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Ogunmokun v. American Education Services/Pheaa

United States District Court, E.D. New York

September 23, 2014



ROSLYNN R. MAUSKOPF, District Judge.

Pro se plaintiff Oasupo Ogunmokun ("Ogunmokun") brings this action against Xpress Loan Servicing ("XLS") a.k.a. CIT Group ("CIT"), [1] and American Education Services/PHEAA ("PHEAA"), relating to the allegedly fraudulent consolidation of Ogunmokun's student loans. Ogunmokun claims that defendants "aided and abetted" that fraud, committed common law conversion, engaged in the "fraudulent imposition of pecuniary loss, " and violated the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. ยงยง 1681n, 1681o, and 1681s-2b. Before the Court are the motions of CIT (Doc. Nos. 78, 80) and PHEAA (Doc. Nos. 74, 76) to dismiss Ogunmokun's Fifth Amended Complaint (Doc. No. 71 ("FAC")) pursuant to Federal Rule of Civil Procedure ("Fed. R. Civ. P.") 12(b)(6). For the reasons stated below, PHEAA's motion to dismiss is GRANTED, and CIT's motion to dismiss is GRANTED in part, and the Court declines to exercise supplemental jurisdiction as to any remaining state law claims against CIT and/or XLS.


I. Relevant Facts[2]

On July 10, 2007, Ogunmokun met with Richard Preisig of University Student Services - a student-loan consolidation business - about a job opening as a loan consolidation agent. That same day, an employee of University Student Services interviewed Ogunmokun, and conducted what Ogunmokun understood, at the time, to be a training exercise for the prospective job.[3] The employee also walked Ogunmokun through the process of completing an application and promissory note for a consolidation loan under the Federal Family Education Loan Program ("FFELP").[4] As part of that exercise, Ogunmokun provided his personal information as well as details for student loans - with a principal balance totaling more than $50, 000 - that he had previously acquired to finance his own college education. The employee assured Ogunmokun, though, that this was only a mock consolidation. Ogunmokun was subsequently offered the job and began working at University Student Services. (FAC at 5-6.)[5]

On August 4, 2007, Ogunmokun received a package in the mail from XLS, which identified itself as the lender for his newly-consolidated loan and requested payment. Ogunmokun immediately advised XLS by phone that he had not authorized the consolidation, he threatened to sue XLS, and he "contacted the authorities." Ogunmokun refused to acknowledge the consolidated loan or to make any payments toward the balance. ( Id. at 6.)

In October 2007, XLS reported Ogunmokun's payment delinquencies to the three major credit reporting agencies - TransUnion, Experian, and Equifax. ( Id. ) In November 2007, using the "dispute" option on each of those agencies' respective websites, Ogunmokun notified the agencies that "a fraud had been perpetrated" against him. ( Id. ) The agencies, in turn, placed Ogunmokun's "credit profiles" on a "fraud alert" and notified the "companies involved, " namely, XLS and the loan guaranty agency, PHEAA.[6] ( Id. )

In early 2008, PHEAA took assignment of the defaulted loan from XLS.[7] Ogunmokun informed customer service personnel at PHEAA that he had been defrauded and insisted that he would not acknowledge the legitimacy of the consolidated loan. ( Id. ) In 2009, based on Ogunmokun's defaulted loan, the Internal Revenue Service ("IRS") confiscated $23 from his tax refund pursuant to the Treasury Offset Program.[8] ( Id. at 7.)

During 2010, Ogunmokun contacted PHEAA multiple times and requested that it investigate the fraud committed against him. ( Id. at 7-8.)

In 2011, the IRS confiscated Ogunmokun's tax refund. ( Id. ) Upon contacting the IRS, Ogunmokun learned that he could obtain relief from the treasury offset only by securing a court order. ( Id. at 8.) At one point, PHEAA offered Ogunmokun an opportunity to file for "hardship, " which might have afforded him additional flexibility in making payments. Ogunmokun declined to pursue that option because he viewed it as an admission of having initiated the consolidation. ( Id. )

II. Procedural History

On August 31, 2012, Ogunmokun filed a pro se complaint against five defendants: Rich Preisig/University Student Services ("Preisig/USS"), XLS, NSL, PHEAA, and the IRS. (Compl. (Doc. No. 1).) On September 19, 2012, Ogunmokun amended his complaint by adding Diversified as a defendant. (Am. Compl. (Doc. No. 5).) On March 20, 2013, on consent of the parties, Ogunmokun amended his complaint for the second time. In his Second Amended Complaint, Ogunmokun named CIT - the parent company of subsidiary XLS - as an alias for XLS. By this time, XLS had apparently ceased doing business and was defunct. Ogunmokun also dismissed NSL, Diversified, and the IRS from the lawsuit. Ogunmokun specified that Preisig/USS had committed fraud and conversion; that XLS had aided and abetted that fraud and conversion, and had willfully and falsely reported negative credit information; and that PHEAA, among other things, had "fraudulently imposed pecuniary loss" on Ogunmokun, and had willfully and falsely reported negative credit information. (Second Am. Compl. (Doc. No. 46).)

On March 27, 2013, Ogunmokun filed his Third Amended Complaint, attaching as exhibits paperwork relating to the consolidated loan. (Third Am. Compl. (Doc. No. 50).) On April 26, 2013, Ogunmokun filed his Fourth Amended Complaint with additional exhibits. (Fourth Am. Compl. (Doc. Nos. 56-57).)[9]

On June 25, 2013, this Court dismissed Preisig/USS from the action based on Ogunmokun's failure to effect service of process, despite the Court having accorded him several extensions in which to do so. (Doc. No. 67.)

On July 15, 2013, Ogunmokun filed his Fifth Amended Complaint, which incorporated additional allegations pertaining to his veil-piercing theory of liability against CIT and constitutes the operative pleading. (Doc. No. 71.) The two remaining defendants in the lawsuit ...

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