Smith v. Professional Debt Mediation Inc et al

Filing 47

MEMORANDUM OPINION. Signed by Judge R David Proctor on 4/5/2017. (AVC)

FILED
2017 Apr-05 PM 12:10
U.S. DISTRICT COURT
N.D. OF ALABAMA

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION

MASTAKI SMITH,
Plaintiff,
v.
PROFESSIONAL DEBT MEDIATION,
INC., et al.,
Defendants.

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Case No.: 2:16-cv-00258-RDP

MEMORANDUM OPINION
This case is before the court on Defendant Professional Debt Mediation, Inc.’s (“PDMI”)
Motion for Judgment on the Pleadings (Doc. # 23) and Motion to Deposit Funds with the Court
(Doc. # 32). Plaintiff has responded to the motions. (Docs. # 26, 36). Defendant PDMI has
filed reply briefs supporting the motions. (Docs. # 27, 39).
I.

Procedural History
In February 2016, Plaintiff filed a complaint against Defendants PDMI and Experian

Information Solutions, Inc. (“Experian”). (See generally Doc. # 1). The complaint presents one
cause of action against Experian and sixteen causes of action against PDMI. (See id. at ¶¶ 60131). According to Plaintiff, PDMI violated both the Fair Credit Reporting Act (“FCRA”) and
the Fair Debt Collection Practices Act (“FDCPA”). (See id. at ¶¶ 60-102). Plaintiff also alleges
that PDMI committed the following violations of Alabama state law: (1) invasion of privacy,
(2) negligent hiring, training, and supervision of debt collectors, (3) wanton hiring, training, and
supervision of debt collectors, and (4) intentional hiring, training, and supervision of
incompetent debt collectors. (See id. at ¶¶ 103-31).

Defendant PDMI has moved for judgment on the pleadings for Plaintiff’s four state-law
claims. (Doc. # 23 at 1). PDMI first argues that the state-law causes of action are expressly
preempted by the FCRA. (Id. at 6-12). Next, it contends that Plaintiff’s hiring, supervision, and
training tort claims fail to state a claim for relief because those claims seek tort damages for an
action premised upon a breach of contract. (Id. at 12-13). PDMI also has requested that the
court grant it leave to deposit $15,000 with the court to provide complete relief for all of
Plaintiff’s claims, pursuant to Federal Rule of Civil Procedure 67. (Doc. # 32 at 1, 6).
II.

Background Facts
In 2012, Plaintiff agreed to settle a consumer debt that was owned by Defendant PDMI

and paid PDMI $2,595. (Doc. # 1 at ¶¶ 21-23). PDMI agreed to “request manual deletion of any
negative trade lines associated” with Plaintiff as a term of the settlement. (Id. at ¶ 24). Plaintiff
later discovered that the consumer debt account remained on his Experian credit report. (Id. at
¶ 25). Plaintiff disputed his credit report, but “Experian kept the account on Plaintiff’s credit
report with a current balance owed.” (Id. at ¶ 26).
Plaintiff alleges that PDMI admitted on March 10, 2015 that he had paid the consumer
debt indicated on his credit report. (Id. at ¶ 29). Yet, the settled debt remained on his credit
report in June 2015. (Id. at ¶ 30). According to Plaintiff, “Defendants continued to report this
negative information even with the proof from Defendant PDM[I] showing that the account was
to be deleted.” (Id. at ¶ 33). When Plaintiff called Defendants to report the error, they refused to
admit that the settled debt account should be deleted from his credit report. (Id. at ¶ 28).
Moreover, PDMI violated the settlement agreement by continuing its collection efforts
after entering into the settlement. (Id. at ¶ 48). It misrepresented that Plaintiff still owed payment
for the debt after he had agreed to and complied with the settlement. (Id. at ¶ 49). Plaintiff’s
complaint charges that PDMI “maliciously, willfully, intentionally, recklessly, and/or
2

negligently” failed to review his disputes or reasonably investigate those disputes. (Id. at ¶ 35).
According to Plaintiff, PDMI acted maliciously and willfully and conducted its actions “with
either the desire to harm Plaintiff and/or with the knowledge that its actions would very likely
harm Plaintiff.”1 (Id. at ¶ 59).
Plaintiff claims that PDMI invaded his privacy, in violation of Alabama law, “by
repeatedly and unlawfully attempting to collect a debt.” (Id. at ¶ 106). Moreover, he claims that
the company negligently, wantonly, and/or intentionally hired, trained, and supervised debt
collectors “who were allowed or encouraged to violate the law.” (Id. at ¶¶ 118, 124, 130).
Plaintiff’s complaint categorizes PDMI as a “furnisher” of information to credit reporting
agencies for purposes of the FCRA and as a “debt collector” for purposes of the FDCPA. (Id. at
¶¶ 55, 67).
III.

Standard of Review
Federal Rule of Civil Procedure 12(c) provides that a party may move for judgment on

the pleadings after the pleadings are closed, but early enough not to delay trial. The standard is a
familiar one. “Judgment on the pleadings is appropriate where there are no material facts in
dispute and the moving party is entitled to judgment as a matter of law.” Cannon v. City of W.
Palm Beach, 250 F.3d 1299, 1301 (11th Cir. 2001); see Bank of New York Mellon v. Estrada,
2013 WL 3811999, at *1 (N.D. Ill. July 22, 2013) (“A Rule 12(c) motion for judgment on the
pleadings is ‘designed to provide a means of disposing of cases when the material facts are not in
dispute and a judgment on the merits can be achieved by focusing on the content of the pleadings
and any facts of which the court will take judicial notice.’” (citations omitted)). The court must

1

In addition, Plaintiff alleges that PDMI either knew its conduct violated the FCRA, the FDCPA, and/or
state law, or that it acted in reckless disregard of the FCRA, the FDCPA, and state law. (Doc. # 1 at ¶ 59).

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accept the facts alleged in the complaint as true and view them in the light most favorable to the
nonmoving party. Cannon, 250 F.3d at 1301.
A Rule 12(c) motion for judgment on the pleadings is analyzed the same as a Rule
12(b)(6) motion to dismiss. Griffin v. SunTrust Bank, Inc., 157 F. Supp. 3d 1294, 1295 (N.D.
Ga. 2015). Accordingly, to survive a motion for judgment on the pleadings, “a complaint must
contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its
face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation and internal quotations omitted); see
also Losey v. Warden, 521 F. App’x 717, 719 (11th Cir. 2013) (applying the plausibility standard
articulated in Iqbal to an appeal concerning a Rule 12(c) judgment on the pleadings).
A complaint states a plausible claim for relief “when [a] plaintiff pleads factual content
that allows the court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.” Iqbal, 556 U.S. at 678. Although detailed facts are not needed, a plaintiff
is obligated to provide as grounds for entitlement to relief more than mere labels and
conclusions. Id. Formulaic recitations of the elements of a cause of action do not satisfy a
plaintiff’s burden. Id. “While legal conclusions can provide the framework of a complaint, they
must be supported by factual allegations.” Id. at 679. A plausible claim for relief requires
“enough fact[s] to raise a reasonable expectation that discovery will reveal evidence” to support
the claim. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007).
Under Rule 67, “[i]f any part of the relief sought is a money judgment . . . , a party [--] on
notice to every other party and by leave of the court [--] may deposit with the court all or part of
the money or thing, whether or not that party claims any of it.” Fed. R. Civ. P. 67(a). The court
has broad discretion in deciding whether to grant a party relief under Rule 67. Fulton Dental,
LLC v. Bisco, Inc., 2016 WL 4593825, at *2 (N.D. Ill. Sept. 2, 2016). In most circumstances,
funds are deposited with a court under Rule 67 “to relieve the depositor of responsibility for a
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disputed fund while the parties litigate its ownership.” Engineered Med. Sys., Inc. v. Despotis,
2006 WL 1005024, at *2 (S.D. Ind. Apr. 14, 2006).

“Few standards govern the court’s

discretion to grant Rule 67 deposits, but courts generally agree that the deposited funds must
truly be in dispute.” Fulton Dental, 2016 WL 4593825, at *3.
IV.

Analysis of Motion for Judgment on the Pleadings
In its motion for judgment on the pleadings, PDMI argues that Plaintiff’s state law claims

are preempted by 15 U.S.C. § 1681t(b)(1)(F) because PDMI’s disclosures of information to
Experian and other credit reporting agencies are regulated under 15 U.S.C. § 1681s-2. (Doc. #
23 at 6-7, 10). PDMI contends that Section 1681t(b)(1)(F) preempts “all state law claims against
furnishers of credit information related to their credit reporting activity,” notwithstanding a
narrower preemption statute relating to invasion of privacy claims in 15 U.S.C. § 1681h(e). (Id.
at 7-8). In the alternative, PDMI argues that Plaintiff’s claims for wanton and intentional hiring,
training, and supervising are preempted under § 1681h(e) because Plaintiff has only presented
“conclusory” allegations that PDMI acted with actual malice or willful intent to injure him. (Id.
at 11-12).
Plaintiff responds that there is a split in authority on this issue among the judges of this
court. (Doc. # 26 at 4). Moreover, he contends that the Eleventh Circuit has persuasively
indicated -- in a non-binding, unpublished opinion -- that state law claims against furnishers of
credit information are not completely preempted by Section 1681t(b)(1)(F). (Id.). Plaintiff
points out that the undersigned has not accepted the complete preemption argument presented by
PDMI in earlier opinions addressing this issue. (Id. at 3).
The resolution of this issue depends on determining the interaction between two
preemption provisions in the FCRA. Section 1681h(e), a limitation of liability contained in a

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FCRA subsection governing disclosures of information by consumer reporting agencies,
provides:
Except as provided in sections 1681n and 1681o of this title, no consumer may
bring any action or proceeding in the nature of defamation, invasion of privacy, or
negligence with respect to . . . any person who furnishes information to a
consumer reporting agency, based on information disclosed pursuant to section
1681g, 1681h, or 1681m of this title, . . . except as to false information furnished
with malice or willful intent to injure such consumer.
15 U.S.C. § 1681h(e). Section 1681t, which addresses the relationship between the FCRA and
state laws, provides in relevant part that “[n]o requirement or prohibition may be imposed under
the laws of any State [ ] with respect to any subject matter regulated under . . . section 1681s-2 of
this title, relating to the responsibilities of persons who furnish information to consumer
reporting agencies.”2

Id. § 1681t(b)(1)(F) (listing particular exceptions to the preemption

provision that do not apply to the present case).
The difficulty in reconciling these FCRA preemption provisions has resulted in a number
of different approaches. Judge William Acker identified five approaches that have been used by
judges of this court:
Four judges . . . have found that § 1681h(e) applies and permits claims based upon
malice against furnishers of credit information. Morgan v. Midland Funding,
LLC, No. 2:12–cv–3846–RDP, [at] *3 (N.D. Ala. Jan. 4, 2013); Wood v. Midland
Funding, LLC, No. 2:12–cv–2703–KOB, 2013 WL 360146, [at] *4 (N.D. Ala.
Jan. 29, 2013); Gamble v. Midland Funding, LLC, No. 2:12–cv–4186–AKK, 2013
WL 979202, [at] *2 (N.D. Ala. Mar. 7, 2013); Dial v. Midland Funding, LLC, No.
2:14–cv–663–TMP, [2015 WL 751662, at *9] (N.D. Ala. Jan. 15, 2015).
Three judges have found that § 1681t(b)(1)(F) applies and bars all related state
law claims against furnishers. Barnett v. JP Morgan Chase Bank, N.A., No. 1:12–
2

Section 1681s-2 of the FCRA prohibits a furnisher of information from providing information to a
consumer reporting agency if it knows or has reasonable cause to believe that the information is inaccurate. 15
U.S.C. § 1681s-2(a)(1)(A). Section 1681s-2 also prohibits a furnisher of information from reporting information
after it has been informed by a consumer that the information is inaccurate (so long as the information is actually
inaccurate). Id. § 1681s-2(a)(1)(B). Furthermore, Section 1681s-2 requires a furnisher to conduct an investigation
after receiving a notice of dispute from a customer. Id. § 1681s-2(a)(8)(E). Accordingly, the conduct underlying all
of Plaintiff’s state law claims is regulated under Section 1681s-2.

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cv–1745–VEH, 2013 WL 3242739, [at] *13 (N.D. Ala. June 26, 2013); Williams
v. Student Loan Guar. Found. of Ark., No. 5:12–cv–2940–JHE, 2015 WL 241428,
[at] *13 (N.D. Ala. Jan. 20, 2015) (Haikala, J., adopting report and
recommendation of England, Mag. J.).
Two judges have found that § 1681h(e) applies to state torts, while §
1681t(b)(1)(F) applies to statutory causes of action. McCloud v. Homeside
Lending, 309 F. Supp. 2d 1335, 1341–42 (N.D. Ala.2004) (Smith, J.); Champion
v. Global Credit Card Serv., LLC, No. 2:12–cv–1966–IPJ, 2012 WL 3542225,
[at] *6 (N.D. Ala. Aug. 15, 2012).
One judge has found that § 1681h(e), by its language, does not cover furnishers,
while § 1681t(b)(1)(F) does, so state law claims are preempted. Schlueter v.
BellSouth Telecommunications, 770 F. Supp. 2d 1204, [1210-11] ([N.D. Ala.]
2010) (Blackburn, J.).
One judge has applied § 1681h(e) to actions taken before furnishers are notified
by a consumer reporting agency of a dispute; § 1681t(b)(1)(F) applies after the
dispute. Woltersdorf v. Pentagon Fed. Credit Union, 320 F. Supp. 2d 1222,
[1226] (N.D. Ala. 2004) (Hancock, J.).
Dial v. Midland Funding, LLC, 2015 WL 751690, at *6-7 (N.D. Ala. Feb. 23, 2015). In an
earlier opinion, the undersigned concluded that Section 1681h(e) affords no protection to a
furnisher of information, such as PDMI, from a defamation claim if the information provided to
the consumer reporting agency “was both false and also given with the malicious or willful intent
to damage the consumer.” Jackson v. HSBC Mortgage Servs., Inc., 2014 WL 5100089, at *5
(N.D. Ala. Oct. 10, 2014) (quoting Lofton-Taylor v. Verizon Wireless, 262 F. App’x 999, 1002
(11th Cir. 2008)). The Jackson opinion noted the separate FCRA preemption provision in
Section 1681t(b)(1)(F), but applied the express exception to FCRA preemption in Section
1681h(e) for state law defamation claims premised on malicious dissemination of false
information. Id.
A review of case law from the circuit courts of appeal provides some persuasive authority
for PDMI’s argument that the preemption provision in Section 1681t(b)(1)(F) applies to
Plaintiff’s invasion of privacy claim. The Seventh Circuit has held that Section 1681t(b)(1)(F) is
7

a broader preemption statute than Section 1681h(e) and applies to preempt all state law claims
covered by Section 1681s-2 against furnishers of information unless the specific exceptions in
Section 1681t(b)(1)(F) apply. Purcell v. Bank of Am., 659 F.3d 622, 625-26 (7th Cir. 2011). It
concluded that the specific-over-general canon of statutory construction cannot reconcile the two
preemption provisions because “each statute is more specific in one respect and more general in
another.” Id. Instead, the Purcell court relied on the norm “that courts do not read old statutes to
defeat the operation of newer ones”; accordingly, it applied the broader preemption provision in
Section 1681t(b)(1)(F) because that provision was passed in 1996, twenty-six years after the
passage of Section 1681h(e). Id. The Second Circuit has adopted the Seventh Circuit’s holding
from Purcell. Macpherson v. JPMorgan Chase Bank, N.A., 665 F.3d 45, 47-48 (2d Cir. 2011).
Specifically, the Macpherson opinion rejected a claim that Section 1681h(e) authorizes state
defamation, invasion of privacy, and negligence claims premised upon conduct committed with
malicious or willful intent. See id. (noting that the plaintiff had advanced that argument and
rejecting that interpretation of Section 1681h(e)).
In an unpublished opinion, the Eleventh Circuit interpreted and applied the preemption
provision in Section 1681h(e). See Lofton-Taylor v. Verizon Wireless, 262 F. App’x 999 (11th
Cir. 2008). The Lofton-Taylor opinion interpreted Section 1681h(e) to provide that a furnisher
under the FCRA “is protected from state law defamation and invasion of privacy claims unless
the information it provided was both false and also given with the malicious or willful intent to
damage the consumer.” Id. at 1002. Applying this standard, the Eleventh Circuit held that the
plaintiff’s state law invasion of privacy and defamation claims were preempted because the
plaintiff had provided no evidence that the furnisher offered false information to a reporting
agency or that the furnisher acted with malicious or willful intent. Id. The Eleventh Circuit

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expressly declined to address whether Section 1681t(b)(1)(F) preempted the plaintiff’s claims.
Id. at 1002-03.3
After careful review, and with the benefit of oral argument, the court adheres to the
conclusion it reached in Jackson on this issue. See Jackson, 2014 WL 5100089, at *5. The
preemption provision in Section 1681h(e) specifically addresses when the FCRA preempts state
law invasion of privacy and negligence claims against furnishers of information. Moreover,
Section 1681h(e) contains a specific exception to preemption, under which such claims may be
brought against furnishers. Accordingly, an invasion of privacy or negligence claim against a
furnisher is not preempted by the FCRA if the information provided was false and the furnisher
acted with malicious or willful intent to damage the consumer. Lofton-Taylor, 262 F. App’x at
1002. Plaintiff’s complaint alleges that (1) PDMI reported false information to Experian and (2)
PDMI committed actions with “malice,” willful intent, and “either the desire to harm Plaintiff
and/or with the knowledge that its actions would very likely harm Plaintiff.” (Doc. # 1 at ¶¶ 31,
59). Whether or not the Rule 56 evidence or the trial evidence supports these allegations remains
to be seen. But, for now, the court concludes that Plaintiff’s invasion of privacy claim is
sufficient to withstand the FCRA’s applicable preemption provision.
Plaintiff’s claims for negligent, wanton, and intentionally wrongful hiring, training, and
supervision, however, are expressly preempted by the FCRA. Plaintiff’s state law tort claims
based on wanton or intentional hiring, training, and supervision (Counts X and XI of the
complaint) do not fall within the three categories of tort claims described in Section 1681h(e).
See 15 U.S.C. § 1681h(e). And, Plaintiff argues that those claims relate to his invasion of
3

Three other circuit courts of appeal have declined to address the relationship between the preemption
provisions in Section 1681h(e) and Section 1681t(b)(1)(F). See Ross v. FDIC, 625 F.3d 808, 814 n. * (4th Cir.
2010); Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1165-67 (9th Cir. 2009) (discussing this “difficult
issue of first impression” but declining to decide it); Beyer v. Firstar Bank N.A., 447 F.3d 1106, 1108 (8th Cir.
2006).

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privacy claim, which clearly is premised upon the furnishing of false information to consumer
reporting agencies. (See Doc. # 26 at 4). Therefore, Counts X and XI against PDMI, a furnisher
of information for purposes of the FCRA, are preempted by Section 1681t(b)(1)(F) of the FCRA.
Plaintiff’s negligent hiring, training, and supervision claim (Count IX) does fall within the scope
of Section 1681h(e). However, Count IX logically cannot fall within the exception to Section
1681h(e) preemption for conduct committed with malicious or willful intent because a negligent
act cannot be committed with malicious or willful intent. See Johnson v. Citimortgage, Inc., 351
F. Supp. 2d 1368, 1379-80 (N.D. Ga. 2004) (“[W]here there is a requirement of ‘malice or
willful intent to injure’ there is no cause of action for negligence. Because negligence claims, by
definition, are not premised upon Defendant’s malice or willful intent to injure, negligence
claims are preempted by § 1681h(e).”). Therefore, Counts IX, X, and XI are due to be dismissed
without prejudice as preempted by the FCRA.4
V.

Analysis of PDMI’s Motion to Deposit Funds
In this motion, Defendant PDMI seeks leave to deposit $15,000 with the court as

complete relief for Plaintiff’s actual and statutory damages. (Doc. # 32 at 9-10). PDMI argues
that some courts have allowed a defendant to moot a case or controversy by depositing sufficient

4

The court need not decide -- and does not decide -- whether Counts IX, X, and XI are due to be dismissed
for alleging a hiring, training, and supervision tort claim premised upon an alleged breach of a contract. (See Doc. #
23 at 12-13). The court observes, though, that this argument is questionable at best because the complaint alleges
that PDMI’s employees falsely reported information about the settled debt to Equifax, in addition to Plaintiff’s
allegations that PDMI failed to complete its obligations from the settlement agreement. (See Doc. # 1 at ¶ 31).
Although PDMI does not argue that Counts IX, X, and XI should be dismissed under Rule 12(b)(6) for
failure to state a claim, the court notes that these claims appear to present conclusory allegations that PDMI
negligently, wantonly, or intentionally hired, trained, and supervised its debt collectors in a fashion that led them to
violate state (and federal) law. (See Doc. # 1 at ¶¶ 118, 124, 130). Plaintiff expressly asserts in the complaint that
he is not aware of “the details of the incompetent hiring, training, and supervision of debt collectors” because he had
not received the benefit of discovery at the time of filing. (See id. at ¶¶ 119, 125, 131). In this respect, the
complaint puts the cart before the horse. Iqbal expressly states that a plaintiff cannot proffer conclusory legal
allegations of a defendant’s wrongful conduct to receive the benefit of discovery. 556 U.S. at 678-79 (asserting that
the Federal Rules of Civil Procedure do not “unlock the doors of discovery for a plaintiff armed with nothing more
than conclusions”). Nonetheless, the court need not decide whether Counts IX, X, and XI are due to be dismissed
under Rule 12(b)(6).

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funds with the court to afford a plaintiff complete relief. (Id. at 5). Accordingly, PDMI requests
that the court grant it leave to deposit $15,000, enter a judgment in favor of Plaintiff for $15,000,
set a briefing schedule to determine the reasonable attorneys’ fees owed by PDMI to Plaintiff’s
counsel, and dismiss Plaintiff’s claims with prejudice as moot. (Id. at 10).
Plaintiff responds that PDMI’s offer does not fully satisfy his claims against the
company. (Doc. # 36 at 5-6). He notes that the opinions PDMI relies upon addressed cases
where plaintiffs sought “sum certain” statutory damages. (Id. at 7-9). In contrast, Plaintiff seeks
damages for emotional distress, mental anguish, and economic harm. (Id. at 5). Moreover, he
has requested punitive damages that can be awarded under Alabama law or the FCRA. (Id. at 6).
Plaintiff highlights that PDMI seeks “to deposit less than 1/5 of what Plaintiff has demanded” as
full relief. (Id. at 11).
In Campbell-Ewald Company v. Gomez, the Supreme Court held that a plaintiff’s
complaint does not become moot when the plaintiff rejects an offer of complete relief from a
defendant, pursuant to Rule 68. 136 S. Ct. 663, 670 (2016). The Court expressly refrained from
deciding “whether the result would be different if a defendant deposits the full amount of the
plaintiff’s individual claim in an account payable to the plaintiff, and the court then enters
judgment for the plaintiff in that amount.” Id. at 672.
Following Campbell-Ewald, several courts have addressed whether to accept a deposit to
the court for complete monetary relief and whether such a deposit moots a plaintiff’s case. Most
district courts have concluded that a deposit of complete monetary relief with the district court,
along with complete equitable relief if requested, moots a plaintiff’s individual action against a
defendant and calls for a judgment in plaintiff’s favor on the claims at issue. See, e.g., Gray v.
Kern, 143 F. Supp. 3d 363, 367 (D. Md. 2016) (concluding that “a measure which makes
absolutely clear that the defendant will pay the complete relief the plaintiff can recover and that
11

the plaintiff will be able to receive that relief will moot the issue in controversy”); S. Orange
Chiropractic Ctr., LLC v. Cayan LLC, 2016 WL 1441791, at *5 (D. Mass. Apr. 12, 2016)
(concluding that a plaintiff’s individual claims can be mooted by “providing a plaintiff with the
full amount of statutory damages and the full scope of equitable relief”); Leyse v. Lifetime Entm’t
Servs., LLC, 171 F. Supp. 3d 153 (S.D.N.Y. 2016), aff’d, 2017 WL 659894 (2d Cir. Feb. 15,
2017). A common thread among those cases is that the plaintiff was entitled to recover a sum
certain amount of damages set by statute. See, e.g., Gray, 143 F. Supp. 3d at 369-70 (concluding
that the plaintiff’s damages were limited to $200,000 by Maryland’s Local Government Tort
Claims Act); S. Orange Chiropractic, 2016 WL 1441791, at *1 (asserting that the defendant
offered to pay $7,500 in monetary damages, which exceeded the $1,500 in damages that the
plaintiff could recover through the Telephone Consumer Protection Act (“TCPA”)); Leyse, 171
F. Supp. 3d at 155-56 (concluding that the defendant’s offer to deposit $1,503 for a TCPA claim
and consent to a judgment against it mooted the case). In this case, Plaintiff has presented some
claims for which he may receive statutory damages. See 15 U.S.C. § 1692k(a) (allowing a court
to award “additional damages” of up to $1,000 per action for FDCPA cases, in addition to actual
damages suffered by the plaintiff); 15 U.S.C. § 1681n(a)(1)(A) (allowing a court to award a
plaintiff actual damages or up to $1,000 in statutory damages).

But, other claims in the

complaint allow (or, better said, require) Plaintiff to recover actual damages and punitive
damages from PDMI. See 15 U.S.C. § 1692k(a)(1) (allowing a court to award a plaintiff actual
damages); 15 U.S.C. § 1681n(a)(1) (allowing a court to award a plaintiff actual damages and
punitive damages); Phillips v. Smalley Maint. Servs., Inc., 435 So. 2d 705, 711-12 (Ala. 1983)
(holding that a plaintiff in an invasion-of-privacy action may recover general damages and
“special damages which proximately result from the breach of his privacy,” including damages
for mental suffering).
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Here, the relief sought by Defendant PDMI is unsupported by Campbell-Ewald. Nor is it
supported by cases in which courts have allowed defendants to deposit funds with the court to
moot actions in which plaintiffs seek damages limited by operation of law. In this case, Plaintiff
is seeking -- and might be entitled to recover -- actual damages and punitive damages from
PDMI, in addition to statutory damages under the FCRA or FDCPA. (See Doc. # 1 at 26 (prayer
for relief)). See also 15 U.S.C. § 1692k(a)(1); 15 U.S.C. § 1681n(a)(1); Phillips, 435 So. 2d at
711-12. Plaintiff’s complaint does not state the amount of actual damages he has suffered, but
alleges that PDMI’s conduct caused actual monetary losses, harm to Plaintiff’s creditworthiness,
mental distress, and emotional anguish. (See Doc. # 1 at ¶¶ 78, 112). Ultimately, Plaintiff seeks
more than $75,000 in total damages. (Id. at 26). PDMI has only offered $15,000 in relief for all
of Plaintiff’s claims. (Doc. # 32 at 6). Given this discrepancy, the court could not possibly
conclude that Defendant PDMI’s offer of deposit moots Plaintiff’s claims against PDMI by
affording complete relief. Cf. Keim v. ADF Midatlantic, LLC, 586 F. App’x 573, 574 (11th Cir.
2014) (determining that a defendant’s offer of payment for a plaintiff’s TCPA claims did not
suffice to moot the case because the defendant did not specify the number of TCPA violations it
had committed).
PDMI clearly seeks to deposit the funds for the sole purpose of mooting Plaintiff’s action
under a novel application of Rule 67. (See Doc. # 32 at 6). PDMI’s Rule 67 motion essentially
asks the court to make an economic determination of the value of Plaintiff’s remaining claims.
(See id. at 9-10 (claiming that $15,000 “would more than cover the statutory and actual damages
to which Plaintiff could be entitled if successful”)). The court cannot do so for at least two
reasons. First, the court does not have enough evidence to determine the extent of Plaintiff’s
damages or the value of his claims. Second, the court is not the arbiter who determines the

13

amount of actual or punitive damages Plaintiff is entitled to under the facts – that role is
emphatically reserved for the jury. Accordingly, PDMI’s Rule 67 motion is due to be denied.
VI.

Conclusion
For the reasons stated above, Defendant PDMI’s motion for judgment on the pleadings

(Doc. # 23) is due to be granted in part and denied in part. Counts IX, X, and XI of Plaintiff’s
complaint are due to be dismissed because they are preempted by the FCRA, pursuant to Section
1681h(e) or Section 1681t(b)(1)(F). In all other respects, PDMI’s motion for judgment on the
pleadings is due to be denied. Additionally, PDMI’s motion to deposit funds with the court
(Doc. # 32) is due to be denied. A separate order will be entered.
DONE and ORDERED this April 5, 2017.

_________________________________
R. DAVID PROCTOR
UNITED STATES DISTRICT JUDGE

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