Order (motion to dismiss) — Marshall v. Prestamos CDFI, LLC

Record facts

UNITED STATES DISTRICT COURT · No. 5:21-cv-04337-JMG · Doc. 57 · 2023-03-30 · Docket on CourtListener

Full text

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IN THE UNITED STATES DISTRICT COURT 
FOR THE EASTERN DISTRICT OF PENNSYLVANIA 
__________________________________________ 
 
 
 
 
 
 
 
 
ALICIA MARSHALL, et al.,  
 
 
: 
 
 
 
Plaintiffs,  
 
 
: 
 
 
 
 
 
 
 
 
: 
 
 
 
v.  
 
 
 
: 
Civil No. 5:21-cv-04337-JMG 
 
 
 
 
 
 
 
: 
PRESTAMOS CDFI, LLC,  
 
 
: 
 
 
 
Defendant.  
 
 
: 
__________________________________________ 
 
ORDER 
AND NOW, this 30th day of March, 2023, upon consideration of Defendants Prestamos 
CDFI, LLC (“Prestamos”) and Chicanos Por La Causa, Inc.’s (“CPLC”) Motion to Dismiss (ECF 
No. 46) Plaintiffs Second Amended Complaint (“SAC”), the responses and replies thereto, as well 
as Plaintiffs’ Motion for Leave to File Supplemental Authority (ECF No. 53), Defendants’ 
Response in Opposition thereto (ECF No. 54), its exhibits and attachments, IT IS HEREBY 
ORDERED as follows: 
1. Plaintiffs’ Motion for Leave to File Supplemental Authority (ECF No. 53) is 
DENIED.1  
 
1 Plaintiffs seek leave to supplement their Response to Defendants’ Motion to Dismiss with 
a Staff Report from the United States House of Representatives Select Subcommittee on the 
Coronavirus Crisis titled “We are not the Fraud Police: How Fintechs Facilitated Fraud in the 
Paycheck Protection Program” (“Report”). See ECF No. 53 at pg. 1. The Report’s Executive 
Summary provides “This staff report presents findings…into the role of financial technology 
companies (fintechs) in facilitating a disproportionately high rate of fraudulent and otherwise 
ineligible loans through the Paycheck Protection Program (“PPP”).” See ECF No. 53-1 at pg. 4. 
Plaintiffs ask this Court to take judicial notice of the contents of this Report, in particular the 
Report’s findings that Defendant Prestamos “approved the highest number of PPP loans of any 
PPP lender in 2021,” that “Prestamos’ President acknowledged that [Prestamos] was ‘not prepared 
for all the applications that we received’ during the PPP and said that the nonprofit knowingly took 
on a role larger than it had been prepared to handle” and that “Blueacorn” who “was involved in 
the processing of nearly all of the loans facilitated by…Prestamos” prioritized large loans over 
other loans, some of which Blueacron deliberately “delet[ed]” or chose not to fund. See ECF No. 
53 at pgs. 2-3.   
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2. Defendants’ Motion to Dismiss (ECF No. 46) is GRANTED IN PART and 
DENIED IN PART as follows: 
a. Defendants’ Motion to Dismiss Plaintiffs’ SAC for lack of standing pursuant to 
Federal Rule of Civil Procedure 12(b)(1) is DENIED IN PART and GRANTED IN PART. 
Named Plaintiffs2 have standing, except to the extent Named Plaintiffs purport to bring state law 
claims under the laws of states in which they do not reside in or in which they were never injured. 
b. Defendants’ Motion to Dismiss Plaintiffs’ SAC as to Defendant CPLC for lack 
of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(6) is DENIED 
WITHOUT PREJUDICE subject to the following limited jurisdictional discovery; 
c. To the extent Plaintiffs seek limited discovery on the issues of Defendant 
CPLC’s relationship with Defendant Prestamos for purposes of establishing personal jurisdiction, 
as set forth in the accompanying Memorandum Opinion, Plaintiffs shall file a proposed plan 
within twenty-one (21) days of entry of this Order, specifically identifying (1) what discovery 
 
Because Plaintiffs ask the Court to take judicial notice of the truth of information and 
conclusions contained within the Report, and Plaintiffs’ Second Amended Complaint is not “based 
on” nor does it explicitly rely upon the Report, the Court declines to take judicial notice of the 
Reports contents. See  Schmidt v. Skolas, 770 F.3d 241, 249 (3d Cir. 2014). “Should Plaintiffs wish 
to incorporate any of this information, they must do so through the proper evidentiary channels.” 
Greathouse v. Capital Plus Financial, LLC, No. 22-cv-686 at ECF No. 54 (N.D. Tex., Dec. 22, 
2022). See also Sturgeon v. PharMerica Corp., 438 F. Supp. 3d 246, 259 (E.D. Pa. 2020) 
(declining, at motion to dismiss stage, to take judicial notice of the truth of the contents of FDA 
reports); Hall v. Johnson & Johnson, No. 18-1833, 2019 U.S. Dist. LEXIS 221513 at *34 (D. N.J. 
Dec. 27, 2019) (declining to take judicial notice of NIH reports at motion to dismiss stage where 
reports “address[] the merits of Plaintiff’s claims, is not relied upon or integral to the complaint, 
and would require the Court to delve into the scientific evidence that forms the crux of the parties’ 
dispute.”); St Luke’s Health Network, Inc. v. Lancaster Gen. Hosp., No. 18-2157, 2021 U.S. Dist. 
LEXIS 195881 at *9 (E.D. Pa. Oct. 12, 2021) (“Under the public records exception, a court make 
take judicial notice of documents such as an administrative or legislative report, but such notice 
serves only to ‘indicate what was in the public realm at the time, not whether the contents of those 
documents are true.’”) (quoting U.S. ex rel Spay v. CVS Caremark Corp., 913 F. Supp. 2d 125, 
139-40 (E.D. Pa. 2012)).  
2 “Named Plaintiffs” are Plaintiffs Alicia Marshall, Daniel Pronsky, Paris Townsend, 
Nancilee Holland, Leona Owsley, Kolawole Ahmadou, Kiana Dervin, Kristina Henderson, 
Dustin Innis, Kelly Stalnaker and Jamie Jones 
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Plaintiff requires and (2) using what proposed discovery tools. Defendants shall respond to the 
proposal within fourteen (14) days of receipt of the proposal.  
d. Defendants’ Motion to Dismiss Count One of the SAC for Breach of Contract 
as to Defendant Prestamos is DENIED. 
e. Defendants’ Motion to Dismiss Count One of the SAC for Breach of Contract 
as to Defendant CPLC is DENIED WITHOUT PREJUDICE pending the limited jurisdictional 
discovery as forth in subsection (c) above and the accompanying Memorandum Opinion.  
f. Defendants’ Motion to Dismiss Count Two of the SAC for Violation of 
California’s Unfair Competition Law as to both Defendants Prestamos and CPLC is GRANTED. 
Count Two of Plaintiffs’ SAC is hereby DISMISSED. 
g. Defendants’ Motion to Dismiss Count Three of Plaintiffs’ SAC for Violation 
of the Illinois Consumer Fraud and Deceptive Business Practices Act as to Defendant 
Prestamos is GRANTED. Count Three of Plaintiffs’ SAC is hereby DISMISSED. 
h. Defendants’ Motion to Dismiss Count Four of  Plaintiffs’ SAC for Violation 
of the Ohio Deceptive Trade Practices Act as to Defendant Prestamos is GRANTED. Count 
Four of Plaintiffs’ SAC is hereby DIMISSED.  
i. Defendants’ Motion to Dismiss Count Five of Plaintiffs’ SAC for Unjust 
Enrichment against Defendant CPLC is DENIED WITHOUT PREJUDICE pending the 
limited jurisdictional discovery as forth in subsection (c) above and the accompanying 
Memorandum Opinion.  
BY THE COURT: 
 
 
 
 
 
 
 
 
 
/s/ John M. Gallagher  
 
 
 
 
 
 
 
 
JOHN M. GALLAGHER 
 
  
United States District Court Judge 
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