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Ketterman v. Bank of America Corp.

United States District Court, E.D. Missouri, Eastern Division

May 2, 2019

BANK OF AMERICA CORP., et al., Defendants.



         This matter is before the Court on Plaintiff's motion for judgment on the pleadings.[1](Doc. No. 78). The motion is fully briefed and ready for disposition. For the following reasons, the motion will be denied.


         On May 11, 2018, Ketterman filed this action against Chase[2] for violations of the Fair Credit Reporting Act, 15 U.S.C. §§ 1681, et seq. (“FCRA”), in the Circuit Court of St. Louis County. The case was removed to this Court on June 13, 2018. (Doc. No. 1). On January 16, 2019, Ketterman filed a first amended complaint against Chase alleging that Chase furnished the credit report agencies (“CRAs”) with inaccurate information relating to a credit card account that his “ex-wife opened up” without his “permission or knowledge.” (First Amended Complaint (“FAC”), Doc. No. 67 at ¶ 15).

         Also on January 16, Chase filed a counterclaim against Ketterman alleging that on October 9, 2014, it opened and issued him a credit card account governed by a written Cardmember Agreement. (Doc. No. 66 at ¶¶ 6-9). Chase further alleges that Ketterman defaulted on his payment obligations and that as of the filing of the Counterclaim, the outstanding unpaid balance is $5, 285.60, plus attorneys' fees and costs. (Id. at ¶¶ 17-18). Chase alleges counterclaims for breach of contract, suit on account and unjust enrichment.

         Ketterman moves for judgment on the pleadings, arguing that the Court lacks supplemental jurisdiction over Chase's counterclaims because they do not arise from the same case or controversy as the instant case brought under the FCRA. (Doc. No. 78 at 4-6). Ketterman also argues that Chase's counterclaims are time-barred because they were brought more than three years after the date of the last payment and past Delaware's statute of limitations.[3] (Id. at 6-8). In support of its motion, Ketterman submits a copy of Chase's responses to his interrogatories indicating that the last payment on the account at issue was September 4, 2015 and that the account was closed on November 5, 2015. (Doc. No. 78-1).

         In response, Chase argues that its counterclaim is compulsory because both the FCRA claims and the counterclaims are centered on the same issue, i.e., whether Ketterman is liable on the Account, and if so, in what amount. (Doc. No. 87 at 7-9). Chase further argues that Ketterman cannot rely on material “outside the pleadings” to support his argument for dismissal under Rule 12(b). (Id. at 10-11). Lastly, Chase argues that under Delaware's statute of limitations, the accrual period for a continuous contract, like a credit card contract, does not begin to run until the “full damages can be ascertained and recovered.” (Id. at 12-13).

         Legal standard

         In resolving a Rule 12(c) motion for judgment on the pleadings, a court must “view the facts presented in the pleadings and the inferences to be drawn therefrom in the light most favorable to the nonmoving party.” Kaestner v. Diversified Consultants, Inc., No. 4:17-CV-2607 CAS, 2018 WL 465786, at *2 (E.D. Mo. Jan. 17, 2018). “Judgment on the pleadings is not properly granted unless the moving party has clearly established that no material issue of fact remains to be resolved and the party is entitled to judgment as a matter of law.” United States v. Any and All Radio Station Transmission Equip., 207 F.3d 458, 462 (8th Cir. 2000). “The motion for judgment on the pleadings only has utility when all material allegations of fact are admitted or not controverted in the pleadings and only questions of law remain to be decided by the district court.” Stewart v. City of St. Louis, No. 4:04CV885 RWS, 2006 WL 389837, at *1 (E.D. Mo. Feb. 17, 2006) (quoting Wright & Miller, Federal Practice and Procedure: Civil 3d § 1367).


         Supplemental jurisdiction

         Ketterman's FCRA claim invokes original jurisdiction under 28 U.S.C. § 1331, and 28 U.S.C. § 1367(a) permits the exercise of supplemental jurisdiction over claims “so related to” the claim invoking original jurisdiction that the claims “form part of the same case or controversy.” This includes counterclaims, which may be compulsory or permissive. A counterclaim is compulsory if it “arises out of the transaction or occurrence that is the subject matter of the opposing party's claims and does not require adding another party over whom the court cannot acquire jurisdiction.” Fed.R.Civ.P. 13(a)(1). Supplemental jurisdiction automatically extends to compulsory counterclaims. St. Jude Med., Inc. v. Lifecare Int'l, Inc., 250 F.3d 587, 594 (8th Cir. 2001).

         “[A]ny claim that is not compulsory” is permissive. Fed.R.Civ.P. 13(b). Courts within the Eighth Circuit have assumed, without deciding, that supplemental jurisdiction exists over at least some permissive counterclaims that, although not arising from the same transaction or occurrence under Rule 13(a), nevertheless form part of the same case or controversy as required under § 1367(a). Ensz v. Chase Bank USA NA, No. 18-CV-2065-CJW-MAR, 2019 WL 136982, at *2 (N.D. Iowa Jan. 7, 2019) (citing Riazi v. Ally Fin., Inc., No. 4:17CV1705JCH, 2017 WL 4260847, at *4 (E.D. Mo. Sept. 26, 2017); Graf v. Pinnacle Asset Grp., LLC, NO. 14-1822-SRN/SER, 2015 WL 632180, at *5 (D. Minn. Feb. 12, 2015)). Claims are a part of the same case or controversy if they “derive from a common nucleus of operative fact, ” such that the parties “would ordinarily be expected to try them all in one judicial proceeding.” ABF Freight Sys., Inc. v. Int'l Bhd. of Teamsters, 645 F.3d 954, 963 (8th Cir. 2011) (citations omitted).

         In the instant motion, Ketterman argues this Court lacks supplemental jurisdiction over Chase's counterclaim because it does not arise from “the same case or controversy” as his FCRA claim. Ketterman relies on cases comparing the elements of TCPA claims and FDCPA claims to a defendant's counterclaims to collect the underlying debt and finding the counterclaims were not part of the same case or controversy because they required largely different evidence. (Doc. No. 78 at 4-5) (citing Ensz, 2019 WL 136982, at *4; Vecchia v. Ally Financial, Inc., No. 8:17-CV-2977-T-23AAS, 2018 WL 907045, at *1 (M.D. Fla. Feb. 15, ...

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