Brandon v. Eaton Group Attorneys, LLC, No. 2:2016cv13747 - Document 17 (E.D. La. 2017)

Court Description: ORDER AND REASONS denying 8 Motion for Summary Judgment. Signed by Judge Sarah S. Vance on 1/24/17. (jjs)
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Brandon v. Eaton Group Attorneys, LLC Doc. 17 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA CASSANDRA BRANDON VERSUS CIVIL ACTION NO. 16-13747 EATON GROUP ATTORNEYS, LLC SECTION “R” (1) ORD ER AN D REASON S Dr. Cassandra Brandon sued Eaton Group Attorneys, LLC, alleging that a debt collection letter sent by Eaton Group violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq., and the Louisiana Unfair Trade Practice and Consum er Protection Act, LA. Rev. Stat. § 51:140 1-18. Eaton Group m oves for sum m ary judgm ent, and argues that its letter offends neither statute as a m atter of law. For the following reasons, the Court denies Eaton Group’s m otion. I. BACKGROU N D On May 6, 20 16, Eaton Group Attorneys, LLC, as the representative of National Collegiate Student Loan Trust 20 0 7-1, filed a petition against Dr. Brandon in the 24th J udicial District Court for the Parish of J efferson.1 In 1 R. Doc. 9-4 at 3. its petition, the Student Loan Trust alleged that Dr. Brandon had defaulted on a debt, and sought $ 41,115.13, plus accrued interest of $ 4,998.37, additional interest at the rate of 4% from the date of judgm ent, and costs.2 On or around J une 3, 20 16, Dr. Brandon received a letter from Eaton Group concerning the lawsuit and her alleged debt.3 The subject line of the letter described it as a “REQUEST FOR PAYMENT ARRANGEMENTS.”4 The letter stated: Dear CASSANDRA PLUMMER: 5 If you would like to explore a voluntary repaym ent plan, then please provide the requested inform ation. The debt will need to be acknowledged through the attached consent judgm ent. Please return these form s as soon as possible. This is a com m unication from a debt collector. This is an attem pt to collect a debt. Any inform ation obtained will be used for that purpose. Teressa Cooper Legal Assistant 6 The letter also included a form for Dr. Brandon to provide inform ation— including address, social security num ber, and em ployer’s contact inform ation—for both Dr. Brandon and her spouse.7 2 3 4 5 6 7 Id. R. Doc. 9-2 at 2; R. Doc. 8-2 at 4-5. R. Doc. 8 -2 at 4. Plum m er is Dr. Brandon’s m aiden nam e. R. Doc. 8 -2 at 4. Id. 2 Attached to the letter was a partially com pleted consent judgm ent 8 and a copy of the petition in the J efferson Parish case.9 The consent judgm ent stated: IT IS ORDERED, ADJ UDGED, AND DECREED that judgm ent be rendered in favor of the Plaintiff, NATIONAL COLLEGIATE LOAN TRUST 20 0 7-1, and against the defendant, CASSANDRA PLUMMER (SSN []), in the full sum of $ 41,115.13, together with accrued interest of $ 4,998.37, and additional interest of 4% from date of judgm ent, and for all costs of these proceedings, subject to a credit of $ .0 0 . 10 The consent judgm ent had already been signed by a representative of the Eaton Group.11 In her com plaint, Dr. Brandon alleges that this letter “was deceptive and m isleading as it attem pted to trick [her] into signing a consent judgm ent by prom ising a voluntary repaym ent plan.”12 She brings claim s under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692, et seq., and the Louisiana Unfair Trade Practice and Consum er Protection Act (LUTPA), LA. Rev. Stat. § 51:140 1-18. The Eaton Group now m oves for sum m ary judgm ent, arguing that the letter it sent to Dr. Brandon was non-deceitful as a m atter of law. 8 9 10 11 12 Id. at 5. Id. at 2. Id. at 5. R. Doc. 9-3 at 2. R. Doc. 1 at 5. 3 II. LEGAL STAN D ARD Sum m ary judgm ent is warranted when “the m ovant shows that there is no genuine dispute as to any m aterial fact and the m ovant is entitled to judgm ent as a m atter of law.” Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 10 69, 10 75 (5th Cir. 1994). When assessing whether a dispute as to any m aterial fact exists, the Court considers “all of the evidence in the record but refrain[s] from m aking credibility determ inations or weighing the evidence.” Delta & Pine Land Co. v. N ationw ide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 20 0 8). All reasonable inferences are drawn in favor of the nonm oving party, but “unsupported allegations or affidavits setting forth ‘ultim ate or conclusory facts and conclusions of law’ are insufficient to either support or defeat a m otion for sum m ary judgm ent.” Galindo v. Precision Am . Corp., 754 F.2d 1212, 1216 (5th Cir. 198 5); see also Little, 37 F.3d at 10 75. “No genuine dispute of fact exists if the record taken as a whole could not lead a rational trier of fact to find for the non-m oving party.” EEOC v. Sim baki, Ltd., 767 F.3d 475, 481 (5th Cir. 20 14). If the dispositive issue is one on which the m oving party will bear the burden of proof at trial, the m oving party “m ust com e forward with evidence which would entitle it to a directed verdict if the evidence went 4 uncontroverted at trial.” Int’l Shortstop, Inc. v. Rally ’s, Inc., 939 F.2d 1257, 1264-65 (5th Cir. 1991). The nonm oving party can then defeat the m otion by either countering with evidence sufficient to dem onstrate the existence of a genuine dispute of m aterial fact, or “showing that the m oving party’s evidence is so sheer that it m ay not persuade the reasonable fact-finder to return a verdict in favor of the m oving party.” Id. at 1265. If the dispositive issue is one on which the nonm oving party will bear the burden of proof at trial, the m oving party m ay satisfy its burden by m erely pointing out that the evidence in the record is insufficient with respect to an essential elem ent of the nonm oving party’s claim . See Celotex, 477 U.S. at 325. The burden then shifts to the nonm oving party, who m ust, by subm itting or referring to evidence, set out specific facts showing that a genuine issue exists. See id. at 324. The nonm ovant m ay not rest upon the pleadings, but m ust identify specific facts that establish a genuine issue for trial. See, e.g., id.; Little, 37 F.3d at 10 75 (“Rule 56 m andates the entry of sum m ary judgm ent, after adequate tim e for discovery and upon m otion, against a party who fails to m ake a showing sufficient to establish the existence of an elem ent essential to that party’s case, and on which that party will bear the burden of proof at trial.” (quoting Celotex, 477 U.S. at 322)). 5 III. D ISCU SSION Eaton Group m oves for sum m ary judgm ent on both Dr. Brandon’s FDCPA claim s and her LUTPA claim . The Court considers each in turn. A. FD CPA The FDCPA seeks to elim inate “abusive, deceptive, and unfair debt collection practices” by regulating the type and num ber of contacts a “debt collector”13 can m ake with a debtor. See 15 U.S.C. § 1692(a). Section 1692e of the law prohibits debt collectors from using “any false, deceptive, or m isleading representation or m eans in connection with the collection of any debt.” Sim ilarly, “[a] debt collector m ay not use unfair or unconscionable m eans to collect or attem pt to collect any debt.” 15 U.S.C. § 1692f. Congress “clearly intended the FDCPA to have a broad rem edial scope,” and the law “should therefore be construed broadly and in favor of the consum er.” Daugherty v. Convergent Outsourcing, Inc., 836 F.3d 50 7, 511 (5th Cir. 20 16) (quoting Serna v. Law Office of Joseph Onw uteaka, P.C., 732 F.3d 440 , 445 (5th Cir. 20 13)). In considering whether a debt collection letter violates these provisions, the Court views the letter from the perspective of “an 13 The Eaton Group does not appear to contest that it qualifies as a debt collector under the FDCPA. 6 unsophisticated or least sophisticated” consum er. Gosw am i v. Am . Collections Enter., Inc., 377 F.3d 488, 495 (5th Cir. 20 0 4). Such a consum er is assum ed to be “neither shrewd nor experienced in dealing with creditors.” Id. Still, “we do not consider the debtor as tied to the very last rung on the intelligence or sophistication ladder.” Id. (internal quotations and m odifications om itted). A collection letter is m isleading or deceptive “when it can be reasonably read to have two or m ore different m eanings, one of which is inaccurate.” Gom ez v. N iem ann & Hey er, L.L.P., No. 16-119, 20 16 WL 3562148, at *5 (W.D. Tex. J une 24, 20 16) (quoting Russell v. Equifax A.R.S., 74 F.3d 30 , 35 (2nd Cir. 1996)); see also Gonzales v. Arrow Fin. Servs. LLC, 660 F.3d 10 55, 10 62 (9th Cir. 20 11); Rosenau v. Unifund Corp., 539 F.3d 218, 222 (3rd Cir. 20 0 8). In a suit seeking statutory dam ages, the plaintiff need not prove that she was actually m isled by the letter. Bartlett v. Heibl, 128 F.3d 497, 499 (7th Cir. 1997). The Court finds that the letter plaintiff received was m isleading because an unsuspecting debtor, seeking only to “explore a voluntary repaym ent plan,”14 could be fooled into executing the consent judgm ent without knowledge of the consequences. Specifically, an unsophisticated debtor m ay not know that the consent judgm ent will serve to waive 14 R. Doc. 8 -2 at 4. 7 potentially valid defenses and m ay facilitate a wage garnishm ent order. Plaintiff alleges that defendant did not intend to use the consent judgm ent for a voluntary repaym ent plan, but rather to enforce involuntary repaym ent. If a repaym ent plan is “explore[d],” but no repaym ent plan is actually agreed to, the debtor is still bound by the acknowledgem ent and consent judgm ent. This follows because the letter could be read to m ean the debtor is receiving only the right to “explore” an unspecified repaym ent plan by signing the acknowledgm ent and consent judgm ent. Under these circum stances, the debtor has to sign the consent judgm ent and acknowledge the debt before he even knows the term s of the paym ent plan to be “explore[d].” Unsophisticated consum ers m ay be unaware that they will have no leverage to negotiate a paym ent plan because they will be bound by the acknowledgem ent and consent judgm ent even if the plan offered is never agreed to. Defendants’ argum ent that the letter expresses their purpose not to enforce the consent judgm ent if plaintiff adheres to an agreed paym ent plan is not supported by the language of the letter. The Fifth Circuit’s recent decision in Daugherty v. Convergent Outsourcing, Inc., 836 F.3d 50 7 (5th Cir. 20 16), is instructive in evaluating Dr. Brandon’s claim . In Daugherty , the court found that allegations concerning a collection letter that contained an offer to “settle” a tim e-barred 8 debt stated a claim for deceptive and m isleading practices under the FDCPA. In deciding the case, the Fifth Circuit quoted approvingly from sim ilar cases in the Sixth and Seventh Circuits. Id. at 511-12. Those circuits both found that, because the offer to “settle” a tim e-barred debt could fool an unsuspecting debtor into reviving the barred debt—and thereby place the debtor in a worse position—letters containing such offers and no disclosure of the associated risk m ay be m isleading. McMahon v. LVN V Funding, LLC, 744 F.3d 10 10 , 10 21 (7th Cir. 20 14) (letters could be m isleading, in part, because “a gullible consum er who m ade a partial paym ent would inadvertently have reset the lim itations period and m ade herself vulnerable to a suit on the full am ount”); Buchanan v. N orthland Grp., Inc., 776 F.3d 393, 399 (6th Cir. 20 15) (partial paym ent “exposes a debtor to substantial new risk” and therefore “[w]ithout disclosure, a well-m eaning debtor could inadvertently dig herself into an even deeper hole.”). Agreeing with these cases, the Fifth Circuit held that “a collection letter seeking paym ent on a tim e-barred debt (without disclosing its unenforceability) but offering a ‘settlem ent’ and inviting partial paym ent (without disclosing the possible pitfalls) could constitute a violation of the FDCPA.” Daugherty , 836 F.3d at 513. 9 Here, as in Daugherty , McMahon, and Buchanon, Eaton Group’s letter invites the consum er to “explore” a voluntary repaym ent plan, but because Eaton Group’s offer requires the consum er to “acknowledge” the debt and execute the attached consent judgm ent to even try to negotiate a voluntary repaym ent plan, a “well-m eaning debtor” seeking to negotiate a paym ent plan “could inadvertently dig herself into an even deeper hole.” Daugherty , 836 F.3d at 513 (quoting Buchanan, 776 F.3d at 399). Specifically, the consum er could unknowingly waive potential defenses, and subject herself to wage garnishm ent, and this could occurred even if no repaym ent plan is ultim ately agreed to. These are substantial “possible pitfalls,” id., and the letter evinces no attem pt at disclosure. Accordingly, drawing all reasonable inferences in favor of Dr. Brandon, the Court cannot find that Eaton Group’s letter is neither m isleading nor deceptive as a m atter of law. Eaton Group’s portrayal of the letter as a settlem ent offer does not disturb this conclusion. See Gosw am i, 377 F.3d at 496 (“A collection agency m ay offer a settlem ent; however, it m ay not be deceitful in the presentation of that settlem ent offer . . . .”). B. LU TPA LUTPA prohibits “[u]nfair m ethods of com petition and unfair or deceptive acts or practices in the conduct of any trade or com m erce.” La. Rev. 10 Stat. § 51:140 5(A). “[A] practice is unfair when it offends established public policy and when the practice is unethical, oppressive, unscrupulous, or substantially injurious.” Rogers v. Brooks, 122 F. App’x 729, 733 (5th Cir. 20 0 4) (quoting Jarrell v. Carter, 577 So.2d 120 , 123 (La. App. 1 Cir.1991). A practice is deceptive “when it am ounts to fraud, deceit, or m isrepresentation.” Mixon v. Iberia Surgical, L.L.C., 956 So. 2d 76, 80 (La. App. 3 Cir. 20 0 7). A practice need not be both unfair and deceptive to fall under LUTPA, either will suffice. Monroe Med. Clinic, Inc. v. Hosp. Corp. of Am ., 622 So. 2d 760 , 763 (La. App. 2 Cir 1993). Determ ination of whether a particular practice offends LUTPA is largely left to the courts, and is to be determ ined on a “case-by-case basis.” Turner v. Purina Mills, Inc., 989 F.2d 1419, 1422 (5th Cir. 1993). The Court finds that sum m ary judgm ent under LUTPA is inappropriate for the sam e reasons as the FDCPA. As noted, Eaton Group’s conduct could be deem ed a deceptive attem pt to fool an unsuspecting debtor seeking only to explore a voluntary paym ent plan into waiving valid defenses and subjecting herself to wage garnishm ents. Whether this conduct offends LUTPA is a question of fact, best suited for the jury. SnoW izard, Inc. v. Robinson, 897 F. Supp. 2d 472, 488 (E.D. La. 20 12) (“[T]his claim should be sent to a jury to determ ine if SnoWizard’s behavior im plicated LUTPA, and 11 therefore SnoWizard’s m otion for sum m ary judgm ent on this issue is denied.”); see also Fagan v. Law rence N athan Assocs., Inc., 957 F. Supp. 2d 784, 80 1 (E.D. La. 20 13) (granting default judgm ent to plaintiff alleging debt collection practices in violation of LUTPA). To resist this conclusion, Eaton Group argues that Louisiana courts have ruled attorneys im m une to LUTPA. The Court finds that Eaton Group’s only supporting case, Thibaut, Thibaut, Garrett & Bacot v. Sm ith & Loveless, Inc., 576 So. 2d 532 (La. App. 1 Cir. 1990 ), is distinguishable. Loveless concerned whether the legislature or Suprem e Court had authority to regulate how attorneys collect legal fees from their ow n clients. It does not stand for the m ore sweeping proposition that, by gaining adm ission to the Louisiana bar, a person m ay im m unize him self from LUTPA entirely. See Reed v. Allison & Perrone, 376 So. 2d 10 67, 10 69 (La. App. 4 Cir. 1979) (attorney advertising m ay be regulated under LUTPA). IV. CON CLU SION For the foregoing reasons, Eaton Group’s m otion for sum m ary judgm ent is DENIED. 12 New Orleans, Louisiana, this _24th _ day of J anuary, 20 17. ___ _____________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE 13