Quinlan et al v. CitiMortgage, Inc. et al
Filing
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MEMORANDUM and ORDER signed by Judge Morrison C. England, Jr on 6/20/11: Defendant GC Services' Motion to Dismiss 5 is granted with leave to amend. Plaintiffs may file an amended complaint not later than twenty (20) days after the date this Memorandum and Order is filed electronically. (Kaminski, H)
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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KAREN QUINLAN nee BETZLER and
BOB BETZLER,
No. 2:11-cv-00986-MCE-EFB
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Plaintiffs,
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MEMORANDUM & ORDER
v.
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CITIMORTGAGE, INC. et al.,
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Defendants.
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Plaintiffs Karen and Bob Betzler (“Plaintiffs”) seek redress
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from Defendants Citimortgage, Inc., GC Services Limited Partnership
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(“GC Services”), Allied International Credit Corp., and Nationwide
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Credit Recovery (collectively, “Defendants”) regarding a debt
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collection originating from a mortgage loan in Plaintiff Karen
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Betzler’s name.
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connection with the loan, Defendants violated various state laws
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and the Fair Debt Collection Practices Act (“FDCPA”).
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Specifically, Plaintiffs allege that, in
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Defendant GC Services filed a Motion to Dismiss Plaintiffs’
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Complaint pursuant to Federal Rule of Civil Procedure1
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Rule 12(b)(6) (ECF No. 5).
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Defendant’s motion, and a hearing on the matter was conducted
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before this Court on June 9, 2011.
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Defendant GC Services’ Motion to Dismiss is granted.
Plaintiff filed a timely opposition to
For the reasons stated below,
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BACKGROUND2
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Plaintiffs are husband and wife.
As stated above, Plaintiff
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Karen Betzler executed a home mortgage loan for approximately
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$7,000 in March 1999.
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financed by the California Rural Home Mortgage Finance Authority
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(not a party to the instant suit), specifically stated that any
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balance left on the loan after ten years was to be “forgiven free
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and clear.”
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Citimortgage, Inc.
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from Plaintiffs, even though the loan was fully discharged and no
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monies were due.
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Services contacted Defendants in January 2010 and “continued to
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contact” them to demand payment on the loan.
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The language of the mortgage, originally
At some point the loan was transferred to Defendant
After 2009, Defendants began demanding payment
Plaintiffs specifically allege that Defendant GC
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All further references to “Rule” or “Rules” are to the Federal
Rules of Civil Procedure unless otherwise noted.
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The factual assertions in this section are based on the
allegations in Plaintiffs’ Complaint unless otherwise specified.
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STANDARD
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On a motion to dismiss for failure to state a claim under
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Rule 12(b)(6), all allegations of material fact must be accepted as
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true and construed in the light most favorable to the nonmoving
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party.
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Cir. 1996).
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statement of the claim showing that the pleader is entitled to
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relief,” to “give the defendant fair notice of what the...claim is
Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th
Rule 8(a)(2) requires only “a short and plain
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and the grounds upon which it rests.”
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550 U.S. 544, 555 (2007) (internal citations and quotations
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omitted).
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Bell Atl. Corp. v. Twombly,
Though “a complaint attacked by a Rule 12(b)(6) motion” need
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not contain “detailed factual allegations, a plaintiff’s obligation
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to provide the ‘grounds’ of his ‘entitlement to relief’ requires
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more than labels and conclusions, and a formulaic recitation of the
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elements of a cause of action will not do.”
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Papasan v. Allain, 478 U.S. 265, 2869 (1986)).
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“factual allegations must be enough to raise a right to relief
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above the speculative level.”
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Federal Practice and Procedure § 1216 (3d ed. 2004) (“[T]he
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pleading must contain something more...than...a statement of facts
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that merely creates a suspicion [of] a legally cognizable right of
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action.”)).
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Id. at 555 (quoting
A plaintiff’s
Id. (citing 5 C. Wright & A. Miller,
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Further, “Rule 8(a)(2)...requires a ‘showing,’ rather than a
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blanket assertion, of entitlement to relief.
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allegation in the complaint, it is hard to see how a claimant could
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satisfy the requirements of providing...grounds on which the claim
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rests.”
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A pleading must then contain “only enough facts to state a claim to
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relief that is plausible on its face.”
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“plaintiffs...have not nudged their claims across the line from
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conceivable to plausible, their complaint must be dismissed.”
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Without some factual
Twombly, 550 U.S. at 555 n.3 (internal citations omitted).
Id. at 570.
If the
Id.
Once the court grants a motion to dismiss, they must then
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decide whether to grant a plaintiff leave to amend.
Rule 15(a)
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authorizes the court to freely grant leave to amend when there is
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no “undue delay, bad faith, or dilatory motive on the part of the
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movant.” Foman v. Davis, 371 U.S. 178, 182 (1962).
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to amend is generally only denied when it is clear that the
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deficiencies of the complaint cannot possibly be cured by an
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amended version.
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655, 658 (9th Cir. 1992); Balistieri v. Pacifica Police Dept.,
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901 F. 2d 696, 699 (9th Cir. 1990) (“A complaint should not be
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dismissed under Rule 12(b)(6) unless it appears beyond doubt that
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the plaintiff can prove no set of facts in support of his claim
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which would entitle him to relief.”) (internal citations omitted).
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In fact, leave
See DeSoto v. Yellow Freight Sys., Inc., 957 F.2d
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ANALYSIS
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Both in the pleadings and during oral argument, the parties
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addressed two material issues: (1) whether Plaintiff Bob Beltzer
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has standing under the Fair Debt Collection Practices Act to sue as
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the spouse of Plaintiff Karen Beltzer, who was the sole individual
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named on the loan; and (2) whether Plaintiffs’ allegations of
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violations of the FDCPA satisfied the statute of limitations under
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the statute.
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The FDCPA was enacted to prevent abusive, “deceptive and
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unfair debt collection practices.”
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“debt collector” is defined as “any person who uses any
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instrumentality...in any business the principal purpose of which is
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the collection of any debts.”
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excludes any person who collects debt “to the extent such
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activity...(i)concerns a debt which was originated by such person;
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or (ii) concerns a debt which was not in default at the time it was
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obtained by such person.”
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FDCPA does not extend to cover the “consumer’s creditors, a
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mortgage servicing company, or any assignee of the debt, so long as
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the debt was not in default at the time it was assigned.”
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HomeQ Servicing, 653 F. Supp. 2d 1047, 1053 (E.D. Cal. 2009)
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(quoting Perry v. Stewart Title Co., 756 F.2d 1197, 1208 (5th Cir.
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1985)).
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Id.
15 U.S.C. § 1692(a).
Id. § 1692(a)(6)(a).
§ 1692(a)(6)(f).
The term
The definition
As a result, the
Nool v.
A “consumer” is defined as “any natural person obligated or
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allegedly obligated to pay any debt.”
15 U.S.C. § 1692a(3).
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“debt collector who fails to comply with any provision” of the
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statute is liable for damages.
Id. § 1692k(a).
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Any
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An action to enforce liability requires that a plaintiff bring suit
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within “one year from the date on which the violation occurs.”
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§ 1692k(d).
Id.
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A.
Plaintiff Bob Beltzer’s Standing.
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Section 1692c of the FDCPA particularly requires that a debt
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collector not “communicate with a consumer in connection with the
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collection of any debt” in a myriad of forbidden circumstances,
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including phoning a debtor/consumer’s place of business or phoning
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during an “unusual time or place.”
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of section 1692c only, the term “consumer” includes the
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debtor/consumer’s spouse, parent, or other authorized party.
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§ 1692c(d).
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Id. § 1692c(a).
For purposes
Id.
Defendant GC Services contends that Plaintiff Bob Beltzer
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lacks standing because he was not a borrower on the loan, nor had
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he assumed any obligation of the note.
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with Plaintiffs’ analysis of section 1692c, and interprets the
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statute as incorporating a debt collector’s liability on a
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debtor/consumer’s spouse.
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However, the Court concurs
Since the FDCPA clearly enumerates that civil liability may
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attach to any collector who fails to comply with any provision of
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the statute, it stands to follow that Plaintiff Bob Beltzer has a
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right of action against Defendants for violation of the FDCPA as it
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directly applies to him.
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claims regarding the violation of section 1692c only.
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Therefore, Plaintiff has standing as to
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The Court declines to extend his standing further, since the
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statute’s applicability otherwise only applies to Plaintiff Karen
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Beltzer since she alone was obligated to pay the mortgage loan.
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B.
Statute of Limitations
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However, even if both Plaintiffs have sufficient standing to
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sue Defendants, there is no indication from the Complaint that
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Defendant GC Services contacted or otherwise violated the FDCPA
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within the allotted statutory period.
Plaintiffs filed their
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complaint on April 13, 2011.3
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violation of the FDCPA, and by extension demonstrate proper
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standing for the case to commence in federal court, Plaintiffs must
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demonstrate on the face of the Complaint that Defendant GC Services
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contacted Plaintiffs or otherwise engaged in conduct prohibited by
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the statute on or before April 13, 2010.
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any specific facts from the Complaint to determine the above, and
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as such the Complaint fails to meet the pleading standards under
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Rule 8 and Twombly.
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Therefore, to allege a proper
The Court cannot elicit
See supra.
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The case was filed under original federal jurisdiction based
upon violations of the FDCPA.
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CONCLUSION
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For the reasons stated above, Defendant GC Services’ Motion to
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Dismiss (ECF No. 5) is granted with leave to amend.
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file an amended complaint not later than twenty (20) days after the
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date this Memorandum and Order is filed electronically.
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amended complaint is filed within said twenty (20)-day period,
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without further notice, Plaintiffs’ claims against GC Services will
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be dismissed without leave to amend.
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Plaintiffs may
If no
IT IS SO ORDERED.
Date: June 20, 2011
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MORRISON C. ENGLAND, JR
UNITED STATES DISTRICT JUDGE
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