Texas Lawyers Violate the State of Texas Surety Bond Requirement Every Day. Here’s a Citable Fed. Case

Bentson v. Chyma

(4:15-cv-00523)

District Court, E.D. Texas

JUL 31 2015 – FEB 8, 2018 | REPUBLISHED BY LIT: JUL 29, 2022

Defendant be held liable to Plaintiff for the sum of $2,000 incurred in actual damages and $1,000 incurred in statutory damages under the FDCPA, that Plaintiff’s request for attorney fees in the amount of $30,387.50 and Plaintiff’s request for court costs in the amount of $600.00 be granted, and that Plaintiff’s request for statutory damages under the TDCA and for exemplary damages be denied.

Having received the report of the United States Magistrate Judge, and no objections thereto having been timely filed, this Court is of the opinion that the findings and conclusions of the Magistrate Judge are correct and adopts the Magistrate Judge’s report as the findings and conclusions of the Court.

It is, therefore, ORDERED that Defendant David E. Chyma is directed to pay damages in the amount of $3,000.001, attorney fees in the amount of $30,387.50, and costs in the amount of $600.00, for a total of $33,987.50, to Plaintiff Aimee Marie Benston.

IT IS SO ORDERED.

Signed this 8th day of February, 2018

AMOS L. MAZZANT
UNITED STATES DISTRICT JUDGE

LAWYERS ABOVE THE LAW?
HELL NO. WE’LL KEEP POSTIN’ -EVERY DAMN DAY:

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— lawsinusa (@lawsinusa) July 27, 2022

MEMORANDUM ADOPTING REPORT AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

RELEVANT BACKGROUND

On July 31, 2015, Plaintiff filed the present suit, alleging Defendant David E. Chyma violated the Fair Debt Collection Practices Act (“FDCPA”) and the Texas Debt Collection Practices Act (“TDCA”) in attempting to collect a debt incurred as a result of a divorce proceeding (Dkt. #1).

Plaintiff asserts Defendant sent her confusing letters in violation of the FDCPA and TDCA and that Defendant consistently contacted her in a harassing, threatening, and demeaning manner (Dkt. #1).

Plaintiff filed an initial Motion for Summary Judgment on November 28, 2016 (Dkt. #32), to which Defendant failed to respond.

The Magistrate Judge entered an amended report and recommendation on February 24, 2017, recommending that Plaintiff’s Motion for Summary Judgment (Dkt. #32) be denied, due mainly to lack of competent summary judgment evidence (Dkt. #33).

See, e.g., Vinings Ins. Co. v. Byrdson Servs., LLC, No. 1:14-cv-525, 2016 WL 3584715, at *3 (E.D. Tex. June 17, 2016) (noting “[i]t is well-established in the Fifth Circuit” that courts may not grant summary judgment on the basis of a party’s failure to respond, alone).

The Court adopted the Magistrate Judge’s ultimate recommendation (Dkt. #37).

The Magistrate Judge thereafter entered an Amended Scheduling Order, setting a deadline of May 5, 2017 to file dispositive motions pursuant to which Plaintiff filed a further Motion for Summary Judgment, seeking judgment as a matter of law on her claims under the FDCPA (Sections 1692d, 1692e, 1692f, and 1692g) and the TDCA (Sections 392.101, 392.301, 392.303, 392.304(a)(1)(A), (a)(4), (6), (8), (13)-(14), (17), and (19)), as well as attorneys fees, damages, and injunctive relief (Dkt. #40).

See Petroleum Helicopters, Inc. v. Avco Corp., 930 F.2d 389 (5th Cir. 1991)

(affirming district court’s consideration of a party’s second request for summary judgment where district court previously denied summary judgment on the same claims but party renewed request for summary judgment following introduction of evidence not previously before the court).

Here, Plaintiff has provided additional, new evidence in support of the motion for summary judgment:

(1) the affidavit of Plaintiff Aimee Marie Bentson (Dkt. #40, Exhibit B) (“Bentson Affidavit”)

and

(2) the affidavit of Plaintiff’s counsel, Steven M. Strong (Dkt. #40, Exhibit C) (“Strong Affidavit”).

Defendant filed a Response on May 22, 2017 (Dkt. #44), proffering no evidence and pointing to no evidence in the record in support of his opposition to Plaintiff’s Motion for Summary Judgment.

On July 7, 2017, the Magistrate Judge entered a report and recommendation (Dkt. #45) recommending that

(A) Plaintiff be granted judgment as a matter of law on her claims under FDCPA Sections 1692e and 1692g(a) and under TDCA Sections 392.101 and 392.304(a)(8), (19),

and

(B) Plaintiff be denied judgment as a matter of law on her claims under FDCPA Sections 1692d, 1692f, and 1692(g)(b) and under TDCA Sections 392.301, 392.303, and 392.304(a)(1)(A), (a)(4), (a)(6), (a)(12), (a)(13), (a)(14), and (a)(17).

The Magistrate Judge also recommended finding Plaintiff’s claims for attorneys fees and damages premature.

Defendant filed his (construed) objections (Dkt. #48) on August 2, 2017. Plaintiff filed a response (Dkt. #49) to Defendant’s objections on August 3, 2017.

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— lawsinusa (@lawsinusa) July 27, 2022

DEFENDANT’S OBJECTIONS

A party who files timely written objections to a magistrate judge’s report and recommendation is entitled to a de novo review of those findings or recommendations to which the party specifically objects. 28 U.S.C. § 636(b)(1)(C); Fed. R. Civ. P. 72(b)(2)-(3).

At the outset, the Court notes the Parties do not object to the Magistrate Judge’s findings regarding Plaintiff’s FDCPA claims, the Magistrate Judge’s conclusions regarding what materials in the record constitute summary judgment evidence in this case, or the Magistrate Judge’s decision that attorneys fees, damages, and costs determinations are premature. As such, and after review of the record, the Court adopts these findings.

The Court therefore turns to Defendant’s objections, which center solely on Plaintiff’s claims under the TDCA.

Defendant generally objects to the Magistrate Judge’s finding that the TDCA applies to Defendant, a debt collector located in Iowa, for sending letters seeking to collect a debt to Plaintiff, who is located in Texas.

Defendant further specifically objects to the Magistrate Judge’s finding that Defendant violated TDCA Section 392.101 by engaging in debt collection activities without a bond

(Dkt. #48).

Plaintiff argues in response only that Defendant’s objections are untimely filed and that they do not sufficiently specify the findings to which Defendant objects, and as such that they should be stricken

(Dkt. #49).

The record does not clearly demonstrate pro se Defendant filed his objections in an untimely manner. Defendant acknowledged he received the Magistrate Judge’s report and recommendation at the earliest on either July 12, 2017, or July 17, 2017

(see Dkt. #46 (date illegible))

or, at the latest, on July 19, 2017

(Dkt. #47).

Given that the Court cannot ascertain with certainty from the record when Defendant received the report (and given that Defendant filed the objections in close proximity to the deadline in any event), the Court finds Defendant filed timely objections to the Magistrate Judge report.

Moreover, Plaintiff’s argument that Defendant’s objections lack specificity cannot prevail. Defendant objects to the Magistrate Judge’s finding the TDCA applies to him and also clearly argues the TDCA bond requirement violates the federal constitution.

As such, the Court denies Plaintiff’s request to strike Defendant’s objections.

The Court does note, however, that Defendant did not raise either of these arguments before the Magistrate Judge or, in fact, at any point previously in this matter.

Accordingly, The Court has no obligation to consider such arguments now. See, e.g., Imperium (IP) Holdings v. Apple, Inc., 920 F. Supp. 2d 747, 752 (E.D. Tex. 2013) (finding plaintiff’s “evidence and arguments presented for the first time upon objection to a report and recommendation need not be considered”).

Notwithstanding such fact, and in light of Defendant’s pro se status, the Court herein considers Defendant’s limited objections to the Magistrate Judge’s report.

An out of state law firm humiliates Texas attempt to stand by their own rogue debt collectin’ law firms.

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— lawsinusa (@lawsinusa) July 28, 2022

Turning to Defendant’s assertion that the TDCA does not apply to him, the Court finds Defendant’s argument must fail. The TDCA applies whenever a “debt collector”—“a person who directly or indirectly engages in debt collection”—attempts to collect debt—“an action, conduct, or practice in collecting, or in soliciting for collection, consumer debts that are due or alleged to be due to a creditor”—from a consumer—an individual with “an obligation or alleged obligation, primarily for personal, family, or household purposes, and arising from a transaction or alleged transaction”—located in Texas. Tex. Fin. Code § 392.001.

The Magistrate Judge found, “neither Party disputes Defendant’s status as a debt collector and/or third-pay debt collector, Plaintiff’s status as a ‘consumer,’ or the status of the debt as debt the collection of which is subject to the TDCA”

(Dkt. #45 at 19).

Defendant proffers no evidence to rebut this finding or the evidence on which it is based (see, e.g., Dkt. #40, Exhibit B at 3-6 (showing the debt at issue here related to allegedly delinquent payments due a law firm located in Iowa for divorce services performed there), Exhibit A (showing Defendant, located in Iowa, sent letters to Plaintiff, located in Texas, seeking to collect on this alleged debt)).

In examining the evidence of record, the Court reaches the same conclusion—the TDCA applies here; the Court overrules Defendant’s objection to the contrary.
More fundamentally, Defendant also seemingly challenges the constitutionality of the TDCA itself, and the bonding provision, arguing as follows:

No State in this Republic (even Texas) can deny a[n] out of state entity the right to correspond by letter with that States’ [sic] residents concerning legitimate business without first being “bonded” to do so. This is targeting a specific legal industry and is so clearly in violation of the United States Constitution. I have no presence in Texas nor does my Practice.

The allegations concerning the TDCA is why, in August, 2016 I requested this case be transferred to a “neutral” State. There are many Texans (including legislators, and likely, jurists) who are advocates of Texas as a “Nation- State.” Ruling in this case is no place for such ideology. I want to be certain such does not exist.

(Dkt. #48).

The Court notes initially Defendant has had numerous opportunities to help ensure the Court correctly analyzes and applies the law.

The Court has accorded Defendant significant leeway for the two years this case has been pending before the Court notwithstanding Defendant’s repeated failure to participate or respond to court orders and adversarial motions (see generally Docket in Eastern District of Texas Case No. 4:15-cv-523).

Specifically, Defendant has not, until filing these objections, responded substantively to Plaintiff’s allegations, except to say he wholly denies them

(Dkt. #6).

Indeed, Defendant failed to attend the Rule 16 Management conference or the subsequent show cause hearing

(e.g., Dkt. #16; Dkt. #18).

Even with respect to the instant Summary Judgment Motion, Defendant failed to respond substantively and neither cited to nor provided the Court with evidence in support of his opposition to Plaintiff’s requested relief

(see Dkt. #44).

Moreover, Defendant’s implication that the Court (or any person or entity involved in this matter) is an “advocate[] of Texas as a ‘Nation- State’” is belied by the record.

To the extent Defendant argues the Court harbors bias in favor of applying Texas law, the Court finds the argument without merit.

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— lawsinusa (@lawsinusa) July 28, 2022

In addition, Defendant’s assertion the TDCA bond requirement violates the federal Constitution (because he is located in Iowa and carries on business there) takes no account of the undisputed and evidenced facts of this case, which show Defendant’s debt collection activities targeted a Texas consumer.

A state’s attempt at extraterritorial regulation of another state’s commercial entities may violate the federal Constitution’s dormant Commerce Clause in certain circumstances.

See, e.g., BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 572-74 (1996).

A state’s regulation of the entities conducting commerce within its borders, even where those entities are located out-of-state, however, generally complies with the federal Constitution’s limitations. Indeed, courts have permissibly applied state debt collection statutes to entities operating outside of a target state where the debt collector attempted to collect a debt within the target state.

See, e.g., Collins v. Erin Capital Mgmt., LLC, 991 F. Supp. 2d 1195, 1207-09 (S.D. Fla. 2013)

(finding Florida analogue to TDCA requiring registration in Florida for conducting certain business in Florida by out-of-state entities was not unconstitutional where statute applied broadly and did not result in excess benefits for Florida);

Grant-Hall v. Cavalry Portfolio Servs., LLC, 856 F. Supp. 2d 929, 938-40 (N.D. Ill. 2012)

(finding Illinois statute regulating debt collection activities within the state did not violation the dormant Commerce Clause where “[a]t most, [the statute] has the indirect extraterritorial effect of requiring debt collection agencies to have certain documentation if they wish to file suit in Illinois”).

In the instant case, Defendant sent letters to Texas. Defendant sent these letters in order to collect an alleged debt from Plaintiff.

The alleged debt constitutes a “consumer debt” under Texas law, and Plaintiff meets the definition of “consumer.”

Defendant accordingly meets the definition of “debt collector” under Texas law and, while engaging in “debt collection” within the state, is subject to the TDCA and other Texas statutes governing such practices.

The TDCA requires that third-party debt collectors obtain “a surety bond issued by a surety company authorized to do business in this state as prescribed by [statute,]” and that “[a] copy of the bond . . . be filed with the [Texas] secretary of state.” Tex. Fin. Code § 392.101(a).

A failure to comply with these requirements constitutes a violation of the TDCA.

See CA Partners v. Spears, 274 S.W.3d 51, 79 (Tex. App.—Houston [14th Dist.] 2008, no pet.).

As the Magistrate Judge found, Plaintiff has shown Defendant failed to comply with the Section 392.101 bond requirement (see Dkt. #40, Exhibit C at 7).

The Court overrules Defendant’s objections.

CONCLUSION

Having considered each of Defendant’s objections (Dkt. #48), and having conducted a de novo review, the Court is of the opinion that the findings and conclusions of the Magistrate Judge are correct and adopts the Magistrate Judge’s report (Dkt. #45) as the findings and conclusions of the Court.

Accordingly, it is ORDERED that Plaintiff’s Motion for Summary Judgment [Dkt. 40] be GRANTED IN PART AND DENIED IN PART.

Plaintiff is hereby GRANTED judgment as a matter of law on her claims under FDCPA Sections 1962e and 1692g(a) and under TDCA Sections
392.101 and 392.304(a)(8), (19).

The Court DENIES judgment as a matter of law as to Plaintiff’s claims under FDCPA Sections 1692d, 1692f, and 1692(g)(b), as well as to Plaintiff’s claims under TDCA Sections 392.301, 392.303, and 392.304(a)(1)(A), (a)(4), (a)(6), (a)(12), (a)(13), (a)(14), and (a)(17).

IT IS SO ORDERED.

Signed this 10th day of August, 2017

AMOS L. MAZZANT
UNITED STATES DISTRICT JUDGE

REPORT AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE – RE DAMAGES

BACKGROUND

On July 31, 2015, Plaintiff filed the present suit, alleging Defendant David E. Chyma violated the Fair Debt Collection Practices Act (“FDCPA”) and the Texas Debt Collection Practices Act (“TDCA”) in his attempts to collect a debt incurred as a result of Plaintiff’s divorce proceeding

[Dkt. 1].

Plaintiff asserts Defendant sent her confusing letters in violation of the FDCPA and TDCA and that Defendant consistently contacted her in a harassing, threatening, and demeaning manner

[Dkt. 1].

Plaintiff testified that she was first contacted by Defendant when he left a voicemail on her cellphone, wherein Defendant notified Plaintiff that she owed her divorce lawyer, Paul Aitken

[Dkt. 67 at 8-9].

Prior to this phone call, Plaintiff was unaware that she potentially owed Aitken any money

[Dkt. 67 at 10].

Two days following this phone call, Plaintiff attempted to resolve any confusion or misunderstanding by sending Aitken an email inquiring as to any pending debt, which was never answered

[Dkt. 67 at 11-12].

Shortly after receiving the voicemail, Plaintiff received a letter from Defendant with several amounts listed for the debt and mention of previous correspondence that Plaintiff did not receive

[Dkt. 67 at 21-22].

Days after, Plaintiff sent another letter disputing her receipt of the first letter and the validity of the debt

[Dkt. 67 at 23].

Defendant answered with a copy of a letter dated months before their first interaction and noted “I anticipate a timely reply as charges clearly stated in the signed agreement continue to mount”

[Dkt. 67 at 23- 24; Ex. 5].

Several weeks later, Plaintiff received another letter from Defendant demanding the full amount of the debt and cautioning Plaintiff to “[g]uide [her]self accordingly”

[Dkt. 67 at 31; Ex. 6].

This letter prompted Plaintiff to obtain counsel and file this lawsuit

[Dkt. 67 at 31-32].

On May 5, 2017, Plaintiff filed a Motion for Summary Judgment, seeking judgment as a matter of law on her claims under the FDCPA (§§ 1692d, 1692e, 1692f, and 1692g)

and the TDCA (§§ 392.101, 392.301, 392.303, 392.304(a)(1)(A), (a)(4), (6), (8), (13)-(14), (17), and (19)),

as well as attorney fees, damages, and injunctive relief

[Dkt. 40].

On July 7, 2017, the Magistrate Judge entered a report and recommendation

[Dkt. 45]

recommending that: Plaintiff be granted judgment as a matter of law on her claims under FDCPA Sections 1692e and 1692g(a) and under TDCA Sections 392.101 and 392.304(a)(8), (19);

and Plaintiff be denied judgment as a matter of law on her claims under FDCPA Sections 1692d, 1692f, and 1692(g)(b) and under TDCA Sections 392.301, 392.303, and 392.304(a)(1)(A), (a)(4), (a)(6), (a)(12), (a)(13), (a)(14), and (a)(17)

[Dkt. 45].

The Magistrate Judge also found “Plaintiff has carried her summary judgment burden as to her FDCPA §§ 1692e and 1692g(a) claims, as well as her TDCA §§ 392.101 and 392.304(a)(8), (19) claims and has shown herself entitled to claim actual damages, statutory damages, and attorneys fees under both the FDCPA and TDCA”

[Dkt. 45 at 26].

The District Judge adopted the Report and Recommendation in full

[Dkt. 50].

On September 22, 2017, Plaintiff filed a Notice of Partial Dismissal of Claims Not Granted in Summary Judgment, voluntarily “dismissing all claims that were not granted in the Memorandum Opinion”

[Dkt. 58 at 2] (emphasis in original).

On October 25, 2017, the undersigned held a hearing on damages, attorney fees and expenses related to the claims for which liability was established; namely Plaintiff’s claims under FDCPA §§ 1692e and 1692g(a) and under TDCA §§ 392.101 and 392.304(a)(8), (19)

[Dkt. 66].

At hearing, Plaintiff appeared with counsel; Defendant did not appear (notwithstanding his acknowledged receipt of the order setting the evidentiary hearing on the issues of damages, attorney’s fees, and expenses)

[Dkts. 63, 64].

At hearing, Plaintiff proffered seventeen exhibits, including her correspondence with Defendant, screenshots of Defendant’s Facebook page, Plaintiff’s unanswered discovery requests, and Plaintiff’s counsel’s billing records and time slips.

Plaintiff advised that she sought no less than $25,000 in actual damages as a result of the mental anguish Plaintiff suffered, “$100 for each of the violations under the [TDCA] of which there were three,” “$1,000 for each of the violations under the [FDCPA] of which there were two,” “$34,087.50 in time, $695 in court costs and $134.54 in expenses associated with [Plaintiff’s counsel’s] firm for the case,” and also an award of exemplary damages

[Dkt. 67 at 38].

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— lawsinusa (@lawsinusa) July 28, 2022

ANALYSIS

Actual Damages

Under the FDCPA and TDCA, actual damages include “not only out-of-pocket expenses, but also damages for personal humiliation, embarrassment, mental anguish, and emotional distress.”

Reyelts v. Cross, 968 F. Supp. 2d 835, 846 (N.D. Tex. 2013) (collecting cases);

see also Hashaway v. Int’l Asset Grp., LLC, No. 4:11-CV-376, 2012 WL 2036458, at *2 (E.D. Tex. Mar. 16, 2012) (Mazzant, J.), report and recommendation adopted, No. 4:11-CV-376, 2012 WL 2036451 (E.D. Tex. June 6, 2012).

It is well established that ”[a] plaintiff may recover actual damages for mental anguish under both the FDCPA … and the TDCA.”

McCartney v. CitiFinancial Auto Credit, Inc., No. 4:10-CV-424, 2010 WL 5834802, at *6 (E.D. Tex. Dec. 14, 2010) (Mazzant, J.), report and recommendation adopted, No. 4:10-CV-424, 2011 WL 675386 (E.D. Tex. Feb. 16, 2011) (quoting Bulluck v. Abbott and Ross Credit Serv., L.L. C., No. A–09– CV–413, 2009 WL 4598330 *3 (W.D. Tex. Dec. 3, 2009).

To collect such damages, a plaintiff must proffer direct evidence regarding the “nature, duration, and severity of the mental anguish” and show it has caused a significant disruption in the plaintiff’s daily routine. Id.;

see also Knoerr v. Pinnacle Asset Grp., L.L.C., No. CV H-16-599, 2017 WL 1177970, at *3 (S.D. Tex. Mar. 30, 2017).

This requires “actual evidence of distress and injury, not merely conclusory statements about it.”

Harrington v. Nat’l Enter. Sys., Inc., No. 4:08-cv-422, 2010 WL 890176, at *4 (E.D. Tex. Mar. 9, 2010).

To that end, “courts must ‘closely scrutinize’ awards of mental anguish damages.”

Bullock v. Abbott & Ross Credit Servs., L.L.C., 2009 WL 4598330, at *3.

The Court has wide discretion to quantify the mental anguish Defendant’s conduct has caused Plaintiff.

In the instant case, Plaintiff seeks $25,000 in actual damages for her mental anguish

[Dkt. 67 at 36].

Plaintiff testified at the hearing that she was humiliated that she was being pursued for the substantial debts Defendant cited in his demand letter

[Dkt. 67 at 22, 29].

Plaintiff testified that her feeling when she first received this letter was “stressful, very stressful, surprised, shocked”

[Dkt. 67 at 22].

Plaintiff testified that with each of Defendant’s letts, she continued to feel concerned, confused, and “extremely” upset

[Dkt. 67 at 25-26].

Plaintiff’s concerns about her financial security were also amplified;

Plaintiff is a single mother of two young children, with minor job experience, geographically distant from other family members, and had experienced distressing issues with debt in her previous marriage

[Dkt. 67 at 27].

Specifically, Plaintiff testified that the effect this “debt threat” had on her was “very heavy … very stressful”

[Dkt. 67 at 27].

Plaintiff testified, “[s]omething of that magnitude when you’re a single mom with two little kids and making very little money, trying to put two ends together, it was…hugely very stressful, upsetting”

[Dkt. 67 at 27].

Plaintiff further testified that she had panic attacks, lost sleep and her appetite, experienced symptoms of chest tightening, headaches, “burning of the stomach,” and had a “huge rash outbreak” because of the communications she received from Defendant

[Dkt. 67 at 28-30].

Plaintiff’s dermatologist confirmed that Plaintiff’s rash was caused by stress

[Dkt. 67 at 28].

Plaintiff worried that this “debt threat” would result in a freeze of her bank accounts and seizure her vehicle or other assets, which would mean that she would no longer be able to care for her children

[Dkt. 67 at 28-29].

Plaintiff also researched Defendant and found his Facebook profile, wherein she discovered that several people who frequented Defendant’s Facebook profile and had visited his place of business featured images Plaintiff described as disturbing on their personal Facebook profiles, which Plaintiff found “terrifying, very disconcerting”

[Dkt. 67 at 35-37; Ex. 8].

Plaintiff testified that even to this day, she suffers from anxiety and stress related to Defendant’s actions

[Dkt. 67 at 36].

Plaintiff has met her burden for establishing that she is entitled to an award of actual damages.

Having observed Plaintiff, and in light of the hearing testimony and evidence presented, the Court is satisfied that Plaintiff has experienced mental anguish and genuinely suffered emotionally due to Defendant’s debt collection efforts.

However, although the Court finds that Plaintiff has experienced emotional distress as a result from Defendant’s confusing and threatening correspondence, her request for $25,000 in mental anguish damages is unreasonable in light of the circumstances present in this case.

Again, noneconomic damages like these cannot be determined with mathematical precision; by their nature, they can be determined only by the exercise of sound judgment. In exercising its sound judgment, the Court has thoroughly evaluated a host of debt collection cases with similar fact patterns and the awards in such cases.

See CA Partners v. Spears, 274 S.W.3d 51, 76–77 (Tex. App.—Houston [14th Dist.] 2008, pet. overruled)

(“Texas courts, including this Court, have held that evidence of a claimant’s physical and emotional state, coupled with his/her inability to eat and sleep, constitutes legally and factually sufficient evidence to support the award of mental anguish damages.);

see also Reyelts v. Cross, 968 F. Supp. 2d 835, 846–47 (N.D. Tex. 2013), aff’d, 566 F. App’x 316 (5th Cir. 2014)

(the court $25,000 in mental anguish damages where plaintiff was forced out of retirement and began taking anti-anxiety medication daily, experienced worry, anger, embarrassment, marital strife, and a disruption of her sleeping habits);

Norwest Mortgage, Inc. v. Salinas, 999 S.W.2d 846, 862–63 (Tex.App.—Corpus Christi 1999, pet. denied)

(concluding evidence that plaintiff was unable to sleep, suffered severe stomach cramps, was often unable to eat, and felt “desperate” supported finding that plaintiff suffered “‘a high degree of mental pain and distress’ that caused a serious disruption in [her] daily routine” and was legally and factually sufficient to support award of mental anguish damages);

EMC Mortgage Corp., v. Jones, 252 S.W.3d 857, 871 (Tex.App.—Dallas 2008, no pet.)

(awarding $5,000 where plaintiff became so depressed from debt collector’s action that he had to take medication);

Household Credit Services, Inc. v. Driscol, 989 S.W.2d 72, 92 (Tex.App.—El Paso 1998, pet. denied)

(upholding $150,000 award against a debt collection agency where defendant harassed plaintiff for over a year with vulgar calls several times a day, made death threats against the plaintiff, and caused plaintiff to suffer physical ailments and severe depression).

Consider in Bullock v. Abbott & Ross Credit Servs., L.L.C., the court awarded $2,000 in mental anguish damages to a single mother, who, after her employer was contacted by a debt collector, worried that she would be arrested for failing to pay off her debt and unable to care for her child, and continued to worry after hiring counsel to represent her in the matter.

No. A-09-CV-413 LY, 2009 WL 4598330, at *3–4 (W.D. Tex. Dec. 3, 2009).

The Court finds that Plaintiff’s case is similar. Here, Plaintiff, a single mother with very limited financial resources, worried (and continues to worry) that she would be unable to provide for her children if her assets were frozen pending resolution of Defendant’s debt collection efforts; this anxiety and stress manifested itself physically whereby Plaintiff experienced panic attacks, headaches, loss of appetite and sleep, and a rash that caused her to visit a dermatologist.

Following review, and a thorough evaluation of the evidence herein, the Court has weighed those amounts that would fairly and reasonably compensate Plaintiff, and has determined that an award of $2,000 in mental anguish damages is warranted.

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— lawsinusa (@lawsinusa) July 28, 2022

Statutory Damages Under the Fair Debt Collection Practices Act

Under FDCPA § 1692k, a court may award “any actual damage sustained by [a debtor]” resulting from a debt collector’s failure to comply “with any provision” of the FDCPA, “additional damages . . . not exceeding $1,000[,]” and “the costs of the action, together with any reasonable attorney’s fee as determined by the court.”

15 U.S.C. § 1692k(a)(1), (2)(A), (3).

Plaintiff asks for an award of statutory damages in the amount of $2,000 for the two separate violations of the FDCPA [Dkt. 67 at 38].

However, Plaintiff is only entitled to $1,000 because under the FDCPA, statutory damages are capped at $1,000 total per action, not per violation.

Brown v. Dallas Creditors Servs., Inc., No. 4:12CV371, 2013 WL 3377438, at *3 (E.D. Tex. July 3, 2013) (rendering award under § 1692k and noting the statute caps additional damages at $1,000 per action, “not per violation”) (Mazzant, J.);

see also Whatley v. Creditwatch Servs., Ltd., No. 4:11- CV-493, 2014 WL 1287131, at *3 (E.D. Tex. Mar. 31, 2014);

Hashaway, 2012 WL 2036458, at *2. Accordingly, the undersigned recommends that the Court find that Plaintiff is entitled to $1,000 total in statutory damages under the FDCPA.

Statutory Damages Under the Texas Debt Collection Act

Under TDCA § 392.304, a court may award “injunctive relief to prevent or restrain a violation of [the TDCA]; and . . . actual damages sustained as a result of a violation of [the TDCA].”

TEX. FIN. CODE § 392.403(a).

Further, “[a] person who successfully maintains an action under this section for violation of Section 392.101, 392.202, or 392.301(a)(3) is entitled to not less than $100 for each violation of this chapter.”

TEX. FIN. CODE § 392.403(e).

“The statutory damages of subsection (e) come into play where the jury finds a violation of one of the three applicable sections but finds that the plaintiff suffered no damages or damages in an amount less than $100 as a result of the violation.”

Marauder Corp. v. Beall, 301 S.W.3d 817 (Tex. App.—Dallas 2009, pet. overruled)

(“If the jury had found that Beall suffered $100 or any amount over$100 as a result of Marauder’s failure to post a bond, Beall would not be entitled to the statutory damages.”);

see also Brown v. Enter. Recovery Sys., Inc., No. 02-11-00436-CV, 2013 WL 4506582, at *14 (Tex. App.—Fort Worth Aug. 22, 2013, pet. denied)(“if a plaintiff establishes a right to only injunctive relief or if the plaintiff proves up actual damages that are less than $100, the plaintiff may recover at least $100” in statutory damages).

Because the undersigned recommends finding that Plaintiff is entitled to $2,000 in actual damages, the Court should not also award her statutory damages under the TDCA.

THIS CASE WAS FILED JUNE 1ST, 2022:

Chris Pettit & Associates, P.C. and Christopher John Pettit (22-50591) United States Bankruptcy Court, W.D. Texas

IT’S NOW JULY 28, 2022 AND THE ‘SELF-ADMITTED’* THIEVIN’ LAWYER IS STILL NOT INDICTED?

*Self Admitted by his court filings. pic.twitter.com/7F4pwtemLl

— lawsinusa (@lawsinusa) July 28, 2022

Attorney Fees

Lastly, at hearing, Plaintiff also requested additional relief in the form of attorney fees. Plaintiff moves for attorney fees and costs pursuant to FDCPA § 1692k(a)(3) and TDCA § 392.403(b)

[Dkt. 1 at 10-14].

“Under the FDCPA, a plaintiff in a successful action to enforce FDCPA liability can recover ‘the costs of the action, together with a reasonable attorney’s fee as determined by the court.”

Whatley, 2014 WL 1287131, at *1–2 (internal quotation marks omitted).

“[U]nder the Texas Debt Collection Act, a party may only be awarded attorney’s fees if he successfully maintains an action for ‘actual damages sustained as a result of a violation’ of the Act.”

Jackson Law Office, P.C. v. Chappell, 37 S.W.3d 15, 30–31 (Tex. App.—Tyler, 2000, pet. overruled) (quoting TEX. FIN. CODE § 392.403(a)(2));

see also Farkas v. Wells Fargo Bank, N.A., No. 03-14-00716-CV, 2016 WL 7187476, at *10 (Tex. App.—Austin, Dec. 8, 2016, no pet.);
TEX. FIN. CODE § 392.403 (b)

(“A person who successfully maintains an action under Subsection (a) is entitled to attorney’s fees reasonably related to the amount of work performed and costs.”).

Because Plaintiff has successfully maintained an action under both the TDCA and the FDCPA, she is entitled to reasonable attorney fees.

In determining the amount of a reasonable attorney fee, the court employs a two-step process.

“First, the court determines the lodestar, which is the reasonable number of hours expended on a case multiplied by the reasonable hourly rates for the litigating attorneys.

It is a plaintiff’s burden to show the reasonableness of the hours billed and to prove he exercised billing judgment.

Billing judgment requires documentation of the hours charged and of the hours written off as unproductive, excessive, or redundant.”

Whatley, 2014 WL 1287131, at *1–2.

Once the Court calculates the “lodestar” fee, the lodestar may be adjusted upward or downward depending on the twelve (12) factors set forth in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974).

These factors are:

(1) the time and labor required for the case;

(2) the novelty and difficulty of the issues involved;

(3) the skill required to litigate the case;

(4) the ability of the attorney to accept other work;

(5) the customary fee for similar work in the community;

(6) whether the fee is fixed or contingent;

(7) time limitations imposed by the client or the circumstances of the case;

(8) the amount involved and the results obtained;

(9) the experience, reputation, and ability of the attorney;

(10) the “undesirability” of the case;

(11) the nature and length of the attorney-client relationship;

and

(12) awards in similar cases.

Johnson, 488 F.2d at 717-19;

see also Shipes v. Trinity Indus., 987 F.2d 311, 319-20 (5th Cir.), cert. denied, 510 U.S. 991 (1993).

Plaintiff seeks $34, 087.50 in attorney fees

[Dkt. 67 at 38].

Plaintiff is represented by Steve Strong of the Strong Law Firm, P.C.

Mr. Strong testified at the hearing that he has been licensed in the state of Texas for the past thirty years, and is board certified in civil trial law

[Dkt. 67 at 38].

Throughout his years of experience, Mr. Strong has specialized in the area of consumer debt, and was “sole outside counsel for Neiman Marcus here in Texas, collecting their large balance and some small balance debts on their charge cards”

[Dkt. 67 at 39].

Mr. Strong also worked for “one of the largest collection law firms in the country[,] again, representing creditors on credit card debt”

[Dkt. 67 at 40].

Mr. Strong avers that as a result of his experience, he is “very well versed” in the FDCPA and the TDCA

[Dkt. 67 at 41].

Mr. Strong charged $325 for each hour of work he performed in this case, and testified that it “is a reasonable and customary hourly rate for the work that was done and for the level of experience [he] ha[s],” and was reasonable and customary with other fees charged in the Eastern District of Texas

[Dkt. 67 at 41].

Mr. Strong submitted his billing invoices to establish the number of hours expended in this matter

[Dkt. 67, Ex. 15].

The invoices demonstrate that Mr. Strong met with Plaintiff, attempted contact (in various forms) with Defendant, researched legal issues related to Plaintiff’s case, drafted various court documents, discovery requests, and other communications with the Parties, and appeared in various court hearings on behalf of Plaintiff.

Overall, Mr. Strong expended 93.50 hours.1

Defendant has not contested any of the hours expended by Mr. Strong.

“Where counsel requests compensation at his normal billing rate and that rate is shown to be within the range of market rates for attorneys of similar skill and experience, the burden is on the opposing party to show that a lower rate should be used.”

United States v. Cornerstone Wealth Corp., Inc., No. 3–98–CV–0601–D, 2006 WL 1524592 at *2 (N.D. Tex. Jun. 2, 2006), citing Islamic Ctr. of Miss., Inc. v. City of Starkville, 876 F.2d 465, 469 (5th Cir. 1989);

see also Watkins, 7 F.3d at 459 (court must articulate reasons for rejecting normal billing rate);

KeyCorp v. Holland, No. 3:16-CV-1948-D, 2017 WL 606617, at *7 (N.D. Tex. Feb. 15, 2017)

(“Further, if a party does not object to particular billing entries as inadequately documented, the court is not obligated sua sponte to sift through fee records searching for vague entries or block billing. It is a common practice for courts to address only those potentially inadequate entries brought to the court’s attention.”).

Moreover, the Court has independently reviewed the billing invoices and has found no duplicative, excessive, or otherwise improper hours billed therein.

Further, the Court finds that the rate charged by Mr. Strong is reasonable and consistent with the prevailing rates in the Eastern District of Texas for an attorney with Mr. Strong’s skill and experience.2

The undersigned concludes that the appropriate lodestar here to be calculated as 93.50 hours for Mr. Strong at $325.00 an hour, for a total of $30,387.50.3

Upon review of the evidence and after giving due consideration to the relevant Johnson factors, Steven Strong’s testimony and affidavit, and The Strong Law Firm’s invoices, the undersigned recommends the Court find that a total of $30,387.50 is a reasonable and appropriate attorney fee in this case.

The Wolves of Texas, on behalf of PHH Mortgage, refuse to Proceed before Magistrate Judge Bryan on remand because her M&R resulted in the remand. Foreclosure mill lawyers should not be able to do so ‘on remand’ because a decision went against their client.https://t.co/DnuUDOfejO

— lawsinusa (@lawsinusa) July 28, 2022

Court Costs

Plaintiff seeks $695 in court costs and $134.54 in litigation expenses

[Dkt. 67 at 38].

“Taxable court costs include:

(1) fees paid to the clerk and marshal;

(2) court reporter fees for all or part of the deposition transcript;

(3) printing costs and witness fees;

(4) fees for copies of papers necessarily obtained for use in the case;

(5) certain docket fees;

and

(6) compensation of court appointed experts and interpreters.”

NSEW Holdings LLC, 2017 WL 1030313, at *7–8 (E.D. Tex. Mar. 17, 2017) (Mazzant, J.) (citing 28 U.S.C. § 1920).

Plaintiff’s counsel, Steven Strong’s billing invoices show that Plaintiff’s costs and expenses include $400.00 in filing fees to the Clerk, a
$95.00 service fee for three summons on defendants, a $41.18 fee for an Iowa process server, $2.09 in postage, a $24.46 fee to serve discovery on Defendant, $66.81 in trial supply costs, and $200.00 in court reporter costs for a deposition

[Dkt. 67 at Exs. 15-17].

Plaintiff is entitled to $600 total in court costs for the $400 filing fee, and the $200 court reporter fee.

Plaintiff may not recover the fees incurred on private process servers.

See Vanderbilt Mortg. & Fin., Inc. v. Flores, No. CIV.A. C-09-312, 2011 WL 2160928, at *21–22 (S.D. Tex. May 27, 2011).

Plaintiff also cannot recover her $2.09 postage fees or $24.46 fee incurred to serve Defendant discovery requests.

See NSEW Holdings LLC, 2017 WL 1030313, at *7–8; see also Auto Wax Co. v. Mark v. Prods., Inc., No. 3:99-CV-982-M, 2002 WL 265091, at *5 (N.D. Tex. Feb. 22, 2002) (Lynn, J.)

(postage and delivery fees are not recoverable under § 1920).

Plaintiff is similarly not entitled to $66.81 in trial supply costs.

See 28 U.S.C. § 1920.

Plaintiff is also not entitled to any of the above-rejected costs under the TDCA.

“When state law provides the rule of decision, federal law provides the procedure for recovery of nontaxable costs, but state law determined whether they are recoverable.”

Vanderbilt, 2011 WL 2160928, at *20–21.

“Thus, [Plaintiff’s] ‘non-taxable expenses’ are recoverable under [her] TDCA claim along with attorney’s fees, so long as they are recoverable under Texas state law.”

Id. (citing Fed. R. Civ. Proc. 54(d)(2)).

A prevailing party under the TDCA may recover “costs” along with “attorney’s fees reasonably related to the work performed.”

TEX. FIN. CODE § 392.403(b).

“However … under Texas law, the following have been held to be not recoverable as costs of court:

delivery services, such as Federal Express; travel;

long distance calls;

bond premiums;

postage;

reproduction expense;

binding of brief;

transcripts of testimony elicited during trial;

office air-conditioning … and secretarial overtime.”

Id. (citing Shenandoah Assocs. v. J & K Properties, Inc., 741 S.W.2d 470, 486 (Tex. App.—Dallas 1987, writ denied).

Accordingly, Plaintiff is not entitled to recover the requested “non-taxable expenses” pursuant to her TDCA claim.

The undersigned recommends finding that Plaintiff is entitled to $600 in taxable court costs for the $400 filing fee, and the $200 court reporter fee.

We decided to go to Tennessee @TNattygen and compare Texas Finance Code with their own Debt Collection Laws and it appears to LIT that TN mirrors Texas, as far as the interpretation of law firms as debt collectors. Check it out Texas @TXAG @TXsecofstate @texasgov @KenPaxtonTX pic.twitter.com/q3ysrTryq6

— lawsinusa (@lawsinusa) July 30, 2022

Exemplary Damages

Exemplary damages are not available under the FDCPA.

Desmond v. Phillips & Cohen Assocs., Ltd., 724 F. Supp. 2d 562, 569 (W.D. Pa. 2010) (citing 15 U.S.C. § 1692k);

Whiteman v. Burton Neil & Assocs. P.C., No. 07–2289, 2008 WL 4372842, at *3 (M.D.Pa. Sept. 19, 2008)

(“The damages section of the FDCPA does not provide for punitive damages.”);

Young v. LVNV Funding LLC, No. 4:12CV01180 AGF, 2013 WL 4551722, at *2 (E.D. Mo. Aug. 28, 2013);

Keeton v. Countrywide Home Loans, Inc., 217 F. Supp. 3d 177, 181 (D.D.C. 2016).

However, “exemplary damages are available under the Texas Act.”

Vanderbilt, 2011 WL 2160928, at *15, n. 11 (S.D. Tex. May 27, 2011) (collecting cases);

Morante v. Am. Gen. Fin. Ctr., 157 F.3d 1006, 1011 (5th Cir. 1998)

(citing Brown v. Oaklawn Bank, 718 S.W.2d 678, 680 (Tex. 1986);

Waterfield Mortgage Co. v. Rodriguez, 929 S.W.2d 641, 645–47 (Tex.App.—San Antonio 1996, no writ)

(holding that under the Texas Act evidence necessary to support a finding of exemplary damages under common law will suffice)).

In deciding whether to awarding exemplary damages in a TDCA case, courts consider:

a. the nature of the wrong,

b. the character of the conduct involved,

c. the degree of culpability of the wrongdoer,

d. the situation and sensibilities of the parties concerned,

e. the extent to which such conduct offends a public sense of justice and propriety,

f. the net worth of the wrongdoer, and

g. compensation for inconvenience and attorney’s fees.

Waterfield Mortg. Co., 929 S.W.2d at 645.

The Court does not find that exemplary damages are appropriate in this case.

A case’s record must be egregious for exemplary damages to be appropriate. TEX. FIN. CODE § 392.404(b);

Morante, 157 F.3d at 1011;

Waterfield Mortg. Co., 929 S.W.2d 641, 647

(court found exemplary damages were appropriate where debt collector took plaintiffs’ “home away from them when they are making good faith attempts to pay ever-escalating demands”);

Marlow v. Medlin, 558 S.W.2d 933, 938 (Tex. Civ. App.—Waco, 1977, no pet.)

(court found exemplary damages appropriate where “defendants were abusive and insulting toward plaintiff, accused her of stealing, and threatened her with arrest”).

Plaintiff was not continually contacted, harassed, or threatened by Defendant at all hours.

Neither were her home or possessions taken away because of Defendant’s collection activity.

The record in this case is not so egregious that exemplary damages should be awarded under the TDCA.

Accordingly, the undersigned recommends that Plaintiff should take nothing in exemplary damages.

CONCLUSION AND RECOMMENDATION

Based on the foregoing, the Court recommends that:

1. Defendant be held liable to Plaintiff for the sum of $2,000 incurred in actual damages as a result of Defendant’s improper debt collection actions.

2. Defendant be held liable to Plaintiff for the sum of $1,000 incurred in statutory damages under the FDCPA as a result of Defendant’s improper debt collection actions.

3. Plaintiff’s request for statutory damages under the TDCA be denied.

4. Plaintiff’s request for attorney fees be granted in the amount of $30,387.50.

5. Plaintiff’s request for court costs be granted in the amount of $600.00.

6. Plaintiff’s request for exemplary damages be denied.

Within fourteen (14) days after service of the magistrate judge’s report, any party must serve and file specific written objections to the findings and recommendations of the magistrate judge. 28 U.S.C. § 636(b)(1)(C).

In order to be specific, an objection must identify the specific finding or recommendation to which objection is made, state the basis for the objection, and specify the place in the magistrate judge’s report and recommendation where the disputed determination is found. An objection that merely incorporates by reference or refers to the briefing before the magistrate judge is not specific.

Failure to file specific, written objections will bar the party from appealing the unobjected- to factual findings and legal conclusions of the magistrate judge that are accepted by the district court, except upon grounds of plain error, provided that the party has been served with notice that such consequences will result from a failure to object.

See Douglass v. United Services Automobile Ass’n, 79 F.3d 1415, 1417 (5th Cir. 1996) (en banc), superseded by statute on other grounds, 28
U.S.C. § 636(b)(1) (extending the time to file objections from ten to fourteen days).

REPORT AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE – RE STATUTORY CAUSES E.G. FDCPA AND TDCA

RELEVANT PROCEDURAL HISTORY

On July 31, 2015, Plaintiff filed the present suit, alleging Defendant and others¹ violated the FDCPA and the TDCA in attempting to collect a debt incurred as a result of a divorce proceeding

[Dkt. 1].

Plaintiff asserts Defendant sent her confusing letters in violation of the FDCPA and TDCA and that Defendant consistently contacted her in a harassing, threatening, and demeaning manner

[Dkt. 1].

On August 31, 2015, Defendant filed a Motion to Dismiss asserting in whole that “Defendant finds [Plaintiff’s] Complaint . . . essentially inaccurate, over-reaching and frivolous.

As such, Defendant hereby requests this case be dismissed”

[Dkt. 6].

The undersigned recommended denying Defendant’s conclusory Motion to Dismiss on November 25, 2015

[Dkt. 13].2

Defendant thereafter filed a Notice of Pleading and Statement on January 7, 2016;

Defendant alleges this Notice of Pleading and Statement documents the entirety of his interactions with Plaintiff

[see Dkt. 19].

The Notice of Pleading and Statement includes a letter dated January 29, 2015, which has enclosed the Attorney-Client Fee Agreement (between Plaintiff and Aitken Law Firm, P.C.), an invoice numbered 3144 with a $10,940.58 “balance due” tabulating various charges against Plaintiff by Aitken, Aitken & Sharpe, P.C., and a “Statement” dated November 1, 2014, indicating a $15,050.05 “amount due[,]” which encompasses or includes the balance on the invoice numbered 3144

[Dkt. 19, Ex. A].

The District Court construed Defendant’s Notice of Pleading and Statement [Dkt. 19] as an objection to the undersigned’s report and recommendation and, after considering the construed objection, adopted the undersigned’s report and recommendation as the findings and conclusions of the Court on Defendant’s Motion to Dismiss

[Dkt. 21].

Subsequently, on March 21, 2016, Plaintiff filed a Motion for Judgment on the Pleadings, seeking judgment as a matter of law against Defendant on each of her claims, as well as damages

[Dkt. 20].

Defendant filed no response, and on August 18, 2016, the undersigned entered a recommendation that Plaintiff’s Motion for Judgment on the Pleadings be granted

[Dkt. 24].

On September 7, 2016, Defendant timely filed objections to the undersigned’s report and recommendation

[Dkt. 26].

After reviewing Defendant’s objections, the undersigned converted Plaintiff’s Motion for Judgment on the Pleadings into a motion for summary judgment and provided additional time for the Parties to supplement their briefing and to provide evidence

[Dkt. 29].

Plaintiff timely filed her Motion for Summary Judgment on November 28, 2016 [Dkt. 32], relying almost wholly on her unverified complaint to carry her summary judgment burden.

Defendant failed to respond and filed no additional evidence.

Largely as a result of the total lack of competent summary judgment evidence, the undersigned entered an amended report and recommendation on February 24, 2017, recommending that Plaintiff’s Motion for Summary Judgment [Dkt. 32] be denied (and that Plaintiff’s related Motion to Strike [Dkt. 28] be denied as moot).

Plaintiff objected [Dkt. 30], but the District Court adopted the undersigned’s ultimate conclusion that the Motion for Summary Judgment [Dkt. 32] should be denied on the record then before the Court

[Dkt. 37].

LAWYERS VIOLATE TEXAS LAWS, EVERY DAMN DAY:
Two-Faced Texas Foreclosure Defense Lawyer Robert Newark is a Real Scumbag https://t.co/GviCGucsX2@TXsecofstate #txlege @statebaroftexas #lawtwitter @TXAG #appellatetwitter @NobelPrize @ScumbagMagazine @RonDeSantisFL @KenPaxtonTX @ABC

— lawsinusa (@lawsinusa) July 27, 2022

Thereafter, on March 30, 2017, the Court entered the Amended Scheduling Order, reinvigorating the dispositive motion deadline and providing the Parties until May 5, 2017, to file any additional dispositive motions in this matter.

Plaintiff filed the pending Motion for Summary Judgment [Dkt. 40] on May 5, 2017, renewing her request for judgment as a matter of law on the same claims for which she earlier sought and was denied summary judgment, as well as attorneys fees, damages, and injunctive relief

[Dkt. 40 at 9].

Critically, Plaintiff provides additional evidence with the pending Motion for Summary Judgment [Dkt. 40] that the Court did not have before it when ruling on Plaintiff’s earlier Motion for Summary Judgment [Dkt. 32], namely the affidavit of Plaintiff Aimee Marie Bentson [Dkt. 40, Ex. B] (“Bentson Affidavit”) and the affidavit of Plaintiff’s counsel Steven M. Strong [Dkt. 40, Ex. C] (“Strong Affidavit”).

Defendant filed his Response on May 22, 2017, arguing the Court’s March 29, 2017 Memorandum

[Dkt. 37]

“correctly concluded all the allegations filed in this case [by Plaintiff] to be meritoriously deficient” and that Plaintiff “continues to pursue Summary Judgement [sic] even though there is no basis for such”

[Dkt. 44].

Defendant proffers no evidence or additional argument in support of his position that “this case should be dismissed”

[Dkt. 44].

The Motion for Summary Judgment [Dkt. 40] alongside the newly filed evidence is ripe for the court’s consideration.

See Petroleum Helicopters, Inc. v. Avco Corp., 930 F.2d 389 (5th Cir. 1991)

(affirming district court’s granting of a party’s second request for summary judgment where district court previously denied summary judgment on the same claims but party renewed request for summary judgment following introduction of evidence not previously before the court).

LEGAL STANDARD

I. Summary Judgment Motion

The purpose of summary judgment is to isolate and dispose of factually unsupported claims or defenses.

See Celotex Corp. v. Catrett, 477 U.S. 317, 327 (1986).

Summary judgment is proper if the pleadings, the discovery and disclosure materials on file, and any affidavits “[show] that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.”

FED. R. CIV. P. 56(a).

A dispute about a material fact is genuine “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.”

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

The trial court must resolve all reasonable doubts in favor of the party opposing the motion for summary judgment.

Casey Enters., Inc. v. Am. Hardware Mut. Ins. Co., 655 F.2d 598, 602 (5th Cir. 1981) (citations omitted).

The substantive law identifies which facts are material.

Anderson, 477 U.S. at 248.

The party moving for summary judgment has the burden to show that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law.

Id. at 247.

If the movant bears the burden of proof on a claim or defense on which it is moving for summary judgment, it must come forward with evidence that establishes “beyond peradventure all of the essential elements of the claim or defense.”

Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986).

But if the nonmovant bears the burden of proof, the movant may discharge its burden by showing that there is an absence of evidence to support the nonmovant’s case.

Celotex, 477 U.S. at 325;

Byers v. Dallas Morning News, Inc., 209 F.3d 419, 424 (5th Cir. 2000).

Once the movant has carried its burden, the nonmovant must “respond to the motion for summary judgment by setting forth particular facts indicating there is a genuine issue for trial.”

Byers, 209 F.3d at 424 (citing Anderson, 477 U.S. at 248-49).

The nonmovant must adduce affirmative evidence. Anderson, 477 U.S. at 257.

In so doing, the nonmovant “cannot rely on the facts in its unverified complaint,” it must instead “point to evidence in the record sufficient to establish the alleged facts[.]”

Solo Serve Corp. v. Westowne Assocs., 929 F.2d 160, 165 (5th Cir. 1991).

Furthermore, “Rule 56 does not impose upon the district court a duty to sift through the record in search of evidence to support a party’s opposition to summary judgment.”

Forsyth v. Barr, 19 F.3d 1527, 1537 (5th Cir. 1994) (quotations omitted).

Nevertheless, the Court “may consider other materials in the record[,]”

FED. R. CIV. P. 56(c)(3), and doing so is particularly appropriate where the opposing party proceeds pro se.

Perez v. United States, 312 F.3d 191, 194-95 (5th Cir. 2002) (citing Haines v. Kerner, 404 U.S. 519 (1972)).

Fourth Time on LIT: The Bandits at Law Firm Waddell Serafino Geary Rechner Jenevein Cashflow Hurtin’ https://t.co/hkgHdhdFz3 @bjenevein Top of the day to you Bob. Y’all seen your firm’s Glassdoor reviews?
We have. They ain’t good from your standpoint nor as an employer. Cheap.

— lawsinusa (@lawsinusa) July 30, 2022

II. Summary Judgment Evidence

Federal Rule of Civil Procedure 56 provides that “[a] party asserting that a fact cannot be. . . genuinely disputed must support the assertion” through “particular parts of materials in the record” or by “showing that the materials . . . do not establish the . . . presence of a genuine dispute, or that the adverse party cannot produce admissible evidence to support the fact.”

FED. R. CIV. P. 56(c).

Briefing does not suffice as factual support: instead, “the court must consider the issues presented by other material offered by the parties . . . to determine whether the Rule 56 request should be granted.”

Marsh v. Austin-Fort Worth Coca-Cola Bottling Co., 744 F.2d 1077, 1079 n.4 (5th Cir. 1984) (per curiam);

see also Godeaux v. Dynamic Indus., Inc., 864 F. Supp. 614, 619 n.10 (E.D. Tex. 1994)

(“The court should not . . . rely upon factual assertions made in the briefs because ‘documents of this character are self-serving and are not probative evidence of the existence or nonexistence of any factual issues.’”).

The Fifth Circuit has made clear the movant bears the burden of showing through evidence its entitlement to judgment as a matter of law:

In the usual case, the party who seeks a summary judgment must show by affidavit or other evidentiary materials that there is no genuine dispute as to any fact material to resolution of the motion. He must establish thereby the existence or nonexistence of enough of the essential elements of a claim and its related defenses to permit disposition of the claim as a matter of law. Thus, if the movant bears the burden of proof on an issue, either because he is the plaintiff or as a defendant he is asserting an affirmative defense, he must establish beyond peradventure all of the essential elements of the claim or defense to warrant judgment in his favor.

Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986).

As a result, a court should deny summary judgment where the party seeking such result fails to show either that no genuine issue of material fact exists as to the claims subject of the motion or that the nonmovant cannot show a genuine issue of material fact exists.

See, e.g., Allergan Sales, LLC v. Sandoz, Inc., 211 F. Supp. 3d 907, 914 (E.D. Tex. 2016)

(“The moving party has the burden to identify the basis for granting summary judgment and to supply evidence demonstrating the absence of a genuine dispute of material fact.”);

Guajardo v. GC Servs., LP, No. CIV. A. H-08-119, 2009 WL 3715603, at *2 (S.D. Tex. Nov. 3, 2009)

(“A plaintiff moving for summary judgment must satisfy its burden by submitting proof that establishes all elements of its cause of action as a matter of law.”);

see also Cuba v. Pylant, 814 F.3d 701, 720 (5th Cir. 2016)

(“Rule 56 permits summary judgment ‘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.’”);

Zhang v. Monroe, No. 6:13-CV-811, 2017 WL 108311, at *2 (E.D. Tex. Jan. 11, 2017)

(citing Celotex, 477 U.S. at 323, and noting the movant bears the initial burden of “identifying those portions of the record [that] demonstrate the absence of genuine issue of material fact”);

FED. R. CIV. P. 56(c), (e); cf.

Howard v. AMH ROMAN TWO TX, LLC, No. 4:15- CV-526, 2016 WL 3392417, at *5 (E.D. Tex. May 11, 2016)

(determining under Rule 56 that certain claims failed as a matter of law because plaintiff “failed to offer any summary judgment evidence to demonstrate a genuine issue of material fact regarding them”).

When determining whether to grant or deny summary judgment within this framework, the Federal Rules of Evidence govern a court’s consideration of the record evidence.

Harrison v. Formosa Plastics Corp. Tex., 776 F. Supp. 2d 433, 441 (S.D. Tex. 2011).

Generally, this means “[a] court may consider any evidence in the record, ‘including depositions, documents, electronically stored information, affidavits or declarations, stipulations . . . , admissions, interrogatory answers, or other materials.’”

Kirkpatrick v. Dover & Fox, P.C., No. 4:13-cv-0123, 2013 WL 5723077, at *1 (quoting FED. R. CIV. P. 56(c)(1)(A) in a case presenting FDCPA and TDCA claims).

Relevant here, Federal Rule of Evidence 201 permits judicial notice of an “adjudicative fact” where the fact is not subject to reasonable dispute; however, a court generally may not take notice of pleadings for the truth of the matter asserted therein.

See, e.g., SB Int’l, Inc. v. Jindal, No. 3:06–CV–1174–G, 2007 WL 1411042, at *1 (N.D. Tex. May 14, 2007)

(citing Taylor v. Charter Med. Corp., 162 F.3d 827, 829 (5th Cir. 1998));

In re B.R., 456 S.W.3d 612, 617 n.4 (Tex. App.—San Antonio 2015, no pet.)

(determining allegations could not serve as evidence if the matters alleged).

Attaching pleadings to the motion for summary judgment as “evidence” does not change this result—“[t]he basic mission of the summary judgment procedure is to allow the court to pierce the pleadings and assess the proof in order to see whether there is a genuine need for a trial.”

Gauck v. Meleski, 346 F.2d 433, 436 (5th Cir. 1965);

see Allergan, 211 F. Supp. 3d at 914 (citing Celotex, 477 U.S. at 323).3

Like we said Deutsche Bank, untrustworthy. @DeutscheBank https://t.co/XSA1b3v3Jh pic.twitter.com/3o3x1PuCNn

— lawsinusa (@lawsinusa) July 30, 2022

SUMMARY OF PLANTINTIFF’S CLAIMS

Plaintiff alleges Defendant

(1) violated FDCPA sections 1692d, 1692e, 1692f, and 1692g

(2) violated TDCA sections 392.101, 392.301, 392.303, and 392.304;

and

(3) violated Texas Business and Commerce Code section 17.62 vis-à-vis his violation of TDCA section 392.404(a)

[Dkt. 1 at 10-14].

Plaintiff argues the Court should find Defendant committed each of these violations and accordingly is liable

[Dkt. 40].

Plaintiff also asserts she should receive “actual and statutory damages proximately caused by Defendant[’s] . . . violation[s] of both the FDCPA and [TDCA]” as well as reasonable and necessary attorneys fees (and costs)

[Dkt. 40 at 6].

SUMMARY OF EVIDENCE

Plaintiff proffers the following documents in support of her Motion for Summary Judgment:

(1) Plaintiff’s Complaint

[Dkt. 1];

(2) letters from Defendant to Plaintiff dated January 29, 2015, March 13, 2015, April 9, 2015, and July 2, 2015, respectively

[Dkt. 40, Ex. A];

(3) a letter from Plaintiff to Defendant dated March 26, 2015

[Dkt. 40, Ex. B-1];

(4) the Bentson Affidavit [Dkt. 40, Ex. B];

and

(5) the Strong Affidavit [Dkt. 40, Ex. C].

Defendant proffers no evidence with his Response and also points to no evidence in the record to support his Response.4

On the instant Motion, Plaintiff again attempts to rely (in part) on her unverified complaint to support her request for judgment as a matter of law.

As the authorities cited supra clearly demonstrate (and as the Court has indicated in several prior orders), Plaintiff may not rely on an unverified complaint to show the truth of the facts alleged therein.

The Court repeats that an unverified complaint does not constitute evidence on which the Court may rely in determining whether or not to grant or deny summary judgment.

See, e.g., Gauck, 346 F.2d at 436; Allergan, 211 F. Supp. 3d at 914.

And the Court may not take judicial notice of the facts asserted therein as the truth of the matter asserted, particularly where such facts conflict or are disputed by the opposing party.

See, e.g., SB Int’l, Inc., 2007 WL 1411042, at *1; Mabile, 2016 WL 5231839, at *17.

ANALYSIS

I. FDCPA Claims

Plaintiff claims (and seeks judgment as a matter of law) that Defendant violated FDCPA sections 1692d, 1692e(2)(A), 1692e(10), 1692f, 1692f(2), 1692g, and 1692g(b)

[Dkt. 40 at 3-4].

The FDCPA governs actions by “debt collectors” against “consumers” and is intended “to protect consumers from a host of unfair, harassing, and deceptive debt collection practices without imposing unnecessary restrictions on ethical debt collectors.”

Peter v. GC Servs. L.P., 310 F.3d 344, 351-52 (5th Cir. 2002) (citation omitted).

The FDCPA defines a “consumer” as “any natural person obligated or allegedly obligated to pay any debt[,]” a “debt” as “any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for personal, family, or household purposes, whether or not such obligation has been reduced to judgment[,]” and “debt collector” as (with certain exceptions inapplicable here) “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.”

15 U.S.C. § 1692a(3), (5), (6) (2012).

Here, neither Party disputes Defendant’s status as a debt collector, Plaintiff’s status as either a “person” or a “consumer,” or the status of the debt as debt the collection of which is subject to the FDCPA

[see, e.g., Dkt. 40, Ex. B at 3-6 (averring the debt in question relates to allegedly delinquent payments due a law firm for divorce services), Ex. A (showing Defendant sent interstate letters seeking to collect on this debt)].

See Guajardo, 2009 WL 3715603, at *3

(noting that, once plaintiff meets these threshold elements, plaintiff must prove some violation of the FDCPA occurred).

A. Section 1692d

FDCPA section 1692d prohibits a debt collector from “engag[ing] in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt.”

Id. § 1692d.

Courts in this circuit apply the objective “least sophisticated consumer” standard in determining whether a debt collector has harassed, oppressed, or abused a consumer so as to violate Section 1692d.

Lee v. Credit Mgmt., LP, 846 F. Supp. 2d 716, 722 (S.D. Tex. 2012)

(citing Taylor v. Perrin, Landry, deLaunay, 569 F.3d 1232, 1236 (5th Cir. 1997)).

In other words, the “consumer need not prove intentional conduct by the debt collector” in order to prevail on a Section 1692d claim, but rather must show the debt collector acted in a manner that the least sophisticated consumer would perceive as harassing, oppressive, or abusive.

Id.

The operative inquiry is whether the “natural consequence of [the debt collector’s communication] is to abuse the hearer or reader.”

15 U.S.C. § 1692d(2).

A debt collector’s “implied threat of violence[,]” use of “religious slurs, profanity, obscenity, or calling the consumer a liar or a deadbeat” along with one’s use of “racial or sexual epithets” may suffice to establish a violation of Section 1692. Statements of General Policy or Interpretation Staff Commentary on the Fair Debt Collection Practices Act, 53 Fed. Reg. 50097-02, 50105 (Dec. 13, 1988).

On the other hand, courts have found debt collectors’ rude language generally will not violate Section 1692d.

See, e.g., Guajardo, 2009 WL 3715603, at *1 (finding no violation where debt collector called consumer a liar and “demanded ‘payment in full within 24 hours or else’” and highlighting that the consumer “[did] not allege that [the debt collector] ever used obscene or profane language, threatened violence, or misrepresented its true purpose in any communication”);

Bassett v. I.C. Sys., Inc., 715 F. Supp. 2d 803, 809 (N.D. Ill. 2010)

(finding no violation where debt collector called consumer “a liar, laughed at him, and accused him of trying to make excuses to get out of paying his debt” and collecting cases to same effect).

In the present case, the record evidence provides insufficient support for judgment as a matter of law on Defendant’s liability under Section 1692d.

Plaintiff alleges Defendant has “repeatedly contacted Plaintiff . . . in writing and via telephone, attempting to collect the Debt made subject of [her] claim” and that Plaintiff also has exchanged emails with the creditor who has purportedly employed Defendant to collect the debt [Dkt. 1 at 2, 4].

Plaintiff asserts that, through this behavior, Defendant violated Section 1692d

[Dkt. 1 at 10].

The record evidence, which consists in relevant part of the letters from Defendant, the March 26, 2015 letter from Plaintiff to Defendant, and the Bentson Affidavit does not suffice to establish such violation.

Though the Bentson Affidavit shows Plaintiff subjectively felt “horrified” and “scared and intimidated” by Defendant’s letters “and the overall event of receiving” them [Dkt. 40, Ex. B at 3- 10], courts applying the objective “least sophisticated consumer” standard have found similar language does not violate the FDCPA.

See, e.g., Guajardo, 2009 WL 3715603, at *1;

Bassett, 715 F. Supp. 2d at 809; see also Lee, 846 F. Supp. 2d at 722 (objective standard).

Further, nothing in the record beyond the bare Complaint supports Plaintiff’s allegations regarding any email communications from Defendant, and the Bentson Affidavit mentions only one phone call “in early to mid-2012” from Defendant [compare Dkt. 1, with Dkt. 40, Ex. B].

Defendant’s letters to Plaintiff currently before the Court, though certainly rude, do not threaten violence or rise to the level of harassment, oppression, or abuse [see Dkt 40, Ex. A at 3

(“I trust the information enclosed will refresh your memory. After all, the amount still owed is substantial.”), 4 (“Your continuing refusal to exhibit responsible conduct in addressing your defaulted agreement . . . gives me little option in the future handling of your account.”)].

See, e.g., Guajardo, 2009 WL 3715603, at *1; Bassett, 715 F. Supp. 2d at 809; see also Lee, 846 F. Supp. 2d at 727 n.7

(Section 1692d means to capture “other derogatory remarks which are similar in their offensiveness to obscene or profane remarks.”)

(quoting Jeter v. Credit Bureau, Inc., 760 F.2d 1168, 1178 (5th Cir. 1985)).

Accordingly, the Court concludes the record evidence does not establish Defendant’s liability under Section 1692d. Cf. Jeter, 760 F.2d at 1179

(finding the question “whether conduct harasses, oppresses, or abuses” generally, but not always, should be reserved for the jury).

The Court recommends Plaintiff’s Motion for Summary Judgment be denied as to Plaintiff’s Section 1692d claims.

Witnessing Judicial Ochlocracy: John Michalek, a former State Supreme Court Judge, appeared before Judge Cerio in Erie County Court, put in handcuffs and then after a chambers meeting with Cerio, released from custody. https://t.co/bwkL2qnFdt @NewYorkStateAG @GovKathyHochul

— lawsinusa (@lawsinusa) July 29, 2022

B. Sections 1692e and 1692f

FDCPA section 1692e proscribes a debt collector’s “use [of] any false, deceptive, or misleading representation or means in connection with the collection of any debt.”

15 U.S.C. § 1692e.

Specifically, Section 1692e(2)(A) prohibits the “false representation of . . . the character, amount, or legal status of any debt” and Section 1692e(10) disallows “use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer.”

Id.;

see also Daugherty v. Convergent Outsourcing, Inc., 836 F.3d 507, 511 (5th Cir. 2016)

(noting 1692e provides “a nonexclusive list of prohibited practices”);

53 Fed. Reg. 50097-2, 50105-07 (same).

FDCPA section 1692f prohibits “use [of] unfair or unconscionable means to collect or attempt to collect any debt” through, for example, “acceptance. . . of a check or other payment instrument postdated by more than five days” lacking notification “in writing of the debt collector’s intent to deposit such check or instrument not more than ten nor less than three business days prior to such deposit.”

15 U.S.C. § 1692f, f(2).

Under Section 1692e(2)(A), “[a] debt collector may not claim an amount more than actually owed, or falsely assert that the debt has matured or that it is immediately due and payable, when it is not” or “convey[] to the consumer a false sense of urgency” in collecting payment, inter alia.

53 Fed. Reg. 50097-2, 50106.

Section 1692e(10) captures this and many other similar types of conduct, though “merely re-alleg[ing] a violation of another section of the FDCPA . . . [will] not suffic[e] to constitute a violation of § 1692e(10) . . . .”

Lee, 846 F. Supp. 2d at 724;

see also Barlow v. Safety Nat’l Cas. Corp., No. 3:11-CV-00236-BAJ, 2014 WL 1327922, at *5 (M.D. La. Mar. 31, 2014), aff’d, 586 F. App’x 191 (5th Cir. 2014)

(dismissing Section 1692e(10) claims where they merely echoed the claims made under Section 1692(e)(2)(A)). Importantly, though a debt collector’s conduct need not be “intentional” in order to violate Section 1692e—“even an unintentional misrepresentation of an amount of debt[,]” for example, “can violate § 1692e(2)(A)[,]” Lee, 846 F. Supp. 2d at 722-23, a debt collector’s violation of Section 1692f generally must be knowing, see Ducrest v. Alco Collections, Inc., 931 F. Supp. 459, 462 (M.D. La. 1996). And the same “unsophisticated or least sophisticated consumer” standard applies in “evaluating whether a collection letter violates § 1692e or § 1692f[.] . . .” Daugherty, 836 F.3d at 511 (noting, however, that “the unsophisticated consumer is not one ‘tied to the “very last rung on the [intelligence or] sophistication ladder”’”).

Here, the record supports a finding Defendant violated Section 1692e, but does not support a finding Defendant violated Section 1692f.5

The record shows Defendant violates Section 1692e(2)(A), which proscribes the false representation of “the character, amount, or legal status of any debt[,]” because each of Defendant’s letters references two different amounts—$10,940.58 as “Balance on Invoice #3144 – 07/13” and $15,050.50 as “Balance on Statement”— and does not identify whether Defendant claims $10,940.58 or $15,050.50 (or both) as the amount due.

Plaintiff avers that she did not know which of the amounts was allegedly owed, and that Defendants letters made clear he was trying to collect such amounts.

Cf., e.g., Womble v. Barton, No. 4:15 CV 734 JMB, 2015 WL 7889628, at *3 (E.D. Mo. Dec. 4, 2015)

(finding that the debt collector’s reference to two different amounts owed in representations to the debtor constituted a violation of Section 1692e(2)(A)).

Furthermore, Defendant’s reference to both amounts without any additional explanation “[is] confusingly misleading” such that Defendant’s failure to explain in the letters which amount he intended to collect also independently violates Section 1692e(10).

See, e.g., Pickard v. Lerch, No. 1:03CV1688-LJM-WTL, 2005 WL 1259629, at *5 (S.D. Ind. May 26, 2005)

(finding violation of Section 1692e and noting “even if the . . . letter was not literally false in its statement of the amount of the debt, the . . . letter was confusingly misleading”).6

By contrast, no record evidence demonstrates Defendant knowingly used unfair or unconscionable practices aimed at deceiving an unsophisticated consumer into paying the alleged debt.

As a result, Plaintiff does not establish a violation of Section 1692f.

Ducrest, 931 F. Supp. at 462

(finding that 1692f requires a knowing and/or intentional violation).

With regard to Plaintiff’s Section 1692f(2) claim, specifically, the record currently before the Court nowhere indicates Defendant accepted any check from Plaintiff, much less a post-dated one.

15 U.S.C. § 1692f(2)

(prohibiting “[t]he acceptance by a debt collector from any person of a check or other payment instrument postdated by more than five days unless such person is notified in writing of the debt collector’s intent to deposit such check or instrument not more than ten nor less than three business days prior to such deposit”).

The Court accordingly recommends Plaintiff’s Motion be granted as to Plaintiff’s claims under Section 1692e and denied as to Plaintiff’s claims under 1692f.

C. Section 1692g

FDCPA section 1692g(a) requires a debt collector to disclose certain information to the targeted consumer at or within five days of initial contact with the consumer, namely

(1) the amount of the debt;

(2) the name of the creditor to whom the debt is owed;

(3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;

(4) a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and

(5) a statement that, upon the consumer’s written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.

15 U.S.C. § 1692g(a).

In this initial notice the “debt collector may condense and combine the required disclosures, as long as he provides all required information.”

53 Fed. Reg. 50097-2, 50108.

But “[m]erely including the required notice in letters to consumers is not sufficient.

The notice must also ‘be set forth in a form and within a context that does not distort or obfuscate its meaning.’”

McMurray v. ProCollect, Inc., 687 F.3d 665, 668 (5th Cir. 2012) (quoting Peter, 310 F.3d at 348).

In other words, the language must not “overshadow” or be “inconsistent with” the mandated notice. Id. Courts determine whether a letter complies with the notice requirement through the eyes of the “‘unsophisticated or least sophisticated consumer standard.’”

Id. at 669 (quoting Goswami v. Am. Collections Enter., Inc., 377 F.3d 488, 495 (5th Cir. 2004)).

The policy underlying the notice requirement—providing the consumer a clear picture of what the consumer owes and/or an opportunity to contest the debt—is further effected through Section 1692g(b), which “requires that, if the consumer disputes the debt or requests identification of the original creditor in writing, the collector must cease collection efforts until he verifies the debt and mails a response.”

53 Fed. Reg. 50097-02, 50109;

see also 15 U.S.C. § 1692g(b).

The consumer must dispute the debt and/or request the name and address of the original debtor, as the case may be, within thirty days and in writing.

15 U.S.C. § 1692g(b).

If the consumer contests the debt, the debt collector must provide “verification” of the debt before continuing to collect.

Mack v. Progressive Fin. Servs., Inc., No. 4:13cv544, 2015 WL 123742, at *3-4 (E.D. Tex. Jan. 8, 2015) (Mazzant, J.)

(noting neither the FDCPA nor the Fifth Circuit has specifically defined “the requirements of verification under the FDCPA” and relying on the Sixth Circuit’s standard in Haddad v. Alexander, Zelmanski, Danner & Fioritto, PLLC, 758 F.3d 777, 785 (6th Cir. 2014));

see also Ghanta v. Immediate Credit Recovery, Inc., No. 3:16-CV-00573-O, 2017 WL 1423597, at *8 (N.D. Tex. Apr. 18, 2017)

(citing Mack and relying on the same standard).

The Court previously has described the standard for verification as follows:

These cases suggest that the “baseline” for verification is to enable the consumer to “sufficiently dispute the payment obligation.”

Although the answer to that question depends on the facts of a particular situation, the cases reflect that an itemized accounting detailing the transactions in an account that have led to the debt is often the best means of accomplishing that objective.

Intuitively, such a practice makes good sense.

In fact, it would likely lead to faster resolutions of disputes with those consumers who act in good faith, because it will either show a valid debt that a consumer acting in good faith will actually pay, uncover an error in the record of the debt leading to the cancellation of the debt, or reveal the underlying dispute between the parties that can then be resolved.

Finally, such an approach is consonant with the congressional purpose of the verification provision.
. . .

The verification provision must be interpreted to provide the consumer with notice of how and when the debt was originally incurred or other sufficient notice from which the consumer could sufficiently dispute the payment obligation.

This information does not have to be extensive.

It should provide the date and nature of the transaction that led to the debt, such as a purchase on a particular date, a missed rental payment for a specific month, a fee for a particular service provided at a specified time, or a fine for a particular offense assessed on a certain date.

Mack, 2015 WL 123742, at *4 (quoting Haddad, 758 F.3d at 785-86).

In the present case, Plaintiff avers she first received communication from Defendant regarding the alleged debt “on or about March 13, 2015” in the form of a demand letter dated March 13, 2015

[Dkt. 40, Ex. B. at 3].

Plaintiff responded to the March 13, 2015 letter on March 26, 2015, requesting verification of the debt and disputing its validity

[Dkt. 40, Ex. B at 6, Ex. B-1].

Defendant responded to Plaintiff’s March 26 letter with a letter dated April 9, 2015, enclosing a demand letter from Defendant to Plaintiff dated January 29, 2015, and Plaintiff’s “original retainer agreement with Aitken for [her] divorce”

[Dkt. 40, Ex. B at 7].

Critically, Plaintiff avers she never received the January 29, 2015 letter prior to receiving it with the April 9, 2015 letter

[Dkt. 40, Ex. B at 7].

No evidence on the record contradicts this averment or demonstrates Defendant actually sent the January 29, 2015 letter to Plaintiff prior to April 9, 2015.

Consequently, the Court finds Plaintiff timely disputed the alleged debt, see 15 U.S.C. § 1692g(b), and that Defendant’s March 13, 2015 letter constitutes Defendant’s initial communication with Plaintiff regarding the alleged debt.

Further, Defendant’s initial communication omits the required validation and dispute notices.

See 15 U.S.C. § 1692g(a)(4)-(5).7

Accordingly, the Court finds Defendant violated Section 1692g(a).8

By contrast, Plaintiff does not demonstrate Defendant violated Section 1692g(b) by failing to provide a sufficient verification of the debt before continuing in his attempts to collect.

The Bentson Affidavit states Defendant’s April 9, 2015 letter, which Defendant apparently sent in response to Plaintiff’s March 26, 2015 letter requesting verification of the debt, “did not provide the address of the original creditor as [Plaintiff] requested but did provide . . . [Plaintiff’s] original retainer agreement with Aitken for [her] divorce”

[Dkt. 40, Ex. B at 7].

The Bentson Affidavit also indicates “[Defendant] did send the Aitken divorce contract and some invoices, but he also enclosed the April 9, 2015 demand letter, rather than respond to the validation letter with whatever documentation he had”

[Dkt. 40, Ex. B at 13].

These conclusory, self-serving statements will not suffice to carry Plaintiff’s burden on this claim.

See, e.g., In re Deepwater Horizon, 857 F.3d 246, 250 & n.7 (5th Cir. 2017)

(rejecting party’s reliance on a conclusory affidavit at summary judgment stage).

Further, Plaintiff’s own averments indicate the letters Defendant sent to Plaintiff provided Plaintiff sufficient information regarding “how and when the debt was originally incurred” and “sufficient notice from which [Plaintiff] could sufficiently dispute the payment obligation.”

See Mack, 2015 WL 123742, at *4; Dkt. 40, Ex. B

(stating Plaintiff reached out to Aiken to verify the debt).

Plaintiff does not show Defendant failed to provide sufficient verification before continuing to attempt to collect the alleged debt.

The Court accordingly recommends Plaintiff’s Motion be granted as to Plaintiff’s Section 1692g(a) claims and denied as to Plaintiff’s Section 1692g(b) claim.

II. TDCA Claims

Plaintiff claims (and seeks judgment as a matter of law) that Defendant violated TDCA sections 392.101, 392.301(a)(1), 392.301(a)(8), 392.303(a)(2), 392.304(a)(1)(A), 392.304(a)(4), 392.304(a)(6), 392.304(a)(8), 392.304(a)(12)-(14), 392.304(a)(17), and 392.304(a)(19) [Dkt. 40 at 4-6].

Plaintiff also asserts Defendant violated Texas Business and Commerce Code section 17.62—the Texas Deceptive Trade Practices Act (“DTPA”)—vis-à-vis TDCA section 392.404(a)

[Dkt. 32 at 7].

The TDCA defines a “consumer” as “an individual who has a consumer debt[,]” a “consumer debt” as “an obligation, or alleged obligation, primarily for personal, family, or household purposes, and arising from a transaction or alleged transaction[,]” and “debt collector” as “a person who directly or indirectly engages in debt collection[,]” which the TDCA defines as “an action, conduct, or practice in collecting, or in soliciting for collection, consumer debts that are due or alleged to be due to a creditor.”

TEX. FIN. CODE § 392.001(1)-(2), (5)-(6);

see also id.

§ 392.001(7) (defining “third-party debt collector” as a “debt collector, as defined by 15 U.S.C. § 1692a(6),” with certain exceptions inapplicable here).

Here, as under the FDCPA, neither Party disputes Defendant’s status as a debt collector and/or third-party debt collector, Plaintiff’s status as a “consumer,” or the status of the debt as debt the collection of which is subject to the TDCA

[see, e.g., Dkt. 40, Ex. B at 3-6 (averring the debt in question relates to allegedly delinquent payments due a law firm for divorce services)].

A. Section 392.101: Bond Requirement

TDCA section 392.101 requires third-party debt collectors to obtain “a surety bond issued by a surety company authorized to do business in this state as prescribed by [the TDCPA].”

TEX. FIN. CODE § 392.101(a).

Additionally, “[a] copy of the bond must be filed with the [Texas] secretary of state.”

Id.

Failure to comply with these requirements constitutes a violation of the TDCA.

See CA Partners v. Spears, 274 S.W.3d 51, 79 (Tex. App.—Houston [14th Dist.] 2008, no pet.)

(upholding injunction prohibiting debt collection activities in Texas where trial court found defendant was a third-party debt collector and had failed to post a security bond in compliance with Section 392.101).

Here Plaintiff has alleged and shown that Defendant failed to comply with the Section 392.101 bond requirement

[see Dkt. 40, Ex. C at 7

(averring Plaintiff’s attorney “checked the records of the Secretary of State of Texas when this suit was filed and it showed no surety bond on file for any name or name combination [Defendant] uses on his letters”).

Accordingly, the Court recommends Plaintiff’s Motion be granted as to her TDCA section 392.101 claim.9

LIT EXPOSES LEGAL OCHLOCRACY IN TEXAS
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Both Operate Illegally in Texashttps://t.co/PJQtMFEnNP@farenthold @ChadPergram @benshapiro @pdmcleod @ellievhall @BBC @frankthorp

— lawsinusa (@lawsinusa) July 14, 2022

B. Section 392.301

TDCA section 392.301(a)(1) proscribes use of “threats, coercion, or attempts to coerce that employ [either] of the following practices:” [a] using or threatening to use violence or other criminal means to cause harm to a person or property of a person; . . . or [b] threatening to take an action prohibited by law.”

TEX. FIN. CODE § 392.301(a).

Here Plaintiff alleges but fails to show Defendant used or threatened violence or other criminal means in the manner proscribed.

As discussed supra at Section I.A, Plaintiff’s similar claims under the FDCPA fail on the present record to demonstrate summary judgment is appropriate; for the same reasons, Plaintiff’s claims under Section 392.301 fail at this stage.

Cf. Cox v. Hilco Receivables, L.L.C., 726 F. Supp. 2d 659, 667 (N.D. Tex. 2010)

(noting comparable provisions of FDCPA and TDCPA and finding allegations of “the same conduct” would violate both without further analysis).

Accordingly, the Court recommends Plaintiff’s Motion be denied as to her TDCA section 392.301 claim.

C. Section 392.303

TDCA section 392.303 provides in relevant part that “a debt collector may not use unfair or unconscionable means that employ [inter alia] . . . [the] collect[ion] or attempt[] to collect interest or a charge, fee, or expense incidental to the obligation unless the interest or incidental charge, fee, or expense is expressly authorized by the agreement creating the obligation or legally chargeable to the consumer[.] . . .”

Id. § 392.303(a)(2);

see also McCaig v. Wells Fargo Bank (Tex.), N.A., 788 F.3d 463, 479 (5th Cir. 2015)

(finding violation of TDCPA section 392.303(a)(2) where bank-defendant assessed fees in violation of the contract between the bank and the borrower-plaintiff).

In the present case, Plaintiff alleges Defendant has attempted to collect fees in violation of Section 392.303, but does not indicate which part of the alleged debt Defendant seeks to collect from Plaintiff constitutes such impermissible fees [see Dkt. 1 at 12].

Plaintiff avers Defendant provided her a copy of the purported contract between Plaintiff and the creditor law firm and as well as “some invoices” [e.g., Dkt. 40, Ex. B at 12-13].

Plaintiff also references an email conversation she had in March 2015 with Aitken about whether Aitken continued to claim Plaintiff owed on any account with Aitken incident to his work on her divorce proceedings [Dkt. 40, Ex. B at 5].

Plaintiff fails to provide the Court with copies of the referenced invoices, contract, or emails, though she baldly avers they support her claims—such conclusory averments do not suffice to show Defendant attempts here to collect an unauthorized fee or other cost, particularly where Plaintiff could have proffered documentary support for her claims.

In re Deepwater Horizon, 857 F.3d at 250 & n.7.

The Court finds Plaintiff provides no evidence to support this claim and, in any case, fails to identify any interest, charge, or fee Defendant seeks to collect that violates the underlying contract between Plaintiff and Aitken.

Accordingly, the Court recommends denying Plaintiff’s Motion as to her claims under TDCA section 392.303.

D. Section 392.304

TDCA section 392.304 proscribes “fraudulent, deceptive, or misleading representation that employs the following practices:”

(1) using a name other than the:

(A) true business or professional name or the true personal or legal name of the debt collector while engaged in debt collection; . . .
. . .
(4) failing to disclose clearly in any communication with the debtor the name of the person to whom the debt has been assigned or is owed when making a demand for money;
. . .
(6) using a written communication that fails to indicate clearly the name of the debt collector and the debt collector’s street address or post office box and telephone number if the written notice refers to a delinquent consumer debt;
. . .
(8) misrepresenting the character, extent, or amount of a consumer debt, or misrepresenting the consumer debt’s status in a judicial or governmental proceeding;
. . .
(12) representing that a consumer debt may be increased by the addition of attorney’s fees, investigation fees, service fees, or other charges if a written contract or statute does not authorize the additional fees or charges;

(13) representing that a consumer debt will definitely be increased by the addition of attorney’s fees, investigation fees, service fees, or other charges if the award of the fees or charges is subject to judicial discretion;

(14) representing falsely the status or nature of the services rendered by the debt collector or the debt collector’s business;
. . .

(17) representing that a consumer debt is being collected by an attorney if it is not;

(19) using any other false representation or deceptive means to collect a debt or obtain information concerning a consumer.

TEX. FIN. CODE § 392.304(a);

see also Thompson v. Bank of Am. Nat’l Ass’n, 783 F.3d 1022, 1026 (5th Cir. 2015)

(identifying Section 392.304(a)(19) as a “catchall provision”).

Importantly, a violation for misrepresentation under the TDCA requires an “affirmative statement that was false or misleading[,]” and which “relate[s] to the character of the debt[.] . . .”

Thompson, 783 F.3d at 1026 (internal quotations omitted).

In this vein, a representation (a) that the consumer owes a lump sum of money that (b) fails to further delineate which parts of that sum constitute interest, fees, or otherwise, without more, merely creates a fact issue as to the debt collector’s liability.

See Gonzalez v. Temple-Inland Mortg. Corp., 28 S.W.3d 622, 625-26 (Tex. App.—San Antonio 2000, no pet.).

Here Plaintiff fails to demonstrate summary judgment is appropriate as to her Section 392.304(a)(1)(A), (4), (6), (12), (13), (14), or (17) claims, as the record contains no evidence that Defendant violated any of provisions (4), (6), (12), (13), (14), or (17).

Defendant notes in each letter his purpose of collecting the alleged debt on behalf of Aitken, Aitken & Sharpe, P.C., never mentions or implies any fees will accrue except as provided by the underlying contract, and never holds himself out as an attorney attempting to collect the debt

[see Dkt. 40, Ex. A].

Furthermore, though Defendant refers to himself variously as “David E. Chyma, Consultant” and “D.E. Chyma, Consultant,” nothing in the record indicates this is not “the true business or professional name or the true personal or legal name of [Defendant].”

See TEX. FIN. CODE § 392.304(a)(1)(A).

And Defendant’s letters make clear his role—he demands payment for a debt Plaintiff allegedly owes to Aitken

[see Dkt. 40, Ex. A].

By contrast, the record supports Plaintiff’s claims under Sections 392.304(a)(8) and (19).10

As the Court found with regard to Plaintiff’s FDCPA Section 1692e claims supra in Section I.B, each of Defendant’s letters references two different amounts—$10,940.58 as “Balance on Invoice #3144 – 07/13” and $15,050.50 as “Balance on Statement”—but does not identify whether Defendant claims $10,940.58 or $15,050.50 (or both) as the amount due.

As with Plaintiff’s FDCPA claim, this evidence suffices to show Defendant violated subsections (a)(8) and (19).

See, e.g., Miller v. BAC Home Loan Servicing, L.P., 726 F.3d 717, 723 (5th Cir. 2013)

(indicating that a Section 392.304(a)(8) occurs where the debt collector leads the debtor “to think differently with respect to the character, extent, amount, or status of the[] debt”);

cf. Cox, 726 F. Supp. 2d at 667 (applying the same analysis to plaintiff’s claims made under FDCPA Section 1692e and TDCA Section 392.304(a)(8) and (19)).

Accordingly, the Court recommends Plaintiff’s Motion be granted as to her TDCA Section 392.304(a)(8) and (19) claims and denied as to her TDCA Section 392.304(a)(1)(A), (4), (6), (12), (13), (14), and (17) claims.

Top of the morn’ @stevebermano
How do you fancy comin’ back to Texas with @hagensberman and help claim the restitution owed to Citizens by the State of Texas @texasgov for allowing lawyers to act as debt collectors and debt mgt advisors illegally? Can’t think of a better firm. pic.twitter.com/7NH6f7OzxL

— lawsinusa (@lawsinusa) July 14, 2022

III. Damages, Costs, and Fees

Plaintiff claims damages under both the FDCPA (Section 1692k) and TDCA (Section 392.403), as well as injunctive relief under the TDCA and “remedies under [the DTPA] pursuant to [TDCA Section 392.404]”

[Dkt. 1 at 11 (FDCPA), 14 (TDCA & DTPA)].

Under Section 1692k, a court may award “any actual damage sustained by [a debtor]” resulting from a debt collector’s failure to comply “with any provision” of the FDCPA, “additional damages . . . not exceeding $1,000[,]” and “the costs of the action, together with any reasonable
attorney’s fee as determined by the court.”

15 U.S.C. § 1692k(a)(1), (2)(A), (3);

see also Brown v. Dallas Creditors Servs., Inc., No. 4:12CV371, 2013 WL 3377438, at *3 (E.D. Tex. July 3, 2013)

(rendering award under Section 1692k and noting the statute caps additional damages at $1,000 per action, “not per violation”).

A court must consider “the frequency and persistence of noncompliance by the debt collector, the nature of such noncompliance, and the extent to which such noncompliance was intentional” in determining the amount of a non-complying debt collector’s liability.

15 U.S.C. § 1692k(b)(1).

Even “[a] single violation is sufficient to establish [such] liability.”

United States v. Commercial Recovery Sys., Inc., 179 F. Supp. 3d 728, 733-34 (E.D. Tex. 2016).

Similarly, under Section 392.304, a court may award “injunctive relief to prevent or restrain a violation of [the TDCA];

and . . . actual damages sustained as a result of a violation of [the TDCA].”

TEX. FIN. CODE § 392.403(a).

Further, “[a] person who successfully maintains an action under Subsection (a) is entitled to attorney’s fees reasonably related to the amount of work performed and costs.”

Id. § 392.403(b).

Where the debtor “successfully maintains an action under [TDCA Section 392.101,]” the debtor also may claim statutory damages of “not less than $100 for each violation of [the TDCA].”

Id. § 392.403(e);

see also Marauder Corp. v. Beall, 301 S.W.3d 817, 822-23 (Tex. App.—Dallas 2009, no pet.)

(finding a debtor must prevail on its claim for actual damages in order to receive additional statutory damages).

Importantly, a debtor must prevail on its claim for injunction “[i]n order to be awarded attorney’s fees . . . .”

Citibank (S.D.), N.A. v. Durden, No. 05-11-00154-CV, 2012 WL 6096569, at *2 (Tex. App.—Dallas Dec. 7, 2012, no pet.) (citing Marauder Corp., 301 S.W.3d at 823).

Further, under the FDCPA and TDCA, actual damages include “not only out-of-pocket expenses, but also damages for personal humiliation, embarrassment, mental anguish, and emotional distress.”

Reyelts v. Cross, 968 F. Supp. 2d 835, 846 (N.D. Tex. 2013) (collecting cases).

To collect such damages, a plaintiff must proffer direct evidence regarding the “nature, duration, and severity of the mental anguish” and show it has caused a substantial disruption in the plaintiff’s daily routine.

Id.

This requires “actual evidence of distress and injury, not merely conclusory statements about it.”

Harrington v. Nat’l Enter. Sys., Inc., No. 4:08cv422, 2010 WL 890176, at *4 (E.D. Tex. Mar. 9, 2010).

Here, Plaintiff has carried her summary judgment burden as to her FDCPA Section 1692e and 1692g(a) claims, as well as her TDCA Section 392.101 and 392.304(a)(8), (19) claims and has shown herself entitled to claim actual damages, statutory damages, and attorneys fees under both the FDCPA and TDCA.

The matter of damages, however, “is not appropriately decided in a motion for summary judgment and would need to be addressed at a hearing.”

Infante v. Samara Portfolio Mgmt., L.L.C., No. 1:14-CV-00324, 2017 WL 1102757, at *7 (E.D. Tex. Jan. 20, 2017).11

Remember this Texas?https://t.co/VeC57jSBf6
Y’all been ignoring these laws for years, even when formal letters and requests have been filed by Texas Citizens with the Office of the Texas Attorney General @TXAG In other words, you’ve been covering up this fraudulence for many yrs https://t.co/2Y5sbrBbaQ

— lawsinusa (@lawsinusa) July 11, 2022

CONCLUSION AND RECOMMENDATION

In light of the foregoing, the Court recommends Plaintiff’s Motion for Summary Judgment [Dkt. 40] be GRANTED IN PART AND DENIED IN PART.

The Court recommends Plaintiff be granted judgment as a matter of law as to her claims under FDCPA Sections 1962e and 1692g(a) and under TDCA Sections 392.101 and 392.304(a)(8), (19).

Further, the Court recommends denying Plaintiff’s claims under FDCPA Sections 1692d, 1692f, and 1692(g)(b), as well as Plaintiff’s claims under TDCA Sections 392.301, 392.303, and 392.304(a)(1)(A), (a)(4), (a)(6), (a)(12), (a)(13), (a)(14), and (a)(17).

Within fourteen (14) days after service of the magistrate judge’s report, any party must serve and file specific written objections to the findings and recommendations of the magistrate judge.

28 U.S.C. § 636(b)(1)(C).

In order to be specific, an objection must identify the specific finding or recommendation to which objection is made, state the basis for the objection, and specify the place in the magistrate judge’s report and recommendation where the disputed determination is found.

An objection that merely incorporates by reference or refers to the briefing before the magistrate judge is not specific.

Failure to file specific, written objections will bar the party from appealing the unobjected-to factual findings and legal conclusions of the magistrate judge that are accepted by the district court, except upon grounds of plain error, provided that the party has been served with notice that such consequences will result from a failure to object.

See Douglass v. United Servs. Auto. Ass’n, 79 F.3d 1415, 1417 (5th Cir. 1996) (en banc), superseded by statute on other grounds, 28 U.S.C.
§ 636(b)(1)

(extending the time to file objections from ten to fourteen days).