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Wade v. Account Resolution Corp.

United States District Court, E.D. Missouri, Eastern Division

May 10, 2017

THOMAS WADE, Plaintiff,
v.
ACCOUNT RESOLUTION CORPORATION, et al., Defendants.

          MEMORANDUM AND ORDER

          JOHN A. ROSS UNITED STATES DISTRICT JUDGE.

         This matter is before the Court on competing motions for summary judgment. Plaintiff Thomas Wade brings this action against Defendants Dennis J. Barton, and the Barton Law Group, LLC (“Defendants”)[1], for alleged violations of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. (“FDCPA”). The motions are fully briefed and ready for disposition.

         Facts

         The relevant facts are not disputed. On July 24, 2014, ARC sued Plaintiff in the Associate Circuit Court for St. Charles County, Missouri to recover an outstanding balance on Plaintiff's SLUCare account. ARC was the assignee of the debt. Defendants are regularly engaged in the collection of consumer debts and represented ARC in the state court action. Plaintiff received service of the summons and complaint in the state court action, but did not answer or otherwise respond. On September 16, 2014, Defendants appeared in state court on behalf of ARC and presented a proposed default judgment seeking judgment against Plaintiff in the amount of the outstanding principal account balance of $1, 203.00 and $190.14 in interest. The state court granted ARC's motion for default judgment, and entered the proposed judgment.

         Legal standard

         Summary judgment is appropriate when no genuine issue of material fact exists in the case and the movant is entitled to judgment as a matter of law. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). The initial burden is placed on the moving party. City of Mt. Pleasant, Iowa v. Associated Elec. Co-op., Inc., 838 F.2d 268, 273 (8th Cir. 1988). If the record demonstrates that no genuine issue of fact is in dispute, the burden then shifts to the non-moving party, who must set forth affirmative evidence and specific facts showing a genuine dispute on that issue. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). In determining whether summary judgment is appropriate in a particular case, the evidence must be viewed in the light most favorable to the nonmoving party. Osborn v. E.F. Hutton & Co., Inc., 853 F.2d 616, 619 (8th Cir. 1988). When both parties move for summary judgment, the Court must analyze each motion individually and on its own merits. Wermager v. Cormorant Township Bd., 716 F.2d 1211, 1214 (8th Cir. 1983).

         FDCPA

         The FDCPA is designed “to eliminate abusive debt collection practices by debt collectors” and “to promote consistent state action to protect consumers against debt collection abuses.” 15 U.S.C. § 1692. Section 1692e prohibits the use of “any false, deceptive, or misleading representation or means in connection with the collection of any debt” including, “[t]he false representation of the character, amount, or legal status of any debt.” §§ 1692e, e(10). Section 1692f prohibits a debt collector from employing any “unfair or unconscionable means to collect or attempt to collect any debt, ” with § 1692f(1) specifically prohibiting “[t]he collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.”

         The FDCPA is liberally construed to protect consumers. Layton v. CACH, LLC, No. 4:15CV00752 AGF, 2015 WL 6736121, at *4 (E.D. Mo. Nov. 4, 2015). The Act's prohibitions apply to collection efforts through litigation, but at the same time, the Act seeks to preserve the judicial remedies of creditors. Id. (citation omitted). The Eighth Circuit applies the “unsophisticated consumer” test in evaluating whether a debt collector's practices are false, misleading, or deceptive. Id. (citation omitted). The test “is designed to protect consumers of below average sophistication or intelligence, ” but also contains an “objective element of reasonableness.” Id. (citation omitted). The determination of whether a plaintiff states a claim under the FDCPA based on litigation conduct is best decided on a case-by-case basis. Id. at 819.

         Defendants' motion for summary judgment

         As a threshold matter, Defendants have moved for summary judgment on the grounds that Plaintiff's complaint is time-barred because it was filed on August 31, 2015, one year and eighteen days after Plaintiff was served, on August 13, 2014, with the petition and affidavit in the state court collection action (Doc. No. 52 at 2-5). Defendants previously raised this same argument in a motion to dismiss (Doc. No. 11). The Court denied Defendants' motion, explaining that the one-year statute of limitations under the FDCPA is triggered when the debt collector has had its last opportunity to comply with the FDCPA, which in this case was when they obtained default judgment against Plaintiff on September 16, 2014. (Doc. No. 27 at 3, citing Coble v. Cohen & Slamowitz, LLP, 824 F.Supp.2d 568, 570 (S.D.N.Y. 2011) (holding that the debtors' FDCPA claims accrued, and the one-year limitations period began to run, when the consumer collection law firm obtained default judgments against them in state-court debt collection actions).

         Defendants state they have “collected more evidence” that now supports summary judgment (Doc. No. 52 at 2 n.2); however, upon review, the Court finds nothing new in the evidence submitted by Defendants on the record that is relevant to the timeliness issue. Moreover, the Court is not persuaded by Defendants' attempts to distinguish Coble from the instant case. Defendants' cross motion for summary judgment will, therefore, be denied.

         Plaintiff's motion for summary judgment

         Plaintiff argues summary judgment is appropriate in this case because Defendants had no authority to collect prejudgment interest on his SLUCare account. He notes that the Affidavit of Account attached to the state court action was silent as to prejudgment interest, and asserts that Defendants did not consult ARC prior to collecting prejudgment interest (Doc. No. 34 ...


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