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Case 2:11-cv-02349-HB Document 13 Filed 08/26/11 Page 1 of 5







NO. 11-2349


Bartle, J.

August 26, 2011

Plaintiff Qaisar Hamid ("Hamid") has sued defendant

Stock & Grimes, LLP ("S&G"), a limited liability law partnership,
for violation of the Fair Debt Collection Practices Act, 15
U.S.C. §§ 1692 et seq. Hamid alleges that S&G previously filed
an underlying debt collection action against her on behalf of
Discover Bank when the action was barred by the applicable
statute of limitations. Defendant has now moved to dismiss on
the ground that plaintiff has failed to state a claim upon which
relief can be granted under Rule 12(b)(6) of the Federal Rules of
Civil Procedure.

For present purposes, we accept as true all well-

pleaded facts. A plaintiff must state sufficient factual matter
to make it plausible that her claim is true. See Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 570 (2007); accord Ashcroft v.
Iqbal, 556 U.S. ---, 129 S. Ct. 1937 (2009). A claim is
plausible "when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged." Twombly, 550 U.S. at 570.

Case 2:11-cv-02349-HB Document 13 Filed 08/26/11 Page 2 of 5

Thus, the allegations must do more than raise a "'mere
possibility of misconduct.'" Fowler v. UPMC Shadyside, 578 F.3d
203, 210 (3d Cir. 2009) (quoting Iqbal, 129 S. Ct. at 1950).

According to the amended complaint, plaintiff, a

resident of Pennsylvania, accepted a Discover credit card in 1994
from Discover Bank, headquartered in the state of Delaware and
regulated by the Delaware State Bank Commissioner. The
cardmember agreement, which stated it would be governed by
Delaware law, provided for Hamid to mail and deliver her payments
to a post office box in Dover, Delaware. If she failed to do so,
she was in default. Discover Bank received her last payment on
July 5, 2006. It never received the payment due from her on
August 12, 2006. On April 23, 2010, approximately three years
and eight months later, S&G, as counsel for Discover Bank, filed
a debt collection action against Hamid in a Pennsylvania state
court. During the lawsuit Hamid's counsel advised S&G that the
statute of limitations barred the action and thus violated 15
U.S.C. § 1692f. Nevertheless, the lawsuit continued. Hamid
ultimately "paid Discover Bank to buy her peace and end the
state-court action."

S&G maintains that the underlying action was timely and

did not violate § 1692f of the Fair Debt Collection Practices
Act, which provides that "a debt collector may not use unfair or
unconscionable means to collect or attempt to collect any debt."
Without limitation, § 1692f then identifies certain conduct which
constitutes such prohibited means. While filing a stale lawsuit


Case 2:11-cv-02349-HB Document 13 Filed 08/26/11 Page 3 of 5

is not specifically listed, S&G, at least at this stage, does not
contest that doing so would constitute an unfair or
unconscionable means to collect or to attempt to collect a debt.
See Kimber v. Federal Financial Corp., 668 F. Supp. 1480, 1486-88
(M.D. Ala. 1987).

The Pennsylvania statute of limitations is four years
for a breach of contract while the relevant Delaware limitations
period is three years. See 42 Pa. Cons. Stat. § 5525; 10 Del. C.
§ 80106. Thus, if the former is applicable, the underlying
lawsuit was timely, but if the latter is controlling, the lawsuit
was time barred.

The underlying lawsuit, as noted above, was filed in
the state court in Pennsylvania. While the parties agreed that
Delaware substantive law governs, Pennsylvania, the forum state,
looks to its own statute of limitations scheme even though the
claim has arisen and is governed by the law of a different state,
unless the parties have specifically provided otherwise as to the
limitations period. Unisys v, U.S. Vision, 630 A.2d 55, 57-58
(Pa. Super. 1993). Under the Pennsylvania Uniform Statute of
Limitations on Foreign Claims Act, "the period of limitation
applicable to a claim accruing outside this Commonwealth shall be
either that provided or prescribed by the law of the place where
the claim accrued or by the law of this Commonwealth whichever
first bars the claim." See 42 Pa. Cons. Stat. § 5521(b); Gluck
v. Unisys Corp., 960 F.2d 1168, 1179-80 (3d Cir. 1992). This Act


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is applicable since the parties have not specifically agreed to a
different limitations period.

Hamid argues that the claim against her accrued in
Delaware when Discover Bank did not receive the plaintiff's
payment due August 12, 2006. Not surprisingly, S&G maintains
that it accrued in Pennsylvania when she did not mail her

Under Delaware law, to state a claim for a breach of

contract a plaintiff must plead the existence of a contract
whether express or implied, the breach of an obligation imposed
by the contract, and resultant damages. VLIM Tech., LLC v.
Hewlett-Packard Co., 840 A.2d 606, 612 (Del. 2003). The law of
Pennsylvania is the same. Pennsy Supply, Inc. v. American Ash
Recycling Corp. of Pa., 895 A.2d 595, 600 (Pa. Super. 2006). A
cause of action arises and the statute of limitations begins to
run "as determined by the final significant event necessary to
make the claim suable." Mack Trucks, Inc. v. Bendix-Westinghouse
Automotive Air Brake Co., 372 F.2d 18, 20 (3d Cir. 1967). As the
Pennsylvania Supreme Court has explained, "a right of action
accrues only when injury is sustained by the plaintiff -- not
when the causes are set in motion which ultimately produce injury
as a consequence." Foley v. Pittsburgh-Des Moines Co., 68 A.2d
517, 533 (Pa. 1949).

Here, the damage to Discover Bank occurred when it did
not receive the payment due on August 12, 2006 at its post office
box in Dover, Delaware. While Hamid's failure to mail her


Case 2:11-cv-02349-HB Document 13 Filed 08/26/11 Page 5 of 5

payment may have set events in motion, it was in Delaware where
the final significant event took place, that is, where Discover
Bank sustained injury from non-payment of Hamid's debt. It was
not until Discover Bank failed to receive Hamid's check on
August 12, 2006 that it was able to sue her for breach of
contract. We conclude that the place where the claim in the
underlying action accrued was in Delaware.

Because the claim accrued outside of the Commonwealth,
the shorter three-year Delaware statute of limitations governed
under the Pennsylvania Uniform Statute of Limitations on Foreign
Claims Act. See 42 Pa. Cons. Stat. § 5521; 10 Del. C. § 80106.
The underlying action was filed in Pennsylvania on April 23,
2010, more than three years and eight months after the breach of
contract claim arose. Thus, the institution of suit occurred
after the clock had run.

In sum, accepting the facts alleged in Hamid's amended

complaint as true, S&G filed out of time the debt collection
action on behalf of Discover Bank and against Hamid in the
Pennsylvania state court. Consequently, she has here stated a
claim for relief for violation of § 1692f of the Fair Debt
Collection Practices Act.

The motion of S&G to dismiss this action under Rule

12(b)(6) of the Federal Rules of Civil Procedure will be denied.