Motes v. Midland Funding LLC et al, No. 6:2015cv00961 - Document 41 (N.D. Ala. 2017)
Court Description: MEMORANDUM OF OPINION. Signed by Judge L Scott Coogler on 1/6/2017. (PSM)
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Motes v. Midland Funding LLC et al Doc. 41 FILED 2017 Jan-06 AM 09:31 U.S. DISTRICT COURT N.D. OF ALABAMA IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ALABAMA JASPER DIVISION MICHAEL MOTES, Plaint if f, vs. MIDLAND FUNDING, LLC, et al ., Defendant s. ) ) ) ) ) ) ) ) ) ) 6: 15-cv-00961-LSC MEMORANDUM OF OPINION Before t he Court is Defendant s’ , Midland Funding, LLC, and Midland Credit Management , Inc. (collect ively “ Midland” ), Mot ion for Summary Judgment (Doc. 25), as well as Plaint iff Michael Mot es’ s (“ Mot es” ) First Mot ion t o St rike (Doc. 33) and Mot ion t o St rike (Doc. 39). Mot es brought t his act ion alleging violat ions of t he Fair Debt Collect ion Pract ices Act , 15 U.S.C. § 1692 et seq. (“ FDCPA” ). Mot es also assert s st at e-law claims for invasion of privacy, want on conduct , malicious prosecut ion, and negligent , want on, or int ent ional hiring, t raining, and supervision of incompet ent debt collect ors. For t he reasons st at ed below, Midland’ s mot ion for summary j udgment is due t o be grant ed in part and denied in Page 1 of 26 Dockets.Justia.com part . Mot es’ s Mot ion t o St rike (Doc. 33) and Midland’ s Mot ion t o St rike (Doc. 39) are due t o be denied as moot . I. BACKGROUND Mot es has lived in Crane Hill, Alabama wit h his wife Sherry Mot es (“ Sherry” ) since 1996. 1 (Mot es Dep. at 16. ) The Unit ed St at es Post al Service websit e list s t he Crane Hill address as locat ed in Cullman Count y, Alabama. (Smit h Dec. ¶ 11, Smit h Dec. Ex. 8. ) GE Capit al Ret ail Bank, which is now Synchrony Bank (“ Synchrony” ) provided a credit account (“ SB account ” ) f or an individual named “ MKE Mot es” at t he Crane Hill address. (Murphy Dec. Ex. 3. ) Mot es does not disput e t hat payment s on t he SB account were made from Sherry’ s bank account from February 2012 t o December 2013. However, Mot es professes t hat he did not open or ever have any credit account wit h Synchrony. (Mot es Dep. at 282-83.) No payment s have been made on t he SB account since December 2013, and a balance of $2, 069. 37 remains unpaid. (Murphy Dec. Ex. 3 & 4.) Aft er seven mont hs wit hout receiving any payment s on t he SB account , Synchrony charged-of f t he account on July 16, 2014. (Id. at Ex. 3.) Midland claims t hat in August 2014, it bought a number of charged-of f account s from Synchrony, including t he SB account . (Id. at ¶ 3.) Midland 1 Mot es’ s address has been redact ed from t he public record. Therefore, it will be referred t o as t he “ Crane Hill address” in t his opinion. Page 2 of 26 provides a Bill of Sale and an Af fidavit of Sale of Account by Original Credit or as proof of t his t ransact ion. (Id. at Ex. 1 & 2.) According t o Midland, t he Bill of Sale “ assigned all of [Synchrony’ s] right s, t it le, and int erest ” in t he purchased account s t o Midland, including t he SB account . (Id. at ¶ 5.) The af fidavit of Synchrony’ s aut horized represent at ive st at es t hat “ Synchrony . . . sold a pool of charge-off account s . . . t o Midland, ” and declares t hat “ [Synchrony] has a process t o det ect and correct errors on t hese account s. ” (Id. at Ex. 2.) However, Mot es st at es t hat t his process does not check for accuracy, but simply ascert ains t hat t he dat a “ meet s t he expect at ions of what should be t here.” (Murphy Dep. Vol. 1 at 66-9.) Midland also charges t hat t he sale involved t ransfer of a “ Final Dat a File, ” which “ cont ained Synchrony Bank’ s elect ronic records and ot her records on t he individual account s purchased by Midland, ” including informat ion about t he SB account which was ext ract ed by Midland and cont ained in a Field Dat a sheet . (Murphy Dec. ¶ 5.) The part ies do not disput e t hat Synchrony also gave Midland t wo account st at ement s f or t he SB account , which list “ MKE Mot es” as t he account owner and t he Crane Hill address as t he mailing address. (Id. at ¶ 7 & Ex. 4.) Midland at t empt ed t o collect on t his debt , calling Mot es seven t imes and sending him “ some” let t ers in Sept ember and November 2014. Page 3 of 26 (Murphy Dec. ¶ 10.) However, Mot es admit s t hat he never spoke t o Midland direct ly. (Mot es Dep. communicat ed wit h Mot es, at 252-53.) Furt her, Synchrony, Zarzaur Midland only & Schwart z, P.C. (“ Zarzaur” ), credit report ing agencies, and t he Small Claims Court s of Cullman and Winst on Count ies about t he SB account . (Murphy Dec. ¶ 11.) By November 20, 2014, Midland placed t he SB account wit h it s out side counsel, Zarzaur, for collect ion. (Smit h Dec. ¶ 4 & 5.) Midland gave Zarzaur access t o t he following document s relat ed t o t he SB account : “ [1] Two (2) mont hly account st at ement s . . . [2] The Field/ Seller Dat a sheet . . . [ 3] The Bill of Sale bet ween Synchrony and Midland Funding . . . [ 4] An af f idavit of Synchrony’ s Aut horized Represent at ive regarding t he Bill of Sale . . . [ 5] A[ ] [Midland] validat ion let t er . . . and [ 6] Ot her charge-of f informat ion from Synchrony.” (Id. at ¶ 6.) Midland relat es t hat aft er mult iple unsuccessful at t empt s t o collect t he debt from “ MKE Mot es, ” Zarzaur reviewed t he evidence and “ had a good f ait h belief t hat MKE Mot es owed t he Synchrony debt , t here were no legal or procedural barriers t o filing suit , and Midland could prevail at t rial.” (Id. at ¶ 7 & 9.) Mot es disput es t his assert ion, st at ing t hat Midland and it s lawyers should have known t hat t here was not enough evidence t o file a successful act ion against him. According t o Midland, it relies on Page 4 of 26 Zarzaur t o det ermine if t here is sufficient evidence for a successful collect ion suit , and decide which document s or wit nesses should be used in t hat act ion. (Id. at ¶ 8.) Yet , Midland also admit s t hat Zarzaur act s as Midland’ s agent in it s collect ion cases, and t hat it requires firms like Zarzaur t o comply wit h a code of conduct or risk t erminat ion. (Murphy Dep. Vol. 1 at 93 & 94. ) On December 23, 2014, Zarzaur filed a collect ion act ion against “ MKE Mot es” on behalf of Midland in t he Small Claims Court of Cullman Count y, Alabama, seeking t o recover t he charge-of f balance of $2, 069.37. (Smit h Dec. ¶ 10, Ex. 7.) According t o Zarzaur and Midland, t he st at e court act ion was filed against “ MKE Mot es” who resided at t he Crane Hill address based on t he informat ion cont ained in Midland and Synchrony’ s SB account records. (Id. at ¶ 20, Ex. 1 & 2. ) The act ion was filed in Cullman Count y because Zarzaur’ s syst em— which flags zip codes t hat could mat ch wit h more t han one count y— ident ified it as t he corresponding count y for t he Crane Hill address zip code. (Id. at ¶ 11.) However, when Mot es answered t he complaint , he indicat ed t hat he did not live in Cullman Count y, and asked for t he act ion t o be t ransferred t o Winst on Count y. (Mot es Dep. Ex. 19. ) He also denied— and cont inues t o deny— hat he owed Midland any money or t hat he had ever done business t Page 5 of 26 wit h t hem, claiming t hat he did not know who Midland was and not ing t hat t he name on t he complaint was incorrect . (Id. at 282-83, Pl. Ex. H.) Trial for t he collect ion case was on April 8, 2015. (Smit h Dec. ¶ 15. ) Zarzaur did not request t hat Midland send a live wit ness for t his t rial because, Midland assert s, af fidavit s can be admit t ed in lieu of live t est imony in Alabama Small Claims Court . (Murphy Dep. Vol. 1 at 103, Smit h Dec. ¶ 14. ) During t he st at e court act ion and ot her collect ion at t empt s, Midland assert s t hat it required Zarzaur t o “ abide by all applicable laws and evident iary and procedural rules,” including a requirement t hat “ t hey can’ t file suit unt il t hey have what t hey need” t o “ see t hat lawsuit t hrough. ” (Smit h Dec. ¶ 22, Murphy Dep. Vol. 1 at 144 & 146. ) Zarzaur present ed t he f ollowing document s at t rial: “ [1] t he t wo mont hly account st at ement s . . . [ 2] t he Field/ Seller Dat a sheet . . . [ 3] t he Bill of Sale . . . [ 4] t he charge-of f informat ion from Synchrony . . . [5] t he Synchrony af fidavit regarding t he bill of sale, and [ 6] t he [ Midland represent at ive] St ocker affidavit .” (Smit h Dec. ¶ 18.) However, Mot es claims t hat none of t hese document s is t he cont ract of sale, and t herefore, t hey are not enough t o evidence t hat t he sale occurred. According t o Mot es, t he full cont ract can only be evidenced by t he Purchase and Sale Agreement (“ t he PSA” ), because t he Page 6 of 26 Bill of Sale st at es t hat t he sale is conduct ed “ in furt her considerat ion of t he mut ual covenant s and condit ions set fort h” in t he PSA and t hat Synchrony sold “ t o t he ext ent of it s ownership, t he Receivables . . . [ ] as defined” in t he PSA. (Pl. Ex. A. ) Furt her, Mot es put s forward t est imony t hat Midland very rarely provides PSAs t o it s lawyers for admit t ance at t rial, did not produce it in t he st at e court act ion, and has not produced it in t his act ion, purport edly because “ it is very confident ial informat ion, and [t hey] make ot her document s available.” (Murphy Dep. Vol. 1 at 60-1 & 143. ) Deposit ion t est imony also demonst rat es t hat Midland’ s represent at ive had not reviewed and does not know what t he PSA cont ains. (Murphy Dep. Vol. 1 at 61-65.) Midland, however, count ers t hat t he PSA was not produced because it is immat erial, as t he Bill of Sale is enough t o t ransfer and prove ownership. Midland also avers t hat aft er Midland obj ect ed t o producing t he PSA during discovery, Mot es never communicat ed wit h Midland about t hese obj ect ions or moved t o compel product ion. While t he st at e court act ion was pending, from February 2015 t o April 8, 2015, Midland provided informat ion about t he SB account t o Consumer Report ing Agencies (“ CRAs” ). (Murphy Dec. ¶ 13. ) Aft er j udgment was ent ered f or Mot es on April 8, 2015, Midland no longer Page 7 of 26 report ed on t he SB account , because “ [t ]he Court had det ermined at t hat point in t ime t hat t he defendant does not owe any money t o Midland. ” (Id., Murphy Dep. Vol. 1 at 153.) Furt her, Mot es does not disput e t hat he never wrot e t o t he CRAs t o challenge t he appearance of t he SB account on his credit report bef ore t he st at e court act ion. Mot es charges t hat Midland never asked and does not know why it lost t he st at e court case against Mot es. (Murphy Dep. Vol. 2 at 76-7, 82.) According t o Mot es, having t o defend himself at t rial and “ everyt hing t hat t hat ent ails” caused him emot ional dist ress. (Mot es Dep. at 139-40. ) Specifically, he present s t est imony t hat t he t hreat of garnishment or sale of his asset s made him feel t errible, embarrassed him, caused him st ress and anxiet y, made him worry and lose sleep, hurt his marriage and his good name, kept him from t aking a yearly vacat ion, and t hat when he had t o t ell his wife, he felt lit t le and small. (Id. at 229 & 277-79.) In f act , he maint ained t hat he had t rouble sleeping every day from January 2015 unt il t rial in April 2015. (Id. at 231-32. ) He also claims t hat his wife lost sleep as a result of Midland’ s act ions, but admit s t hat neit her he nor his wife visit ed a professional or sought medicat ion t o resolve t heir alleged emot ional dist ress. (Id. at 230-31.) However, Mot es did t est ify t hat he began t o suf fer from Irrit able Bowel Syndrome (“ IBS” ) Page 8 of 26 during t he pendency of t he lawsuit , and t hat t hough he did not see a doct or about t his issue, he t ook over t he count er medicat ion t o t reat it . (Id. at 263-64. ) Yet , he admit s t hat t he IBS did not disappear when t he st at e court act ion ended. (Id.) Mot es filed t his act ion against Midland on June 8, 2015, alleging mult iple violat ions of t he FDCPA and various st at e law claims. II. STANDARD OF REVIEW Summary j udgment is appropriat e “ if t he movant shows t hat t here is no genuine disput e as t o any mat erial f act and t he movant is ent it led t o j udgment as a mat t er of law.” Fed. R. Civ. P. 56(a). A f act is “ mat erial” if it “ might af fect t he out come of t he suit under t he governing law.” Anderson v. Libert y Lobby, Inc., 477 U.S. 242, 248 (1986). There is a “ genuine disput e” as t o a mat erial fact “ if t he evidence is such t hat a reasonable j ury could ret urn a verdict for t he nonmoving part y. ” Anderson, 477 U.S. at 248. The t rial j udge should not weigh t he evidence but must simply det ermine whet her t here are any genuine issues t hat should be resolved at t rial. Id. at 249. In considering a mot ion for summary j udgment , t rial court s must give deference t o t he nonmoving part y by “ considering all of t he evidence and t he inferences it may yield in t he light most f avorable t o Page 9 of 26 t he nonmoving part y. ” McGee v. Sent i nel Of f ender Servs., LLC, 719 F.3d 1236, 1242 (11t h Cir. 2013) (cit at ions omit t ed). In making a mot ion f or summary j udgment , “ t he moving part y has t he burden of eit her negat ing an essent ial element of t he nonmoving part y’ s case or showing t hat t here is no evidence t o prove a f act necessary t o t he nonmoving part y’ s case. ” Id. Alt hough t he t rial court s must use caut ion when grant ing mot ions for summary j udgment , “ [ s]ummary j udgment procedure is properly regarded not as a disf avored procedural short cut , but rat her as an int egral part of t he Federal Rules as a whole. ” Cel ot ex Corp. v. Cat ret t , 477 U.S. 317, 327 (1986). III. DISCUSSION A. Collat eral Est oppel The part ies in t his case have not raised t he issue of collat eral est oppel. However, a “ [c]ourt may consider t he preclusive effect of a prior j udgment sua spont e. ” Cmt y. St at e Bank v. St rong, 651 F.3d 1241, 1261 & n. 17 (11t h Cir. 2011). In order t o decide if t he Alabama st at e court j udgment has preclusive ef fect in t his case, t he Court will analyze Alabama’ s law of collat eral est oppel. Vazquez v. Met ro. Dade Cnt y., 968 F. 2d 1101, 1106 (11t h Cir. 1992). Under Alabama law, collat eral est oppel is an af firmat ive defense which may be waived if not pleaded. Wait e v. Page 10 of 26 Wai t e, 959 So. 2d 610, 612-13 (Ala. 2006) (quot ing Wait e v. Wait e, 891 So.2d 341, 343 (Ala. Civ. App. 2004). A court cannot ent er summary j udgment for a part y based on an af firmat ive defense t hat was not pleaded by t he part ies. Wausau Dev. Corp. v. Nat ural Gas & Oil , Inc., 144 So.3d 309, 315 (Ala. 2013). Mot es does not ment ion collat eral est oppel in his Response t o Defendant ’ s Mot ion for Summary Judgment (Doc. 34). Therefore, collat eral est oppel will not be considered in t his opinion. B. FDCPA In his complaint (Doc. 1) Mot es claims t hat Midland violat ed t he FDCPA by [ 1] “ suing [Mot es] for a debt [he] did not owe” in t he wrong venue and aft er t he st at ut e of limit at ions had expired, 2 [2] filing said lawsuit “ in hope of obt aining a def ault j udgment or coercing [Mot es] int o paying on a debt [Mot es] did not owe,” [ 3] “ misrepresent ing numerous fact s in t he lawsuit , ” [4] engaging in t his conduct as a “ pat t ern of collect ion act ivit y by [Midland] in t heir collect ion lawsuit s in Alabama, ” and [ 5] “ falsely credit report ing a debt t hat [ Mot es] does not own. ” 2 Mot es does not ment ion t he st at ut e of limit at ions argument in his Response t o Defendant ’ s Mot ion for Summary Judgment (Doc. 34). It will t herefore be deemed abandoned and not discussed in t his opinion. Resolut ion Trust Corp. v. Dunmar Corp., 43 F.3d 587, 599 (11t h Cir. 1995). Page 11 of 26 The FDCPA prohibit s debt collect ors3 from using “ conduct t he nat ural consequence of which is t o harass, oppress, or abuse any person in connect ion wit h t he collect ion of a debt , ” and “ us[ing] unf air or unconscionable means t o collect or at t empt t o collect any debt .” 15 U.S.C. §§ 1692d & 1692e. This conduct can include lit igat ion, and “ document s filed in court in t he course of j udicial proceedings t o collect on a debt . . . are subj ect t o t he FDCPA. ” Mil j kovic v. Shaf rit z & Dinkin, P.A. , 791 F. 3d 1291, 1295 (11t h Cir. 2015). Furt her, t he FDCPA also bars “ us[ing] any false, decept ive, or misleading represent at ion or means in connect ion wit h t he collect ion of any debt .” 15 U. S.C. § 1692e. False represent at ion is prohibit ed “ regardless of t o whom it is direct ed, so l ong as it is made ‘ in connect ion wit h t he collect ion of any debt .’ ” Mil j kovic, 791 F. 3d at 1301 (emphasis in original). 1. 15 U.S.C. § 1692d The Elevent h Circuit views claims under § 1692d “ from t he perspect ive of a consumer whose circumst ances make[ ] him relat ively more suscept ive t o harassment , oppression, or abuse.” Jet er v. Credit Bureau, Inc., 760 F. 2d 1168, 1179 (11t h Cir. 1985). Here, Mot es alleges t hat Midland violat ed § 1692d by inst it ut ing a collect ion suit against him 3 The part ies do not disput e t hat Midland is a debt collect or. Page 12 of 26 in Alabama st at e court . However, “ t he filing of a lawsuit does not have t he nat ural consequence of harassing, abusing, or oppressing a debt or.” Mil j kovic, 791 F. 3d at 1305 (cit ing Harvey v. Great Seneca Fin. Corp., 453 F. 3d 324, 330 (6t h Cir. 2006) (“ [T]he filing of a debt -collect ion lawsuit wit hout t he immediat e means of proving t he debt does not have t he nat ural consequence of harassing, abusing, or oppressing a debt or.” )) Furt her, Mot es cannot show t hat Midland violat ed t he FDCPA by alleging t hat he suffered “ embarrassment , inconvenience, and furt her expense,” because “ [ a]ny at t empt t o collect a default ed debt will be unwant ed by a debt or. ” Id. (quot ing Harvey, 453 F.3d at 330). Inst ead, Mot es must show t hat Midland’ s “ conduct . . . manifest [ s] ‘ a t one of int imidat ion.’ ” Id. (quot ing Jet er, 760 F.2d at 1179). Therefore, filing a lawsuit , as Midland did in t his act ion, is not in it self a violat ion of § 1692d, as it does not necessarily “ manifest a t one of int imidat ion. ” However, Mot es does not simply charge t hat Midland filed suit against him, but rat her, t hat Midland filed suit knowing t hat Mot es did not owe t he debt and wit hout int ending t o properly prosecut e t he act ion. Yet , t he evidence indicat es t hat Midland did prosecut e t he act ion and lost aft er part icipat ing in t rial and present ing evidence. Mot es argues t hat Midland’ s plan t o file t he act ion but not see it t hrough properly is Page 13 of 26 demonst rat ed by it s f ailure t o provide t he PSA at t rial. But Mot es also fails t o provide any evidence t hat t he PSA is required or necessary in order t o properly prosecut e a collect ion act ion in st at e court . Inst ead, he simply cit es t o Prince v. LVNV Funding, in which t he U.S. Dist rict Court for t he Middle Dist rict of Alabama denied summary j udgment in favor of t he defendant s in a similar f act ual sit uat ion. No. 2: 13-CV-462-WKW, 2014 WL 3361912 (M.D. Ala. 2014), vacat ed per st ipul at i on 2014 WL 7506753. In Prince, t he plaint iff also declared t hat defendant had filed a lawsuit against her “ only t o obt ain eit her a def ault j udgment or an agreement t o pay a smaller sum of money because it lacked evidence t o obt ain a j udgment against her for t he amount sought . ” Prince, 2014 WL 3361912 at *3. However, in t hat case, t he defendant “ lacked . . . a bill of sale showing it s ownership of [Plaint if f’ s] account . . . [or] any document signed by [ Plaint iff] applying f or credit . . . or obligat ing her t o pay a debt . ” Id. at *10. The court found t hat a quest ion of fact exist ed because “ a reasonable j ury could infer from t he circumst ances [Defendant ’ s] bad fait h int ent not t o prove it s collect ion claim against [Plaint iff ]. ” Id. These circumst ances involved disput es about “ what evidence [Defendant ] lacked from t he out set t o succeed on it s collect ion suit , whet her it Page 14 of 26 present ed evidence at t rial when it had t he opport unit y t o prove it s case, and whet her [ Plaint if f] ult imat ely prevailed. ” Id. In t his case, t here is no disput e t hat Midland possessed and present ed a Bill of Sale in it s st at e court act ion against Mot es. Therefore, Prince fails t o support Mot es’ s proposit ion t hat a Bill of Sale is not suf ficient t o prove ownership wit hout a PSA. The court in Prince explains t hat ownership could have been shown by a Bill of Sale or by a document signed by t he Plaint iff , but never ment ions a PSA. 4 In fact , t he only case Mot es cit es f or his claim under § 1692d is from Hamil t on v. Mi dl and, 2:14-CV-02008, a mat t er current ly pending before anot her j udge in t his dist rict . In an order denying Defendant ’ s mot ion t o dismiss, t he Court st at ed t hat “ t he court cannot say t hat . . . forcing a layperson t o defend himself against a purport edly baseless lawsuit lacks t he element of int imidat ion necessary t o sust ain a claim pursuant t o § 1692d. ” Hamil t on, 2: 14-CV-02008 at Doc.21. However, t hough Mot es alleges t hat he did not owe t he debt in t his case, he cannot allege t hat t he st at e court suit was ent irely baseless, as Midland has provided mult iple document s which at t est t o Midland’ s purport ed 4 Though not discussed by t he part ies, t he Court quest ions if Midland had in it s possession t he document s necessary t o prove t hat t he debt was creat ed in t he first place— such as a promissory not e or cont ract wit h t he alleged debt or. Page 15 of 26 ownership of a debt owed by a “ MKE Mot es” who lives at t he address t hat Mot es has lived at since 1996. Mot es has present ed no evidence t hat Midland’ s conduct in filing t he st at e court collect ion act ion rises t o t he “ t one of int imidat ion” required for a violat ion of § 1692d. Mot es also cannot make out a claim for violat ion of § 1692d by showing t hat Midland engaged in decept ive conduct during t his lawsuit , because “ Congress did not cont emplat e t he prohibit ion of decept ive conduct per se wit hin t he confines of § 1692d. ” Jet er, 760 F.2d at 1179. Therefore, any claims t hat Mot es has arising out of purport ed misrepresent at ions by Midland must be brought under ot her sect ions of t he FDCPA. Summary j udgment is due t o be grant ed in Midland’ s f avor as t o Count One. 2. 15 U.S.C. § 1692e Among t he ways t hat a debt collect or can violat e § 1692e are by “ f alse represent at ion of . . . t he charact er, amount , or legal st at us of any debt , ” by “ [c] ommunicat ing . . . t o any person credit informat ion which is known or which should be known t o be f alse,” and “ us[ing] . . . any false represent at ion or decept ive means t o collect or at t empt t o collect any debt . ” 15 U.S.C. § 1692e. In t his case, Mot es alleges t hat Midland violat ed t his sect ion by suing him for a debt t hat Midland should have Page 16 of 26 known he did not owe, using misrepresent at ion during t he lawsuit , and falsely report ing t he debt t o CRAs. Claims under § 1692e are evaluat ed using a “ least sophist icat ed consumer” st andard, which asks “ whet her t he ‘ least sophist icat ed consumer’ would be deceived or misled by t he [ allegedly decept ive] communicat ion. ” Bi shop v. Ross Earl e & Bonan, P. A. , 817 F. 3d 1268, 1274 (11t h Cir. 2016). This st andard “ prot ect [s] naïve consumers, [but ] . . . also prevent s liabilit y for bizarre or idiosyncrat ic int erpret at ions of collect ion not ices by preserving a quot ient of reasonableness.” LeBl anc v. Unif und CCR Part ners, 601 F. 3d 1185, 1194 (11t h Cir. 2010) (quot ing Unit ed St at es v. Nat ’ l Fin. Servs., 98 F.3d 131, 136 (4t h Cir. 1996)). Communicat ions may be misleading if, for example, t hey “ erroneously st at e t he amount of t he debt owed, ” or t hey “ incorrect ly ident ify t he holder of t he alleged debt .” Mil j kovic, 791 F.3d at 1306. Furt her, “ [ a] false represent at ion in connect ion wit h t he collect ion of a debt is sufficient . . . even where no misleading or decept ion is claimed.” Bourf f v. Rubin Lubl in, LLC, 674 F. 3d 1238, 1241 (11t h Cir. 2012). Mot es charges Midland sued him f or a debt he did not owe and credit report ed Page 17 of 26 on t hat debt , 5 and t herefore bot h “ erroneously st at e[ d] t he amount of t he debt owed” and “ incorrect ly ident ified t he holder of t he alleged debt . ” Mil j kovic, 791 F.3d at 1306. As evidence of his lack of debt , Mot es provides his t est imony t hat he never opened t he SB account or did business wit h Synchrony at all. He also shows t hat t he st at e court ruled in his favor in t he collect ions suit . 6 Midland, however, provides various document s list ing t he SB account as purport edly belonging t o “ MKE Mot es” who has t he same address as Mot es. Because t here is a disput e of mat erial f act as t o t he exist ence of t he debt , t he quest ion of whet her Midland “ erroneously st at e[ d] t he amount of debt owed” and “ incorrect ly ident ified [Mot es] as t he holder of t he alleged debt ” is a quest ion for t he j ury. Midland declares t hat it filed t he lawsuit against Mot es in good fait h, and t hat it did not know t hat Mot es did not owe t he debt . Yet , “ [t ]he FDCPA t ypically subj ect s debt collect ors t o liabilit y even when violat ions are not knowing or int ent ional. ” Owen v. I.C. Sys. Inc., 629 F. 3d 1263, 1270 (11t h Cir. 2011). In f act , it has at t imes been labeled a 5 Because t he underlying misrepresent at ion— hat Mot es owed and Midland owned t he t debt — t he same for t he credit report ing and lawsuit claims, t hey will be analyzed is t oget her. 6 As discussed above, Mot es does not allege t hat t he defense of collat eral est oppel applies, and t he Court will t herefore not consider t he defense sua spont e. Page 18 of 26 “ st rict liabilit y st at ut e. ” LeBl anc, 601 F. 3d at 1190. Nonet heless, t he st at ut e provides t he “ bona fide error” defense if “ t he debt collect or shows by a preponderance of evidence t hat t he violat ion was not int ent ional and result ed from a bona fide error not wit hst anding t he maint enance of procedures reasonably adapt ed t o avoid any such error.” 15 U.S.C. § 1692k(c); see Owen, 629 F. 3d at 1271. This defense is applicable if Midland shows t hat t he “ violat ion (1) was ‘ not int ent ional’ ; (2) was ‘ a bona fide error’ ; and (3) occurred despit e t he maint enance of procedures ‘ reasonably adapt ed t o avoid any such error.’ ” Owen, 629 F. 3d at 1271. Mot es maint ains t hat Midland cannot aver t hat it s conduct was not int ent ional because “ Midland did not accident ally sue Mot es [ and] Midland did not accident ally not produce t he purchase agreement at t rial.” (Doc. 34 at 21.) However, t he proper issue is not whet her Midland int ent ionally sued Mot es, but rat her, if Midland int ent ionally violat ed t he FDCPA by misrepresent ing t he amount of t he debt t hat Mot es owed and Mot es’ s ident it y as a debt or. Here, Midland provides evidence of document s which purport ed t o ident ify an “ MKE Mot es” as t he debt or. Mot es does not provide any evidence t hat Midland knew t hat Mot es did now owe it money. In f act , t he record shows t hat Mot es did not disput e Page 19 of 26 t he debt unt il aft er Midland had inst it ut ed a collect ions act ion against him in st at e court . Mot es simply advances an unsupport ed assert ion t hat Midland did not int end t o properly prosecut e t he act ion as evidence of Midland’ s knowing violat ion. Therefore, Midland has carried it s burden of showing t hat t he violat ion was not int ent ional. Mot es also claims t hat t he error was not a “ bona fide error” because “ suing wit hout ownership . . . was a deliberat e decision, ” and “ t o t he ext ent Midland seeks t o blame t his on a mist ake of underst anding what t he j udge would allow int o evidence [t hat is] a mist ake of law . . . [and] f ails.” (Doc. 34 at 21.) However, while Mot es is correct in not ing t hat some mist akes of law are not “ bona fide errors” because t he “ defense . . . does not apply t o a violat ion of t he FDCPA result ing from a debt collect or’ s incorrect int erpret at ion of t he requirement s of t hat st at ut e,” t he “ mist ake of law” t hat Mot es claims Midland made is not a mist aken int erpret at ion of t he FDCPA. Jerman v. Carl isl e, McNel l ie, Rini, Kramer & Ul rich LPA, 559 U.S. 573, 604-05 (2010). Nonet heless, Midland st ill has t o show t hat it s mist ake is “ obj ect ively reasonable,” and “ made in good f ait h; a genuine mist ake. ” Edwards v. Niagara Credit Sol ut i ons, Inc., 584 F.3d 1350, 1353 (11t h Cir. 2009). As described above, Midland has provided evidence t hat it reasonably believed Mot es owed t he debt . Page 20 of 26 The fact t hat t he st at e court f ound ot herwise does not , in it self, t urn Midland’ s mist ake int o a bad fait h or unreasonable error. Neit her do t he unsupport ed allegat ions about Midland’ s lack of int ent ion t o properly prosecut e t his case. Therefore, Midland has carried it s burden of showing t hat t he error was a “ bona fide error.” Last ly, Midland must prove t hat it made t his error “ despit e t he maint enance of procedures ‘ reasonably adapt ed t o avoid any such error.” Owen, 629 F. 3d at 1271. In order t o meet t his st andard, Midland must show (1) t hat it “ ‘ maint ained’ . . . procedures t o avoid errors, ” and (2) t hat “ t he procedures were ‘ reasonably adapt ed’ t o avoid t he specific error at issue. ” Id. at 1274 (quot ing Johnson v. Riddl e, 443 F.3d 723, 729 (10t h Cir. 2006)). Here, Midland alleges t hat it had procedures for checking t he accuracy of t he dat a on it s account records, and t hat it implement ed t hese procedures regularly. Specifically, it provided t est imony t hat t he document s were checked t o makes sure t hat t he dat a made sense. (Murphy Dep. Vol. 1 at 66-9. ) Furt her, Midland also maint ains t hat it holds it s collect ion counsel (like Zarzaur) t o a code of conduct . Therefore, Midland has provided enough evidence t o show t hat it maint ains procedures t o avoid errors. However, Midland cannot show t hat Page 21 of 26 t he “ procedures [ are] reasonably adapt ed t o avoid readily discoverable errors, ” because t he error in t his case should have been easily discernible. Owen, 629 F. 3d at 1276. A procedure t hat f ails t o not ice t hat a debt or’ s first name is list ed as MKE cannot be said t o be appropriat e t o avoid error. See Id. (holding t hat a mist ake list ing compound int erest inst ead of simple int erest would have been discovered by reasonable procedures). Therefore, Midland f ails t o prove t he last element f or t he defense of bona fide error, and a disput e of f act remains as t o it s violat ion of § 1692e. Summary j udgment as t o Count s Two, Three, Four, and Five is due t o be denied. 3. 15 U.S.C. § 1692f Furt her, § 1692f is a “ cat ch-all provision” t hat prohibit s “ us[ing] unfair or unconscionable means t o collect or at t empt t o collect any debt ” including “ collect ion of any amount . . . unless such amount is expressly aut horized by t he agreement creat ing debt . ” 15 U.S.C. § 1692f ; Mil j kovic, 791 F.3d at 1308. Claims under § 1692f are also analyzed using t he “ least sophist icat ed consumer” st andard. Le Bl anc, 601 F.3d 1185, 1200. Midland has not “ allege[d] any conduct beyond t hat which he assert s violat es t he ot her provisions of t he FDCPA, and . . . f ails t o specifically ident ify how [Midland’ s] conduct here Page 22 of 26 was eit her unfair or unconscionable in addit ion t o being abusive, decept ive, or misleading.” Mil j kovic, 791 F.3d at 1308. Therefore, t he success of t his claim is largely dependent on t he out come of t he § 1692e claim, as t he fact ual assert ions are ident ical. LeBl anc, 601 F.3d at 1200. As wit h § 1692e, t he bona fide error defense is also applicable t o § 1692f, and t he analysis will be t he same, as t he conduct alleged is indist inguishable. Thus, summary j udgment as t o Count s Six and Seven is due t o be denied. 4. 15 U.S.C. § 1692i Mot es does not ment ion § 1692i in his Response t o Defendant ’ s Mot ion for Summary Judgment (Doc. 34). Because “ grounds alleged in t he complaint but not relied upon in summary j udgment are deemed abandoned, ” Mot es’ s claims against Midland under § 1692i are deemed abandoned. Resol ut ion Trust Corp., 43 F.3d at 599. Summary j udgment in Midland’ s f avor is due t o be grant ed as t o Count Eight . C. St at e Law Claims 1. Invasion of Privacy Mot es does not ment ion his claim f or invasion of privacy in his Response t o Defendant ’ s Mot ion for Summary Judgment (Doc. 34). Therefore, Mot es’ s claims against Midland f or invasion of privacy are Page 23 of 26 deemed abandoned. See Id. Summary j udgment in Midland’ s favor is due t o be grant ed as t o Count Nine. 2. Hiring, Training, and Supervision Mot es does not ment ion his hiring, t raining and supervision claims in his Response t o Defendant ’ s Mot ion for Summary Judgment (Doc. 34). Therefore, Mot es’ s claims against Midland for negligent , want on, or int ent ional hiring, t raining and supervision are deemed abandoned. See Id. Summary j udgment in Midland’ s favor is due t o be grant ed as t o Count s Ten 7 and Eleven. 3. Want on Conduct Mot es does not ment ion t he want on conduct claim in his Response t o Defendant ’ s Mot ion f or Summary Judgment (Doc. 34). Therefore, Mot es’ s claims against Midland f or want on conduct are deemed abandoned. See Id. Summary j udgment in Midland’ s f avor is due t o be grant ed as t o Count Twelve. 4. Malicious Prosecut ion In order t o st at e a claim for malicious prosecut ion under Alabama law, a plaint iff must show t he exist ence of “ (1) a j udicial proceeding 7 Mot es’ s complaint list s t wo Count Tens. The first one is for “ Negligent Hiring, Training and Supervision of Incompet ent Debt Collect ors.” The second is for “ Want on Hiring, Training, and Supervision of Incompet ent Debt Collect ors.” Summary j udgment in Midland’ s favor is grant ed as t o bot h. Page 24 of 26 init iat ed by t he defendant , (2) t he lack of probable cause, (3) malice, (4) t erminat ion in favor of t he plaint iff , and (5) damage. ” Cut t s v. Am. Unit ed Lif e Ins. Co., 505 So.2d 1211, 1214 (Ala. 1987). Here, t wo of t he element s are easily proven by t he plaint if f. There is no disput e t hat Midland init iat ed a j udicial proceeding against Mot es in st at e court , or t hat j udgment was ent ered in f avor of Mot es in t he st at e court suit . The element s of lack of probable cause, malice, and damage are in disput e. A finding of probable cause requires “ t hat t he claimant reasonably believe t hat t here is a chance t hat his claim may be held valid upon adj udicat ion.” Wil l is v. Parker, 814 So.2d 857, 863 (Ala. 2001). As explained above in t he discussion about § 1692e, Midland could reasonably have believed t hat Mot es owed t he debt sued upon. However, it is disput ed whet her Midland could have reasonably believed t hat t hey could win t he collect ions suit wit hout present ing t he PSA and wit h document s t hat purport ed t o st at e t hat “ MKE Mot es” owed t he debt . Therefore, t here is a disput e of mat erial f act about t he element of probable cause. Because t here is a disput e of mat erial f act on at least one of t he element s of malicious prosecut ion, summary j udgment on Count Thirt een is due t o be denied. IV. CONCLUSION Page 25 of 26 For t he reasons st at ed above, Midland’ s mot ion for summary j udgment is due t o be GRANTED in part and DENIED in part . Summary j udgment as t o Count s Two, Three, Four, Five, Six, and Seven is due t o be denied. Summary j udgment in Midland’ s favor is due t o be grant ed as t o Count s One, Eight , Nine, Ten, Ten, 8 Eleven, Twelve, and Thirt een. Furt her, Plaint if f’ s Mot ion t o St rike (Doc. 33) and Defendant s’ Mot ion t o St rike (Doc. 39) are DENIED AS MOOT. A separat e order consist ent wit h t his opinion will be ent ered. DONE and ORDERED t his 6t h day of January 2017. _____________________________ L. Scot t Coogler Unit ed St at es Dist rict Judge 186291 8 As previously not ed, Plaint if f list ed t wo Count Tens in his Complaint (Doc. 1). Summary j udgment is due t o be grant ed as t o bot h of t hese count s. Page 26 of 26
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