United States of America v. Kaniadakis
Filing
48
ORDER: The United States of America's renewed Motion for Summary Judgment (Doc. # 43 ) is GRANTED. The Clerk is directed to enter judgment in favor of the United States of America in the amount of $444,495.01 ($435,430.67 in princ ipal, $7,739.34 in interest accrued through April 13, 2017, a $45.00 service fee, and $1,280.00 in attorney's fees), plus interest at the variable rate of 3.625% per annum on the unpaid principal to the date of this judgment and interest at the rate prescribed by 28 U.S.C. § 1961 from the date of judgment, for which sum let execution issue. Once Judgment has been entered, the Clerk is directed to CLOSE THE CASE. Signed by Judge Virginia M. Hernandez Covington on 11/27/2017. (DMD)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
UNITED STATES OF AMERICA,
Plaintiff,
v.
Case No. 8:17-cv-1269-T-33TGW
STEVEN J. KANIADAKIS,
Defendant.
________________________________/
ORDER
This matter comes before the Court pursuant to the United
States of America’s renewed Motion for Summary Judgment (Doc.
# 43), filed on November 8, 2017. Pro se Defendant Steven J.
Kaniadakis responded on November 21, 2017. (Doc. # 45). For
the reasons that follow, the Motion is granted.
I.
Background
“As a student at the Ohio College of Podiatric Medicine,
[Kaniadakis] applied for and [was] granted Health Education
Assistance Loans (HEAL)” made by a private lender. (Doc. #
43-2 at 1). Kaniadakis “consolidated [his] HEAL loans into
one HEAL Relief Account loan in the amount of $146,575.13”
and “signed a promissory note on February 25, 1995, agreeing
to repay the loan at a variable rate of interest.” (Id.; Doc.
# 43-1 at 3-5). “Between October 23, 1995, and February 4,
1
1997,
[Kaniadakis]
made
sixteen
[]
payments
totaling
$11,633.75.” (Doc. # 43-2 at 1).
On September 12, 1997, Kaniadakis filed for bankruptcy
in the United States Bankruptcy Court, District of Alaska.
(Id.). The majority of Kaniadakis’s debts were “discharged on
June 22, 1998, however, [Kaniadakis’s] HEAL debt was not
dischargeable
under
bankruptcy.”
(Id.).
Due
to
the
bankruptcy, the promissory note was assigned from the private
lender to the Department of Health and Human Services (HHS)
on October 7, 1997. (Id.). HHS informed Kaniadakis that it
was the current holder of the note by letter dated October 7,
1997. (Id.). Despite numerous attempts by HHS to establish a
repayment schedule with Kaniadakis, a repayment schedule was
not set and no further payments were made. (Id. at 1-2).
On May 26, 2017, the United States initiated this default
of
student
loan
action
against
Kaniadakis.
(Doc.
#
1).
According to the Complaint, Kaniadakis is indebted to the
United States in the total amount of $443,170.01 for the
principal and interest accrued for the consolidated student
loan. (Id. at 1-2; Doc. # 1-2). Kaniadakis filed a motion to
dismiss the Complaint on June 27, 2017, (Doc. # 11), which
the Court denied on July 13, 2017. (Doc. # 15). Subsequently,
Kaniadakis filed his Answer on July 31, 2017. (Doc. # 17).
2
On June 29, 2017, the Court entered its Case Management
and Scheduling Order (Doc. # 12), setting a discovery deadline
of
August
28,
2017.
But
Kaniadakis
moved
to
extend
the
discovery period by sixty days on August 17, 2017, arguing
that further discovery was necessary regarding his payment
history. (Doc. # 21). After the United States indicated that
it did not oppose the requested extension (Doc. # 23), the
Court granted Kaniadakis’s motion, extended the discovery
deadline to October 27, 2017, and entered an Amended Case
Management and Scheduling Order. (Doc. ## 24, 25).
Then, on September 15, 2017, the United States filed its
first Motion for Summary Judgment. (Doc. # 30). Kaniadakis
then filed numerous motions to compel discovery and responded
to the Motion for Summary Judgment, arguing that the Motion
was premature because discovery was still underway. (Doc. ##
31, 32, 35). The Court denied the United States’ first Motion
for Summary Judgment without prejudice on September 27, 2017,
after finding that the Motion was premature. (Doc. # 36). The
Magistrate Judge granted Kaniadakis’s Second Motion to Compel
on October 24, 2017 (Doc. # 41), and the United States
subsequently filed a notice of compliance indicating that it
had provided the requested to discovery to Kaniadakis. (Doc.
# 42).
3
Now, after the discovery period has ended, the United
States has filed its renewed Motion for Summary Judgment.
(Doc. # 43). Kaniadakis responded in opposition on November
21, 2017. (Doc. # 45). The Motion is ripe for review.
II.
Legal Standard
Summary Judgment is appropriate “if the movant shows
that there is no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of law.”
Fed.
R. Civ. P. 56(a). A factual dispute alone is not enough to
defeat a properly pled motion for summary judgment; only the
existence of a genuine issue of material fact will preclude
a grant of summary judgment. Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 247-48 (1986).
An issue is genuine if the evidence is such that a
reasonable jury could return a verdict for the non-moving
party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742
(11th Cir. 1996)(citing Hairston v. Gainesville Sun Publ’g
Co., 9 F.3d 913, 918 (11th Cir. 1993)). A fact is material if
it may affect the outcome of the suit under the governing
law. Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir.
1997). The moving party bears the initial burden of showing
the court, by reference to materials on file, that there are
no genuine issues of material fact that should be decided at
4
trial. Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256,
1260 (11th Cir. 2004)(citing Celotex Corp. v. Catrett, 477
U.S. 317, 323 (1986)). “When a moving party has discharged
its burden, the non-moving party must then ‘go beyond the
pleadings,’ and by its own affidavits, or by ‘depositions,
answers
to
interrogatories,
and
admissions
on
file,’
designate specific facts showing that there is a genuine issue
for trial.” Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590,
593-94 (11th Cir. 1995)(citing Celotex, 477 U.S. at 324).
If there is a conflict between the parties’ allegations
or evidence, the non-moving party’s evidence is presumed to
be true and all reasonable inferences must be drawn in the
non-moving party’s favor. Shotz v. City of Plantation, Fla.,
344 F.3d 1161, 1164 (11th Cir. 2003). If a reasonable fact
finder evaluating the evidence could draw more than one
inference from the facts, and if that inference introduces a
genuine issue of material fact, the court should not grant
summary judgment. Samples ex rel. Samples v. City of Atlanta,
846 F.2d 1328, 1330 (11th Cir. 1988) (citing Augusta Iron &
Steel Works, Inc. v. Emp’rs Ins. of Wausau, 835 F.2d 855, 856
(11th Cir. 1988)).
consists
of
conclusional
However,
nothing
if
“more
allegations,”
the
than
summary
5
non-movant’s
a
repetition
judgment
is
response
of
not
his
only
proper, but required. Morris v. Ross, 663 F.2d 1032, 1034
(11th Cir. 1981).
III. Analysis
“In a suit to enforce a promissory note, where the
claimant
establishes,
affidavits,
the
through
existence
of
pleadings,
the
note,
exhibits,
the
and
borrower’s
default, and the amount due under the note, the claimant has
established a prima facie case.” United States v. Pelletier,
No. 8:08–cv–2224–T–33EAJ, 2009 WL 800140, at *2 (M.D. Fla.
Mar. 24, 2009). Specifically, “[t]o recover on a promissory
note, the government must show (1) the defendant signed it,
(2) the government is the present owner or holder, and (3)
the note is in default.” United States v. Carter, 506 F. App’x
853, 858 (11th Cir. 2013).
“The
[United
States]
may
establish
the
prima
facie
elements by producing the promissory note and certificate of
indebtedness signed under penalty of perjury.” United States
v. Hennigan, No. 6:13-cv-1609-Orl-31DAB, 2015 WL 2084729, at
*7 (M.D. Fla. Apr. 30, 2015). The United States need not
produce
the
original
promissory
note
to
recover
from
a
defaulted student loan debtor. Carter, 506 F. App’x at 858.
“The burden then shifts to the borrower to establish that the
amount is not due and owing. In the absence of such proof,
6
summary judgment in favor of the claimant is appropriate.”
Pelletier, 2009 WL 800140, at *2 (citing United States v.
Irby, 517 F.2d 1042, 1043 (5th Cir. 1975)).
The United States has established its prima facie case
by
providing
a
copy
of
the
promissory
note
signed
by
Kaniadakis, and the Certificate of Indebtedness, in which the
United
States’
loan
specialist
states
under
penalty
of
perjury that the United States is the current owner and holder
of the note and that Kaniadakis defaulted on the note. (Doc.
## 43-1, 43-2). While the photocopy of the promissory note is
less than ideal in clarity, it reflects that that a promissory
note consolidating $146,575.13 in HEAL student loan debt
through SallieMae was signed by Kaniadakis on February 25,
1995. (Doc. # 43-1 at 3-5). It is of no consequence that the
United States has not presented the original promissory note.
See Carter, 506 F. App’x at 858; United States v. Geis, No.
13-80474-CIV-DIMITROULEAS, 2013 WL 12101145, at *1 (S.D. Fla.
Sept. 4, 2013)(“Defendant’s ‘defense’ that Plaintiff failed
to produce the signed bank documents is not a defense as the
original note [for the student loan] is not a negotiable
instrument and therefore need not be produced.” (citation
omitted)).
7
Therefore, the burden is on Kaniadakis to establish a
genuine issue of material fact as to whether he owes the loan
amount described by the United States. “It is not sufficient
for [Kaniadakis] to merely allege non-liability; rather, [he]
must
produce
specific
and
concrete
evidence
of
the
nonexistence, payment, or discharge of the debt.” Hennigan,
2015 WL 2084729, at *9.
First, Kaniadakis argues that the United States did not
sufficiently respond to his discovery requests. (Doc. # 45 at
10, 25). He insists that a complete payment history was not
provided to him, including all payments made before his
various
loans
were
consolidated.
(Id.
at
22).
He
also
complains that it is unclear which loans were consolidated.
(Id. at 4-5, 7-8, 13, 22). But the Court notes that the United
States filed a certificate of compliance on October 27, 2017,
indicating
that
it
sent
Kaniadakis
approximately
120
documents in compliance with the order granting Kaniadakis’s
second motion to compel. (Doc. # 42). Kaniadakis did not file
any further motions to compel arguing that the discovery was
insufficient. Nor is it clear that the United States withheld
any documents in its possession, custody, or control. See
Fed. R. Civ. P. 34(a)(requiring a party in a civil case to
8
produce
only
those
documents
“in
the
responding
party’s
possession, custody, or control[.]”).
Also,
Kaniadakis
argues
that
many
of
the
documents
attached to the United States’ motion are “inconsistent, . .
. incomplete, tampered with in various ways.” (Doc. # 45 at
7, 2-3, 25). But, Kaniadakis does not provide any evidence of
tampering besides his conclusory allegation and insistence
that some of his own handwritten annotations should be visible
on certain documents. Cf. United States v. White, No. 5:08–
CV–348–F,
2009
WL
3872342,
at
*3
(E.D.N.C.
Nov.
18,
2009)(granting summary judgment where defendant failed to
“proffer [ ] any sworn statement or statement made under
penalty of perjury supporting” his belief that “forgery or
other nefarious actions [were] at play” regarding his student
loans). Although he argues documents are inconsistent or
incomplete, Kaniadakis does not point out any inconsistencies
in the documents attached to the United States’ Motion or
turned over to him in discovery that would raise a genuine
issue of material fact about the amount of the student loans.
Furthermore, two of the documents provided by the United
States
—
the
promissory
note
and
the
Certificate
of
Indebtedness — are alone sufficient to establish a prima facie
case. If certain documents provided by the United States are
9
incomplete or other documents exist, that does not change
that the United States has met its burden. See United States
v. Bayless, No. 8:16-cv-2757-T-33MAP, 2017 WL 882109, at *4
(M.D. Fla. Mar. 6, 2017)(“[T]o the extent these documents are
not originals or other documents not in the record exist,
they are not required for the United States to show that it
is entitled to a judgment against Bayless. The United States
needs to produce only the promissory note and Certificate of
Indebtedness to establish its prima facie case, which it has
done.”).
Essentially,
consolidation
while
Kaniadakis
documentation
for
wishes
the
that
various
more
pre-
loans
were
available, he has not provided any evidence to doubt that the
consolidated loan amount, as described in the Certificate of
Indebtedness, was incorrectly calculated. See United States
v. Ashanti, No. 3:10CV42/MCR/EMT, 2010 WL 5510074, at *4 (N.D.
Fla. Nov. 29, 2010), report and recommendation adopted, No.
3:10CV42/MCR/EMT, 2011 WL 31126 (N.D. Fla. Jan. 3, 2011)(“In
short, Defendant has come forward with nothing that disputes
the fact of the consolidated loan itself nor his default of
that loan in repayment.”).
Finally, Kaniadakis insists that his student loans were
discharged in his bankruptcy proceedings. (Doc. # 45 at 6-7,
10
10-11,
14,
19-20,
24).
The
burden
is
on
Kaniadakis
to
establish that his loans were discharged. See Pelletier, 2009
WL 800140, at *2. Thus, Kaniadakis is incorrect when he
asserts that the United States must prove that his loan was
not discharged and that it would not be an undue hardship on
Kaniadakis to pay the student loans. (Doc. # 45 at 14-15, 1824). Kaniadakis has not presented any evidence that his debt
was
discharged
in
the
bankruptcy
proceedings
in
Alaska.
Attached to his Answer is a document from his original HEAL
loan agreement that states that HEAL loans may be “discharged
in bankruptcy after the first 5 years of the repayment period
only upon a finding by the Bankruptcy Court that the nondischarge of such debt would be unconscionable . . .” (Doc.
# 17-1 at 7). But, while his loans may have been dischargeable
upon a finding of unconscionability or undue hardship by the
Bankruptcy Court, Kaniadakis has not attached a Court order
or other bankruptcy filing to show that such a finding was
made and the student loans were actually discharged.
Kaniadakis’s statement in his response that his student
loans were discharged is insufficient to rebut the United
States’ prima facie case. See Ashanti, 2010 WL 5510074, at *4
(“Even if Defendant has a genuine belief that the loan at
issue was discharged in bankruptcy along with his other loans
11
.
.
.
such
belief
is
not
enough
to
defeat
Plaintiff’s
motion.”). Therefore, he has not shown the existence of a
genuine issue of material fact regarding his obligation to
pay under the promissory note. See United States v. Morrissey,
No. 6:14-cv-697-Orl-31KRS, 2014 WL 4674290, at *4 (M.D. Fla.
Sept.
15,
2014)(“Because
Morrissey
did
not
provide
any
evidence whatsoever that his student loan debt was discharged
in a bankruptcy proceeding, he has failed to demonstrate a
genuine issue of disputed material fact regarding his default
on his obligation to pay under the note.”).
Nor can Kaniadakis show that his student loan should not
otherwise be enforced because of undue hardship. It is not
the role of this Court to make an undue hardship determination
for Kaniadakis’s student loan debt. See United States v.
Hebert, No. 8:07-cv-11-T-30EAJ, 2007 WL 2916394, at *2 (M.D.
Fla. Oct. 5, 2007)(“Other than making an undue hardship
argument
under
11
U.S.C.
§
523(8)
within
an
adversary
proceeding before a U.S. bankruptcy court, this Court is
unaware of any other common law or non-bankruptcy statutory
law that provides a defense, exclusion, or exception that
would relieve Defendant from liability under the Note.”).
Kaniadakis has not shown that his student loan debt was
discharged through any bankruptcy proceedings, and therefore
12
he has not presented a genuine issue of material fact as to
whether the debt is still owed.
IV.
Conclusion
Because the United States has established a prima facie
case
and
Kaniadakis
has
failed
to
proffer
any
evidence
creating a genuine issue of material fact, the United States’
renewed Motion for Summary Judgment is granted.
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
(1)
The
United
States
of
America’s
renewed
Motion
for
Summary Judgment (Doc. # 43) is GRANTED.
(2)
The Clerk is directed to enter judgment in favor of the
United States of America in the amount of $444,495.01
($435,430.67 in principal, $7,739.34 in interest accrued
through
April
13,
2017,
a
$45.00
service
fee,
and
$1,280.00 in attorney’s fees), plus interest at the
variable rate of 3.625% per annum on the unpaid principal
to the date of this judgment and interest at the rate
prescribed by 28 U.S.C. § 1961 from the date of judgment,
for which sum let execution issue.
(3)
Once Judgment has been entered, the Clerk is directed to
CLOSE THE CASE.
13
DONE and ORDERED in Chambers in Tampa, Florida, this
27th day of November, 2017.
14
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