Peters v. Coface Collections North America Incorporated
Filing
45
ORDER, granting Defendant's 31 Motion for Summary Judgment; denying Plaintiff's 33 Motion for Summary Judgment. Signed by Senior Judge Frederick J Martone on 3/27/14.(REW)
1
WO
2
3
4
5
6
IN THE UNITED STATES DISTRICT COURT
7
FOR THE DISTRICT OF ARIZONA
8
9
10
11
12
13
14
)
)
)
Plaintiff,
)
)
vs.
)
)
Coface Collections North America, Inc., )
)
)
Defendant.
)
)
Andrew Peters,
No. CV-12-02600-PHX-FJM
ORDER
15
16
17
The court has before it defendant’s motion for summary judgment (doc. 31), plaintiff’s
18
response (doc. 35), and defendant’s reply (doc. 39). We also have before us plaintiff’s
19
motion for summary judgment (doc. 33), defendant’s response (doc. 37), and plaintiff’s reply
20
(doc. 41).
21
Plaintiff purchased software from Media Cybernetics/Princeton Instruments
22
(“Princeton”) using the business name Multi Media Plus. When plaintiff did not pay for the
23
software, Princeton placed the account with defendant Coface Collections North America,
24
Inc. for collection (the “Debt”). Plaintiff filed this action under the Fair Debt Collection
25
Practices Act (“FDCPA”), 15 U.S.C. §§ 1692b, 1692c, alleging that Coface collected the
26
Debt in an unfair and harassing manner in violation of the Act. Both parties now move for
27
summary judgment.
28
1
The FDCPA protects consumers from unlawful debt collection practices, and
2
therefore, “applies to consumer debts and not business loans.” Bloom v. I.C. System, Inc.,
3
872 F.2d 1067, 1068 (9th Cir. 1992) (emphasis added). The Act defines a consumer debt as
4
“any obligation or alleged obligation of a consumer to pay money arising out of a transaction
5
in which the . . . property . . . which [is] the subject of the transaction [is] primarily for
6
personal, family, or household purposes.” 15 U.S.C. § 1692a(5) (emphasis added). In
7
classifying a debt, we will “examine the transaction as a whole, paying particular attention
8
to the purpose for which the credit was extended in order to determine whether [the]
9
transaction was primarily consumer or commercial in nature.” Slenk v. Transworld Systems,
10
Inc., 236 F.3d 1072, 1075 (9th Cir. 2001) (citation omitted). “We must therefore ‘look to the
11
substance of the transaction and the borrower’s purpose in obtaining the loan, rather than the
12
form alone.’” Id. (quoting Riviere v. Banner Chevrolet, Inc., 184 F.3d 457, 462 (5th Cir.
13
1999)).
14
When plaintiff purchased the software from Princeton, he listed the name “Multi
15
Media Plus” as the purchaser. He asserts that he used the business name to purchase the
16
software because Princeton only sells to businesses. It is undisputed that if plaintiff had not
17
represented himself as a business, the sale would not have occurred.
18
Plaintiff also asserts that he would typically use the name Multi Media Plus when he
19
bought products that sold or marketed only to businesses. Plaintiff also used Multi Media
20
Plus to gain access to websites that catered to businesses only. In these various transactions,
21
plaintiff held himself out as the “president” or “head” of Multi Media Plus. DSOF ¶ 8. He
22
also developed the email addresses of multmplus@aol.com and multmplus@yahoo.com, the
23
latter which he used for the Princeton transaction.
24
Plaintiff, a former teacher, contends that he purchased the software for the purpose
25
of making educational 3-D images for use in his classroom and to share with other educators,
26
and that he generally creates images as a hobby. He argues that he has never sold or made
27
a profit on any of the images. He further contends that “[e]ven though [he] stated that
28
MultiMedia Plus was the business purchasing the Software, MultiMedia Plus is not actually
-2-
1
a business.” PMSJ at 6. He contends that, notwithstanding his representations that
2
MultiMedia Plus was the purchaser, the Princeton software was for personal, family and
3
household purposes only, and therefore he is entitled to the protections of the FDCPA.
4
Defendant argues that, as evidenced by the transaction documents as well as the actual
5
intended use of the software, the Debt was a commercial, not a consumer debt and therefore
6
the FDCPA is not applicable. We agree.
7
The undisputed evidence shows that plaintiff represented to Princeton that Multi
8
Media Plus was the business purchasing the software and incurring the Debt. By holding
9
himself out as a business, he is estopped from now asserting that he purchased the software
10
as a consumer. Coface contends that in pursuing its collection efforts it relied on the
11
information provided by Princeton that the Debt was owed by Multi Media Plus. During the
12
relevant period, Coface was in the business of collecting commercial debts only. If it learned
13
that a debt was consumer in nature, it would immediately cease all collection efforts. It
14
would work an injustice to allow a debtor to expressly hold itself out as a business at the
15
inception of a debt, only to later contradict that characterization for the purpose of claiming
16
FDCPA protection.
17
In addition, according to plaintiff’s own admissions, the intended use of the software
18
cannot be characterized as “primarily for personal, family, or household purposes.” 15
19
U.S.C. § 1692a(5). Although plaintiff asserts that he made educational 3-D images as a
20
“hobby,” it is undisputed that he intended to use the images beyond his personal use. He
21
acknowledges that he primarily intended to use the images in his classroom and to share the
22
images with the education community. Therefore, plaintiff intended to use the software to
23
create images that would extend beyond his own personal, family, or household use.
24
Accordingly, the evidence establishes that the Debt is not a consumer debt and the FDCPA
25
does not apply.
26
...
27
28
-3-
1
IT IS ORDERED GRANTING defendant’s motion for summary judgment (doc. 31).
2
IT IS FURTHER ORDERED DENYING plaintiff’s motion for summary judgment
3
4
(doc. 33).
DATED this 27th day of March, 2014.
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
-4-
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?