VAUGHN, JR. v. ALLY FINANCIAL, INC.

IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF NORTH CAROLINA

CARL DAVIS VAUGHN, JR., )

)

Plaintiff, )

)

v. ) 1:24-cv-6

)

ALLY FINANCIAL, INC. and )

BRADLEY J. BROWN, )

)

Defendants. )

MEMORANDUM OPINION AND ORDER

OSTEEN, JR., District Judge

Before this court is a motion to dismiss filed by Defendant

Ally Financial, Inc. (“Defendant Ally”). (Doc. 7.) For the

reasons stated herein, Defendant Ally’s motion will be granted.

I. FACTUAL BACKGROUND

The facts of this case are not completely clear. Based on

the Plaintiff’s Complaint and its accompanying documents,1 it

appears that this dispute arises from Defendant Ally issuing a

loan to Plaintiff in order for him to purchase a vehicle. (See

Doc. 4-1 at 7, 8, 10 (showing CarMax purchasing paperwork that

notes Ally Financial as the “lienholder” and “loss-payee”).)

1 A court may consider documents “attached to the motion to

dismiss, so long as they are integral to the complaint and

authentic.” Six v. Generations Fed. Credit Union, 891 F.3d 508,

512 (4th Cir. 2018) (citation omitted).

Around June 1, 2023, in what appears to be an attempt to

discharge his debt, Plaintiff submitted a “remittance/payment

coupon/Bill of Exchange/bill of credit” to Defendant Ally via

U.S. Mail. (Doc. 4 at 3.) As Plaintiff notes, this was an

attempt by Plaintiff to “utilize the Plaintiff’s redeemable

credits/collateral securities that the Defendants received from

the Plaintiff’s promissory note, that the Defendants are

withholding in a Trust account purportedly on behalf of

Plaintiff’s application/instrument/advancement.” (Id.)

Around August 23, 2023, Plaintiff sent another email to

Defendant to follow up on his June 1 attempt and further

requested that Defendant “fully disclose . . . the type of

accounts . . . that were opened by the Defendants/Creditors in

the Plaintiff’s name.” (Id. at 5.) On August 30, 2023, Plaintiff

sent another email to Defendant Ally, further reminding

Defendant Ally of his previous two emails (which apparently went

unanswered) and providing Ally an “Opportunity to Cure” by

providing Plaintiff the information he had previously requested

and offsetting his debt. (Id. at 5 (requesting that Defendants

“transfer the Principal’s balance to the Principal’s account . .

. to balance out the accounting the Plaintiff’s account”).)

Finally, on September 4, 2023, Plaintiff sent an email

entitled “Default Judgment” to Defendant Ally for not responding

“to the claim of the Plaintiff’s redeemable credits.” (Id. at

6.) It does not appear from the face of the Complaint that

Defendant responded to any of these emails.

II. PROCEDURAL HISTORY

Plaintiff originally filed a complaint in Durham County,

North Carolina, but Defendant Ally removed the lawsuit to

federal court on January 3, 2024. (Doc. 1.) Plaintiff filed his

Complaint with this court on January 4, 2024. (Complaint

(“Compl.”) (Doc. 4).) Defendant Ally filed its Motion to Dismiss

on January 10, 2024, (Def. Mot. to Dismiss (“Def. Mot.”) (Doc.

7)), and a supporting memorandum, (Def. Mem. of Law in Supp. of

Mot. to Dismiss (“Def. Mem.”) (Doc. 8)).

Plaintiff did not timely respond to Defendant’s motion to

dismiss, but rather, filed a notice, entitled “Demand for the

Bonds of All Parties Involved for the Injuries, Negligence, and

Harm Caused” on March 28, 2024. (Pl. Notice (Doc. 11).)

Defendant responded to this notice on April 18, 2024, (Def.

Resp. to Pl. Notice (“Def. Resp.”) (Doc. 12)), and Plaintiff

replied on May 21, 2024, (Pl. Reply to Def. Resp. (“Pl. Reply”)

(Doc. 13)).

III. STANDARD OF REVIEW

To survive a Rule 12(b)(6) motion, “a complaint must

contain sufficient factual matter, accepted as true, to ‘state a

claim to relief that is plausible on its face.’” Ashcroft v.

Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007)). A claim is plausible on its

face if the plaintiff “pleads factual content that allows the

court to draw the reasonable inference that the defendant is

liable” and demonstrates “more than a sheer possibility that a

defendant has acted unlawfully.” Iqbal, 556 U.S. at 678 (citing

Twombly, 550 U.S. at 556–57). When ruling on a motion to

dismiss, this court accepts the complaint’s factual allegations

as true. Iqbal, 556 U.S. at 678. This court liberally construes

“the complaint, including all reasonable inferences therefrom, .

. . in the plaintiff’s favor.” Est. of Williams-Moore v. All.

One Receivables Mgmt., Inc., 335 F. Supp. 2d 636, 646 (M.D.N.C.

2004) (citation omitted), but does not, however, accept legal

conclusions as true, and “[t]hreadbare recitals of the elements

of a cause of action, supported by mere conclusory statements,

do not suffice.” Iqbal, 556 U.S. at 678.

Federal courts must liberally construe pro se complaints,

even “inartful” ones. See Boag v. MacDougall, 454 U.S. 364, 365

(1982). However, pro se plaintiffs are still required to plead

facts that fairly put the defendant on notice of the nature of

the claims and “contain more than labels and conclusions.” See

Giarratano v. Johnson, 521 F.3d 298, 304, 304 n.5 (4th Cir.

2008) (quoting Twombly, 550 U.S. at 555).

IV. ANAYLYSIS

Ascertaining what legal claims Plaintiff is attempting to

pursue is difficult, given the relative incoherence and rambling

nature of the Complaint.2 This court, in construing the Complaint

liberally, finds that Plaintiff asserts the following claims for

relief: 1) a claim under D.C. Code 28:3-303, 2) a claim under 12

U.S.C. § 1431, 3) a failure to disclose claim under the Truth in

Lending Act (TILA), 4) breach of fiduciary duties, 5) breach of

contract, 6) discrimination in violation of the Consumer Credit

Protection Act of 1964 and the Civil Rights Act of 1964, 7) a

claim of “Piercing the Corporate Veil,” 8) a claim of

“negligence,” and 9) a claim of “Unfair and Deceptive Trade

Practices.” (See generally Compl. (Doc. 4).)

As an initial matter, Plaintiff’s claims all appear to be

predicated upon the fact, as alleged, that Plaintiff attempted

to “balance out the accounting on [his] account” with a

“remittance/payment coupon/Bill of Exchange/bill of credit.”

(See Compl. (Doc. 4) at 3, 5.) While Plaintiff may have sent

2 Plaintiff cites many statutes and legal doctrines

throughout his Complaint. Many appear to simply provide

definitions and not state causes of action. As such, this court

has only identified the statutes and rules of law under which

Plaintiff appears to pursue a cause of action.

something to Defendant Ally that was titled “remittance/payment

coupon/Bill of Exchange/bill of credit,” an allegation that this

constituted a lawful manner to discharge a debt is implausible.

First, the phrase “attempted to balance out the accounting,” is

a conclusory description of Plaintiff’s actions and not entitled

to any deference. See Iqbal, 556 U.S. at 681. Second,

Plaintiff’s description of the documents he used to attempt the

“account-balancing” falls short of plausibly alleging an act by

Defendant that might give rise to a cognizable claim. Absent

some other explanation, it is implausible to suggest that any

debt could be discharged in the manner described by Plaintiff.

A. Violation of District of Columbia Code 28:3-303 and 12

U.S.C. § 1431

Plaintiff alleges that “Defendants willfully neglected and

denied Plaintiff’s beneficial interest in all occurrences,

pursuant to the Code of the District of Columbia 28:3-303. Value

and consideration, and pursuant to 12 USC 1431.” (Compl. (Doc.

4) at 3.) Plaintiff has not explained why the law of the

District of Columbia should apply to this lawsuit. Further, §

28:3-303 only defines terms and does not provide a private cause

of action. See D.C. Code § 28:3-303. To the extent Plaintiff

intended to assert a cause of action under this statute, it will

be dismissed.

His claim under 12 U.S.C. § 1431 is similarly insufficient.

This section of the United States Code explains the “powers and

duties of banks.” See 12 U.S.C. § 1431. Plaintiff does not

explain how Defendant violated this statute beyond his vague

statement that Defendant “willfully neglected and denied

Plaintiff’s beneficial interest in all occurrences,” (Compl.

(Doc. 4) at 3.) Further, § 1431 does not provide a private cause

of action. See Kornegay v. Cap. One, No. 1:23-cv-1032, 2024 WL

1463794, at *2 (M.D.N.C. April 4, 2024); Slocum v. Zen Realty,

No. 5:23-cv-550, 2024 WL 666329, at *2 (E.D.N.C. Feb. 16, 2024).

Accordingly, this claim must also be dismissed.

B. Violation of Truth in Lending Act - Disclosures

Plaintiff claims that Defendant violated the Truth in

Lending Act (TILA) for “not fully disclosing . . . the type of

accounts . . . that were opened by the Defendants/Creditors in

the Plaintiff’s name.” (Compl. (Doc. 4) at 6). He does not cite

to any specific provisions of the TILA, but in liberally

construing this pro se complaint, this court will assume

Plaintiff refers to 15 U.S.C. § 1640, which provides a private

right of action under TILA. See 15 U.S.C. § 1640(a).

“TILA protects consumers by requiring certain disclosures.

E.g., 15 U.S.C. § 1601(a) . . . .” El v. McGehee, No. 1:22-cv-

03957, 2022 WL 16833490, at *2 (N.D. Ga. Oct. 4, 2022). Here,

Plaintiff argues that Defendant failed to disclose information

regarding an account allegedly opened by Defendants in

Plaintiff’s name. (See Compl. (Doc. 4) at 5.) Plaintiff has not

cited what provision of TILA requires such a disclosure.

Further, he has not sufficiently identified what “accounts” he

is referring to such that Defendant Ally Financial could even

begin to understand his request.3 Plaintiff has not provided

sufficient information regarding what he wanted Defendant to

disclose and what Defendant failed to disclose. Accordingly,

this claim is dismissed.

C. Breach of Fiduciary Duty/Breach of Contract

Plaintiff alleges that Defendant has breached its fiduciary

duty to Plaintiff and breached a contract with Plaintiff.

(Compl. (Doc. 4) at 6, 7, 8, 9.) Fiduciary duties and contracts

are governed by state law. Under North Carolina law, to

establish a claim for breach of fiduciary duty, Plaintiff must

allege that “(1) defendants owed [him] a fiduciary duty of care;

3 As Defendant Ally notes, Plaintiff’s request for

information related to account(s) “opened by the

Defendants/Creditors in the Plaintiff’s name,” (Compl. (Doc. 4)

at 6), appears to be in reference to “the common ‘sovereign

citizen’ conspiracy theory that each person has a secret U.S.

Treasury trust account under their name,” (Def. Resp. (Doc. 12)

at 2). Such an account does not exist. See, e.g., Bryant v.

Washington Mut. Bank, 524 F. Supp. 2d 753, 763 (W.D. Va. 2007)

(describing Office of Comptroller alerts explaining that such

accounts do not exist). Accordingly, it would be impossible for

Defendant to disclose information about a non-existent account.

(2) defendants violated their fiduciary duty; and (3) this

breach of duty was a proximate cause of injury to [the

plaintiff].” French Broad Place, LLC v. Asheville Sav. Bank,

S.S.B., 259 N.C. App. 769, 787, 816 S.E.2d 886, 899 (2018)

(cleaned up).

Plaintiff fails to allege any of these elements plausibly.

It appears that Plaintiff and Defendant Ally were in a debtor-

creditor relationship. (See, e.g., Doc. 4-1 at 10 (listing Ally

as lienholder).) “[O]rdinary borrower-lender transactions . . .

do not typically give rise to fiduciary duties.” Dallaire v.

Bank of Am., N.A., 367 N.C. 363, 368, 760 S.E.2d 263, 266–67

(2014). Further, Plaintiff also fails to allege any identifiable

breach of fiduciary duty beyond the generalized assertion that

“Defendants/Creditors [did] not submit[] . . . a response point

by point to Plaintiff.” (Compl. (Doc. 4) at 6.) Because the

elements of breach of fiduciary duty under North Carolina law

have not been plausibly alleged, this claim will be dismissed.

Plaintiff also claims Defendant breached a contract. (Id.

at 6, 7, 8, 9.) To plausibly state a claim for breach of

contract in North Carolina, a party must allege the “(1)

existence of a valid contract and (2) breach of the terms of

that contract.” Poor v. Hill, 138 N.C. App. 19, 26, 530 S.E.2d

838, 843 (2000). Plaintiff has not identified any contract with

Defendant and instead attached to his Complaint his retail

agreement with CarMax, which only references that Defendant Ally

has provided financing. (See Compl. (Doc. 4) at 7, 8, 10.) Even

if this court assumes the parties had a loan agreement contract,

Plaintiff has not alleged any facts to support the idea that

Defendant violated that contract. Accordingly, this claim will

be dismissed.

D. Discrimination Claims

Plaintiff alleges that Defendant discriminated against him

based on “Plaintiff’s assumed on file race, color, national

origin, income, sex, marital status, age, and Good Faith

exercising of the Plaintiff’s rights.” (Compl. (Doc. 4) at 7.)

Although he does not cite specific provisions, he claims that

this discrimination violates the Consumer Credit Protection Act

of 1968 and the Civil Rights Act of 1964. (Id.)

With respect to his claim of a violation of the Consumer

Credit Protection Act, this court will assume he is referring to

15 U.S.C. § 1691, which makes it unlawful “for any creditor to

discriminate against any applicant . . . on the basis of race,

color, religion, national origin, sex or marital status, or

age.” 15 U.S.C. § 1691(a). Plaintiff has not alleged any facts

to support the claim that Defendant discriminated against him on

these grounds. Accordingly, this claim will be dismissed.

With respect to his claim of a violation of the Civil

Rights Act of 1964, Plaintiff has not cited a specific

subsection of this Act, which contains many provisions. See

Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 241.

Without knowing what provision of the Act Plaintiff refers to,

this court cannot begin to analyze whether Plaintiff has

asserted a claim for relief. Further, as explained above,

Plaintiff has not put forth any facts to support his allegation

that Defendant discriminated against him “based on race, color,

national origin, income, sex, marital status, age, and good

faith exercising” of his rights. Accordingly, these claims will

be dismissed.

E. Negligence, Unfair Trade Practices, and “Piercing the

Corporate Veil” Claims

Plaintiff has additionally alleged that Defendant engaged

in “negligence.” (Compl (Doc. 4) at 7, 9.) Merely alleging that

the Defendant was “negligent” is a legal conclusion that this

court need not accept. See Twombly, 550 U.S. at 555. Plaintiff

fails to state any particular facts in connection with this

claim; therefore, it must be dismissed.

Plaintiff also alleges Defendant engaged in “Unfair and

Deceptive Trade Practices.” (Compl. (Doc. 4) at 7.) Even

assuming this allegation is in reference to N.C. Gen. Stat. §75-

1.1, he fails to state any coherent instances of deception or

unfair practices to support his claim. This will be dismissed.

Finally, to the extent plaintiff argues a claim of

“piercing the corporate veil,” this too must fail as a matter of

law. Under North Carolina law,4 “courts will ‘pierce the

corporate veil’ to extend liabilities of the corporation beyond

the confines of the corporation’s entity when it is necessary to

achieve equity.” Allred v. Exceptional Landscapes, Inc., 227

N.C. App. 229, 235, 743 S.E.2d 48, 54 (2013). Because Plaintiff

has failed to allege any cognizable liability on the part of

Defendant, the question of whether to pierce the corporate veil

is moot. This claim is dismissed.

F. Any Potential Remaining Claims

Finally, Plaintiff, in his final effort to locate a viable

claim, inserts the following string of alleged wrongdoings by

Defendants.

The Defendants have knowingly and willfully

neglected, dishonored, discriminated, defaulted

Judgment/Aquiesences [sic], used deceptive Language,

used unfair trading practices, forceful repayment

tactics, theft of property, pierced the Corporate

Veil by engaging in wrongful and fraudulent

practices, conspired against, securities fraud, trust

fraud, Identity theft, alter ego, willfully and

knowingly dishonored and refused protocol of the

following Acts, legalese/Commerce, Codes, and

4 “Whether to pierce the corporate veil is a question of

state law.” Gerritsen v. Warner Bros. Ent. Inc., 112 F. Supp. 3d

1011, 1041 n. 126 (C.D. Cal. 2015).

Statutes that the Defendants are Obligated to follow

procedure of as listed; the Securities and Exchange

Act of 1934, Securities Act of 1933, Trust Indenture

Act of 1939, the revised Consumer Protection Act of

2010, 12 USC 1431. Powers and duties of banks, UCC-

3-205. Special Indorsement; Blank Indorsement;

Anomalous Indorsement, Bill of Exchange Act of 1882,

The Federal Reserve Act of 1913 Section 16. Notes

Issues, paragraphs (1) (2) (6), UCC-3-603. Tender of

Payment, Consumer Credit Protection Act of 1968,

Civil Rights Act of 1964, and the Truth in Lending

Act of 1968 (TILA). Furthermore, Defendants collected

extensions of the Plaintiff’s credit by extortionate

means as pursuant to 18 USC 894-Collection of

extensions of credit by extortionate means. .. .

(Compl. (Doc. 4) at 7-8.) These assertions are all legal

conclusions. Plaintiff does not explain how Defendant allegedly

violated these statutes or rules of law. “[L]egal conclusions,

elements of a cause of action, and bare assertions devoid of

further factual enhancement fail to constitute well-pled facts

for Rule 12(b) (6) purposes.” Nemet Chevrolet, LTD v.

Consumeraffairs.com, Inc., 591 F.3d 250, 255 (4th Cir. 2009).

These “claims” are unsupported by any alleged facts and must be

dismissed.

Vv. CONCLUSION

For the foregoing reasons, IT IS THEREFORE ORDERED that

Defendant Ally’s Motion to Dismiss, (Doc. 7), is GRANTED.

This the 30th day of September, 2024.

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