Hecht v. United Collection Bureau Inc

Filing 43

RULING AND ORDER denying 37 MOTION for Reconsideration re 35 Order, filed by Chana Hecht. Signed by Judge Mark R. Kravitz on 4/12/2011. (Garguilo, B) .

UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT

CHANA HECHT,

:
:
Plaintiff,
:
:
v.
:
:
UNITED COLLECTION BUREAU, INC., :
:
Defendant.
:

No. 3:10cv1213 (MRK)

RULING AND ORDER

In this case, Plaintiff Chana Hecht asserts two claims against Defendant United
Collection Bureau, Inc. ("United Collection"): a federal law claim under the Fair Debt Collection
Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq., and a state law claim under the Connecticut
Unfair Trade Practices Act ("CUTPA"), Conn. Gen. Stat. § 42-110a et seq. On March 8, 2011,
the Court issued a Memorandum of Decision [doc. # 34] concluding that United Collection's
settlement of an FDCPA class action in the United States District Court for the Eastern District
of New York, see Final Order, Gravina v. United Collection Bureau, Inc., No. 09cv4816 (LDW)
(E.D.N.Y. Nov. 29, 2010), ECF No. 36, precluded Ms. Hecht's FDCPA claim and also declining
to exercise supplemental jurisdiction over Ms. Hecht's CUTPA claim.1 The Court entered a
Judgment [doc. # 36] in favor of United Collection on March 9, 2011.
Pending before the Court is Ms. Hecht's Motion for Reconsideration [doc. # 37], which
the Court construes as a timely motion to alter or amend the Judgment entered on March 9, 2011

1

The Court later issued an Amended Memorandum of Decision [doc. # 35] and a Second
Amended Memorandum of Decision [doc. # 39] to correct typographical errors in the original
Memorandum of Decision. Neither changed the substance of the Court's decision.

pursuant to Rule 59(e) of the Federal Rules of Civil Procedure.2 For the reasons set forth below,
the Court DENIES the Motion for Reconsideration.
I.
Motions to alter or amend judgments are governed by Rule 59(e). A Rule 59(e) motion
should "generally be denied unless the moving party can point to controlling decisions or data
that the court overlooked – matters, in other words, that might reasonably be expected to alter the
conclusion reached by the court." Shrader v. CSX Transportation, Inc., 70 F.3d 255, 257 (2d Cir.
1995); see, e.g., Linden v. District Council 1707-AFSCME, No. 10-4145-cv, 2011 WL 1054031,
at *1 (2d Cir. Mar. 24, 2011); Matthews v. Connecticut Department of Public Safety, No.
10cv325 (MRK), 2011 WL 285868, at *1 (D. Conn. Jan. 26, 2011). Such a motion "may not be
used to plug gaps in an original argument or to argue in the alternative once a decision has been
made." Horsehead Resource Development Co., Inc. v. B.U.S. Environmental Services, Inc., 928
F. Supp. 287, 289 (S.D.N.Y. 1996). In other words, such a motion "should not be granted where
the moving party seeks solely to relitigate an issue already decided." Schrader, 70 F.3d at 257.
II.
Ms. Hecht raises two arguments in support of the pending motion. First, she argues that
under the Supreme Court's decision in Eisen v. Carlisle & Jacqueline, 417 U.S. 156 (1974), the
Gravina district court was required to provide individual notice to class members rather than
notice by publication. See Eisen, 417 U.S. at 173. Second, she argues that it was United
Collection's burden to show that United Collection complied with the requirements of the Class
Action Fairness Act ("CAFA"), 28 U.S.C. § 1715 et seq., and that United Collection failed to
2

After Ms. Hecht filed the pending motion, but before the motion was fully briefed – and thus
before the Court had an opportunity to rule on the motion – she filed a Notice of Appeal [doc. #
42] as to the Judgment.

2

carry that burden. Neither argument provides a reason for this Court to reconsider its decision
that the Gravina class action settlement precludes Ms. Hecht's FDCPA claim.
A.
Ms. Hecht's first argument is that the Court's Memorandum of Decision overlooked the
Supreme Court's controlling decision in Eisen. See 417 U.S. at 173. The Eisen plaintiffs were
investors who alleged that the defendant brokerage firms had violated various provisions of the
federal antitrust and securities laws. See id. at 159. The United States District Court for the
Southern District of New York initially denied the plaintiffs' motion for class certification. See
id. at 161-62. The United States Court of Appeals for the Second Circuit agreed that the
proposed class was not certifiable under either Rule 23(b)(1) or Rule 23(b)(2). See Eisen, 417
U.S. at 163. However, the Second Circuit remanded to the district court to conduct a further
inquiry regarding whether the proposed class was certifiable under Rule 23(b)(3). See id. at 164.
On remand, the district court certified the proposed class under Rule 23(b)(3). See id.
Because the district court certified a Rule 23(b)(3) class, the district court was required to "direct
to class members the best notice that is practicable under the circumstances, including individual
notice to all members who can be identified through reasonable efforts." Fed. R. Civ. P.
23(c)(2)(B); see Eisen, 417 U.S. at 166-67. But see Fed. R. Civ. P. 23(b)(2)(A) ("For any class
certified under Rule 23(b)(1) or (b)(2), the court may direct appropriate notice to the class.").
The district court reasoned that even though it was required to follow Rule 23(c)(2)(B),
individual notice was not required under Rule 23(c)(2)(B) because the cost of sending individual
notice to 2,250,000 class members was prohibitively high given the fact that each class member's
maximum potential stake in the litigation was only $70. See Eisen, 417 U.S. at 167-68.

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Both the Second Circuit, see id. at 169, and the Supreme Court, see id. at 173, disagreed
with the district court's interpretation of Rule 23(c)(2)(B). Noting that "the import of [Rule
23(c)(2)(B)'s] language is unmistakable," the Supreme Court held that "[i]ndividual notice must
be sent to all class members whose names and addresses may be ascertained through reasonable
effort." Id. at 173. The Supreme Court reasoned that it was impermissible for the district court to
consider the cost of individual notice because "individual notice to identifiable class members is
not a discretionary consideration" under Rule 23(c)(2)(B). Id. at 176. The Supreme Court
concluded that "[i]n the present case, the names and addresses of 2,250,000 class members are
easily ascertainable, and there is nothing to show that individual notice cannot be mailed to
each." Id. at 175.
Although the Court agrees with Ms. Hecht, as it must, that Eisen is binding precedent,
that case has little if anything to do with the issue that this Court faced when it ruled on United
Collection's Motion to Dismiss the First and Second Causes of Action [doc. # 19]. The Gravina
district court certified a class action under Rule 23(b)(2), not Rule 23(b)(3). Thus, the Gravina
district court was not required to follow the strict notice requirements of Rule 23(c)(2)(B) as
interpreted by the Supreme Court in Eisen. See Fed. R. Civ. P. 23(c)(2)(A) (providing that, in a
Rule 23(b)(2) class action, the district court need only direct "appropriate" notice to the class);
7AA Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure
§ 1786, at 500-01 (3d ed. 2005).3 This Court reasoned in its Memorandum of Decision

3

Ms. Hecht does not seek reconsideration regarding the Court's rejection of her blanket assertion
that it is never appropriate for a district court to certify an FDCPA class action under Rule
23(b)(2). The drafters of Rule 23 recognized that "[i]n representative actions brought under [Rule
23(b)(2) as opposed to Rule 23(b)(3)], the class generally will be more cohesive." 7AA Wright,
Miller & Kay § 1786, at 496. "This means that there is less reason to be concerned about each
member of the class having an opportunity to be present." Id. The class in an FDCPA case like

4

dismissing Ms. Hecht's FDCPA claim that the notice provided by the Gravina district court was
sufficient to satisfy the requirements of Rule 23(c)(2)(A) and of due process,4 if perhaps not to
satisfy the stricter requirements of Rule 23(c)(2)(B). See Wolfert ex rel. Estate of Wolfert v.
Transamerica Home First, Inc., 439 F.3d 165, 170 n.4 (2d Cir. 2006) (citing Phillips Petroleum
Co. v. Shutts, 472 U.S. 797, 808 (1985). The Court stands by its reasoning and its conclusion that
the Gravina class action settlement precludes Ms. Hecht's FDCPA claim.
B.
Ms. Hecht's second argument is that United Collection did not carry its burden of
showing that the Gravina class action settlement complied with the requirements of CAFA, 28
U.S.C. § 1715 et seq. Ms. Hecht does not cite a single case, statutory provision, or other legal
authority in support of her second argument. She simply does not explain why she believes that a
defendant arguing that a plaintiff's claim is precluded by a prior class action settlement has the
burden of demonstrating that the settlement complied with CAFA. She provides no reasoning
whatsoever to support her assertion that if district court does not specifically find in an order
approving a class action settlement that CAFA's requirements have been satisfied, the settlement
can have no preclusive effect on absent class members' future claims. Thus, the Court can only

Gravina is indeed more cohesive than in an ordinary class, both because any injunctive relief
obtained will benefit all class members whether or not they have an opportunity to be present,
and because Congress strictly limited the amount of damages available to the class to 1% of the
debt collector's net worth – in this case, only $26,508.02. See 15 U.S.C. § 1692k(a)(2)(B).
4
The Supreme Court's decision in Eisen references Mullane v. Central Hanover Bank & Trust
Co., 339 U.S. 306 (1950), and other due process cases. See Eisen, 417 U.S. at 173-74. But Ms.
Hecht does not appear to dispute that Eisen's holding with respect to notice is only about the
interpretation of Rule 23(c)(2)(B), and not about the constitutional requirement of due process.
See id. at 177 n.14 ("We are concerned here only with the notice requirements of subdivision
(c)(2), which are applicable to class actions maintained under subdivision (b)(3). By its terms
subdivision (c)(2) is inapplicable to class actions for injunctive or declaratory relief under
subdivision (b)(2).").

5

conclude that Ms. Hecht's second argument represents a bare attempt to "relitigate an issue
already decided," Schrader, 70 F.3d at 257 – namely, whether the Gravina class action
settlement complied with CAFA's requirements – and an issue that the Court already fully
addressed in its prior opinion.
III.
In sum, the Court concludes that the Supreme Court's decision in Eisen relates only to
Rule 23(b)(3) class actions rather than to Rule 23(b)(2) class actions, and further that through her
CAFA argument, Ms. Hecht seeks nothing more than to relitigate an issue that this Court has
already decided. For those reasons, her Motion for Reconsideration [doc. # 37] is DENIED.

IT IS SO ORDERED.

/s/

Mark R. Kravitz
United States District Judge

Dated at New Haven, Connecticut: April 12, 2011.

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