Allen v. eBay, Inc.

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION

JOHN ALLEN,

Plaintiff,

Civil Action 2:20-cv-3459

v. Judge Edmund A. Sargus, Jr.

Magistrate Judge Chelsey M. Vascura

EBAY, INC., et al.,

Defendants.

ORDER and REPORT AND RECOMMENDATION

Plaintiff, John Allen, an Ohio resident proceeding without the assistance of counsel, has

submitted requests to file a civil action in forma pauperis. (ECF No. 1.) The Court GRANTS

Plaintiff’s requests to proceed in forma pauperis. All judicial officers who render services in this

action shall do so as if the costs had been prepaid. 28 U.S.C. § 1915(a). This matter is also

before the Court for the initial screen of Plaintiff’s Complaint as required by 28 U.S.C.

§ 1915(e)(2) to identify cognizable claims and to recommend dismissal of Plaintiff’s Complaint,

or any portion of it, which is frivolous, malicious, fails to state a claim upon which relief may be

granted, or seeks monetary relief from a defendant who is immune from such relief. 28 U.S.C.

§ 1915(e)(2). Having performed the initial screen, for the reasons that follow, it is

RECOMMENDED that the Court DISMISS this action pursuant to 28 U.S.C. § 1915(e)(2).

I.

In this action, Plaintiff advances fraud and other state-law claims against Defendant,

eBay, Inc., arising from Defendant’s alleged refusal to re-publish Plaintiff’s advertisement/listing

of an item for the discounted price of $3 million, after Plaintiff’s initial eBay listing of that item

did not sell for his listed price of $4,470,000.

Prior to filing this action, in July 2020, Plaintiff sued Defendant in this Court, also

asserting claims arising from Defendant’s alleged refusal to re-list the same advertisement about

which he complains in this action. See Allen v. eBay, Inc., 2:20-cv-3459 (the “1744 Case”). The

undersigned summarized Plaintiff’s Complaint in the 1744 Case as follows:

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

(“RICO”) and also the Hobbs Act. 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.” (Id. 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.

(1744 Case, ECF No. 2 at PAGEID # 12.) Following an initial screen of Plaintiff’s Complaint in

the 1744 Case, the undersigned recommended dismissal of that action pursuant to § 1915(e) for

failure to state a claim. (Id. at ECF No. 2.) Plaintiff objected to the undersigned’s Report and

Recommendation, and the Court overruled Plaintiff’s Objections, adopted the Report and

Recommendation, and dismissed the 1744 Case pursuant to § 1915(e) for failure to state a claim.

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(Id. at ECF Nos. 5 and 10.)

The facts upon which Plaintiff’s claims are based are the same in both this action and the

1744 Case—indeed, the two Complaints are nearly identical and advance only different theories

of relief, with Plaintiff advancing a variety of fraud-related state-law claims in this action.

Plaintiff makes the same monetary demands in this action as he advanced in the 1744 Case.

II.

Congress enacted 28 U.S.C. § 1915, the federal in forma pauperis statute, seeking to

“lower judicial access barriers to the indigent.” Denton v. Hernandez, 504 U.S. 25, 31 (1992).

In doing so, however, “Congress recognized that ‘a litigant whose filing fees and court costs are

assumed by the public, unlike a paying litigant, lacks an economic incentive to refrain from

filing frivolous, malicious, or repetitive lawsuits.’” Id. at 31 (quoting Neitzke v. Williams, 490

U.S. 319, 324 (1989)). To address this concern, Congress included subsection (e) as part of the

statute, which provides in pertinent part:

(2) Notwithstanding any filing fee, or any portion thereof, that may have been paid,

the court shall dismiss the case at any time if the court determines that–

* * *

(B) the action or appeal—

(i) is frivolous or malicious; [or]

(ii) fails to state a claim on which relief may be granted . . . .

28 U.S.C. § 1915(e)(2)(B)(i) & (ii); Denton, 504 U.S. at 31. Thus, § 1915(e) requires sua sponte

dismissal of an action upon the Court’s determination that the action is frivolous or malicious, or

upon determination that the action fails to state a claim upon which relief may be granted.

To properly state a claim upon which relief may be granted, a plaintiff must satisfy the

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basic federal pleading requirements set forth in Federal Rule of Civil Procedure 8(a). See also

Hill v. Lappin, 630 F.3d 468, 470–71 (6th Cir. 2010) (applying Federal Rule of Civil Procedure

12(b)(6) standards to review under 28 U.S.C. §§ 1915A and 1915(e)(2)(B)(ii)). Under Rule

8(a)(2), a complaint must contain a “short and plain statement of the claim showing that the

pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). Thus, Rule 8(a) “imposes legal and factual

demands on the authors of complaints.” 16630 Southfield Ltd., P’Ship v. Flagstar Bank, F.S.B.,

727 F.3d 502, 503 (6th Cir. 2013).

Although this pleading standard does not require “‘detailed factual allegations,’ . . . [a]

pleading that offers ‘labels and conclusions’ or ‘a formulaic recitation of the elements of a cause

of action,’” is insufficient. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic

Corp. v. Twombly, 550 U.S. 544, 555 (2007)). A complaint will not “suffice if it tenders ‘naked

assertion[s]’ devoid of ‘further factual enhancement.’” Id. (quoting Twombly, 550 U.S. at 557).

Instead, to survive a motion to dismiss for failure to state a claim under Rule 12(b)(6), “a

complaint must contain sufficient factual matter . . . to ‘state a claim to relief that is plausible on

its face.’” Id. (quoting Twombly, 550 U.S. at 570). Facial plausibility is established “when the

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

defendant is liable for the misconduct alleged.” Id. “The plausibility of an inference depends on

a host of considerations, including common sense and the strength of competing explanations for

the defendant’s conduct.” Flagstar Bank, 727 F.3d at 504 (citations omitted). Further, the Court

holds pro se complaints “to less stringent standards than formal pleadings drafted by lawyers.”

Garrett v. Belmont Cty. Sheriff’s Dep’t, 374 F. App’x 612, 614 (6th Cir. 2010) (quoting Haines

v. Kerner, 404 U.S. 519, 520 (1972)). This lenient treatment, however, has limits; “courts should

not have to guess at the nature of the claim asserted.” Frengler v. Gen. Motors, 482 F. App’x

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975, 976–77 (6th Cir. 2012) (quoting Wells v. Brown, 891 F.2d 591, 594 (6th Cir. 1989)).

III.

The doctrine of res judicata or claim preclusion operates to bar Plaintiff’s claims in this

action. Under the doctrine of res judicata or claim preclusion, “a final judgment on the merits

bars further claims by parties or their privies based on the same cause of action.” Montana v.

U.S., 440 U.S. 147, 153 (1979). The United States Court of Appeals for the Sixth Circuit has

instructed that res judicata requires proof of the following four elements: “(1) a final decision on

the merits by a court of competent jurisdiction; (2) a subsequent action between the same parties

or their privies; (3) an issue in the subsequent action which was litigated or which should have

been litigated in the prior action; and (4) an identity of the causes of action.” Kane v. Magna

Mixer Co., 71 F.3d 555, 560 (6th Cir. 1995). “The purpose of res judicata is to promote the

finality of judgments, and thereby increase certainty, discourage multiple litigation, and conserve

judicial resources.” Westwood Chemical Co. v. Kulick, 656 F.2d 1224, 1227 (6th Cir. 1981).

In the instant action, the requisite four elements are satisfied. This Court’s dismissal of

Plaintiff’s prior complaint under 28 U.S.C. § 1915(e) for failure to state a claim upon which

relief could be granted operates as an adjudication on the merits for res judicata purposes. See

Taylor v. Reynolds, 22 F. App’x 537, 539 (6th Cir. 2001) (“The dismissal of [the plaintiff’s]

claims under § 1915(e)(2)(B) creates a res judicata bar . . . .”); Murray v. Reed, 69 F. App’x 246,

247 (6th Cir. 2003) (citing Cieszkowska v. Gray Line New York, 295 F.3d 204, 206 (2d Cir.

2002) (giving res judicata effect to a prior suit that had been dismissed under 28 U.S.C.

§ 1915(e)(2)(B)(ii) for failure to state a claim upon which relief could be granted and hence

barring a second suit which the district court dismissed “for failure to state a claim pursuant to 28

U.S.C. § 1915(e)(2) because the complaint was barred by res judicata.”)). In addition, this

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action involves the same parties or their privies as the prior action, and although Plaintiff raises

somewhat different legal theories in the two actions, the alleged injuries and facts underlying

those theories are identical such that the new legal theories should have been raised in the prior

action. See Holder v. City of Cleveland, 287 F. App’x 468, 471 (6th Cir. 2008) (quoting Cemer

v. Marathon Oil Co., 583 F.2d 830, 832 (6th Cir. 1978) (per curiam) (“Where two successive

suits seek recovery for the same injury, a judgment on the merits operates as a bar to the later

suit, even though a different legal theory of recovery is advanced in the second suit.”); Nathan v.

Rowan, 651 F.2d 1223, 1228 n.8 (6th Cir. 1981) (“[T]he doctrine of res judicata necessarily

applies to all matters, including new or different legal theories against the same parties . . . .”).

Finally, as set forth above, this action and the previous action arise from the same core of

operative facts—namely, Defendant’s refusal to re-publish Plaintiff’s advertisement/listing. For

these reasons, the undersigned concludes that the doctrine of res judicata operates to bar the

claims Plaintiff asserts in this action.

It is therefore RECOMMENDED that this action be DISMISSED pursuant to

§ 1915(e).

IV.

In summary, The Court GRANTS Plaintiff’s requests to proceed in forma pauperis.

(ECF No. 1.) In addition, for the reasons set forth above, it is RECOMMENDED that the Court

DISMISS this action pursuant to 28 U.S.C. § 1915(e)(2).

PROCEDURE ON OBJECTIONS

If any party objects to this Report and Recommendation, that party may, within fourteen

(14) days of the date of this Report, file and serve on all parties written objections to those

specific proposed findings or recommendations to which objection is made, together with

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supporting authority for the objection(s). A Judge of this Court shall make a de novo

determination of those portions of the Report or specified proposed findings or recommendations

to which objection is made. Upon proper objections, a Judge of this Court may accept, reject, or

modify, in whole or in part, the findings or recommendations made herein, may receive further

evidence or may recommit this matter to the Magistrate Judge with instructions. 28 U.S.C. §

636(b)(1).

The parties are specifically advised that failure to object to the Report and

Recommendation will result in a waiver of the right to have the District Judge review the Report

and Recommendation de novo, and also operates as a waiver of the right to appeal the decision of

the District Court adopting the Report and Recommendation. See Thomas v. Arn, 474 U.S. 140

(1985); United States v. Walters, 638 F.2d 947 (6th Cir. 1981).

/s/ Chelsey M. Vascura

CHELSEY M. VASCURA

UNITED STATES MAGISTRATE JUDGE

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