McMullen v. Synchrony Bank ( 2020 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
VALERIE MCMULLEN,
Plaintiff,
v. Civil Action No. 14-1983 (JEB)
SYNCHRONY BANK, et al.,
Defendants.
MEMORANDUM OPINION
This Opinion is the final chapter in the long-running suit brought by the Plaintiff class
against banks, companies, and individuals related to improper credit lines and charges for gym
memberships and personal-training sessions that were billed on health-related credit cards. The
only remaining Defendants are Karim Steward and One World Fitness. Neither has participated
in this litigation for some time, and neither has responded to Plaintiffs’ recent Motion for
Summary Judgment. As a result, the Court may consider Plaintiffs’ undisputed facts as true, see
Fed. R. Civ. P. 56(e)(2); in doing so, it will grant the Motion and enter judgment against these
last two Defendants.
I. Background
As the Court has set out the background of this case in detail in prior Opinions, see, e.g.,
McMullen v. Synchony Bank, 300 F. Supp. 3d 292, 298–300 (D.D.C. 2018), its recitation here
will be abbreviated.
Defendants JPMorgan Chase and Synchrony Bank are banks that rolled out programs
offering lines of credit for the purpose of financing and facilitating the payment of the medical
costs of various elective procedures, but not including gym memberships. See ECF No. 174-2
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(Pl. Statement of Material Facts), ¶¶ 1–3. Steward owned One World Fitness, a gym that was
not eligible for these financing programs. Id., ¶ 6. Defendant Wayne Bullen, who owned a
chiropractic business, joined Steward to form Bullen Wellness. Id., ¶¶ 5, 7. The two created this
front company, which had no employees, in order to sign up One World gym members for
healthcare-financing credit lines. Id., ¶¶ 8–9. These Defendants then obtained healthcare
financing for 956 customers of One World without ever submitting signed applications to the
banks. Id., ¶¶ 19–20. They then opened credit lines without customers’ knowledge or
authorization and billed against those credit lines. Id., ¶¶ 78–79. In total, Defendants billed One
World customers over $1.8 million in unauthorized charges. Id., ¶ 98.
Plaintiff Valerie McMullen and a class of others brought this action in 2014 against
myriad Defendants, but almost all have either settled, had judgment granted against them, or
been dismissed. The only two that remain are Steward and One World Fitness, and the claims
against them from the Second Amended Class Complaint are Unlawful Trade Practices under the
D.C. Consumer Protection Procedure Act (Count II vs. Steward), Fraud and Conspiracy (Count
III vs. Steward and One World), Conversion (Count IV vs. Steward), and Breach of Contract
(Count V vs. Steward and One World). See ECF No. 80 (Sec. Am. Compl.), ¶¶ 64–100. The
current Motion for Summary Judgment invokes only the CPPA and fraud. See ECF No. 174 (Pl.
MSJ) at 14–24.
II. Legal Standard
Summary judgment may only be granted if “the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.
R. Civ. P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48 (1986);
Holcomb v. Powell, 433 F.3d 889, 895 (D.C. Cir. 2006). A fact is “material” if it is capable of
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affecting the substantive outcome of the litigation. See Liberty Lobby, 477 U.S. at 248;
Holcomb, 433 F.3d at 895. A dispute is “genuine” if the evidence is such that a reasonable jury
could return a verdict for the non-moving party. See Scott v. Harris, 550 U.S. 372, 380 (2007);
Holcomb, 433 F.3d at 895. “A party asserting that a fact cannot be or is genuinely disputed must
support the assertion” by “citing to particular parts of materials in the record” or “showing that
the materials cited do not establish the absence or presence of a genuine dispute, or that an
adverse party cannot produce admissible evidence to support the fact.” Fed. R. Civ. P. 56(c)(1).
When a motion for summary judgment is under consideration, “[t]he evidence of the non-
movant is to be believed, and all justifiable inferences are to be drawn in his favor.” Liberty
Lobby, 477 U.S. at 255; see also Mastro v. PEPCO, 447 F.3d 843, 850 (D.C. Cir. 2006); Aka v.
Wash. Hosp. Ctr., 156 F.3d 1284, 1288 (D.C. Cir. 1998) (en banc). On a motion for summary
judgment, the Court must “eschew making credibility determinations or weighing the evidence.”
Czekalski v. Peters, 475 F.3d 360, 363 (D.C. Cir. 2007).
When the non-movant fails to file an opposition, the court may not treat the motion as
conceded. See Winston & Strawn, LLP v. McLean, 843 F.3d 503, 506 (D.C. Cir. 2016). Rather,
“a district court must always determine for itself whether the record and any undisputed material
facts justify granting summary judgment.” Id. (quoting Grimes v. Dist. of Columbia, 794 F.3d
83, 95 (D.C. Cir. 2015)). In doing so, the court may, however, accept the moving party’s
uncontested assertions of fact as true. See Fed. R. Civ. P. 56(e)(2).
III. Analysis
Given that the D.C. CPPA offers treble damages, this is where Plaintiffs focus their
Motion. Their count under this Act alleges the violation of several provisions — to wit, D.C.
Code §§ 28-3904(b), (e), (f), and (r). See Sec. Am. Compl., ¶¶ 65-70. Unlike common-law
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fraud, a plaintiff need not prove scienter or intent to show a violation of the CPPA. See Fort
Lincoln Civic Ass’n, Inc. v. Fort Lincoln New Town Corp., 944 A.2d 1055, 1073 & n.20 (D.C.
2008). Rather, she need only show that the merchant violated the statutory elements. Saucier v.
Countrywide Home Loans, 64 A.3d 428, 442 (D.C. 2013). The CPPA “establishes an
enforceable right to truthful information from merchants about consumer goods and services that
are or would be purchased, leased, or received in the District of Columbia.” D.C. Code § 28-
3901(c). It is a remedial statute to be construed broadly but through the lens of a “reasonable
consumer.” Saucier, 64 A.3d at 442.
Section 28-3904(b), to begin, prohibits a merchant from representing that it “has a
sponsorship, approval, status, affiliation, certification, or connection” that it does not actually
have. Yet, One World and Steward used Chase’s logo and marketing materials to mislead
customers into believing that Defendants were approved partners of the bank in signing them up
for the healthcare program. Next, Section 28-3904(e) bars the “misrepresent[ation] as to a
material fact which has a tendency to mislead,” and (f) prohibits merchants from “fail[ing] to
state a material fact if such failure tends to mislead.” Here, again, Steward and One World never
informed customers that Defendants had not been approved by the banks for the lines of credit,
that Defendants were in fact opening lines of credit in Plaintiffs’ names and charging amounts
against such lines, and that the banks never authorized fitness charges under their program in the
first place.
Steward and One World have thus clearly violated the CPPA, and their fraudulent
practices resulted in the wrongful billing of $1,837,722.85 against the customers’ lines of credit.
See Pl. SMF, ¶ 98. In addition, the CPPA authorizes the trebling of damages without any further
findings. Byrd v. Jackson, 902 A.2d 778, 782 (D.C. 2006) (citations omitted). The Court will
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thus award $5,513,168.55. As the same amount was awarded for the same misdeeds against
three other Defendants — Wayne Bullen, Washington Chiropractic, and Bullen Wellness — the
Court will issue an Order holding Steward and One World jointly and severally liable with each
other and the aforementioned three.
IV. Conclusion
For the foregoing reasons, the Court grants Plaintiffs’ Motion and will enter judgment in
the amount of $5,513,168.55. A contemporaneous Order to that effect will issue this day.
/s/ James E. Boasberg
JAMES E. BOASBERG
United States District Judge
Date: April 24, 2020
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