United States District Court, D. Maine
JANE C. FORRESTER WINNE, et al., Plaintiffs,
NATIONAL COLLEGIATE STUDENT LOAN TRUST 2005-1, et al., Defendants.
ORDER ON DEFENDANTS' MOTIONS TO DISMISS THE
SECOND AMENDED COMPLAINT AND ON PLAINTIFFS' MOTION TO
LEVY, U.S. DISTRICT JUDGE
Forrester Winne, Sarah Coffey, Vickie McMullen, and Karin
Hills filed a Second Amended Complaint ("the
Complaint") on behalf of a putative class against 24
named defendants, alleging claims arising out of attempts to
collect on student loan debts. See ECF No. 112.
Fifteen Defendants, including 13 of the 17 National
Collegiate Student Loan Trusts,  Wilmington Trust Company,
and The First Marblehead Corporation, now known as Cognition
Financial Corporation,  have moved to dismiss the claims
against them. ECF No. 154; ECF No. 155; ECF No. 167.
Plaintiffs have moved to supplement the record before the
Court related to the motions to dismiss with the deposition
of Bradley Luke, an employee of Defendant Transworld Systems,
Inc., that was taken in a separate collection action filed
against two of the named Plaintiffs. ECF No. 206.
Plaintiffs allege that they, along with other Maine
residents, have been the subject of unlawful and fraudulent
student debt collection activities. They allege that a large
number of student loans purportedly owned by a series of
National Collegiate Student Loan Trusts are not collectible
because the Trusts do not have a lawful basis to collect on
the loans, and that the collection efforts undertaken by the
Defendants violate state and federal law. Each of the named
Plaintiffs borrowed money to finance her education or the
education of a family member. The student loan debt was then
sold by the original lender, and eventually acquired by one
of the National Collegiate Student Loan Trusts. Each of the
named Plaintiffs asserts that, beginning in 2014, she was
contacted by an entity acting on behalf of a National
Collegiate Student Loan Trust, seeking to collect on a debt.
The Plaintiffs allege that these collection efforts violate
the federal Fair Debt Collection Practices Act, 15 U.S.C.A
§§ 1692-1692p (2017), ("FDCPA") the Maine
Fair Debt Collection Practices Act, 32 M.R.S.A §§
11001-11054 (2017), ("MFDCPA") and the Maine Unfair
Trade Practices Act, 5 M.R.S.A. §§ 205-A-214
(2017), ("UPTA") as well as constituting fraud and
breach of contract.
Trusts move to dismiss the claims against them for lack of
standing and failure to state a claim. Wilmington moves to
dismiss the claims against it for lack of personal
jurisdiction and failure to state a claim. First Marblehead
moves to dismiss the claims against it for lack of standing,
lack of personal jurisdiction, and failure to state a claim.
I address each motion in turn.
Motion to Dismiss for Failure to State a Claim
survive a motion to dismiss under Federal Rule of Civil
Procedure 12(b)(6), a complaint "must contain sufficient
factual matter to state a claim to relief that is plausible
on its face." Saldivar v. Racine, 818 F.3d 14,
18 (1st Cir. 2016) (quoting Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009)) (internal quotation marks and
alterations omitted). The court should accept all
well-pleaded facts as true, while ignoring conclusory legal
allegations. Id. All reasonable inferences should be
drawn in favor of the non-moving party. Id. at 16.
The complaint must contain facts that support a reasonable
inference "that the defendant is liable for the
misconduct alleged." Iqbal, 556 U.S. at 678.
Determining the plausibility of a claim is a context-specific
task that requires the court "to draw on its judicial
experience and common sense." Saldivar, 818
F.3d at 18 (quoting Iqbal, 556 U.S. at 679)
(quotation marks omitted). The burden of demonstrating that
the complaint does not state a claim for which relief can be
granted is on the Defendants. See 5B Charles Alan
Wright & Arthur R. Miller, Federal Practice and
Procedure § 1357 (3d ed. 2017 Update).
of fraud are subject to the higher pleading standard of
Federal Rule of Civil Procedure Rule 9(b). See Fed.
R. Civ. P. 9(b). The complaint must "be specific about
the 'time, place, and content of an alleged false
representation[.]'" Murtagh v. St. Mary's
Reg'l Health Ctr., No. 1:12-cv-00160, 2013 WL
5348607, at *6 (D. Me. Sep. 23, 2013) (quoting Hayduk v.
Lanna, 775 F.2d 441, 444 (1st Cir. 1985)). Mere
conclusory allegations will not satisfy the particularity
requirement. See Hayduk, 775 F.2d at 444. Rule 9(b)
also requires that plaintiffs identify a basis for inferring
scienter on the part of the defendant. N. Am. Catholic
Educ. Programming Found., Inc. v. Cardinale, 567 F.3d 8,
13 (1st Cir. 2009).
Motion to Dismiss for Lack of Personal Jurisdiction
plaintiff has the burden of establishing the court's
personal jurisdiction over a defendant. Boit v. Gar-Tec
Prods., Inc., 967 F.2d 671, 674-75 (1st Cir. 1992). When
a defendant files a motion to dismiss for want of personal
jurisdiction pursuant to Rule 12(b)(2), "a district
court may choose from among several methods for determining
whether the plaintiff has met its burden."
Baskin-Robbins Franchising LLC v. Alpenrose Dairy,
Inc., 825 F.3d 28, 34 (1st Cir. 2016) (quoting
Adelson v. Hananel, 510 F.3d 43, 48 (1st Cir. 2007))
(internal quotation marks omitted). The "most
conventional" of these methods is the prima facie
method, which "permits the district court to consider
only whether the plaintiff has proffered evidence that, if
credited, is enough to support findings of all facts
essential to personal jurisdiction." Foster-Miller,
Inc. v. Babcock & Wilcox Canada, 46 F.3d 138, 145
(1st Cir. 1995) (quoting Boit, 967 F.2d at 675)
(internal quotation marks omitted).
satisfy the prima facie standard, the plaintiff must show
that the requirements of both the forum's long arm
statute and the due process clause of the Constitution are
satisfied. Boit, 967 F.2d at 675. The Maine long-arm
statute extends "to the fullest extent permitted by the
due process clause" and therefore the constitutional
inquiry controls. Harlow v. Children's Hosp.,
432 F.3d 50, 57 (1st Cir. 2005) (quoting 14 M.R.S.A. §
the Supreme Court's opinion in Int'l Shoe Co. v.
State of Washington, 326 U.S. 310 (1945), courts have
divided the personal jurisdiction analysis into two parts:
"general" and "specific" personal
jurisdiction. Donatelli v. Nat'l Hockey League,
893 F.2d 459, 462-63 (1st Cir. 1990). General jurisdiction
exists when the defendant has engaged in "continuous and
systematic activity" in the forum. Harlow, 432
F.3d at 64. Specific jurisdiction exists when "the cause
of action . . . arises directly out of, or is related to, the
defendant's forum-based contacts." Id. at
60-61. For both categories of personal jurisdiction, the
defendant must have sufficient "minimum contacts"
with the forum; those contacts must be purposeful; and the
exercise of jurisdiction must be reasonable under the
circumstances. Id. at 57.
Motion to Dismiss for Lack of Standing
III of the Constitution limits the judicial power to actual
cases and controversies. See Warth v. Seldin, 422
U.S. 490, 498 (1975). "One element of the
case-or-controversy requirement is that plaintiffs must
establish that they have standing to sue." Kerin v.
Titeflex Corp., 770 F.3d 978, 981 (1st Cir. 2014)
(quotation omitted). A plaintiff must plead three elements to
satisfy the standing requirement: injury in fact,
traceability, and redressability. Id. (citing
Lujan v. Defenders of Wildlife, 504 U.S.
555, 560-61 (1992)). "Prudential considerations . . .
demand that there be 'concrete adverseness which sharpens
the presentation of issues.'" United States v.
Windsor, 133 S.Ct. 2675, 2680 (2013) (quoting Baker
v. Carr, 369 U.S. 186, 204 (1962)). Therefore, courts
are limited to deciding cases where the party seeking review
demonstrates "a personal stake in the outcome of the
controversy." Pollard v. Law Office of Mandy L.
Spaulding, 766 F.3d 98, 102 (1st Cir. 2014) (quoting
Baker, 369 U.S. at 204).
Motion to Supplement the Record
Trusts, Wilmington, and First Marblehead oppose
Plaintiffs' motion to supplement. Wilmington and First
Marblehead argue that consideration of the deposition
testimony would violate the principles underlying Federal
Rule of Civil Procedure 32 because they were not given notice
of the deposition and did not have the opportunity to be
represented by counsel at its taking. Rule 32 states that a
deposition may be used against a party at a hearing or trial
if "the party was present or represented at the taking
of the deposition or had reasonable notice of it."
Fed.R.Civ.P. 32(a)(1)(A). By its terms, however, Rule 32
applies to the use of deposition testimony at a hearing or
trial, and therefore does not bar consideration of the
transcript in ruling on the instant motions. Accordingly, the
Plaintiffs' motion to supplement is granted.
The Trusts' Motion
Trusts argue that the claims against them should be dismissed
because the Plaintiffs lack standing and because the
Complaint fails to state a claim.
Trusts assert that at least one named plaintiff in a putative
class action must have standing against each individual
defendant, and that Plaintiffs have admitted that they do not
have standing to sue because they acknowledge that they do
not have ...