Broughton v. Truist Bank

Background

Tyrell Broughton proceeded without a lawyer and without paying the filing fee. He sued Truist Bank, invoking federal-question jurisdiction and alleging that the bank violated his rights in connection with an automobile loan. His original filing attached documents concerning a retail installment contract, communications about the loan balance, and monthly statements. It also included references to the Fair Debt Collection Practices Act, but did not set out facts explaining what conduct violated that statute or other federal laws.

On January 23, 2024, the court dismissed the original complaint for failure to state a claim because it did not provide the short and plain statement required by Rule 8 of the Federal Rules of Civil Procedure. The court allowed Broughton to file an amended complaint and explained that, if he intended to rely on the Fair Debt Collection Practices Act, he needed to allege facts showing that the debt arose from a consumer transaction, that Truist Bank qualified as a debt collector, and that the bank engaged in conduct prohibited by the statute.

In the amended complaint, Broughton asserted breach of contract and alleged violations of the Uniform Commercial Code, House Joint Resolution 192, Public Law 73-10, the Federal Reserve Act, federal banking laws, and Securities and Exchange Commission regulations. He alleged that the automobile contract became invalid because Truist Bank failed to disclose an option concerning an alleged security interest. He sought to eliminate the debt, obtain clear title to the vehicle, and recover $300,000.

Federal Claims

The court dismissed the claims based on House Joint Resolution 192 because Broughton alleged no facts showing that the resolution applied to Truist Bank’s conduct. The court explained that the resolution concerns contracts requiring payment in gold and that courts have generally rejected theories asserting that debts are unenforceable because lenders provided credit rather than legal tender.

The court also found that Broughton failed to state claims under the Federal Reserve Act, federal banking laws, and Securities and Exchange Commission regulations because he did not explain how those laws applied to his allegations. Although some attachments referred to the Fair Debt Collection Practices Act, the court found that Broughton did not allege facts supporting a claim under that statute.

State Claims and Further Amendment

Broughton also asserted state-law claims, including breach of contract and claims involving the Uniform Commercial Code. The court explained that the Uniform Commercial Code is a set of model laws adopted by states, not a federal law. After dismissing the federal claims, the court declined to exercise supplemental jurisdiction, meaning its authority to hear related state-law claims in the same case. The court also noted that Broughton had not alleged facts establishing diversity jurisdiction or showing that he could state a viable state-law claim.

Because Broughton had already received an opportunity to amend and the amended complaint did not suggest that further amendment would produce viable claims, the court declined to grant another opportunity to amend.

Disposition

The court dismissed the action for failure to state a claim under 28 U.S.C. § 1915(e)(2)(B)(ii). It declined to exercise supplemental jurisdiction over any state-law claims Broughton might be asserting. The court certified that any appeal would not be taken in good faith, denied fee-free status for purposes of an appeal, and directed the Clerk of Court to enter judgment. Judge Laura Taylor Swain signed the order.