, plaintiffs Theophilus R. Nix, Sr., and Lulu Mae Nix borrowed a total of
$77,000 through two consumer credit transactions with the Wilmington Savings Fund
Society, FSB ("WSFS"). Two years later, on September 22, 1999, WSFS’s counsel,
Jeffrey Welch of Welch & White, P.A., the defendants in this action, sent plaintiffs two
debt collection letters to recover the outstanding balances on these loans.
In 1999, plaintiffs also entered consumer credit transactions with Joseph B. Dietz,
Jr., DDS, for dental treatment that Dr. Dietz provided to them. Seeking to collect debts
owed on these credit transactions, defendants, acting as legal counsel for Dr. Dietz, filed a
complaint against plaintiffs on October 24, 2000 and sent plaintiffs a debt collection letter
on October 25, 2000.
Believing the September 22, 1999 collection letters violated the FDCPA, plaintiffs
sued defendants on July 20, 2000, and filed an amended complaint on November 17,
2000, adding defendants’ collection efforts on behalf of Dr. Dietz. In that complaint,
plaintiffs alleged that:
10. The September 22, 1999 letters embodied violations of the Act.
11. On information and belief, defendants violated the Act in other ways.
16. The October 24 process embodied violations of the Act.
17. The October 25 letter embodied violations of the Act.
Defendants filed a motion to dismiss under Fed. R. Civ. P. 12(b)(6) for failure to
state a claim upon which relief can be granted. Plaintiffs unsuccessfully attempted to file
a second amended complaint without leave of court. Plaintiffs then engaged in discovery
and subsequently filed additional motions.
On July 18, 2001, the District Court granted defendants’ motion to dismiss.
Without seeking reconsideration of the District Court’s dismissal order, plaintiffs
appealed on August 8, 2001.
II.
Plaintiffs assert two arguments on appeal: first, that their amended complaint was
sufficient to withstand a motion to dismiss for failure to state a claim upon which relief
can be granted under Fed. R. Civ. P. 12(b)(6); and second, that the District Court abused
its discretion by dismissing their complaint without granting leave to amend.
A. Whether the District Court Erred in Dismissing Plaintiffs’ Complaint
Our review of the District Court’s Rule 12(b)(6) motion to dismiss is plenary.
Doug Grant, Inc. v. Greate Bay Casino Corp., 232 F.3d 173, 183-184 (3d Cir. 2000).
While we accept as true all well-pleaded allegations in the complaint and view them in
the light most favorable to plaintiffs, "we need not accept as true ’unsupported
conclusions and unwarranted inferences.’" Id. (citations omitted).
Under Fed. R. Civ. P. 8(a), a complaint must contain "a short and plain statement
of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). A
complaint satisfies the Rule 8(a) pleading requirements if it gives notice and the grounds
upon which a plaintiff’s claim rests. See Swierkiewicz v. Sorema N.A., 534 U.S. 506,
514 (2002). While a complaint generally need not allege every element of a plaintiff’s
claim, it must plead facts sufficient to provide the defendant with "fair notice of the
transaction" and "set[] forth the material points necessary to sustain recovery."
Menkowitz v. Pottsdown Mem’l Med. Ctr., 154 F.3d 113, 124 (3d Cir. 1998).
Citing Swierkiewicz, plaintiffs contend their complaint was sufficient to withstand
a Fed. R. Civ. P. 12(b)(6) challenge. In Swierkiewicz, the Court held McDonnell
Douglas Corp. v. Green, 411 U.S. 792 (1973), did not govern the pleading standard
because "the precise requirements of a prima facie case can vary depending on the context
and were ’never intended to be rigid, mechanized, or ritualistic.’" Id. at 511. The Court
believed the McDonnell Douglas framework imposed a heightened standard on pleadings
that would conflict with Fed. R. Civ. P. 8(a). Id. at 512. The Court found the complaint
satisfied Rule 8(a) because it "detailed the events leading to [plaintiff’s] termination,
provided relevant dates, and included the ages and nationalities of at least some of the
relevant persons involved with his termination. These allegations g[a]ve respondent fair
notice of what petitioner’s claims [were] and the grounds upon which they rest[ed]." Id.
at 514.
In contrast, the complaint here fails to satisfy the minimal pleading requirements of
Rule 8(a) because it merely alleges defendants’ actions "embodied violations of the Act"
and "violated the Act in other ways." These are conclusory allegations. The complaint
fails to provide the "grounds upon which they rest." Furthermore, the remainder of
plaintiffs’ allegations fail to state a claim upon which relief can be granted. As the
District Court noted, plaintiffs "fail to allege, however, any facts to support these
allegations and provide no notice to defendants as to how the letters allegedly violated the
FDCPA." As a result, plaintiffs did not provide notice to defendants as to how their
actions allegedly violated the FDCPA.
B. Whether the District Court Abused its Discretion by Not Granting Leave to
Amend
We review a district court’s failure to grant leave to amend for abuse of discretion.
See Darr v. Wolfe, 767 F.2d 79, 81 (3d Cir. 1985). Under the Federal Rules of Civil
Procedure, a plaintiff may amend a complaint once as a matter of right and afterward by
leave of court or by written consent of the defendant. Fed. R. Civ. P. 15(a). In this case,
plaintiffs made no motion for leave to amend. In his brief on appeal, plaintiffs’ attorney
said he "did not think it a useful expenditure of [plaintiffs’] resources to file a motion to
amend, where it was to be expected that if the Court were to dismiss on the grounds of
insufficient factual allegations, it would at the same time grant leave to amend."
(Appellants’ Br. At 21). Seven months elapsed between the date the motion to dismiss
was filed (December 4, 2000) and the date the District Court granted the motion (July 18,
2001). Instead of curing the complaint’s defects adverted to in the motion to dismiss by
requesting leave to amend, plaintiffs chose to stand on their amended complaint and
pursue discovery and other motions. Furthermore, plaintiffs appealed without first
seeking reconsideration of the District Court’s dismissal order. Plaintiffs should have
amended their complaint after receiving the motion to dismiss. Nonetheless, absent
futility, our case law grants them the opportunity to amend after the dismissal.
Although the Federal Rules of Civil Procedure do not address the precise situation
here, that is, where leave to amend is not sought, it must be granted if the deficiency
could be cured by amendment. Shane v. Fauver, 213 F.3d 113, 116 (3d Cir. 2000) (citing
Borelli v. City of Reading, 532 F.2d 950 (3d Cir. 1976)).
As explained in Borelli, 532 F.2d at 951 n.1, and recently confirmed in Shane, 213
F.3d at 116, district courts should, before dismissing a claim:
[E]xpressly state, where appropriate, that the plaintiff has leave to amend
within a specified period of time, and that application for dismissal of the
action may be made if a timely amendment is not forthcoming within that
time. If the plaintiff does not desire to amend, he may file an appropriate
notice with the district court asserting his intent to stand on the complaint,
at which time an order to dismiss the action would be appropriate.
In Darr, 767 F.2d at 81, we said:
[T]his court has consistently held that when an individual has filed a
complaint under 1983 which is dismissible for lack of factual specificity,
he should be given a reasonable opportunity to cure the defect, if he can, by
amendment of the complaint and that denial of an application for leave to
amend under these circumstances is an abuse of discretion.
Although the District Court properly found that plaintiffs failed to plead a FDCPA
claim, it should have allowed plaintiffs an opportunity to amend their complaint.
Of course, we express no opinion on the merits of the claim. We will reverse and
remand for further proceedings consistent with this opinion.
TO THE CLERK:
Please file the foregoing opinion.
/s/ Anthony J. Scirica
Circuit Judge
DATED: January 8, 2003