Albritton v. Sessoms & Rogers, P.A. et al, No. 5:2009cv00321 - Document 34 (E.D.N.C. 2010)
Court Description: ORDER granting 20 Motion to Dismiss and denying 30 Motion to Strike. The clerk is directed to close this case. Signed by Senior Judge Malcolm J. Howard on 8/3/10. (Lee, L.)
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Albritton v. Sessoms & Rogers, P.A. et al Doc. 34 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA WESTERN DIVISION NO.: 5:09-CV-321-H OSCAR ALBRITTON, Plaintiff, v. ORDER SESSOMS & ROGERS, P.A., et al. Defendants. This matter is before the court on defendants' motion dismiss pursuant to Federal Rule of Civil Procedure 12(b) (6) plaintiff's motion to strike. filed, and the time for to and Responses and replies have been further filings has expired. These matters are ripe for adjudication. STATEMENT OF THE CASE On with July 15, this 2009, court, plaintiff asserting Collections Practices Act state governing debt laws plaintiff Richard J. filed claims ("FDCPA") as collection his original under well the as LLC Jr. activities. ("De Giacomo"), ("North Star"), and complaint Fair North suit against Sessoms and Rogers, De Giacomo, Acquisi tions, filed Carolina Initially, P.A. North Star Jessica Debt Sled. ("S&R"), Capital However, Dockets.Justia.com plaintiff voluntarily dismissed his claims against Ms. Sled on August 29, 2009. On September 1, 2009, pursuant to Rule 12 (b) (6) of the Federal Rules of Civil Procedure, the remaining defendants filed a motion to dismiss plaintiff's complaint in its entirety for failure to state a claim upon which relief can be granted. Plaintiff responded by filing his amended complaint in which he dropped added his state-law an Defendants additional claims, basis subsequently added for filed a factual relief motion to allegations, under the dismiss and FDCPA. plaintiff's amended complaint on October 2, 2009. Finally, on suggestion of February 25, February 11, 2010, defendants submitted subsequently decided controlling authority. a On 2010, plaintiff moved to strike this notice in its entirety. STATEMENT OF THE FACTS Plaintiff, account with Oscar Albritton, Wells Fargo Bank. maintained Sometime a personal prior to credit 2008, plaintiff defaulted on his debt of around $4,000 by not making payments on the account under the required terms. The defaulted debt was sold by Wells Fargo in May of 2008 to defendant North Star, who engages in the business of collecting consumer debts and purchasing defaulted debt. 2 In the process of collecting plaintiff's debt, employed defendant S&R, a North Carolina business of collecting consumer debts. law North Star firm in the S&R filed a state-court debt collection action on behalf of North Star against plaintiff on January 23, 2009, (Am. Compl. ~ 29.) North Carolina. In in the District Court of Cumberland County, preparation requested North for Star its execute lawsuit an against affidavit details of plaintiff's outstanding debt. February 3, 2009, an employee of plaintiff, setting (Am. CompI. North Star, S&R out ~ the 31.) Jessica On Sled, executed an affidavit ("the Sled Affidavit") stating in part: Oscar Albritton is currently indebted to North Star Capital Acquisitions, LLC, the Plaintiff herein, in the sum of $4,064.10, together with interest thereon at the rate of 8.00% per annum from and after November 26, 2008, and costs. (Sled. Aff. ~ 5 (emphasis in original) [DE #16 Ex. 1].) Also pertinent to the motions before the court, paragraph four of the Sled Affidavit stated: If a statement of account is attached hereto, that statement is a true and accurate accounting and accurately reflects the sums owed by [Albritton] to North Star Capital Acquisitions, LLC pursuant to the written credit agreement between the parties. 3 (Sled. ~ Aff. attached. However, 4.) no such statement of account was Ms. Sled signed only the one-page affidavit that day, February 3, 2009. Cumberland arbitration County for District certain civil Court cases. utilizes North nonbinding Star's action against plaintiff to collect the $4,064.10 debt was selected for such arbitration. The governing arbitration rules required the parties to exchange information as to their witnesses, evidence, and contentions prior to the arbitration hearing. ~ For 39. ) purposes of this pre-arbitration (Am. Compl. exchange, S&R calculated what plaintiff's total outstanding debt would be at the time of arbitration, June 11, 2009. (Stmt. of Acct. [DE #16 Ex. was as 1].) Defendant avers that this necessary the arbitration rules required plaintiffs to state what award they were seeking. 13-14.) (Defs.' Mem. Supp. Dfs.' Mot. Dismiss of $4,239.50, and then put 2009 to calculate the balance this Statement of Account dated May 29, 2009. the at S&R used the principal and interest rate as set out in the Sled Affidavit of February 3, owed [DE #21] amounts Affidavit incorrect. or contained the May in 29, either 2009 the figure in a one-page Neither party alleges February Statement of 3, 2009 Account Sled are 1 1 The court notes that even though plaintiff appears to summarily dispute the validity of the debt (Am. Compo ~ 26) this 4 An attorney Giacomo, Jr., employed S&R, defendant Richard J. De submitted North Star's pre-arbitration packet to plaintiff on May scheduled arbitration. 29, stapled together: February 3, by 2009, approximately The packet ten days consisted of before five the pages a two-page statement concerning the case; the 2009 Sled Affidavit; the May 29, 2009 Statement of Account; and a demand letter dated December 28, 2008. Plaintiff's complaint misrepresentation arbitration February because it Account, ~~ ~ is 28, 3, involving proceeding. 2009 in fact alleges Sled three these First, to the of documents plaintiff Affidavit swears acts is May a in claims false 29, deception or pre- that the representation 2009 Statement a document that was not yet in existence. 36.) the (Am. of Compl. In this vein, plaintiff construes the statement in 4 of the February 3, 2009 Sled Affidavit 2 to mean that Ms. Sled swearing that if at any future point physically attaches to the piece of paper she day on February 3, 2009, in time, anyone is signing that any statement of account, she swears is mentioned only once in a paragraph establishing jurisdiction and, even reading the complaint in the light most favorable to plaintiff, the amount or existence of the debt cannot be said to form the basis of any of his FDCPA claims. Plaintiff's FDCPA claims are derived solely from the manner in which the Statement of Account and Sled Affidavit were allegedly sworn to and presented. For purposes of this action, the amount of the debt at issue is therefore not a point of contention. 2 [I]f a statement of account is attached hereto, that statement is a true and accurate accounting ... " (Sled Aff. ~ 4) U 5 under oath and risk of perjury to the accuracy and truth of such future Plaintiff document. impossible; it is a thus asserts that this is lie to swear to something you have never seen, and therefore both Ms. Sled and the affidavit are "false, deceptive, and/or misleading." (Am. Compl. ~ 37.) Second, plaintiff argues that the Sled Affidavit is a false representation in and of itself because Ms. whether a statement of signed the document. she ~ attached or not 34). when she is It alleged circumstances unclear arrives at The court is left to construe the claim, on the face of its language, because was (Am. Compl. exactly under what this conclusion. account Sled did not know could not, that Ms. as a Plaintiff Sled gave a false statement matter a physical observation, determine whether a statement of account was "attached" piece of paper she was signing, "[i]f a Aff. ~4) statement of account to the and therefore her conditional is attached ... " language, (Sled. was dishonest/false/fraudulent. Plaintiff's third and final that defendant falsely represented to plaintiff that the February 3, 2009 Sled Affidavit swore to the May 29, Comp 1. ~ actually 36). 2009 Statement of Account. (Am. Plaintiff alleges that, even if Ms. Sled did not attest to a stapling the May 29, 3, allegation is 2009 affidavit, non-existent statement of account by 2009 Statement of Account to her February defendants falsely represented to plaintiff 6 that Ms. Account Sled had sworn to 116 days before the validity of it even the Statement of This existed. misrepresentation is based solely on the manner alleged in which the documents were stapled together in the pre-arbitration packet. The §§ above three acts are all alleged as conduct violating 1692e (2) (A), 1692e (10), and 1692f of the FDCPA. COURT'S DISCUSSION I. Standard of Review Federal Rule of Civil Procedure 12 (b) (6) provides that a court may dismiss a complaint for failure to state a claim upon which relief can be granted. The intent of Rule 12(b) (6) test complaint. the Goldsboro, survive a sufficiency 178 F.3d 12 (b) (6) of a 231, 243 Edwards (4th Cir. motion to dismiss, a 1999). v. is to City of In order to complaint must allege facts that raise a right to relief above the speculative level. Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007). A plaintiff must provide "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." (2009) . the Id. at 555; Ashcroft v. 129 S. Ct. 1937, 1949 While a court must accept as true all allegations in plaintiff's favorable Iqbal, to the complaint, plaintiff, and view it conclusions drawn from the facts" 7 need them not in the "accept light most the legal nor "unwarranted inferences, unreasonable Corp., 444 conclusions, F.3d 312, 319 plausible on its face. facial or arguments." (4th Cir. Twombly, Kloth v. A claim must 2006). pleads be "A claim has 550 U.S. at 570. plausibility when the plaintiff Microsoft factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct Iqbal, alleged." 129 S.Ct. at 1949. II. Sufficiency of Claims Pled Under 15 U.S.C. § 1692e(2) (A) Plaintiff claims defendants are liable under § 1692e (2) (A) of the FDCPA, which provides in pertinent part: A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt . . [T]he following conduct is a violation of this section: (2) The false representation of (A) 15 U.S.C. § the character, of any debt; 1692e(2) (A) Plaintiff has not amount, or legal status (emphasis added) . properly pled a § 1692e(2) (A) claim because he has not alleged any facts from which the court could draw a reasonable inference that the character, amount, or legal status of plaintiff's debt was falsely represented. There are no facts whatsoever in the pleading setting out or alleging that either the $4,064.10 balance in 8 the Sled Affidavit or the $4,239.50 balance in the May 29, falsely represented. In fact, status in of the questioned. 3 debt 2009 Statement of Account were the amount, question have Plaintiff's claims deal character, never been 1692e (2) (A) § claim seriously strictly with the manner and means by which proof of the debt was presented. plaintiff's and legal dealing with Therefore, the false representation of the debt itself has not been properly pled and should be dismissed. III. Sufficiency of Claims Pled Under 15 U.S.C. Plaintiff under § additionally 1692e(10) of the claims that FDCPA, (Am. § 1692e(10) defendants Compl. ~ are liable 80), which prohibi ts a debt collector from using any false representation or deceptive means to collect or attempt to collect any debt or to § obtain information concerning a consumer. 15 U.S.C. favorable to the 1692e (10) . Reading the complaint in the light most plaintiff, there are three ways plaintiff appears to be alleging defendants used a actionable under § "false representation" or "deceptive means" 1692e(10) of the FDCPA: (1) The Sled Affidavit is a false representation because it in fact swears to the May 29, 2009 Statement of Account; 3 See n.l supra. 9 (2) The Sled Aff idavi t deceptive because Ms. is a false representation or is Sled did not know whether a statement of account was attached when she signed; and/or (3) Sled Defendants Affidavit Account. a. falsely attested represented to the May to plaintiff 29, 2009 that the Statement of Each branch of plaintiff's claim is discussed below: The Sled Affidavit is a False Representation Because it Swears to the Statement of Account. Plaintiff alleges representation" in that the defendants process because the February 3, of employed a "false collecting plaintiff's 2009 Sled Affidavit swore to the and accuracy of the May 29, 2009 Statement of Account. plaintiff's own words, "[a]t the time Ms. Sled debt truth Yet, in swore as an affiant, it was not possible for her to swear that any statement of account attached would be a true and accurate accounting and accurately reflect the sums owed at some future point in time." ~ (Am. Compl. the assertion documents, 35.) Ms. With no supporting facts pled to back up Sled plaintiff requirement. was has swearing not met to the future non-existent threshold pleading The court would have to construe the statement "If a Statement of Account is Attached" in such a highly unusual and hyper-technical way as to conclude Ms. piece of paper Sled was swearing to any stapled to her Affidavit 10 for all time. Even under the interpretation of the least sophisticated consumer, 4 Ms. Sled swore solely to what was in front of her on February 3, 2009, which did not include the May 29, 2009 statement. As such, plaintiff's theory is unsupported by the face of the affidavit in question and he has not pled a plausible statement of facts to survive a motion to dismiss on this theory. b. The Sled Affidavit is a False Representation in and of Itself Because Ms. Sled Did Not Know Whether or Not a Statement of Account was Attached When She Signed Plaintiff asserts that "Ms. Sled did not know at the time she swore as affiant whether a statement of account was attached to her affidavit or not" renders her affidavit a the presence conditional of statement Compl. ~ 34) false representation. because she did not know, to (Am. did not care, anything "If a attached Statement and claims this In other words, or was willfully blind to of her affidavit, Account is her attached ." was somehow deceptive or misleading. It is undisputed that when Ms. Sled affixed her signature to her affidavit no statement of account was attached. It would therefore be an unreasonable inference to conclude that she was unaware whether or not any other documents were attached to the 4 The case, United States v. Nat'l Fin. Servs. Inc., 98 F.3d 136 (4th Cir. 1996), set forth a "least sophisticated consumer standard" , in which the court must look at the alleged actionable conduct with respect to how the least sophisticated consumer's understanding of the debt or his FDCPA rights might be affected. 11 Furthermore, one-page affidavit. even if this allegation were plausible, plaintiff has not explained how this conduct would be a misrepresentation or deception aside from the mere conclusory accusation that it is Based deceptive. on the foregoing, plaintiff has not pled a plausible act of false representation or deception. c. Defendants Falsely Represented to Plaintiff that the Sled Affidavit Swore to the Accuracy of the May Statement of Account Plaintiff's last around defendants' the Sled pled of misrepresentation centers act of stapling the Statement of Account to Affidavit. Plaintiff statement to the affidavit, Ms. act alleges that by stapling the defendants falsely represented that Sled had sworn to the validity of the Statement of Account 116 days before it even existed. For this claim, the court determine must whether defendants' actions would plausibly deceive or mislead the least sophisticated Inc., 98 consumer. F.3d 131 (4th United Cir. States 1996) sophisticated consumer" standard). v. Nat'l (setting Fin. out the Servs., "least While this standard protects consumers from the "gullible" to the "shrewd," it also "prevents liability for bizarre collection notices or idiosyncratic by preserving a quotient interpretations of of reasonableness and presuming a basic level of understanding and willingness to read wi th care." Nat'l Fin. Servs., 12 98 F.3d at 136. Thus, the issue in this case, based on plaintiff's facts and exhibits, whether under it is the plausible circumstances deceived by the that a rational presented manner in here which consumer, would be defendants is operating misled or stapled the arbitration packet. Defendants submitted four documents, of five pages, consisting of a total in a pre-arbitration packet to plaintiff and the Even assuming that the Sled Affidavit and Statement arbitrator. of Account were stapled right next to each other in that packet, the court is unable to discern how even the least sophisticated consumer could have been deceived or misled by defendants' actions. Based on the forgoing, § plaintiff has not pled a plausible 1692e claim. IV. Sufficiency of Claim Pled Under 15 U.S.C. § 1692f Plaintiff also alleges that he is entitled to damages under 15 U. S. C. 1692f. This cause of action under the FDCPA is a sort of catch-all, picking up unfair practices that manage to slip by 1692e. debt § Section 1692f provides generally, "a collector may not use unfair or unconscionable means to collect §§ or 1692d & attempt to collect any debt." The section then provides eight specific practices that are violations with the qualification that an action under those enumerated violations. 13 § 1692f is not limited to Plaintiff has not alleged that defendants falls 1692f's § the eight enumerated general "unfair" or is of acts in light "unconscionable" Plaintiff's alleged harm here prohibition. the categories This court thus considers defendants' violations. of under the conduct of any of conduct that, when the allegedly false/deceptive arbitration packet is relied upon, causes more the May 29, likely ~ (Am. Compl. It is the appear clear reliance it was without plaintiff on one has of Statement of Account "unfairly" 2009 Statement page long. balance that the "appear to be false statement." 66.) not plaintiff's makes valid 2009 Statement of Account to it or of It pled displays uncontrovertibly sworn showing alleged misrepresentations (a) appear more more prepared by the facts the "unconscionably" Account any balance to in valid, valid. or (b) The May 29, defendants of the is $4,064.10, one-half the same Sled Affidavit. It then uses an elementary calculation with the 8% interest rate, also sworn to in the Sled Affidavit, 2009 balance of $4,239.50. these figures are disputed. to arrive at a June 11, The difference is $175.48. None of It is further clear from the facts and evidence presented with the complaint that there was a debt collection action against him. notice that the Ex. 1 (demand debt letter was accruing stating, interest. "[Plaintiff] 14 plaintiff knew He was also on (See should Am. Compl. be aware, however, that interest Based on account. ") . ) supporting exhibit, facts continue may the face of plaintiff has to plaintiff's not pled a complaint plausible indicating that any misrepresentation resulting stapling of the acknowledged, documents by on accrue would defendants the and set of from the make an readily calculable balance due "appear more likely valid," especially unfairly or unconscionably so. Based on § the 1692f claim, to plaintiff's V. foregoing, plaintiff and defendants' § has not pled a proper motion to dismiss is granted as 1692f claim. Materiality Defendants additionally argue properly pled that defendants' or misleading, even if plaintiff has statements or actions were false these false or misleading statements/actions are not actionable because P'ships LLC, that they are not material. 557 F.3d 755, 757-58 (7th Cir. Hahn v. 2009) Triumph ("Materiality is an ordinary element of any federal claim based on a false or misleading it is statement. material, so a A statement false but cannot non-material mislead statement unless is not actionable."); see also Miller v. Javitch, Block & Rathbone, 561 F.3d 588, 596 (6th Cir. 2009). Although the materiality standard has not been addressed by the Fourth Circuit Court of Appeals, recently adopted the "materiality" 15 in this district the court standard from the Sixth and Seventh Circuits. (Order, 5 : 08 - cv - 615 - D (E . D. N. C. brought an FDCPA § O'Fay v. Feb. of contained a a The statement. Rogers, P.A., a No. plaintiff 1692e claim because the defendant law firm billing minor & In 0' Fay, 9 2010). 5 mistakenly labeled an exhibit "copy" Sessoms statement, address court in its when error concluded state-court action as in from that fact the any a the exhibit original billing confusion would be "immaterial" and in no way would mislead the debtor as to her rights under the FDCPA. Plaintiff, of course, argues that this court should not apply the materiality standard and that any false or deceptive representation, the FDCPA. no matter how small, should be actionable under Based on the absurd results that could come from plaintiff's interpretation, wherein every de minimis error would render a debt collector liable under the FDCPA and every debt collection defense misspelling, would turn into or minute mislabeling, a hunt for technical the slightest falsity, this court applies the materiality standard. Under falsity. this The standard, numbers and plaintiff facts represented by the February 3, 2009 Statement of account has not relating pled to a the material debt as 2009 Sled Affidavit and May 29, are not in dispute. The 5 This case was brought to the court's attention by Defendant's Suggestion of Subsequently Decided Authority, #29], and is the subject of Plaintiff's Motion to Strike. 16 alleged [DE misrepresentation concerns whether someone swore to these As undisputedly accurate numbers prior to seeing them. such, this misrepresentation does not materially relate to the debt at issue in any way that would mislead the debtor as to his rights under the discussed FDCPA. supra, in Therefore, plaintiff's FDCPA addition claims to are the reasons dismissed for failure to show a material violation. 6 VI. Motion to Strike Defendants, on February 11, 2010, submitted a suggestion of subsequently decided authority [DE #29]. In their filing, it was stated: Defendants submit the Order, O'Fay v. Sessoms & Rogers, P.A., No. 5:08-cv-615-D (E.D.N.C. Feb. 9 2010) , from this Court as subsequently decided authority on this Court's adoption of the 'materiality standard' for claims under 15 U.S.C. § 1692. [DE #29] . Plaintiff, defendants' #30] . In in response, suggestion short, of filed a subsequently plaintiff argues motion decided that to strike authority. defendants' [DE motion violated Local Rule 7.1(g), which reads: Defendants also argue that plaintiff's case should be dismissed because plaintiff has not properly pled that the debt at bar is a "consumer debt" as defined by the FDCPA. Reading the complaint in the light most favorable to plaintiff, the court is satisfied that plaintiff has sufficiently set out both Albritton's status as a "consumer" and Albritton's debt as a "consumer debt." (See Am. Compl. ~~ 25-26.) 17 A suggestion of subsequently decided controlling authority, without argument, may be filed and served at any time prior to the court's ruling and shall contain only the citation to the case relied upon if published or a copy of the opi nion if the case is unpublished. Local Rule 7.1(g) one-half Specifically, added). that reads, "on this court's adoption of the 'materiality standard,'" impermissible argument sentence and in defendants' plaintiff argues is the (emphasis therefore motion defendants' that entire submission should be stricken. The court notes that 0' Fay was a mUlti-part order, and defendants, at most, merely directed the court to the section of the order they were suggesting as "controlling authority." Defendants did not argue the merits of their case nor did they raise any argument as to why this court should adopt that standard. As such, the court declines to consider the one-half sentence "argument" at issue in violation Local Rule 7.1 (g) . For these reasons, plaintiff's motion to strike is denied. 18 CONCLUSION For the foregoing reasons, defendants' motion to dismiss [DE #21] is GRANTED and plaintiff's motion to strike [DE # 30] is DENIED. The clerk is directed to close this case. A~) This ~~ay of August 2010. ~~b------Senior United States District Judge At Greenville, NC AMP 19
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