Guthrie v. JD Enterprise & Financial Services et al, No. 3:2011cv00911 - Document 41 (S.D. Cal. 2013)
Court Description: ORDER granting in part and denying in part 37 Motion for Default Judgment. Specifically, the Court GRANTS IN PART Plaintiffs request for statutory damages and attorneys fees and costs, and DENIES his request for actual damages. Judgment shall be entered in favor of Plaintiff in the amount of $1,500 for statutory damages and $6,755.73 for fees and costs, for a total of $8255.73. Signed by Judge M. James Lorenz on 5/20/2013. (sjt)
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Guthrie v. JD Enterprise & Financial Services et al Doc. 41 1 2 3 4 5 6 7 8 9 10 UNITED STATES DISTRICT COURT 11 SOUTHERN DISTRICT OF CALIFORNIA 12 13 14 15 16 17 18 19 20 RAYMOND B. GUTHRIE, ) Case No. 11-cv-911-L(DHB) ) Plaintiff, ) ORDER GRANTING IN PART AND ) DENYING IN PART MOTION FOR v. ) DEFAULT JUDGMENT [DOC. 37] ) JD ENTERPRISE & FINANCIAL ) SERVICES., ) ) Defendant. ) ) ) ) Pending before the Court is Plaintiff Raymond B. Guthrie’s motion for default judgment 21 against Defendant Joseph Dassa. This action was brought for violations of the Fair Debt 22 Collection Practices Act (“FDCPA”) and the Rosenthal Fair Debt Collection Practices Act 23 (“Rosenthal Act”). JD Enterprise & Financial Services and Joe Willis have since been dismissed 24 from this action. To date, Defendant has not opposed this motion. 25 The Court found this motion suitable for determination on the papers submitted and 26 without oral argument. See Civ. L.R. 7.1(d.1). (Doc. 39.) For the following reasons, the Court 27 GRANTS IN PART and DENIES IN PART Plaintiff’s motion for default judgment. (Doc. 28 37.) 11cv911 Dockets.Justia.com 1 I. BACKGROUND 2 Plaintiff allegedly incurred “certain financial obligations” sometime before September 23, 3 2010, which were “primarily for personal, family or household purposes[.]” (Compl. ¶¶ 21–22.) 4 Sometime thereafter, but before September 23, 2010, Plaintiff allegedly fell behind in the 5 payments owed on the debt. (Id. ¶ 24.) Plaintiff apparently disputes the validity of the 6 aforementioned debt. (See id.) This alleged debt was “assigned, placed, or otherwise 7 transferred, to Defendants for collection.” (Id. ¶ 25.) 8 On or about September 23, 2010, Defendant telephoned Plaintiff and demanded payment 9 for the debt. (Compl. ¶ 26; Guthrie Decl. ¶ 2.) During this communication, Defendant told 10 Plaintiff that he was a process server obligated to serve Plaintiff with legal documents unless 11 Plaintiff called Joe Willis and resolved the problem. (Compl. ¶ 28; Guthrie Decl. ¶ 3.) 12 Subsequently, Plaintiff called Mr. Willis and was falsely informed that he was an attorney; 13 Plaintiff alleges that Mr. Willis is a debt collector. (Compl. ¶ 37.) Mr. Willis “explained to 14 Plaintiff that he now owned the alleged debt which was originally ‘a little under $200’ but now 15 had risen to over $900 due to his fees.” (Id. ¶ 41.) 16 Plaintiff verbally disputed the debt, but Mr. Willis told Plaintiff that if he did not pay the 17 debt that he would be served with legal papers. (Compl. ¶ 45.) At one point during the 18 conversation, Mr. Willis indicated that he had a process server on another call and that he 19 instructed the process server to serve Plaintiff with legal papers. (Id. ¶¶ 48–50.) Mr. Willis 20 added that failure to pay immediately would result in additional costs and legal fees, which he 21 stated could amount to thousands of dollars. (Id. ¶ 51.) He also threatened that he would “come 22 after Plaintiff’s ‘wages, car, and job.’” (Id. ¶ 54.) 23 Plaintiff inquired about the details of the alleged debt, including how it had increased 24 several hundred dollars from the original amount Mr. Willis claimed Plaintiff owed, but Mr. 25 Willis was not responsive. (Compl. ¶ 58.) When Plaintiff refused to pay, Mr. Willis ended the 26 conversation stating “it’s your mistake” and that he would see Plaintiff in court. (Id. ¶ 63.) A 27 few minutes later, Plaintiff called Mr. Willis back and asked for an address where he could write 28 a letter requesting information and validation of the alleged debt, but Mr. Willis refused to give 11cv911 2 1 an address, accused him of “buying time,” and ended the conversation again by stating, “I’ll see 2 you in court.” (Id. ¶¶ 66–67.) Plaintiff is under the impression and belief that Defendant and 3 Mr. Willis are the same person. (Guthrie Decl. ¶ 12.) 4 Within 30 days following the phone conversation, Plaintiff’s counsel found the business 5 address for Mr. Willis and JD Enterprise & Financial Services, and mailed a letter requesting 6 validation of the alleged debt. (Smith Decl. ¶ 7.) Neither Plaintiff nor Plaintiff’s counsel 7 received a written response to the request for validation. (Guthrie Decl. ¶ 13; Smith Decl. ¶ 8.) 8 And to this day, Plaintiff has not been served with any legal paperwork for the alleged debt. 9 (Guthrie Decl. ¶ 14.) 10 On April 28, 2011, Plaintiff commenced this action for violations of the FDCPA and 11 Rosenthal Act. On September 10, 2012, the Clerk of the Court issued an entry of default as to 12 Joseph Dassa. (Doc. 24.) Following an issuance of a notice of hearing for failure to move for 13 default judgment (Doc. 30) and an order reprimanding Plaintiff’s counsel for repeated failures to 14 comply with the rules governing electronic filing (Doc. 33), Plaintiff filed a motion for default 15 judgment against Mr. Dassa. To date, there has been no opposition to the motion. 16 17 II. LEGAL STANDARD 18 Rule 55(b)(2) of the Federal Rules of Civil Procedure governs applications to the court 19 for default judgment. See Fed. R. Civ. P. 55(b)(2). Default judgment is available as long as the 20 plaintiff establishes: (1) defendant has been served with the summons and complaint and default 21 was entered for their failure to appear; (2) defendant is neither a minor nor an incompetent 22 person; (3) defendant is not in military service or not otherwise subject to the Soldiers and 23 Sailors Relief Act of 1940; and (4) if defendant has appeared in the action, that defendant was 24 provided with notice of the application for default judgment at least three days prior to the 25 hearing. See, e.g., 50 U.S.C. § 521; Fed. R. Civ. P. 55; Twentieth Century Fox Film Corp. v. 26 Streeter, 438 F. Supp. 2d 1065, 1070 (D. Ariz. 2006). 27 Upon entry of default, the factual allegations in plaintiff’s complaint, except those 28 relating to damages, are deemed admitted. E.g., Televideo Sys., Inc. v. Heidenthal, 826 F.2d 11cv911 3 1 915, 917–18 (9th Cir. 1987) (quoting Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 2 1977)). Where the amount of damages claimed is a liquidated sum or capable of mathematical 3 calculation, the court may enter a default judgment without a hearing. Davis v. Fendler, 650 4 F.2d 1154, 1161 (9th Cir. 1981). When it is necessary for the plaintiff to prove unliquidated or 5 punitive damages, the court may require plaintiff to file declarations or affidavits providing 6 evidence for damages in lieu of a full evidentiary hearing. Transportes Aereos De Angola v. Jet 7 Traders Inv. Corp., 624 F. Supp. 264, 266 (D. Del. 1985). 8 Entry of default judgment is within the trial court’s discretion. See Taylor Made Golf Co. 9 v. Carsten Sports, Ltd., 175 F.R.D. 658, 660 (S.D. Cal. 1997) (Brewster, J.) (citing Lau Ah Yew 10 v. Dulles, 236 F.2d 415, 416 (9th Cir. 1956)). In making this determination, the court considers 11 the following factors: (1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff’s 12 substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the 13 action, (5) the possibility of a dispute concerning the material facts, (6) whether the default was 14 due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil 15 Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 16 1986). 17 18 III. DISCUSSION 19 A. 20 Upon default, the factual allegations in the complaint relating to damages are not taken as Statutory Damages 21 true. Gaddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977). “The plaintiff is required 22 to provide evidence of its damages, and the damages sought must not be different in kind or 23 amount from those set forth in the complaint.” Amini Innovation Corp. v. KTY Int’l Mktg., 768 24 F. Supp. 2d 1049, 1054 (C.D. Cal. 2011). However, statutory damages under the FDCPA are 25 available without proof of actual damages. Baker v. G.C. Servs. Corp., 677 F.2d 775, 781 (9th 26 Cir. 1982). Under the FDCPA, a plaintiff may recover statutory damages of up to $1,000, and 27 under the Rosenthal Act, a plaintiff may recover statutory damages for a willful and knowing 28 violation in an amount not less than $100 but not greater than $1,000. 15 U.S.C. § 11cv911 4 1 1692k(a)(2)(A); Cal. Civ. Code § 1788.30(b). Damages may be awarded cumulatively under 2 both statutes. 15 U.S.C. § 1692n; Cal. Civ. Code § 1788.32; Gonzalez v. Arrow Fin. Servs., 3 LLC, 660 F.3d 1055, 1066-68 (9th Cir. 2011). 4 In considering an award of statutory damages, the court “shall consider, among other 5 relevant factors . . . the frequency and persistence of noncompliance by the debt collector, the 6 nature of such noncompliance, and the extent to which such noncompliance was intentional.” 15 7 U.S.C. § 1692k(b)(1). “Some courts refuse to award any statutory damages where violations are 8 technical or de minimis.” Smith v. Simm Assocs., Inc., No. C12-4622, 2013 WL 1800019, at *1 9 (N.D. Cal. Apr. 29, 2013) (citing Lester E. Cox Med. Ctr. v. Huntsman, 408 F.3d 989, 933-94 10 (8th Cir. 2005)). 11 For this violation, Plaintiff requests the maximum award of statutory damages under both 12 the FDCPA and the Rosenthal Act. Upon review, nothing in the facts indicate that this single 13 violation merits a maximum damages award. But the violation is more than technical or de 14 minimis. The facts strongly suggest that Defendant was misleading and deceptive, from the 15 misrepresentation that Mr. Willis was an attorney to the belief that “Joe Willis” is actually an 16 alias for Mr. Dassa. (See Guthrie Decl. ¶¶ 1–11.) Given the single but substantial violation, the 17 Court awards Plaintiff $750 under the FDCPA and $750 under the Rosenthal Act. 18 19 B. 20 Under the FDCPA, actual damages may be awarded to a plaintiff as a result of the Actual Damages 21 defendant’s failure to comply with its provisions. 15 U.S.C. § 1692k(a)(1). Actual damages 22 include any out-of-pocket expenses as well as damages for personal humiliation, embarrassment, 23 mental anguish, or emotional distress. Fausto v. Credigy Servs. Corp., 598 F. Supp. 2d 1049, 24 1054 (N.D. Cal. 2009). Emotional distress may be proven in a number of ways, including 25 through corroborating medical evidence or non-expert testimony establishing “manifestations of 26 mental anguish [and the occurrence of] significant emotional harm.” Dawson v. Wash. Mut. 27 Bank F.A., 390 F.3d 1139, 1149-50 (9th Cir. 2004). 28 // 11cv911 5 1 Plaintiff requests $5,000 in actual damages because “he still is affected by the false 2 threats and abusive collection tactics Defendant Dassa used in his attempt to collect the alleged 3 debt.” (Pl.’s Mot. 6:24–28.) The only evidence that Plaintiff provides is his own declaration 4 which includes three paragraphs (out of eighteen) that discuss the lasting harm that he sustained. 5 (See Guthrie Decl. ¶¶ 15–17.) These three paragraphs state the following: (1) “The collection 6 tactics used by Defendant Dassa caused me to suffer emotional and mental distress”; (2) “I 7 suffered sleeplessness, pessimism, restlessness, anxiety, worry, and irritability as a result of 8 Defendant Dassa’s collection abuse”; and (3) “To date I worry that Defendant Dassa may renew 9 his abusive collection activity as he has clearly[.]” (Id.) No further evidence is provided. And 10 without more, Plaintiff fails to prove that he sustained any lasting harm that warrants awarding 11 him $5,000 in actual damages for personal humiliation, embarrassment, mental anguish, or 12 emotional distress. See Fausto, 598 F. Supp. 2d at 1054. 13 14 C. 15 Both the FDCPA and Rosenthal Act provides for an award of attorney’s fees and costs to Attorney’s Fees and Costs 16 a prevailing plaintiff. 15 U.S.C. § 1692k(a)(3) (debt collector is liable for “the costs of the 17 action, together with a reasonable attorney’s fees as determined by the court”); Cal. Civ. Code § 18 1788.30(c). “The FDCPA’s statutory language makes an award of fees mandatory.” Camacho 19 v. Bridgeport Fin., Inc., 523 F.3d 973, 978 (9th Cir. 2008). 20 Courts in the Ninth Circuit calculate an award of attorneys’ fees using the lodestar 21 method, whereby a court multiplies “the number of hours the prevailing party reasonably 22 expended on the litigation by a reasonable hourly rate.” Camacho, 523 F.3d at 978 (internal 23 quotation marks omitted). The fee applicant bears the burden of demonstrating that the number 24 of hours spent were “reasonably expended” and that counsel made “a good faith effort to 25 exclude from [the] fee request hours that are excessive, redundant, or otherwise unnecessary.” 26 Hensley v. Eckerhart, 461 U.S. 424, 434 (1983). It is likewise the fee applicant’s burden to 27 “submit evidence supporting the hours worked and rates claimed . . . . Where the documentation 28 of hours is inadequate, the district court may reduce the award accordingly.” Id. at 433. 11cv911 6 1 “Although in most cases, the lodestar figure is presumptively a reasonable fee award, the 2 district court may, if circumstances warrant, adjust the lodestar to account for other factors 3 which are not subsumed within it.” Ferland v. Conrad Credit Corp., 244 F.3d 1145, 1149 n.4 4 (9th Cir. 2001). Those factors—also known as the Kerr factors—include: 5 6 7 8 9 10 (1) the time and labor required, (2) the novelty and difficulty of the questions involved, (3) the skill requisite to perform the legal service properly, (4) the preclusion of other employment by the attorney due to acceptance of the case, (5) the customary fee, (6) whether the fee is fixed or contingent, (7) time limitations imposed by the client or the circumstances, (8) the amount involved and the results obtained, (9) the experience, reputation, and ability of the attorneys, (10) the “undesirability” of the case, (11) the nature and length of the professional relationship with the client, and (12) awards in similar cases. Ballen v. City of Redmond, 466 F.3d 736, 746 (9th Cir. 2006) (quoting McGrath v. Cnty. of 11 Nevada, 67 F.3d 248, 252 (9th Cir. 1995)); see also Kerr v. Screen Extras Guild, Inc., 526 F.2d 12 67, 70 (9th Cir. 1995). 13 Here, Plaintiff’s counsel purportedly recorded 22.31 hours at $295 per hour. That rate 14 appears to be reasonable for this area and community.1 However, upon closer inspection of the 15 billing records, Plaintiff’s counsel’s purported hours recorded do not match the sum of the hours 16 from each billing entry. After independently adding the hours expended from each billing entry, 17 the sum is 20.11 hours. (See Smith Decl. Ex. A.) Though arithmetic errors certainly occur, it is 18 nonetheless disappointing to see such mathematical sloppiness in light of the Court reprimanding 19 Plaintiff’s counsel for earlier failures in complying with this district’s filing requirements. Using 20 the lodestar method, the new attorney’s fee total amounts to $5,932.45. 21 Moving on to the costs incurred, all of the cost and expense descriptions are at least 22 minimally adequate except one. The billing record for a “cost and expense” incurred on March 23 9, 2012 is merely described as “SWLS #7313” for a charge of $530. (See Smith Decl. Ex. A.) It 24 is not clear what that charge is for, and thus that amount will be deducted from the total costs 25 requested. Adjusting for the one ambiguous charge, the total costs amount to $823.28. 26 27 1 The Court notes that Plaintiff loosely supports the proposition that his counsel’s billing 28 rate is reasonable for this area and community. (See Smith Decl. ¶¶ 27–28.) 11cv911 7 1 The Court notes that the overall fee award seems high, but also notes that there was an 2 evidentiary hearing that required a significant expenditure of time to prepare for. See Smith, 3 2013 WL 1800019, at *2 (noting that an overall fee award of $6,494.50 “seems high” for an 4 action prosecuting FDCPA and Rosenthal Act violations). Accordingly, the Court partially 5 approves of the request, and awards $6,755.73 in fees and costs. 6 7 IV. CONCLUSION & ORDER 8 In light of the foregoing, the Court GRANTS IN PART and DENIES IN PART 9 Plaintiff’s motion for default judgment. (Doc. 37.) Specifically, the Court GRANTS IN PART 10 Plaintiff’s request for statutory damages and attorney’s fees and costs, and DENIES his request 11 for actual damages. Judgment shall be entered in favor of Plaintiff in the amount of $1,500 for 12 statutory damages and $6,755.73 for fees and costs, for a total of $8255.73. 13 IT IS SO ORDERED. 14 15 DATED: May 20, 2013 16 17 M. James Lorenz United States District Court Judge 18 COPY TO: 19 HON. DAVID H. BARTICK UNITED STATES MAGISTRATE JUDGE 20 ALL PARTIES/COUNSEL 21 22 23 24 25 26 27 28 11cv911 8
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