Henry v. J.P. Morgan Chase Bank, N.A.

Background

After Gina Henry fell behind on credit card payments, J.P. Morgan Chase Bank, N.A. began calling her to collect the debt. Henry sued Chase, alleging violations of federal and state law based on repeated calls using a prerecorded or artificial voice without her consent. Chase filed counterclaims seeking to recover the debt it alleges Henry owes.

Motion and analysis

Henry moved to dismiss Chase’s counterclaims under the argument that the court lacked supplemental jurisdiction. Supplemental jurisdiction allows a federal court to hear additional claims that are sufficiently related to claims already before it. Henry argued that Chase’s counterclaims did not arise from the same nucleus of operative facts as her claims.

The court rejected that argument. It acknowledged that the counterclaims might not require proof of the same facts or arise from the same transaction or occurrence as Henry’s claims. But the court concluded that the counterclaims clearly arose from the same nucleus of operative facts and therefore formed part of the same case or controversy under 28 U.S.C. § 1367(a).

The court also found no compelling reason to decline supplemental jurisdiction. Henry argued that allowing debt-collection counterclaims of this kind could discourage people from asserting rights under laws such as the Telephone Consumer Protection Act. The court reasoned that dismissing the counterclaims would leave Chase free to bring them in a separate state-court action, which could impose greater expense and burden on Henry by requiring her to litigate two separate cases.

Disposition

Judge Vince Chhabria denied Henry’s motion to dismiss Chase’s counterclaims.