United States District Court, N.D. Illinois, Eastern Division
DANIEL KARON, individually and on behalf of all others similarly situated, Plaintiff,
CNU ONLINE HOLDINGS, LLC, d/b/a/ CASHNETUSA, a Delaware limited liability company, and JOHN DOE CORPORATION, Defendants.
H. LEFKOW U.S. DISTRICT JUDGE.
motions of CNU Online Holdings, LLC's (CNU) to dismiss
and strike class allegations (dkt. 19) and for sanctions
(dkt. 30) are denied. Karon's motion to strike the motion
for sanctions and for counter-sanctions (dkt. 32 at 14-15) is
denied. See statement.
2018, Karon, an Ohio resident, received an unsolicited,
prerecorded call to his cell phone encouraging him to call a
phone number to obtain a cash advance loan from CNU. (Dkt. 1
¶¶ 1-2, 28-29.) When Karon dialed the number solely
to determine the caller's identity, a representative of
John Doe Corporation (John Doe) answered and informed Karon
that he had been preapproved for a $3, 000 loan from CNU.
(Id. ¶¶ 30-31.) Karon had never given
consent for CNU or its affiliates to call him. (Id.
filed a single-count complaint alleging a violation of the
Telephone Consumer Protection Act, 47 U.S.C. § 227
(TCPA), individually and on behalf of a putative class of
anyone who received an unsolicited call from or on behalf of
CNU using a prerecorded or automated voice. (Id.
¶ 58.) Karon alleges that CNU is responsible for John
Doe's call because John Doe was CNU's agent. In
support, Karon alleges that CNU exercised significant control
over John Doe's activities, including (1) limiting the
geographical areas to which John Doe could place calls, (2)
restricting John Doe's contract and call volume, (3)
instructing John Doe to forward calls to a third-party
verification company, (4) maintaining ultimate discretion to
determine whether and when to accept customers, and (5)
permitting John Doe to bind CNU in contract. (Dkt. 1
moves to dismiss, arguing that although John Doe may have
violated the TCPA, Karon has not plausibly alleged that CNU
is directly or vicariously liable. To support its motion, CNU
attaches a redacted agreement that purportedly governs
CNU's relationship with its marketing affiliates, under
which affiliates may not make robocalls or any outgoing
calls. (Dkt. 20-1 § 2.5.) CNU also attaches a printout
of its website in an attempt to show that the call could not
have originated from an authorized CNU agent because CNU does
not originate or broker loans of that size to Ohio residents.
(Dkt. 20-2.) CNU also moves to strike Karon's class
furnishing documents and permitting Karon to interview a CNU
official, CNU argues that it proved definitively to Karon
that it is not liable under the TCPA and that Karon therefore
has no good-faith basis for prosecuting this action further.
CNU therefore moves for sanctions. (Dkt. 30.) In response,
Karon asks the court to deny or, in the alternative, strike
CNU's motion for sanctions under Rule 12(f). (Dkt. 32 at
15.) He also seeks sanctions against CNU for filing what he
argues is a frivolous motion for sanctions. (Id.)
Motion to Dismiss
motion to dismiss under Rule 12(b)(6) challenges a complaint
for failure to state a claim upon which relief may be
granted. In ruling on a Rule 12(b)(6) motion, the court
accepts as true all well-pleaded facts in the plaintiff's
complaint and draws all reasonable inferences from those
facts in the plaintiff's favor. Active Disposal, Inc.
v. City of Darien, 635 F.3d 883, 886 (7th Cir. 2011);
Dixon v. Page, 291 F.3d 485, 486 (7th Cir. 2002). To
survive a Rule 12(b)(6) motion, the complaint must not only
provide the defendant with fair notice of a claim's basis
but must also establish that the requested relief is
plausible on its face. See Ashcroft v.
Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937 (2009);
Bell Atl. v. Twombly, 550 U.S. 544, 555, 127 S.Ct.
1955 (2007). The allegations in the complaint must be
“enough to raise a right to relief above the
speculative level.” Twombly, 550 U.S. at 555,
127 S.Ct. 1955. At the same time, the plaintiff need not
plead legal theories; it is the facts that count.
Hatmaker v. Mem'l Med. Ctr., 619 F.3d 741, 743
(7th Cir. 2010); see also Johnson v. City of Shelby,
574 U.S. 10, 135 S.Ct. 346, 346 (2014) (per curiam)
(“Federal pleading rules call for a short and plain
statement of the claim showing the pleader is entitled to
relief; they do not countenance dismissal of a complaint for
imperfect statement of the legal theory supporting the claim
limited exceptions, courts may consider only the
complaint's four corners when deciding a 12(b)(6) motion.
Venture Assocs. Corp. v. Zenith Data Sys. Corp., 987
F.2d 429, 431 (7th Cir. 1993). CNU asks the court to consider
two documents outside the complaint, but neither is
appropriate here. The redacted agreement between CNU and an
unspecified lead provider (dkt. 20-1) is referenced
“obliquely, if at all” in the complaint and is
thus not properly before the court on this motion. Elward
v. Electrolux Home Prods., Inc., 264 F.Supp.3d 877,
885-86 (N.D. Ill. 2017). The printed portions of CNU's
website (dkt. 20-2) are outside the complaint altogether and
inappropriate for judicial notice. See Mussat v. Power
Liens, LLC, No. 13-cv-7853, 2014 WL 3610991, at *3 (N.D.
Ill. July 21, 2014) (refusing to take judicial notice of
website in TCPA action).
TCPA prohibits “mak[ing] any call (other than a call
made for emergency purposes or made with the prior consent of
the called party) using any automatic telephone dialing
system or an artificial or prerecorded voice . . . to any
telephone number assigned to a . . . cellular telephone
service . . . .” 47 U.S.C. § 227(c)(5). Karon
alleges, and CNU does not contest, that John Doe called his
cell phone without his ...