Tillman v. Capital One Auto Finance

Background

Delaneo-Nathaniel Tillman, Sr. filed a self-represented lawsuit against Chase, Volkswagen Group of America, and Capital One Auto Finance. The case was removed from Hennepin County District Court to the U.S. District Court for the District of Minnesota. The opinion states that the exact basis of the complaint was unclear, but that Tillman appeared to seek discharge of his car loan based on Article I, Section 10, Clause 1 of the U.S. Constitution. He alleged that defendants were seeking payment even though they should instead “balance the book-entry” for the transactions.

The complaint also stated that debts could be paid only in gold or silver, referred to House Joint Resolution 192 and Public Law 73-10, and asserted that the car-loan account should be treated as paid. Tillman’s complaint also mentioned a “fraudulent contract” and sought $2 million for alleged fraudulent activity and injury.

Motions to Dismiss

JPMorgan Chase Bank N.A. and Volkswagen Group of America separately moved to dismiss under Federal Rule of Civil Procedure 12(b)(6). Under that rule, a complaint must allege enough specific facts to state a plausible claim for relief. The court must generally accept factual allegations as true, but it need not accept conclusory statements or legal conclusions. Although self-represented complaints are read liberally, they still must allege enough facts to support the claims.

Constitutional and Loan Theory

The court construed Tillman’s allegations about gold, silver, promissory notes, and prepaid book entries as an attempt to assert the “vapor money” theory. That theory claims that a borrower does not owe money advanced by a lender because the loan was not funded with actual money, or that a promissory note signed by the borrower is itself money that pays the debt. The court stated that federal courts have consistently rejected this theory as frivolous and nonsensical.

The court held that Tillman’s complaint failed because the theory has no legal support and because he did not allege any acts by defendants that violated the Constitution. The court also explained that Article I, Section 10, Clause 1 restricts state power, not private entities, so defendants could not violate that provision. To the extent Tillman relied on the Constitution’s Contract Clause, the court said that clause applies to laws passed by states. The court further noted that the Supreme Court rejected the argument that only gold and silver coins can be legal tender for private debts.

Fraud Claim

The court read the complaint liberally as possibly asserting fraud. But Federal Rule of Civil Procedure 9(b) requires fraud to be pleaded with particularity, including the who, what, where, when, and how of the alleged fraud. The court held that Tillman had not pleaded the elements of fraud under Minnesota law and had not alleged the facts required by Rule 9(b). It therefore dismissed any fraud claim with prejudice.

Disposition

The court concluded that the entire basis of Tillman’s claims rested on a rejected legal theory and that amendment would be futile. It granted Chase’s motion to dismiss, granted Volkswagen Group of America’s motion to dismiss, and dismissed Tillman’s claims against the defendants with prejudice. The court directed that judgment be entered accordingly. The opinion states that the court did not need to reach the defendants’ alternative reasons for dismissal.