Tag: Iqbal

Bankr. E.D.N.C.: In re KGC Homeowners, Inc.- Pleading Requirements for Negligence and Breach of Fiduciary Duty, Economic Loss Doctrine

Summary:

KGC Homeowners, Inc. (“KGC”) brought suit against William Douglas Management, Inc. (“WDM”) alleging breach of contract, negligence and breach of fiduciary duty. While conceding that the complaint sufficiently alleged a breach of contract, WDM moved to dismiss the negligence and breach of fiduciary duty claim, pursuant to Rule 12(b)(6) and Iqbal/Twombly.

The elements of a negligence claim are:
(1) The Defendant owed a duty to plaintiff;
(2) The Defendant breached the duty by failing to conform to the required standard of conduct,
(3) The breach of duty resulted in injury to the plaintiff; and
(4) An actual injury to the interests of the plaintiff occurred.… Read More

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Bankr. E.D.N.C.: In re American Ambulette & Ambulance Service – Unfair and Deceptive Trade Practices Negatively Affecting Consumers

Summary:

The Chapter 7 Trustee alleged that the defendants’ misrepresentations to the debtor regarding expansion opportunities constituted unfair or deceptive acts or practices, as these induced the debtors to transfer their valuable business assets to the defendant’s competing businesses . The Trustee alleged that, in fact, the true purpose of the transfers was to force the debtors into bankruptcy.

In ruling on the defendant’s Rule 12(b)(6) motion to dismiss, the bankruptcy court began with restating the elements of the Unfair and Deceptive Trade Practices Act at N.C.G.S. § 75 claims:

(1) The defendant committed an unfair or deceptive act or practice;
(2) The action in question was in or affecting commerce; and
(3) The act proximately caused injury to the plaintiff.… Read More

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Bankr. E.D.N.C.: In re Sorge- Amendment to Complaint; Embezzlement

Summary:

Federal Insurance Company, together with other plaintiffs, sought to amend its complaint, which already asserted that the debt owed by Mr. Sorge was nondischargable under 11 U.S.C. § 523(a)(2), to add a claim of embezzlement and to revive a previously dismissed claim of breach of fiduciary duty, both nondischargable under § 523(a)(4). As “[l]eave to amend should be freely given when justice so requires, but may be denied if undue prejudice would result or if the amendment is futile,” Kozohorsky v. Harmon, 332 F.3d 1141, 1144 (8th Cir. 2003), the bankruptcy court previously held that, given the lack of surprise and sufficient remaining time for discovery, there was no undue prejudice.… Read More

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Bankr. E.D.N.C.: In re Long – Iqbal/Twombley Pleading for § 727(a)(2)(A)

Summary:

Creditor, Two Olives, Inc., sought denial of the debtors’ discharge pursuant to 11 U.S.C. § 727(a)(2)(A) , asserting that“the debtor, with intent to hinder, delay, or defraud a creditor . . . has permitted to be transferred . . . property of the debtor, within one year before the date of the filing of the petition.” Prior to the filing of the Chapter 7, the Debtors had allowed three parcels of real property to be sold a t foreclosure- the Ridley property was purchased with a credit bid by the lienholder and the Male Debtor’s mother purchased the McCulloch and Anclote properties for $396,338 and $189,805.65, respectively.… Read More

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Bankr. E.D.N.C.: Oliver v. Bateman, et al.- Iqbal/Twombley and Fraudulent Transfer Pleadings

Summary:

On September 26, 2008, Luther Bateman transferred, subject to retention of a life estate, property located at 106 Sanderline Road, Shawboro, North Carolina to his children, Carol Bateman Cooper, Timothy Ross Bateman, Louis Eugene Bateman, and Robert Charles Bateman (“the Defendants”). On August 4, 2010, Mr. Bateman filed Chapter 7 and valued his life estate in the Property to be approximately $186,000.00, subject to a mortgage in the amount of $15,395.99. The Trustee then sought to avoid and recover the transfer of the Property to as fraudulent transfers, pursuant to 11 U.S.C. §§ 548; N.C. Gen. Stat. § 39-23.4; and 11 U.S.C.… Read More

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Bankr. M.D.N.C.: Livingstone College v. DeBerry- Failure to Specifically Cite Statutory Basis for Claim and Amendment of Complaint

Summary:

On remand from the district court, the issue was whether the complaint filed by Livingstone College, Inc. (“Livingstone”) properly states a claim for relief under 11 U.S.C. § 523 of the Bankruptcy Code for nondischargability of a debt owed by Joseph Maurice DeBerry (“DeBerry”) and Golden Student Housing, LLC (“GSH”) (together, the “Defendants”), and, if it does not, whether Livingstone’s complaint may be amended under the applicable rules.

The Complaint alleged that after Livingstone had entered into a lease, negotiated by DeBerry, with GSH, that DeBerry substituted pages from the executed lease before delivering it to GSH to sign. In the Complaint, Livingstone sought eight specific forms of relief, including a jury trial, a declaratory judgment, actual, punitive and treble damages, and “such other and further relief as to the Court may deem proper.” Livingstone did not, however, request that the debt be declared nondischargeable.… Read More

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4th Circuit: Larrabee v. Bank of America- Iqbal/Twombley Pleading of Truth In Lending Rescission Action

Summary:

The Court of Appeals held that the Plaintiff had failed to state a plausible claim for relief under the TILA because her proposed reading of the notice disclosing the number and due dates of payments due under that transaction is not objectively reasonable. Further, because the disclosure to the Plaintiff of her right to cancel the 2007 credit transaction contained all of the information required by the TILA, 15 U.S.C.A. § 1635(a)-(b), and Regulation Z, 12 C.F.R. § 226.23(a)-(b), (d), the disclosure complied with the TILA.

The grant of summary judgment against the plaintiff she did not suggest that she was confused as to whether she could cancel the 2007 credit transaction without cost, nor did she put forth any evidence explaining how or suggesting that an average borrower faced with both the notice of right to cancel and the fee notice would be confused as to whether she could cancel the 2007 credit transaction without cost.… Read More

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N.C. Court of Appeals: Cullen v. Emmanuel & Dunn- Collateral Attack & Iqbal/Twombley

Summary:

In a prior related case, the Plaintiffs brought class action suit against Credit Collections Defense Network (“CCDN”) and several individuals, as attorneys associated with CCDN, alleging a scam that involved promises to assist debtors in legally avoiding credit card debts. See Lucas v. R.K. Lock & Assoc., 710 S.E. 2d 707 (N.C. Ct. App. March 2011). In that case, the attorney defendants moved for and were granted a dismissal due to a lack of personal jurisdiction, as they did not have minimum contacts with the State of North Carolina, other than in connection with CCDN, which had not been named in that Complaint as a party.… Read More

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Bankr. M.D.N.C.: Dark v. Thomas- Iqbal/Twombley Pleading under 11 U.S.C. § 523(a)(2)(A) regarding whether money was “Obtained” through Fraud

Summary:

Dark brought an adversary proceeding seeking to have the debt of Thomas declared nondischargable pursuant to 11 U.S.C. § 523(a)(2).  Thomas moved to dismiss pursuant to Rule 12(b)(6), arguing that “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim for relief that is plausible on its face.'” Ashcroft v. Iqbal,  129 S.Ct. 1937, 1949,  (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).  The Court ruled for Thomas finding that the complaint did not contain even a “threadbare recital of the elements” required under § 523(a)(2).  Pertinent in this case is that § 523(a)(2)(A) requires that money or property be “obtained” by fraud, false representation or false pretenses. … Read More

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Bankr. E.D.N.C.: In re Brown- Delay of Voluntary Dismissal to Protect Creditor’s Rights & Dismissal for Failure to Prosecute

Summary:

After Wells Fargo commenced foreclosure, the Debtor filed an action against Wells Fargo first in North Carolina Superior Court, which was then removed to the Middle District Court.  (This series of events actually occurred twice.)  When the Debtor eventually filed bankruptcy in the Eastern District, venue in her case against Wells Fargo was transferred.

Following a Motion to dismiss the Debtor’s complaint, the Debtor sought to voluntarily dismiss her Chapter 13 case, requesting that the Complaint against Wells Fargo then be remanded to either the Eastern District Court or North Carolina Superior Court.  Because such a voluntary dismissal would adversely affect the rights of Wells Fargo while the Motion to Dismiss the complaint was pending, the bankruptcy court delayed entry of the voluntary bankruptcy dismissal.… Read More

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