Allen v. eBay, Inc.

FILED...

RICHARD VFS

UNITED STATES DISTRICT COURT CLERK □□

SOUTHERN DISTRICT OF OHIO in PM I2: □□

EASTERN DIVISION 2020 JUN 19

Ee sis sme? □□□

JOHN ALLEN, 2 The □□ □□□

Plaintiff, Civil Action: 2:20-ev-1744

JUDGE EDMUND A. SARGUS, JR.

v. Magistrate Judge Chelsey M. Vascura

EBAY, INC.,

Defendant.

OPINION AND ORDER

This matter is before the Court on the Objection filed by Plaintiff to the Report and

Recommendation issued by the Magistrate Judge on April 10, 2020. (ECF No. 2.) For the

reasons that follow, the Court OVERRULES the Objection, ADOPTS the Report and

Recommendation, and DISMISSES this action pursuant to 28 U.S.C. § 1915(e}(2).

The Magistrate Judge set forth the facts alleged in the Complaint accurately and the Court

adopts that recitation here:

According to the Complaint, Plaintiff placed an advertisement with

Defendant, eBay, Inc., to sell items for $4,470,000. When Plaintiff's items failed to

sell, he attempted to re-list the item with the discounted price of $3 million, but

could not do so because Defendant had suspended his account. Plaintiff represents

that Defendant’s suspension of his account occurred in 2012. (See Pl.’s Compl. 3,

ECF No. 1-1 at PAGEID # 4 (“The 2012 agreement in force when Plaintiff[*]s

account was suspended . . . .”).) Plaintiff appears to allege that Defendant’s

suspension of his account, together with “various acts forming a pattern of

racketeering” violates the Racketeer Influenced and Corrupt Organizations Act[, 15

U.S.C. § 15 (RICO”) and also the Hobbs Act[ 18 U.S.C. § 1951]. Plaintiff

acknowledges that Defendant could take certain actions against his account had he

committed certain violations, but alleges that his “compliance has consistently been

above standard.” (/d. at PAGEID # 6.) Plaintiff also acknowledges that under his

agreement with Defendant, certain lawsuits must be brought in California, but

makes clear that he is not bringing a breach-of-contract or other state-law claim

based upon Defendant’s suspension of his account, but is instead pleading a pattern

of extortion and racketeering activity and advancing violations claims under RICO

and the Hobbs Act.

In terms of relief, Plaintiff seeks monetary damages.

(R&R at 2.)

The Magistrate Judge reviewed the pro se Complaint and issued an Order and Report and

Recommendation granting Plaintiff in forma pauperis status and recommending that the case be

dismissed in its entirety for failure to state any claim upon which relief could be granted. (ECF

No. 2.) Plaintiff then filed an Amended Complaint (ECF No. 4) and a timely Objection (ECF

No. 5).

It.

If a party objects within the allotted time to a report and recommendation, 28 U.S.C.

§ 636(b)(1) provides that a district court “shall make a de novo determination of those portions of

the report or specified proposed findings or recommendations to which the objection is made.

The district court may accept, reject, or modify, in whole or in part, the findings or

recommendations made by the magistrate.”

The federal in forma pauperis statute is “designed to ensure indigent litigants have

meaningful access to the federal courts.” Neitzke v. Williams, 490 U.S. 319, 324 (1989) (citing

Adkins v. E. I. Dupont De Numours & Co., 335 U.S. 331, 342-43 (1948)). Recognizing,

however, that a litigant whose costs are assumed by the public “lacks economic incentive to

refrain from filing frivolous, malicious, or repetitive lawsuits,” Congress included subsection (e)

authorizing federal courts to dismiss certain claims sua sponte. Id. Courts may, sua sponte,

dismiss claims which they determine are “frivolous or malicious” or “failf] to state a claim on

which relief may be granted.” 28 U.S.C. § 1915(e)(2)(B)() & (ii); Neitzke, 490 U.S. at 324.

Additionally, complaints must satisfy Federal Rule of Civil Procedure 8(a), requiring a

“short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R.

Civ. P. 8(a)(2). The Supreme Court’s standards articulated to govern dismissals under Federal

Rule of Civil Procedure 12(b)(6) for failure to state a claim apply also to § 1915{e). Hill v.

Lappin, 630 F.3d 468, 47071 (6th Cir. 2010). Rule 8(a) “imposes legal and factual demands on

the author of complaints.” 16630 Southfield Ltd P’ship v. Flagstar Bank, 727 F.3d 502 ,504

(6th Cir. 2013).

In evaluating a complaint to determine whether it states a claim upon which relief can be

granted under Rule 12(b)(6), a court must construe it in the light most favorable to the plaintiff

and determine whether the factual allegations present any plausible claim. Bell Atlantic Corp. v.

Twombly, 550 U.S. 544, 570 (2007); see also Ashcroft v. Iqbal, 556 U.S. 662 (2009) (clarifying

the plausibility standard articulated in Twombly). “A claim has facial plausibility when the

plaintiff pleads factual content that allows the court to draw the reasonable inference that the

defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. The plausibility of an

inference depends on many considerations, “including common sense and the strength of

competing explanations for the defendant’s conduct.” Flagstar Bank, 727 F.3d at 504. Although

a plaintiff s complaint need not contain “detailed” factual allegations, its “[flactual allegations

must be enough to raise a right to relief above the speculative level on the assumption that all the

allegations in the complaint are true.” Twombly, 550 U.S. at 555.

“Pro se complaints are to be held ‘to less stringent standards than formal pleadings

drafted by lawyers,’ and should therefore be construed liberally.” Garret y. Belmont County

Sherriff's Dep't, 374 F. App’x 612, 614 (6th Cir. 2010) (Citing Haines v. Kerner, 404 U.S. 519,

520 (1972)). However, this lenient treatment has limits, “a pro se pleading must provide the

opposing party with notice of the relief sought . . . it is not within the purview of the district court

to conjure up claims never presented.” Frengler v. GM, 482 F. App’x 975, 977 (6th Cir. 2012).

TH.

Plaintiff objects to the Report and Recommendation, arguing that it offers as the “sole

reason” for dismissal that his Complaint “fail[s] state a claim.” Plaintiff contends that his

Complaint and Amended Complaint comply with Rule 8 of the Federal Rules of Civil Procedure

and queries: “How can the court believe he has failed to state a claim? Is the court trying to say

that this should be a state action rather than federal even though Plaintiffs’ claims are cognizable

in federal courts? Additionally, this case should not be dismissed before service of process, the

court would be acting as an advocate for defendants without the defendants even knowing they

were sued.” Plaintiff further states that “[a]ny alleged errors in the complaint are hopefully

corrected in Plaintiffs Amended Complaint.”

Plaintiff's Objection misapprehends the nature of a § 1915(e) screen and dismissal under

Federal Rule 12, the standards that are forth above. Federal courts are tasked with review of

complaints filed under the in forma pauperis statute to determine whether they should proceed.

There is nothing unique about the Magistrate Judge’s decision. The Recommendation did not

indicate that RICO or the Hobbs Act claims are not recognized in federal court, but rather that

even accepting Plaintiff's allegations as true and making reasonable inferences in his favor, he

has failed to state any claim upon which relief could be granted under either of these statutes.

The Court below makes its de novo review of Plaintiff's allegations in his Complaint and

Amended Complaint.

A. RICO

As the Magistrate Judge correctly explained, civil RICO claims are subject to a four-year

statute of limitations period. Rotella v. Wood, 528 U.S. 549, 552, 557 (2000). “The four- year

period begins to run when a party knew, or through exercise of reasonable diligence should

have discovered, that the party was injured by a RICO violation.” Sims v. Ohio Cas. Ins. Co.,

151 F. App’x 433, 435 (6th Cir. 2005). In this case, the injury about which Plaintiff complains

(i.c., the suspension of his account, which precluded him from placing an advertisement to sell

items for $3 million)—occurred in 2012. Thus, this action was filed several years after the

expiration of the 2016 deadline. Consequently, even accepting all of the allegations in the

Complaint and Amended Complaint as true, Plaintiff's RICO claim is barred by the statute of

limitations and must be dismissed.

Additionally, as the Magistrate Judge correctly found, Plaintiff's RICO claims would be

subject to dismissal even if they were not time barred. A plaintiff seeking to advance a civil

RICO claim “must plead the following elements: ‘(1) conduct (2) of an enterprise (3) through a

pattern (4) of racketeering activity.’” Moon v. Harrison Piping Supply, 465 F.3d 719, 723 (6th

Cir. 2006) (quoting Sedima,S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 (1985)). Further, any such

claim must allege an illicit agreement “to participate directly or indirectly in the affairs of an

enterprise through the commission of two or more predicate crimes.” Heinrich v. Waiting Angels

Adoption Servs., 668 F.3d 393, 411 (6th Cir. 2012) (quoting United States v. Sinito, 723 F.2d

1250, 1261 (6th Cir. 1983)). Finally, a plaintiff advancing a civil RICO claim must allege injury

to business or property. See 18 U.S.C. § 1964(c). In the instant action, Plaintiff's civil RICO

claims lacks the factual specificity required under Jgbal. Specifically, Plaintiff's allegations of

criminal enterprise, like his allegations of a pattern of racketeering activity, are conclusory and

unsupported by specific plausible factual allegations supporting a claim for any of the predicate

offenses. Thus, even if Plaintiff's RICO claims were timely, those claims would still be subject

to dismissal under § 1915(e) for failure to state a claim upon which relief could be granted.

B. Hobbs Act

Plaintiff also purports to advance claims under the Hobbs Act, which is a criminal statute

that “criminalizes robbery accomplished by using or threatening force against ‘person or

property.’” United States v. Camp, 903 F.3d 594, 600 (6th Cir. 2018) (quoting 18 U.S.C. §

1951(b)(1)). Because the Hobbs Act is “a criminal statute that does not provide a private right of

action,” Stanard v. Nygren, 658 F.3d 792, 794 (7th Cir. 2011), Plaintiff—as a private citizen—

cannot recover civilly for violations of the Hobbs Act. See Saro v. Brown, 11 F. App’x 387, 388

(6th Cir. 2001) (“Violations of these [mail and wire fraud] sections of the federal criminal code

do not give rise to independent causes of action.”); Moralez v. Moore, No. 2:17-cv-10567, 2017

WL 9802881, at *6 (E.D. Mich. Nov. 21, 2017) (finding that civil claims brought under Hobbs

Act must be dismissed because the Hobbs Act is a criminal statute without a private right of

action); Hopson v. Shakes, No. 3:12-CV—722-M, 2013 WL 1703862, at *2 (W.D. Ky. Apr. 19,

2013) (holding that federal extortion statute “is a criminal statute, and federal courts have

consistently found that the Hobbs Act does not support a private cause of action”) (internal

quotation marks omitted). Plaintiffs Hobbs Act must therefore be dismissed pursuant to §

1915(e) for failure to state a claim upon which relief could be granted.

IV.

For the reasons set forth above, the Court OVERRULES the Objection, ADOPTS the

Report and Recommendation, and DISMISSES this action pursuant to 28 U.S.C. § 1915(e)(2).

IT IS SO ORDERED.

&-19-2 Oy □ pa __

DATE ED A. SARGUS, JR.

U STATES DISTRICT JUDGE