1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 ANDRE KOVACS, Case No. 2:25-cv-2152-DAD-JDP (PS) 12 Plaintiff, 13 v. ORDER 14 J.P. MORGAN SECURITIES LLC, et al., 15 Defendants. 16 17 Plaintiff brings this action against J.P. Morgan Securities LLC and Chase Bank. His 18 complaint, however, fails to state a claim and is dismissed. I will give plaintiff leave to amend to 19 file an amended complaint that better explains the factual basis for his claims. I will also grant 20 his application to proceed in forma pauperis, ECF No. 2, which makes the showing required by 21

(a)(1) and (2). 22 Screening and Pleading Requirements 23 A federal court must screen the complaint of any claimant seeking permission to proceed 24 in forma pauperis. See

(e). The court must identify any cognizable claims and 25 dismiss any portion of the complaint that is frivolous or malicious, fails to state a claim upon 26 which relief may be granted, or seeks monetary relief from a defendant who is immune from such 27 relief.

28 1 A complaint must contain a short and plain statement that plaintiff is entitled to relief, 2 Fed. R. Civ. P. 8(a)(2), and provide “enough facts to state a claim to relief that is plausible on its 3 face,” Bell Atl. Corp. v. Twombly,

(2007). The plausibility standard does not 4 require detailed allegations, but legal conclusions do not suffice. See Ashcroft v. Iqbal,

662, 678 (2009). If the allegations “do not permit the court to infer more than the mere 6 possibility of misconduct,” the complaint states no claim.

. The complaint need not 7 identify “a precise legal theory.” Kobold v. Good Samaritan Reg’l Med. Ctr.,

, 8 1038 (9th Cir. 2016). Instead, what plaintiff must state is a “claim”—a set of “allegations that 9 give rise to an enforceable right to relief.” Nagrampa v. MailCoups, Inc.,

, 1264 10 n.2 (9th Cir. 2006) (en banc) (citations omitted). 11 The court must construe a pro se litigant’s complaint liberally. See Haines v. Kerner, 404

, 520 (1972) (per curiam). The court may dismiss a pro se litigant’s complaint “if it 13 appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which 14 would entitle him to relief.” Hayes v. Idaho Corr. Ctr.,

(9th Cir. 2017). 15 However, “‘a liberal interpretation of a civil rights complaint may not supply essential elements 16 of the claim that were not initially pled.’” Bruns v. Nat’l Credit Union Admin.,

, 17 1257 (9th Cir. 1997) (quoting Ivey v. Bd. of Regents,

(9th Cir. 1982)). 18 Analysis 19 Plaintiff alleges that in June 2017 he opened a Chase credit card to make purchases from 20 Amazon. ECF No. 1 at 9. Plaintiff made three timely payments on the card and maintained a 21 balance of $115.

In August of that year, Chase mailed plaintiff a letter which stated, “[w]e 22 will be closing your credit card account on October 6, 2017 because continuing the relationship 23 creates possible reputational risk to our company.”

Plaintiff alleges that he never defaulted 24 on the card, made late payments, or received a negative credit event.

Plaintiff requested from 25 Chase all evidence that demonstrated he was a “reputational risk.”

Chase refused to provide 26 plaintiff with any information.

Plaintiff later spoke with a Chase representative who “hinted” 27 that an unrelated 2012 federal conviction was the basis for Chase labeling plaintiff a reputational 28 risk.

Chase never confirmed that plaintiff’s conviction was the basis for his card being 1 canceled.

2 In 2025, plaintiff opened a checking account with Chase for the sole purpose of depositing 3 an $8,000 check.

Three months later, Chase sent plaintiff a letter stating, “[y]our account will 4 be closed. Please move your deposits to a different bank.”

Chase did not provide plaintiff 5 with a reason for closing his account. 6 Plaintiff brings six causes of action: defamation, intentional infliction of emotional 7 distress, breach of implied covenant of good faith and fair dealing, violation of California’s 8 Unfair Competition Law pursuant to California Business and Professions Code section 17200, 9 violation of California’s Consumer Legal Remedies Act pursuant to California Civil Code section 10 1750, and violation of the Fair Credit Reporting Act (“FCRA”) pursuant to

.

11 at 10-11. 12 Plaintiff’s federal claim for violation of the FCRA fails. The purpose of the FCRA is “to 13 require that consumer reporting agencies adopt reasonable procedures for meeting the needs of 14 commerce for consumer credit, personnel, insurance, and other information in a manner which is 15 fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and 16 proper utilization of such information.”

(b). Imposition of civil liability for 17 violations of this Act are governed by §§ 1681n and 1681o. Section 1681n(b) provides that 18 “[a]ny person who obtains a consumer report from a consumer reporting agency under false 19 pretenses or knowingly without a permissible purpose shall be liable to the consumer reporting 20 agency . . .” Section 1681o(a) imposes civil liability for “negligent” noncompliance on “[a]ny 21 person who is negligent in failing to comply with any requirement imposed under this subchapter 22 with respect to any consumer is liable to that consumer . . .” The FCRA imposes requirements 23 only on “consumer reporting agencies” or “users of information” furnished by consumer 24 reporting agencies. See

(h) (conditions and form of disclosure to consumers). 25 Section 1681a(f) defines the term “consumer reporting agency” to include only persons or 26 organizations that engage on a regular basis in assembling or evaluating consumer credit 27 information in order to furnish consumer reports to third parties. 28 Plaintiff does not allege that defendants engaged in activities covered by the FCRA. 1 Indeed, plaintiff alleges that Chase closed his credit card in 2017 due to a reputational risk and 2 closed his checking account in 2025 without explanation. These actions are not covered under 3 the FCRA and therefore this claim should be dismissed. 4 Plaintiff also alleges five state law claims. And while the complaint contains sufficient 5 alleges to show complete diversity, the allegations regarding the amount in controversy fall below 6 the necessary requirement for diversity jurisdiction. See U.S.C. § 1332 (requiring diversity 7 between the parties and the amount in controversy exceeds $75,000). In his complaint, plaintiff 8 seeks $10,000,000 in damages for emotional distress, reputational harm, and credit impairment. 9 ECF No. 1 at 11-12. However, he alleges that his Chase checking account with $8,000 was 10 closed (its unclear whether plaintiff moved his money to a different account) and that his

credit card was closed. Plaintiff has made no plausible allegations that the amount in controversy 12 in this action is ten million dollars, or anywhere close to $75,000. See Licea v. Caraway Home 13 Inc., No. EDCV 22-1791 JGB (SHKx),

, at *6 (C.D. Cal. Feb. 9, 2023); see 14 also Petkevicius v. NBTY, Inc., No. 3:14-cv-02616-CAB (RBB),

, at *4 (S.D. 15 Cal. Mar. 24, 2017) (“[S]imply stating . . . the amount in controversy . . . without any specific 16 factual allegations as to the actual amount sought by the plaintiffs does not constitute a good faith 17 allegation . . . .”). Accordingly, because this court lacks diversity jurisdiction, I will decline to 18 exercise supplemental jurisdiction and dismiss plaintiff’s state law claims. 19 Accordingly, plaintiff’s complaint is dismissed for failure to state a claim. I will allow 20 plaintiff a chance to amend his complaint before recommending that this action be dismissed. 21 Plaintiff should also take care to add specific factual allegations against defendant. If plaintiff 22 decides to file an amended complaint, the amended complaint will supersede the current one. See 23 Lacey v. Maricopa Cnty.,

, 907 n.1 (9th Cir. 2012) (en banc). This means that the 24 amended complaint will need to be complete on its face without reference to the prior pleading. 25 See E.D. Cal. Local Rule 220. Once an amended complaint is filed, the current one no longer 26 serves any function. Therefore, in an amended complaint, as in the original, plaintiff will need to 27 assert each claim and allege defendant’s involvement in sufficient detail. The amended complaint 28 should be titled “First Amended Complaint” and refer to the appropriate case number. If plaintiff 1 | does not file an amended complaint, I will recommend that this action be dismissed. 2 Accordingly, it is hereby ORDERED that: 3 1. Plaintiff's request for leave to proceed in forma pauperis, ECF No. 2, is GRANTED. 4 2. Plaintiff's complaint, ECF No. 1, is DISMISSED with leave to amend. 5 3. Within thirty days from service of this order, plaintiff shall file either (1) an amended 6 | complaint or (2) notice of voluntary dismissal of this action without prejudice. 7 4. Failure to timely file either an amended complaint or notice of voluntary dismissal may 8 | result in the imposition of sanctions, including a recommendation that this action be dismissed 9 | with prejudice pursuant to Federal Rule of Civil Procedure 41(b). 10 5. The Clerk of Court shall send plaintiff a complaint form with this order. 11 IT IS SO ORDERED.

Dated: _ October 21, 2025 Q_—_—. 14 JEREMY D. PETERSON 15 UNITED STATES MAGISTRATE JUDGE

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