Roybal v. Bachman

• Court: District Court, D. Nevada
• Decided: June 27, 2022
• Docket: 2:21-cv-01931
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 DISTRICT OF NEVADA 6 * * *

7 RICHARD ROYBAL, Case No. 2:21-CV-1931 JCM (DJA)

8 Plaintiff(s), ORDER

9 v.

10 ROBERT L. BACHMAN, ESQ., et al.,

11 Defendant(s).

12 13 Presently before the court is defendants Robert L Bachman (“Bachman”) and Debt 14 Solutions Service, LLC’s (“DSS”) (collectively “defendants”) motion to dismiss. (ECF No. 11). 15 Plaintiff Richard Roybal (“Richard”) filed a response (ECF No. 13), to which defendants replied 16 (ECF No. 14). 17 Also before the court is Richard’s motion for leave to file a surreply (ECF No. 15), to 18 which defendants replied (ECF No. 16).1 19 I. Facts 20 This matter arises out of the parties’ debt consolidation agreement. In 2019, Richard, a 21 retired elderly person,2 entered into an agreement with Bachman to reduce, compromise, modify, 22 or eliminate his debt. (See ECF No. 1 at 6, 8). The agreement identifies DDS as an “outside 23 company and independent consultant” that “will be performing the services contemplated under 24 25 26 27 1 The court DENIES Richard’s motion for a surreply. The defendants’ reply did not raise a new material issue that warranted a reply. 28 2 As defined by Nevada Revised Statute (“NRS”) § 598.0933. 1 [the] [a]greement.” (ECF No. 1-2 at 2).3 The agreement contains the following mediation 2 clause: 3 Mediation. If any dispute arises out of or related to this [a]greement, and if the dispute cannot be resolved through good faith negotiation, [DDS] and [Richard] 4 agree to submit the dispute to non-binding mediation for no less than one, eight- hour day, before resorting to any other dispute resolution procedure. In the event 5 of mediation, each side will bear their own attorney’s fees and costs, with each side paying one-half of the mediator’s fees. The party first invoking this 6 provision will select the mediator. (Id. at 7). 7 Richard now brings claims against defendants for charging him an advanced fee in 8 violation of the Credit Repair Organizations Act (“CROA”), (ECF No. 1 at 11), and charging 9 him more than the disclosed performance fee in violation of the Telemarketing Act, (id. at 15).4 10 Defendants, however, move to dismiss Richard’s complaint for failure to comply with the 11 agreement’s mediation clause. (Id. at 3). 12 II. Legal Standard 13 A court may dismiss a plaintiff’s complaint for “failure to state a claim upon which relief 14 can be granted.” FED. R. CIV. P. 12(b)(6). A properly pled complaint must provide “[a] short 15 and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 16 8(a)(2); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). While Rule 8 does not 17 require detailed factual allegations, it demands “more than labels and conclusions” or a 18 “formulaic recitation of the elements of a cause of action.” Ashcroft v. Iqbal, 556 U.S. 662, 678 19 (2009) (citation omitted). 20 “Failure to mediate a dispute pursuant to a contract that makes mediation a condition 21 precedent to filing a lawsuit warrants dismissal.” Brosnan v. Dry Cleaning Station Inc., No. C– 22 08–02028, 2008 WL 2388392, at * 1 (N.D. Cal., June 6, 2008); see also HIM Portland, LLC v. 23 De Vito Builders, Inc., 317 F.3d 41, 44 (1st Cir. 2003). 24 . . . 25

26 3 Richard extensively references the agreement in his complaint, attached it to his 27 complaint, and defendants do not dispute its authenticity. Therefore, the court considers its contents at this dismissal stage. 28 4 Richard also alleges nine other claims which the court need not discuss in detail. 1 III. Discussion 2 A. Richard’s failure to comply with the agreement’s mediation clause precludes his initiation of this litigation 3 The plain language of the agreement’s mediation clause provides that to the parties must 4 participate in non-binding mediation before resorting to any other resolution procedure. This 5 imposes a condition precedent to initiating litigation. Richard admits that the parties did not 6 participate in mediation before he filed his complaint, but argues that defendants waived the 7 condition by not responding to his request to begin mediation. 8 Richard argues that he sent a letter to defendants requesting clarifications about the 9 agreement’s mediation clause on October 6, 2021, but defendants failed to respond in a timely 10 manner. (ECF No. 13 at 3). He then sent another letter on October 12, 2021, informing 11 defendants of his choice of mediator, Advanced Resolution Matters. (Id. at 4). Richard 12 demanded that defendants reply to the letter by October 15, 2021, or he would consider the 13 mediation condition waived. (Id.). Richard argues that defendants’ failure to respond by that 14 date constitutes waiver of the mediation obligation. (See id.) 15 Defendants, however, argue that they responded to Richard’s first letter discussing 16 disputed facts on October 11, 2021, and agreed to Richard’s choice of mediator on October 25, 17 2021. (ECF No. 11 at 2). 18 Here, defendants’ failure to respond by October 15, 2021, does not constitute a waiver of 19 their right to mediation. While not responding to a request can be considered a waiver, a two- 20 week delay in response does not constitute waiver merely because Richard unilaterally imposed 21 an arbitrary deadline to respond to his request; especially when no such requirement is contained 22 in the agreement. 23 The parties are bound by the agreement’s terms and must complete the mediation process 24 before any alternative dispute resolution, including this litigation. See, e.g., MB Am., Inc. v. 25 Alaska Pac. Leasing, 367 P.3d 1286, 1291 (Nev. 2016). Therefore, the court dismisses 26 Richard’s complaint as unripe. 27 . . . 28 . . . 1 Ti. Conclusion 2 Accordingly, IT IS HEREBY ORDERED, ADJUDGED, and DECREED that defendants’ motion to 4| dismiss (ECF No. 11) be, and the same hereby is, GRANTED. Richard’s complaint is 5 | DISMISSED, without prejudice. 6 IT IS FURTHER ORDERED that Richard’s motion for a surreply (ECF No. 15) be, and 7 | the same hereby is, DENIED. 8 The clerk is instructed to close this case. 9 DATED June 27, 2022. 10 Nts ©. Atala ll UN; TED'STATES DISTRICT JUDGE 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

es C. Mahan District Judge _4-