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Knoll v. Horizon Bank

United States District Court, W.D. Michigan, Southern Division

June 11, 2018

EVAN WARD KNOLL, Plaintiff,
v.
HORIZON BANK, Defendant.

          OPINION

          Paul L. Maloney United States District Judge.

         This is a diversity action brought by a federal prisoner proceeding in forma pauperis, under 28 U.S.C. § 1332.[1] Under the Prison Litigation Reform Act, Pub. L. No. 104-134, 110 Stat. 1321 (1996) (PLRA), the Court is required to dismiss any prisoner action brought under federal law if the complaint is frivolous, malicious, fails to state a claim upon which relief can be granted, or seeks monetary relief from a defendant immune from such relief. 28 U.S.C. § 1915(e)(2. The Court must read Plaintiff's pro se complaint indulgently, see Haines v. Kerner, 404 U.S. 519, 520 (1972), and accept Plaintiff's allegations as true, unless they are clearly irrational or wholly incredible. Denton v. Hernandez, 504 U.S. 25, 33 (1992). Applying these standards, the Court will dismiss Plaintiff's complaint for failure to state a claim.

         Discussion

         I. Factual allegations

         Plaintiff is presently incarcerated at the federal correctional institution in Forrest City, Arkansas. Plaintiff sues Horizon Bank.

         Plaintiff alleges that Defendant Horizon Bank was negligent and/or engaged in fraud when, in 2007, it failed to perform due diligence before accepting a fraudulent power of attorney from an unauthorized person to issue mortgages and personal lines of credit against six properties owned by Plaintiff. Plaintiff contends that the negligence or fraud of Defendant resulted in a loss of $9, 139, 520.00. He seeks compensatory damages in that amount.[2]

         II. Failure to state a claim

         A complaint may be dismissed for failure to state a claim if it fails “‘to give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.'” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). While a complaint need not contain detailed factual allegations, a plaintiff's allegations must include more than labels and conclusions. Twombly, 550 U.S. at 555; Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (“Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”). The court must determine whether the complaint contains “enough facts to state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570. “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 679. Although the plausibility standard is not equivalent to a “‘probability requirement, ' . . . it asks for more than a sheer possibility that a defendant has acted unlawfully.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 556). “[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged - but it has not ‘show[n]' - that the pleader is entitled to relief.” Iqbal, 556 U.S. at 679 (quoting Fed.R.Civ.P. 8(a)(2)); see also Hill v. Lappin, 630 F.3d 468, 470-71 (6th Cir. 2010) (holding that the Twombly/Iqbal plausibility standard applies to dismissals of prisoner cases on initial review under 28 U.S.C. §§ 1915A(b)(1) and 1915(e)(2)(B)(i)).

         This is a diversity action under 28 U.S.C. § 1332. In diversity actions, the law that is applicable to a state-law claim filed in state court is also applicable to such a claim filed in a federal court. Erie R. Co. v. Tompkins, 304 U.S. 64 (1938). In Guaranty Trust Co. v. York, 326 U.S. 99 (1945), the Supreme Court applied that principle to statutes of limitations on the theory that, where one is barred from recovery in the state court, he should likewise be barred in the federal court.

         Plaintiff sues Defendant Horizon Bank on state-law tort claims of negligence and fraud. The period of limitations for claims of to rtious injury to persons or property is three years. Mich. Comp. Laws § 600.5805(10). Under Michigan law, the statute of limitations begins to run when “all of the elements of an action for personal injury, including the element of damages, are present.” Connelly v. Paul Ruddy's Equipment Repair & Service Co., 200 N.W.2d 70, 72 (Mich. 1972). The elements which must be present are:

(1) The existence of a legal duty by defendant towards plaintiff.
(2) The breach of such duty.
(3) A proximate causal relationship between the breach of such duty and an ...

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