Peters v. Roberts Markel, PC et al
Filing
127
ORDER GRANTING IN PART, DENYING IN PART, AND CONTINUING IN PART MOTIONS FOR SUMMARY JUDGMENT AND MOTIONS TO DISMISS OR TRANSFER VENUE 31 ; 34 - Signed by CHIEF JUDGE SUSAN OKI MOLLWAY on 5/24/12. ("For the foregoing reasons, the court grants summary judgment with respect to all but one of Peters's FDCPA claims. The court denies summary judgment with respect to the FDCPA claim against Roberts Markel arising out of the May 12, 2011, letter from that law firm to Peters and Angela. The court also overrules Defendants' Objections at ECF Nos. 122, and 123. The court orders additional statements and requests and allows supplemental briefing, discovery, and motions as set forth above. Finally, the court continues the remaining portions of the motions currently before this court until August 27, 2012, at 11:15.") ( 31 MOTION to Dismiss And/Or To Transfer Venue AND 34 MOTION to Dismiss continued to 8/27/2012 11:15 AM before CHIEF JUDGE SUSAN OKI MOLLWA Y.) (emt, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Paul Peters served by first class mail at the address of record on May 24, 2012.
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
PAUL PETERS,
)
)
Plaintiff,
)
)
vs.
)
)
ROBERTS MARKEL, PC;
)
BENTWATER YACHT AND COUNTRY
)
CLUB, LTD.;
)
BRADY ORTEGO;
)
and DOES I THROUGH X,
)
)
Defendants.
)
_____________________________ )
CIVIL NO. 11-00331 SOM/KSC
ORDER GRANTING IN PART,
DENYING IN PART, AND
CONTINUING IN PART MOTIONS
FOR SUMMARY JUDGMENT AND
MOTIONS TO DISMISS OR
TRANSFER VENUE
ORDER GRANTING IN PART, DENYING IN PART, AND
CONTINUING IN PART MOTIONS FOR SUMMARY JUDGMENT
AND MOTIONS TO DISMISS OR TRANSFER VENUE
I.
INTRODUCTION.
The case in which a mountain is likeliest to be made
out of a molehill is a case brought by a plaintiff who is a
lawyer representing himself and whose primary practice area is
not litigation.
This is such a case.
Plaintiff Paul Peters is a Utah lawyer who now runs a
bed and breakfast business on Maui.
He is the sole plaintiff in
this case, which concerns a Texas country club’s dues.
He
alleges, among other things, theft and violations of the
Racketeer Influenced and Corrupt Organizations Act (“RICO”).
Reviewing the claims asserted in this case, this court cannot
help but think of another case brought by a pro se attorney:
Walter v. Drayson, 496 F. Supp. 2d 1162 (D. Haw. 2007), aff’d 538
F.3d 1244 (9th Cir. 2008).
The plaintiff-attorney in that
earlier case, having made a protracted and expensive civil RICO
lawsuit out of what was actually a relatively simple trust and
estate dispute, recovered nothing and ultimately was taxed with
$5,000 in his opponents’ costs.
The case now before this court begins with the purchase
of property in a Texas development.
Peters purchased property in
that project in 2002, and his wife, Angela, purchased a separate
property in the same project in 2004.
Peters complains that he
was double-billed by the Bentwater Yacht and Country Club for
membership dues relating to those properties.
Peters takes the
position that his family should pay for only one membership,
while Bentwater Yacht and Country Club contends that the
association documents encumbering both properties require at
least a social membership to be maintained for each property.
For years, Defendant Bentwater Yacht and Country Club attempted
to collect the social dues Angela did not pay on her property.
Peters proceeds here alone, without Angela, against Bentwater
Yacht and Country Club, the Texas Law Firm of Roberts Markel
retained by the club, and Brady Ortego, an attorney at the law
firm.
Like the attorney in Walter v. Drayson, Peters
demonstrates that he is smart, imaginative, and resourceful.
But
he is apparently not an experienced litigator, and his zeal and
2
unfamiliarity with court rules have robbed his lawsuit of any
sense of proportionality with the actual underlying dispute.
The Complaint’s First and Fourth Claims for Relief
involve alleged violations of the Fair Debt Collection Practices
Act (“FDCPA”).
Except with respect to a single letter dated May
12, 2011, from the law firm, summary judgment is granted in favor
of all Defendants on the FDCPA claims asserted in the First and
Fourth Claims for Relief.
To the extent FDCPA claims are
asserted against Bentwater Yacht and Country Club, the FDCPA is
inapplicable because the club’s attempts to collect its own debt
do not render it a debt collector.
Even if Bentwater Yacht and
Country Club were a debt collector, its debt collection
activities, like those of Ortego and most of the collection
activities of the law firm, were aimed at only Angela, not
Peters.
Peters lacks statutory standing to maintain claims on
behalf of his wife, who is not a party to this action.
In
granting summary judgment on most of Peters’s FDCPA claims, the
court is not ruling on whether such claims could be brought by
Angela.
The court is only ruling that the FDCPA does not allow a
husband to assert claims belonging to his wife.
To the extent the motions seek other relief, including
the transfer of venue to the United States District Court for the
Southern District of Texas, Houston Division, the court continues
the hearing until 11:15 a.m. on August 27, 2012, and requests
3
supplemental briefing and/or motions to aid the court in
determining whether a transfer of venue or other relief is
appropriate.
II.
BACKGROUND.
Paul H. Peters is a Utah attorney who now apparently
runs a bed and breakfast on Maui.
See ECF 31-6 (letter dated
August 30, 2011, from Utah State Bar indicating that Peters is an
active member of the Utah Bar and is in good standing); ECF 95-9
(review of the Blue Tile Beach House on Maui).
In February 2002, Peters purchased property in the
Bentwater development in Texas from Mark G. Sweeney.
This
property is described as “Lot Five (5), Block One (1) of
BENTWATER, SECTION EIGHTEEN (18), a subdivision situated in the
James J. Foster Survey, A-203, Montgomery County, Texas.”
ECF 31-8 (warranty deed).
See
According to the Declarations of
Covenants, Conditions and Restrictions for Bentwater Section 18,
filed in April 1990 as Clerks File # 9014194, Section 6.02(f) at
page 26:
“Each owner of a Lot, other than Declarant, has agreed
to obtain and maintain a ‘Social Membership’ as defined in the
By-Laws of the Bentwater Country Club, Inc., a Texas corporation
(‘BCC’) during the term of said Owner’s ownership of a Lot.”
ECF No. 31-11.
4
See
Peters, unmarried at the time he bought the first lot
in 2002, married Angela in 2004.
Declaration of Paul Peters ¶ 3
(Jan 26, 2012), ECF No. 83 (filed Jan. 31, 2012).
After they got married, Angela purchased a lot in the
Bentwater development in her name, identified as “SURFACE ESTATE
ONLY OF LOT EIGHT (8) IN BLOCK ONE (1) OF BENTWATER SECTION
THIRTY-NINE (39), A SUBDIVISION IN MONTGOMERY COUNTY TEXAS.”
ECF No. 31-9 (General Warranty Deed with Vendor’s Lien).
See
The
mailing address for this property was 254 Creekwood West,
Montgomery, TX
77356.
Id.
The title to this property,
purchased from Andrew and Harriet Stromdahl, is held by “Angela
M. Peters, a married woman, married to Paul H. Peters (whether
one or more, hereinafter called ‘Grantee’).”
Id.
It appears
that Angela took out a loan to purchase this property.
No. 83-3 (Deed of Trust).
See ECF
The “Borrower” is identified in the
loan documents as “ANGELA M. PETERS, joined herein Pro Forma by
his/her spouse.”
Id.
Peters signed the loan document on behalf
of Angela under a power of attorney and signed it himself as a
“Borrower.”
Id.
Although title to the property is held in
Angela’s name, various real property tax documents list both
Peters and Angela as owners.
See ECF No. 83-4, 83-5, and 83-6.
There is no dispute that Peters and Angela were not
living in Hawaii at the time Angela purchased her lot in 2004.
See, e.g., ECF No. 83-7 (Dec. 3, 2004, letter sent to the Peters
5
in Montgomery, Texas); ECF No. 31-21 (July 15, 2005, letter sent
to the Peters in Key West, Florida); Sealed Ex. B (Feb. 27, 2012)
(2002-04 tax returns for Paul Peters, indicating that his home
address was in Key West, Florida; 2005-09 tax returns for Paul
Peters, indicating that his home address was in Montgomery,
Texas).
Although Peters’s tax returns listed his home address
between 2005 and 2009 as Montgomery, Texas, it appears that
Peters and/or Angela may have started living in Hawaii at some
point in 2005.
See ECF No. 83-11, PageID #1231 (Nov. 2005 bill
addressed by Bentwater Yacht and Country Club to Angela in Paia,
Hawaii); see also ECF No. 83-11, PageID #1176 (Jan. 2006 bill
addressed by Bentwater Yacht and Country Club to Peters in Paia,
Hawaii).
Peters asserts that Bentwater Yacht and Country Club
recognized in December 2004 that he and his wife jointly owned
the second property, as evidenced by a letter from Trina Almas,
the club’s membership director, addressed to Peters and Angela,
stating, “congratulations on your purchase.”
See ECF No. 31-15.
This document, however, only discussed membership and did not
clearly indicate who was the record owner of the property.
id.
See
Enclosed with the letter were applications for membership
and for credit.
Id.
The second lot was encumbered by Declarations of
Covenants, Conditions and Restrictions for Bentwater Section 39,
6
filed in April 1994 as Clerks File # 9420835, that were similar
to the provisions governing the first lot.
Section 6.02(g) at
page 29 of that document states: “Each owner of a Lot, other than
Declarant, has agreed to obtain and maintain a ‘Social
Membership’ as defined in the By-Laws of the Bentwater Country
Club, Inc., a Texas corporation (‘BCC’) during the term of said
Owner’s ownership of a Lot.”
See ECF 31-12.
On or about May 4, 2005, Trina Almas, Bentwater’s
membership director, sent Peters and Angela a letter stating,
“Looking through your file I see that we still have not received
your application for membership and application for credit.
Enclosed is another set of applications for you.”
See ECF No.
34-10.
On August 31, 2005, various Declarations of Covenants,
Conditions and Restrictions for Bentwater, including those
applicable to the first and second lots in issue here, were
amended to state: “Notwithstanding anything contained in the
Declarations to the contrary, a Social Membership, as previously
defined, shall be required to be maintained on each and every
Lot, and the Owner of multiple Lots shall be obliged to maintain
a Social Membership on each and every Lot owned.”
See ECF 31-13
(Second Amendment to Clarify the Declarations of Covenants,
Conditions and Restrictions for Bentwater).
7
The Complaint in this case alleges that, when the
second lot was purchased, someone from the Bentwater Yacht and
Country Club told Peters that it “would not duplicate membership
dues.”
See Complaint ¶ 25, ECF No. 1 (May 24, 2011).
The
Complaint alleges that, for a period, duplicate membership dues
were not charged.
That is, Peters and Angela were allegedly not
charged dues on both lots.
Id.
However, the Complaint says that
“recently,” duplicate dues have been charged.
Id. ¶ 26.
The earliest bill sent by Bentwater Yacht and Country
Club to “Angela Peters” that is in the record is dated November
30, 2005.
The November 2005 bill indicates that Angela owed
Bentwater $970.28.
was $882.62.
00626).
The bill indicates that her previous balance
See ECF No. 83-11, PageID # 1231 (Bates Stamp
It is not clear whether earlier bills were sent to
Angela, as the Bates Stamp numbers on the documents before this
court jump from 00614 to 00626, and the exhibit does not provide
all of those intervening pages.
The $882.62 owed is consistent
with all of the social fees and late fees allegedly owed by
Angela from December 2004 through October 2005.
16.
See ECF No. 34-
It appears that, beginning in May 2011, Angela began making
some payments, bringing her account current through September
2007.
See ECF No. 34-16; ECF No. 83-12 PageID #1297 (Bates Stamp
No. 00692).
There is no dispute that the bills sent by Bentwater
8
Yacht and Country Club concerning the second property were all
sent to “Angela Peters.”
See ECF Nos. 83-11 and 83-12.
For a while, membership dues on the first lot,
purchased by Peters in 2002, were paid by way of automatic debit
from Peters’s Bank of America checking account in Key West,
Florida, pursuant to Peters’s authorization of February 10, 2005,
to “Bentwater Yacht & Country Club.”
See ECF No. 95-8.
It
appears that Peters stopped paying dues on the first lot in April
2011, shortly before filing the Complaint in this matter.
See
ECF No. 83-11, PageID #s 1176 through 1230.
On March 2, 2010, “Bentwater Yacht & Country Club,
LTD.,” through its “Senior A/R Accountant,” Toni Steck, sent
Angela a letter.
See ECF No. 31-30.
Angela owed more than $8,000.
This letter indicated that
It told Angela, “Your membership
privileges for this account have been suspended as well as any
other Bentwater account.
During the period of suspension, you
and your family shall have no right or privileges to use the
facilities.”
Id. (emphasis deleted).
The letter indicated
that Angela’s name had been posted on the “Club’s delinquent
list.”
Id.
This letter is nearly identical to one that had been
sent in March 2005 to Angela by “Bentwater Yacht & Country Club,
LTD.”
See ECF No. 34-8.
Bentwater Yacht and Country Club continued to deduct
membership dues from the Bank of America checking account for
9
dues relating to the first lot after it sent the March 2010
letter barring Angela and her family from the club’s facilities.
Peters’s Complaint asserts that, in so doing, Bentwater stole
membership dues of $329.38 per month.
34, 56-58.
See Complaint ¶¶ 28, 29,
The bills submitted by Peters indicate that he
stopped the automatic deductions more than a year after his wife
was told that her family would not be able to use the facilities.
See ECF No. 83-11, PageID #1223 (May 2011 bill).
On or about March 27, 2010, Peters and Angela sent Toni
Steck a letter responding to the March 2, 2010, letter.
No. 31-31.
See ECF
The response asked Steck to explain the nature of the
alleged debt, to provide an accounting of how the debt had been
determined, to provide the documentation forming the basis of the
alleged debt, to provide the basis for denying the entire family
use of the Bentwater facilities, to provide copies of prior
invoices, and to provide the name and address of the original
creditor.
See id.
On or about April 8, 2010, Defendant Brady E. Ortego,
an attorney at the Defendant law firm in this action, Roberts
Markel, responded to the letter from Peters and Angela of March
27, 2010.
See ECF No. 31-32.
Peters’s Hawaii address.
Ortego sent that response to
See ECF No. 31-32.
The response
indicated that Ortego and the law firm represented “Bentwater
Yacht & Country Club, LTD,” the entity that was allegedly owed
10
the dues.
Id.
Ortego’s letter attached an itemized accounting
of all of the fees Angela Peters owed and explained that the fees
were based on the Declarations of Covenants, Conditions and
Restrictions for the property, as amended, which required “social
memberships” to be maintained for all properties, even when
multiple properties were owned by the same person.
See id.
The
letter stated: “We are attempting to collect a debt and all
information obtained will be used for that purpose.”
Id.
(emphasis deleted).
On or about June 25, 2010, Bentwater Property Owners
Association, Inc., through its attorney, Ortego, filed a “Notice
of Assessment” that placed a lien on Angela’s property in
Montgomery, Texas.
See ECF No. 31-33.
This lien indicated that
the owner of the property on which it was being placed was
“Angela M. Peters.”
Id.
On or about June 28, 2010, Ortego sent
Angela a copy of the Notice of Assessment lien on Roberts Markel
stationery.
See ECF No. 83-25.
and regular mail.
The letter was sent by certified
Id.
On or about November 9, 2010, Peters and Angela sent
Ortego an email, stating, “We are seeking your assistance to
resolve a critical situation involving our family’s finances and
reputation.”
See ECF No. 83-26, PageID #1539.
The email stated
that, in the process of refinancing the mortgage on Angela’s
property, “we learned that you recorded a lien with the
11
Montgomery County Clerk against our home.”
Id.
The email
thereby suggested that Peters and Angela had not seen the June
2010 letter notifying Angela of the lien.
In their email, Peters
and Angela complained about alleged double billing and noted that
$329.38 was being taken out of their checking account without
their consent, while they were being denied use of club
facilities.
Id. PageID #1540-41.
On or about November 22, 2010, Ortego replied via email
to the email of November 9, 2010, stating: “When you purchased
your homes in Bentwater, you agreed to pay certain charges
related to your ownership of the property . . . .
You are
delinquent in your payment of the charges related to your social
membership or the country club charge.”
#1537.
See ECF 83-26, PageID
Ortego noted, “The $329.38 that you are paying each month
relates to only one membership for one lot.
There is a remaining
balance owed for the other lot you own which is the basis of the
collection action.”
Id.
Documents submitted to this court
confirm that, as of November 2010, Peters was paying the monthly
dues on his property.
See ECF No. 83-11, PageID #1217.
Ortego
informed Peters and Angela in the email of November 22, 2010,
that, when they purchased lots in Bentwater, they had agreed that
social membership dues “‘shall be a charge on the Lots and shall
be a continuing lien upon the property . . . .’”
ECF No. 83-
11, PageID #1217 (quoting Article VI, Section 6.01 of the
12
declaration relating to Angela’s property).
Ortego noted that,
“While the social membership dues are assessed by the BYCC
[Bentwater Yacht and Country Club, LTD], the POA [Bentwater
Property Owners Association, Inc.] is assigned to collect the
delinquent charges from non-paying owners.”
ECF No. 83-26 at
PageID #1537.
On or about May 12, 2011, Marc Markel, on behalf of the
law firm of Roberts Markel, sent Peters and Angela a Final Demand
Letter.
See ECF No. 83-27.
This letter noted that the law firm
had been retained by the Bentwater Property Owners Association,
Inc., to collect delinquent assessments regarding 254 Creekwood
West, Angela’s property.
Id.
The letter stated that the law
firm represented the association “as a creditor in this matter”
and noted that it was “attempting to collect a debt” and that
“all information obtained will be used for that purpose.”
Id.
The letter said, “You have previously been sent correspondence
with regard to delinquent assessments” and noted that the balance
due on the account was $11,535.98.
13
III.
ANALYSIS.
A.
FDCPA Claims.
1.
Peters Lacks Statutory Standing to Assert
Most of the FDCPA Claims.
In the Complaint’s First and Fourth Claims for Relief,
Peters asserts that Defendants have violated the Fair Debt
Collection Practices Act, 15 U.S.C. §§ 1692e, 1692f, and 1692g.
Defendants have moved to dismiss the FDCPA claims,
arguing that Angela, not Peters, was the subject of the debt
collection activities.
Defendants contend that Peters lacks
“standing” to assert FDCPA claims based on debt collection
activities concerning Angela.
Although Defendants cite Rule
12(b)(1) of the Federal Rules of Civil Procedure, which concerns
a motion to dismiss for lack of subject matter jurisdiction, this
court concludes that Defendants’ motions actually challenge
Peters’s statutory standing, rather than this court’s subject
matter jurisdiction.
Congress enacts statutes that create legal rights.
When such legal rights are infringed on, a person may have an
injury for purposes of Article III standing, even though there
would be no injury without the statute.
Richard D., 410 U.S. 614, 617 n.3 (1973).
See Linda R.S. v.
A statute may place
additional restrictions on who can sue, creating “statutory
standing” requirements that are separate from the standing
requirements relating to a court’s subject-matter jurisdiction.
14
See Steel Co. v. Citizens for a Better Environment, 523 U.S. 83,
90-92 (1998).
Here, the court clearly has subject matter
jurisdiction, as FDCPA and RICO violations are alleged.
See 28
U.S.C. § 1331 (“The district courts shall have original
jurisdiction of all civil actions arising under the Constitution,
laws, or treaties of the United States.”).
In addition, the
court appears to have diversity jurisdiction.
For purposes of
subject matter jurisdiction, whether the claims are valid or not
is irrelevant.
Defendants are not denying that Peters alleges
numerous injuries (e.g., loss of use of club facilities).
Instead, they are arguing that Peters does not meet the statutory
requirements for asserting an FDCPA claim.
The Ninth Circuit has
noted that, when a court determines whether a plaintiff is an
aggrieved person under a statute, that determination “is a merits
determination, not a threshhold [jurisdictional] standing
question.”
Jewel v. Nat’l Security Agency, 673 F.3d 902, 907 n.4
(9th Cir. 2011).
In addition to citing the subject matter jurisdiction
provision in Rule 12(b)(1), Defendants also rely on Rule
12(b)(6), which concerns motions to dismiss for failure to state
a claim.
However, instead of treating the present motions as
motions to dismiss, this court treats the motions as seeking
summary judgment under Rule 56 of the Federal Rules of Civil
15
Procedure.
After providing the parties with notice of the
court’s intention to convert the motions into summary judgment
motions and after allowing the parties to be heard on the matter,
the court concluded that conversion was appropriate given all
parties’ submission of evidence outside the pleadings in
connection with the motions.
See Inclinations at 2, ECF No. 117,
May 7, 2012.
Under Rule 56 of the Federal Rules of Civil Procedure,
summary judgment shall be granted when “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.”
P. 56(a) (2010).
Fed. R. Civ.
See Addisu v. Fred Meyer, Inc., 198 F.3d 1130,
1134 (9th Cir. 2000).
The movants must support their position
that a material fact is or is not genuinely disputed by either
“citing to particular parts of materials in the record, including
depositions, documents, electronically stored information,
affidavits or declarations, stipulations (including those made
for the purposes of the motion only), admissions, interrogatory
answers, or other materials”; or “showing that the materials
cited do not establish the absence or presence of a genuine
dispute, or that an adverse party cannot produce admissible
evidence to support the fact.”
Fed. R. Civ. P. 56(c).
One of
the principal purposes of summary judgment is to identify and
16
dispose of factually unsupported claims and defenses.
Celotex
Corp. v. Catrett, 477 U.S. 317, 323-24 (1986).
Summary judgment must be granted against a party that
fails to demonstrate facts to establish what will be an essential
element at trial.
See id. at 323.
A moving party without the
ultimate burden of persuasion at trial--usually, but not always,
the defendant--has both the initial burden of production and the
ultimate burden of persuasion on a motion for summary judgment.
Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1102
(9th Cir. 2000).
The burden initially falls on the moving party to
identify for the court those “portions of the materials on file
that it believes demonstrate the absence of any genuine issue of
material fact.”
T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors
Ass’n, 809 F.2d 626, 630 (9th Cir. 1987) (citing Celotex Corp.,
477 U.S. at 323).
“When the moving party has carried its burden
under Rule 56(c), its opponent must do more than simply show that
there is some metaphysical doubt as to the material facts.”
Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
586 (1986) (footnote omitted).
The nonmoving party may not rely on the mere
allegations in the pleadings and instead must set forth specific
facts showing that there is a genuine issue for trial.
Elec. Serv., Inc., 809 F.2d at 630.
17
T.W.
At least some “‘significant
probative evidence tending to support the complaint’” must be
produced.
Id. (quoting First Nat’l Bank of Ariz. v. Cities Serv.
Co., 391 U.S. 253, 290 (1968)); see also Addisu, 198 F.3d at 1134
(“A scintilla of evidence or evidence that is merely colorable or
not significantly probative does not present a genuine issue of
material fact.”).
“[I]f the factual context makes the non-moving
party’s claim implausible, that party must come forward with more
persuasive evidence than would otherwise be necessary to show
that there is a genuine issue for trial.”
Cal. Arch’l Bldg.
Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468
(9th Cir. 1987) (citing Matsushita Elec. Indus. Co., 475 U.S. at
587).
Accord Addisu, 198 F.3d at 1134 (“There must be enough
doubt for a ‘reasonable trier of fact’ to find for plaintiffs in
order to defeat the summary judgment motion.”).
In adjudicating summary judgment motions, the court
must view all evidence and inferences in the light most favorable
to the nonmoving party.
T.W. Elec. Serv., Inc., 809 F.2d at 631.
Inferences may be drawn from underlying facts not in dispute, as
well as from disputed facts that the judge is required to resolve
in favor of the nonmoving party.
Id.
When “direct evidence”
produced by the moving party conflicts with “direct evidence”
produced by the party opposing summary judgment, “the judge must
assume the truth of the evidence set forth by the nonmoving party
with respect to that fact.”
Id.
18
The FDCPA provides damages to “any person” who suffers
“actual damage” at the hands of a “debt collector:”
Except as otherwise provided by this section,
any debt collector who fails to comply with
any provision of this subchapter with respect
to any person is liable to such person in an
amount equal to the sum of-(1) any actual damage sustained by such
person as a result of such failure; [or]
(2)(A) in the case of any action by an
individual, such additional damages as the
court may allow, but not exceeding $1,000[.]
15 U.S.C. § 1692k(a).
The court examines each of Peters’s FDCPA
claims to see whether he may maintain it.
Peters’s Complaint generically asserts that Defendants
violated the FDCPA by filing a lien, by misrepresenting the
character, status, and amount of the debt, by failing to validate
the debt, and by making false statements.
Peters’s Complaint
does not tie specific wrongful conduct to any section of the
FDCPA.
Accordingly, the court asked Peters at the hearing to
identify the legal and factual bases for his FDCPA claims.
Peters clarified that he was asserting violations of 15 U.S.C.
§§ 1692d,1 e,2 f,3 and g4 based on six letters.
1
Except with
At the hearing on the present motions, Peters referred to
FDCPA sections by Act number, rather than by the section numbers
in the United States Code. Following the hearing, to address the
court’s reference to local court rules and to comply with Local
Rule 7.6, Peters submitted corresponding statutory citations to
the United States Code. Contributing to the already voluminous
filings, Defendants filed “objections” to this submission. ECF
Nos. 122, 123. The court overrules the objections, which in no
19
respect to the May 12, 2011, letter from the law firm of Roberts
way reflect that any Defendant was prejudiced in any manner by
Peters’s eventual compliance with this court’s rule requiring
that any statutory citation include the United States Code
provision.
With respect to Peters’s reference to § 1692d(3), the court
notes that that statute prohibits a “debt collector” from
“engaging in any conduct the natural consequence of which is to
harass, oppress, or abuse any person in connection with the
collection of a debt,” including the “publication of a list of
consumers who allegedly refuse to pay debts.”
2
In relevant part, § 1692e prohibits a “debt collector” from
using “any false, deceptive, or misleading representation or
means in connection with the collection of any debt.” It
explains that the following are violations of § 1692e: “(2) The
false representation of (A) the character, amount, or legal
status of any debt . . . . (5) The threat to take any action
that cannot legally be taken. . . . (10) The use of any false
representation or deceptive means to collect or attempt to
collect any debt or to obtain information concerning a consumer.”
3
In relevant part, § 1692f prohibits a “debt collector” from
using “unfair or unconscionable means to collect or attempt to
collect any debt,” including “(1) The collection of any amount
(including any interest, fee, charge, or expense incidental to
the principal obligation) unless such amount is expressly
authorized by the agreement creating the debt or permitted by
law. . . . (6) Taking or threatening to take any nonjudicial
action to effect dispossession or disablement or property if--. .
. (C) the property is exempt by law from such dispossession or
disablement.”
4
In relevant part, § 1692g requires a “debt collector” to
take certain actions within five days of an initial communication
with a consumer in connection with the collection of a debt.
These actions include sending a written notice containing the
amount of the debt, the name of the creditor to whom the debt is
owed, statements concerning verification of a debt, and provision
of the name and address of the original creditor, if different
from the current creditor. 15 U.S.C. § 1692g(a). The section
also requires the debt collector to cease collection activities
if notified in writing that the alleged debt is disputed. 15
U.S.C. § 1692g(b).
20
Markel to “Angela M. Peters and Paul H. Peters,” Peters fails to
demonstrate that there were possible FDCPA violations in the form
of debt collection activities directed to Peters himself.
In
fact, the court is at somewhat of a loss as to why Peters, a Utah
attorney, is attempting to pursue claims that really belong to
his wife.
Perhaps Peters pursues these claims pro se because he
is not licensed to practice law in Hawaii and therefore cannot
represent his wife.
Angela may be reluctant to represent herself
or to incur the cost of retaining an attorney, even if only to
satisfy the local attorney requirement if Peters were admitted
pro hac vice for the purpose of representing her.
Whatever his
motivation, Peters lacks statutory standing to pursue most of the
FDCPA claims.
a.
Bentwater Yacht and Country Club is Not
Liable For Any of the Alleged Violations
of the FDCPA.
At the hearing on the present motions, Peters stated
that his FDCPA claims are based in part on letters that Bentwater
Yacht and Country Club sent him and Angela in December 2004 and
May 2005.
The December 2004 letter stated, “[C]ongratulations on
your purchase of a Bentwater property.
Enclosed is an
application for membership and an application for credit.”
ECF No. 83-7.
See
The May 2005 letter stated, “Looking through your
file I see that we still have not received your application for
membership and application for credit.
21
Enclosed is another set
of applications for you.”
See ECF No. 34-10.
Because these
letters are by Bentwater Yacht and Country Club, the court
construes Peters’s FDCPA claims, to the extent based on these
letters, as asserted against only Bentwater Yacht and Country
Club and not against other Defendants.5
Notably, neither letter
even refers to any debt, much less seeks to collect any debt.
In
short, they cannot be read as having involved debt collection
activity by a “debt collector.”
Certainly, as neither letter
suggests that Peters himself owed any debt, Peters may not base
any of his FDCPA claims on either letter.
Peters identifies no
section of the FDCPA that was violated by the congratulatory
letter with which applications for membership and for credit were
provided, or by the subsequent letter noting that completed
applications had not yet been received.
Summary judgment is
therefore granted in favor of Bentwater Yacht and Country Club on
any FDCPA claim arising out of these two letters.
Even if the letters could be read as attempts to
collect a debt, Bentwater Yacht and Country Club could not be
liable for any possible FDCPA violation based on the December
5
If Peters intended these particular letters to support
claims against other Defendants, the court grants summary
judgment to those other Defendants, as there is no evidence tying
them to these matters. The court takes the same position with
respect to other claims it reads as limited to fewer than all
Defendants. That is, to the extent Peters asserts such claims
against all Defendants, they are all entitled to summary judgment
in the absence of evidence tying them to those claims.
22
2004 and May 2005 letters, because Bentwater Yacht and Country
Club could not possibly qualify as a “debt collector” with
respect to those letters.
Any debt in issue would have been
Bentwater’s own debt, not a debt it was seeking to collect for
another person or entity.
The FDCPA defines “debt collector” as
follows:
any person who uses any instrumentality of
interstate commerce or the mails in any
business the principal purpose of which is
the collection of debts, or who regularly
collects or attempts to collect, directly or
indirectly, debts owed or due or asserted to
be owed or due another.
See 15 U.S.C.A. § 1692a(6).
A “debt collector” does not include
“any person collecting or attempting to collect any debt owed or
due or asserted to be owed or due another to the extent such
activity . . . (ii) concerns a debt which was originated with
such person.”
15 U.S.C. § 1692a(6)(F)(ii); see also De Dios v.
Int’l Realty & Invs., 641 F.3d 1071, 1074 (9th Cir. 2011) (noting
that the FDCPA excludes from the definition of “debt collector”
any “person who originated the debt, such as a creditor to whom
the debt was originally owed”); Rowe v. Educ. Credit Mgm’t Corp.,
559 F.3d 1028, 1031 (9th Cir. 2009) (stating that “a ‘creditor’
is not a ‘debt collector’ under the FDCPA”); Jonak v. John
Hancock Mut. Life Ins. Co., 629 F. Supp. 90, 94 (D. Neb. 1985)
(noting that the definition of “debt collector” “excludes both
23
creditors seeking to collect their own debts and the officers and
employees of creditors collecting debts for the creditors”).
Not only is Bentwater Yacht and Country Club free of
FDCPA liability with respect to the bills it sent Angela for
social club dues and late fees, see ECF No. 83-11 and 83-12,
Bentwater Yacht and Country Club has no FDCPA liability with
respect to any of the other letters attempting to collect its own
debt.
For example, on March 2, 2010, Bentwater Yacht & Country
Club, LTD, through its “Senior A/R Accountant,” Toni Steck, sent
“Angela Peters” a letter that attempted to collect allegedly past
due amounts owed to Bentwater.
This letter notifies Angela that
she and her family “shall have no right or privileges to use the
facilities” and that Angela’s name has been “posted on the Club’s
delinquent list.”
See ECF No. 31-30.
Because Peters relies on
FDCPA provisions applicable to debt collectors, and because
Bentwater Yacht and Country Club does not fit into the definition
of “debt collector” in seeking to collect amounts owed to it,
Bentwater Yacht and Country Club cannot be liable to Peters on
his FDCPA claims.
Peters points to documents that refer to different
Bentwater entities, arguing that it is unclear that Bentwater
Yacht and Country Club was itself owed anything.
Thus, for
instance, Peters points to the Declarations encumbering the
properties and requiring “social club” memberships “as defined in
24
the By-Laws of the Bentwater Country Club, Inc.”
Nos. 31-11 and 31-12.
See, e.g., ECF
But that does not raise a genuine issue of
material fact as to whether Bentwater Yacht and Country Club was
attempting to collect its own debt.
Instead, the reference to
Bentwater Country Club, Inc., addresses the definition of a
“social club” membership; it does not identify the entity to
which membership dues are owed.
Peters attempts to raise a genuine issue of fact as to
whether Bentwater was attempting to collect its own debt by
showing that the entity seeking to collect the debts used
different names.
Compare ECF Nos. 83-11 and 83-12 (bills from
“Bentwater Yacht and Country Club”), with ECF Nos. 31-30
(collection letter from Toni Steck on behalf of “Bentwater Yacht
& Country Club, LTD”); 31-32 (letter from Ortego saying he was
representing “Bentwater Yacht & Country Club, LTD”); 31-33
(notice of assessment on behalf of “Bentwater Property Owners
Association, Inc.”); 83-26 (email from Ortego indicating that he
represented “Bentwater Yacht and Country Club, LTD,” which
assessed membership dues, and “Bentwater Property Owners
Association, Inc.,” which was assigned to collect delinquent
charges); 83-27 (letter from law firm indicating that it
represented “Bentwater Property Owners Association, Inc.”).
Even
if Bentwater Yacht and Country Club could be considered a “debt
collector” because it was not collecting its own debts, Peters
25
would lack “statutory standing” to assert the FDCPA claims to the
extent collection activities were directed only toward Angela.6
See generally Burdett v. Harrah’s Kansas Casino Corp., 294 F.
Supp. 2d 1215, 1227 (D. Kan. 2003); Dewey v. Assoc. Collectors,
Inc., 927 F. Supp. 1172, 1174 (W.D. Wis. 1996).
No matter what,
relief under the FDCPA is available only to a person who sustains
damage through a debt collector’s violation of the FDCPA “with
respect to” that very person.
15 U.S.C. § 1692k(a).
When a debt
collector violates the FDCPA with respect to someone else, the
FDCPA does not provide for claims by others.
The court also denies Peters’s Rule 56(d) request.
Rule 56(d), formerly Rule 56(f), permits a court to continue a
summary judgment motion when a “nonmovant shows by affidavit or
declaration that, for specified reasons, it cannot present facts
essential to justify its opposition.”
The 2010 Advisory
Committee Notes state, “Subdivision (d) carries forward without
6
The record does not allow the court to conclude that,
because Bentwater Yacht and Country Club is related to other
Bentwater entities, the club is not a “debt collector” for FDCPA
purposes to the extent it is collecting a related entity’s debt.
See 15 U.S.C. § 1692a(6)(B) (“debt collector” does not include
“any person while acting as a debt collector for another person,
both of whom are related by common ownership or affiliated by
corporate control, if the person acting as a debt collector does
so only for persons to whom it is so related or affiliated and if
the principal business of such person is not the collection of
debts”). As the Ninth Circuit noted in Fox v. Citicorp Credit
Services, Inc., 15 F.3d 1507, 1514 (9th Cir. 1994), the “related
entity” exemption requires proof of certain circumstances, none
of which the court has any evidence of.
26
substantial change the provisions of former subdivision (f).”
That is, a party requesting a Rule 56(d) continuance bears the
burden of (1) filing a timely application that specifically
identifies relevant information; (2) demonstrating that there is
some basis to believe that the information sought exists; and
(3) establishing that such information is essential to resist the
summary judgment motion.
See Employers Teamsters Local Nos. 175
& 505 Pension Trust Fund v. Clorox Co., 353 F.3d 1125, 1130 (9th
Cir. 2004) (interpreting Rule 56(f)) (citation omitted); accord
Moss v. U.S. Secret Serv., 572 F.3d 962, 966 n.3 (9th Cir. 2009)
(“Rule 56(f) requires a party seeking postponement of a summary
judgment motion to show how additional discovery would preclude
summary judgment and why it cannot immediately provide specific
facts demonstrating a genuine issue of material fact.”
(punctuation, quotations, and citation omitted)).
Peters says
that he needs a continuation of the motions to allow him to
conduct discovery regarding whether Bentwater Yacht and Country
Club was collecting its own debt.
However, because Bentwater
Yacht and Country Club’s letters and bills were directed only to
Angela, the sole owner of the second lot, Peters’s proposed
discovery would have no impact on this portion of the motions.
27
b.
The June 21, 2006, Letter Was Not an
Attempt to Collect a Debt That Gives
Rise To FDCPA Liability on The Part of
Roberts Markel.
At the hearing on the present motions, Peters stated
that his FDCPA claims were also based in part on a letter dated
June 21, 2006.
Peters appears to have been referring to a letter
by Marc D. Markel to Peters and Angela on Roberts Markel
stationery.
See ECF No. 83-22.
The letter noted that Markel
represented the Bentwater Property Owners Association and
informed Peters and Angela that no subassociation had been
incorporated, meaning that the association itself was vested to
charge, collect, and disburse “Harbor View” charges.
Id.
Roberts Markel is the only named Defendant with any connection to
this letter.
Accordingly, the court construes Peters’s claim
arising out of this letter as limited to Defendant Roberts
Markel.
As with the 2004 and 2005 letters identified by Peters
at the hearing, the letter of June 21, 2006, is not an attempt to
collect a debt.
The letter provides information but does not
demand payment or mention any action resulting from nonpayment.
Peters does not state which section of the FDCPA it could
possibly violate.
In fact, it is not at all clear which claim
asserted in the Complaint this letter is relevant to.
Given the
absence of genuine issues of material fact relating to this
letter, the court grants summary judgment to the law firm of
28
Roberts Markel to the extent an FDCPA claim is being asserted
against it based on the letter of June 21, 2006.
c.
The April 8, 2010, Letter Was Not an
Attempt to Collect a Debt From Peters.
Peters also identified a letter of April 8, 2010, as
forming the basis of at least part of an FDCPA claim.
Defendant
Brady E. Ortego, an attorney at Roberts Markel, wrote a letter to
Peters and Angela dated April 8, 2010.
The court therefore
construes any FDCPA claim based on the letter of April 8, 2010,
as asserted against Ortego and Roberts Markel.
That letter responded to a letter from Peters and
Angela dated March 27, 2010.
See ECF No. 31-32.
The response
indicated that Ortego and the law firm represented “Bentwater
Yacht & Country Club, LTD,” the entity allegedly owed the dues.
Id.
The letter attached an itemized accounting of all of the
fees Angela owed and explained that the fees were based on the
Declarations of Covenants, Conditions and Restrictions for the
property, as amended, which required “social memberships” to be
maintained for all properties, even when multiple properties were
owned by the same person.
See id.
The letter stated: “We are
attempting to collect a debt and all information obtained will be
used for that purpose.”
Id. (emphasis deleted).
Although this
letter was addressed to both Peters and Angela, the attached
itemization makes it clear to any reasonable person that the
letter was referring to a debt that the writer of the letter
29
considered to be owed only by Angela, not Peters.
Peters was
included as an addressee of the letter only because he and Angela
had earlier sent Ortego a letter.
See ECF No. 31-31 (March 27,
2010, letter asking Bentwater to explain the nature of the
alleged debt, to provide an accounting of how the debt was
determined, to provide the documentation forming the basis of the
alleged debt, to provide the basis for denying the entire family
use of the Bentwater facilities, to provide copies of prior
invoices, and to provide the name and address of the original
creditor).
Because there is no genuine issue of material fact as
to whether Ortego and/or the law firm were attempting to collect
a debt from Peters when Ortego sent the letter of April 8, 2010,
summary judgment is granted in favor of Ortego and Roberts Markel
to the extent an FDCPA claim is asserted against them based on
the letter of April 8, 2010.
d.
The November 22, 2010, Email Was Not an
Attempt to Collect a Debt From Peters.
Peters stated at the hearing that he was also basing
his FDCPA claims on an email of November 22, 2010, from Ortego.
No reasonable juror could find that that email was attempting to
collect a debt from Peters.
The email was clearly responding to
an email dated November 9, 2010, from Peters and Angela, and the
response was directed to both of them only because they appeared
to have both sent the original communication.
30
Their email of
November 9, 2010, had asked Ortego to help them “resolve a
critical situation” and complained about the alleged double
billing.
See ECF No. 83-26, PageID #1539.
Ortego’s responsive email dated November 22, 2010,
stated: “When you purchased your homes in Bentwater, you agreed
to pay certain charges related to your ownership of the property
. . . .
You are delinquent in your payment of the charges
related to your social membership or the country club charge.”
See ECF 83-26, PageID #1537.
Ortego noted that, “The $329.38
that you are paying each month relates to only one membership for
one lot.
There is a remaining balance owed for the other lot you
own which is the basis of the collection action.”
Id.
Ortego
further stated that, when Peters and Angela purchased their lots
in Bentwater, they agreed that social membership dues “‘shall be
a charge on the Lots and shall be a continuing lien upon the
property . . . .’”
ECF No. 83-11, PageID #1217 (quoting
Article VI, Section 6.01 of the declaration relating to Angela’s
property).
Ortego’s email of November 22, 2010, responded to an
email by Peters and Angela, recognized that more than one lot had
been purchased, and discussed the bases for charging a social
membership for each property.
Given that context, no reasonable
juror would conclude that Ortego was attempting to collect from
Peters the allegedly delinquent social dues and late fees for
31
Angela’s property.
Peters fails to show that the email of
November 22, 2010, violated any FDCPA provision.
Accordingly,
summary judgment is granted in favor of Ortego and Roberts Markel
on the FDCPA claim arising out of the email of November 22, 2010.
e.
Peters May Not Assert an FDCPA Claim
Arising Out of the Lien on Angela’s
Property.
Peters also lacks statutory standing to assert FDCPA
claims based on the June 2010 lien that was placed on Angela’s
property.
Any collection effort relating to the lien was
directed at Angela, the owner of the property, not Peters.
In
fact, the lien specifically identifies the owner of the
applicable property as Angela M. Peters and does not mention
Peters at all.
See ECF No. 31-33.
Nor does Peters have
statutory standing to assert FDCPA violations based on the June
28, 2010, letter in which Ortego sent Angela a copy of the Notice
of Assessment lien on Roberts Markel stationery, as
no
collection activities were directed at Peters in that letter.
See ECF No. 83-25.
In fact, Peters earlier suggested that he had
not seen the letter of June 28, 2010.
See ECF No. 83-26
(November 9, 2010, email from Peters and Angela to Ortego
stating, “In the process of refinancing our current mortgage for
our home at 254 Creakwood . . . , we learned that you recorded a
lien with the Montgomery County Clerk against our home.”).
32
In ruling that Peters lacks statutory standing to
assert FDCPA claims arising out of a lien placed on Angela’s
property, the court recognizes that various tax records list both
Peters and Angela as owners of the second Bentwater property.
The court also recognizes that Peters signed a loan document as a
“Borrower” as an accommodation.
These documents do not create a
genuine issue of fact as to the identity of the owner of the
second property.
The only recorded document presented to the
court indicates that the property is held in the name of Angela
alone.
If recordation and the Statute of Frauds, Vernon’s Tex.
Stat. & Codes Ann. § 26.01, are to have any meaning or effect,
the court must treat the recorded document as denoting ownership.
Even if tax authorities considered Peters an owner of
the property, there is no evidence that Ortego and/or Roberts
Markel aimed any debt collection activity at Peters or otherwise
exposed him to debt collection by filing a lien on property held
in Angela’s name, or by sending a copy of the lien document to
Angela.
Because Peters fails to identify any provision of the
FDCPA that makes Ortego and/or Roberts Markel liable to him for
activities concerning the lien, summary judgment is granted in
their favor and against Peters with respect to any FDCPA claim
based on the lien.
The court is unpersuaded by Peters’s argument that,
notwithstanding the clear wording of the recorded title document,
33
he and Angela are both owners of the second lot under Texas law.
Peters argues that the community property law of Texas gives a
spouse standing in Texas courts to maintain a claim relating to
property belonging to a spouse.
In Forgetaboutit, Inc. v. Warner, 2005 WL 3219578 (Tex.
App. Dec. 1, 2005), cited by Peters, the Texas Court of Appeals
recognized that a wife had standing to sue along with her husband
for damages relating to a nonfunctioning “satellite operated
charge machine” purchased by an unincorporated business allegedly
owned only by her husband.
The Texas Court of Appeals reasoned
that, because “[i]ncome from the business during the property
would be community property,” the wife’s interest in any
community property gave the wife “a justiciable interest in the
controversy sufficient to confer standing to sue along with her
husband.”
Id. at *3.
This case does not establish that Texas
law makes Peters an owner of Angela’s property.
In the first place, the Texas court was examining
whether Charlotte, the wife, had standing for subject matter
jurisdiction purposes.
See id. (“To the extent Forgetaboutit
complains of lack of standing, that issue may be raised at any
time, because without standing a court lacks subject matter
jurisdiction.”).
By contrast, this court is being asked to
consider whether Peters was an owner of Angela’s property for
substantive purposes.
This court undoubtedly has subject matter
34
jurisdiction, regardless of whether Peters succeeds or not on any
claim.
He asserts sufficient injury for subject matter
jurisdiction purposes (e.g., by claiming to have been barred from
club facilities).
What he does not show is that any alleged
injury flowed from a debt collection activity that violated the
FDCPA with respect to him, rather than possibly to Angela.
In the second place, the Texas court was not saying
that Charlotte was an owner of her husband’s business.
The
court’s use of the words “would be community property” suggests
that the Texas court was positing the possibility that, if
Charlotte and her husband separated or got divorced, Charlotte
could claim income from the business earned during the marriage
as community property.
That is, the Texas court was considering
a hypothetical situation, not an existing legal status.
This
court sees no other reason the Texas court used the words “would
be” rather than “is.”
If indeed the concept of community
property applied to income earned during the marriage without
regard to any separation or divorce, why did the Texas court
speak of what “would be”?
Moreover, while the Texas court said that Charlotte’s
interest in avoiding a diminution in income that might be divided
between separating or divorcing spouses gave her standing to sue,
it nowhere said that Texas law made her an actual owner of her
husband’s business.
Had Texas law so provided, the Texas court
35
would have had no need to refer to the “income” from the business
that “would be” constituting community property.
The Texas court
could instead have referred to the very business itself.
Thus,
the distinction the Texas court made between the business and the
income from the business undercuts Peters’s argument that the
Forgetaboutit decision makes him an owner of Angela’s property.
Finally, neither that case nor any other case cited by
any party indicates that one spouse may assert an FDCPA claim
just because another spouse owns property that is the subject of
debt collection activities.
No party cites any law suggesting
that community property laws in any jurisdiction render any debt
collection activity against one spouse actionable by the other
spouse.
In enacting the FDCPA, Congress decided who could sue
for violations of its provisions.
Congress sought to protect
debtors from certain debt collection practices, not to create
claims by the debtors’ relatives who sought to insert themselves
into a debtor-creditor relationship.
Peters cites no authority
for the proposition that a debtor’s spouse who is not the subject
of debt collection activity (and who may not have been exposed to
any such activity at all) automatically stands in the shoes of
the debtor for FDCPA purposes solely because a state has
community property laws.
See generally Burdett v. Harrah’s
Kansas Casino Corp., 294 F. Supp. 2d 1215, 1227 (D. Kan. 2003)
36
(“Unless plaintiff has a legal status which entitles her to stand
in his shoes, she ordinarily does not have standing to assert a
FDCPA violation based on collection efforts aimed at her
spouse.”); Dewey v. Assoc. Collectors, Inc., 927 F. Supp. 1172,
1174 (W.D. Wis. 1996) (refusing to allow wife to maintain an
FDCPA claim based on a collection letter sent to husband, and
rejecting claim that, because debts are marital debts, a debt
collection letter addressed to one spouse should be treated as a
letter addressed to both spouses).
f.
The Only Potentially Viable FDCPA Claim
Arises Out of a Letter of May 12, 2011,
and Any Such Claim May Be Asserted Only
Against Roberts Markel.
The only possible factual basis for Peters to recover
under the FDCPA may be a letter of May 12, 2011, in which Marc
Markel, on Roberts Markel stationery, sent a “Final Demand
Letter” to Peters and Angela.
See ECF No. 83-27.
This letter
noted that the law firm had been retained by the Bentwater
Property Owners Association, Inc., to collect delinquent
assessments regarding 254 Creekwood West, Angela’s property.
Id.
The letter stated that the law firm represented the association
“as a creditor in this matter,” that it was “attempting to
collect a debt,” and that “all information obtained will be used
for that purpose.”
Id.
The letter stated that, “You have
previously been sent correspondence with regard to delinquent
37
assessments” and noted that the balance due on the account was
“$11,535.98.
Id.
Although the context of that letter may be sufficiently
clear for a jury to ultimately conclude that Markel was not
attempting to collect a debt from Peters, there is, on the
present record, a question of fact to that issue.
Arguably, that
letter was an attempt to collect the debt from Peters.
Of the
Defendants named in this action, only Roberts Markel could
possibly have any FDCPA liability arising from this letter, as it
is the only party that may have been acting as a debt collector
in connection with the letter.
See Fox v. Citicorp Credit
Servs., Inc., 15 F.3d 1507, 1513 (9th Cir. 1994) (“Attorneys,
like all other persons, are subject to the definition of ‘debt
collector’ in 15 U.S.C. § 1692a(6).”).
Accordingly, Peters’s
FDCPA claim(s) arising out of the May 12, 2011, letter survive
the present motions with respect to Defendant Robert Markel only.
The denial of summary judgment with respect to the May
2011 letter does not mean that the court will ultimately go to
trial based on that letter.
There may be evidence that is not
yet in the record that demonstrates that the letter was not an
attempt to collect a debt from Peters, especially given the lack
of clarity concerning Peters’s claim.
If such evidence exists,
it may or may not support a future motion.
38
The court notes that it is being asked to transfer this
action to the United States District Court for the Southern
District of Texas.
As discussed in more detail below, knowing
the legal and factual bases of Peters’s claims will greatly aid
this court in determining whether a transfer of any part of this
case is appropriate.
Accordingly, the court directs Peters to
file, no later than June 1, 2012, a statement as to the exact
section or sections of the FDCPA that were allegedly violated by
the law firm of Roberts Markel in sending the letter of May 12,
2011, along with a short explanation of how each cited section of
the FDCPA was violated.
B.
The Court Continues the Remainder of the Motions.
Defendants have moved, in part, to dismiss or transfer
this action under 28 U.S.C. § 1404(a) to the Fifth Circuit Court
in Houston, Texas.
At the hearing, Defendants indicated that
they were actually seeking to transfer this matter to the United
States District Court for the Southern District of Texas, Houston
Division.
A request for transfer of venue is governed by 28
U.S.C. § 1404(a), which provides: “For the convenience of parties
and witnesses, in the interest of justice, a district court may
transfer any civil action to any other district or division where
it might have been brought.”
The purpose of § 1404(a) is “to
prevent the waste ‘of time, energy and money’ and ‘to protect
39
litigants, witnesses and the public against unnecessary
inconvenience and expense.’”
Van Dusen v. Barrack, 376 U.S. 612,
616 (1964) (quoting Continental Grain Co. v. Barge FBL-585, 364
U.S. 19, 26-27 (1960)).
Under § 1404(a), the district court has
discretion “to adjudicate motions for transfer according to an
individualized, case-by-case consideration of convenience and
fairness.”
Jones v. GNC Franchising, Inc., 211 F.3d 495, 498
(9th Cir. 2000) (citation and internal quotation marks omitted).
See Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 27 (1988)
(same).
“Weighing of the factors for and against transfer
involves subtle considerations and is best left to the discretion
of the trial judge.”
Ventress v. Japan Airlines, 486 F.3d 1111,
1118 (9th Cir. 2007) (quoting Commodity Futures Trading Comm'n v.
Savage, 611 F.2d 270, 279 (9th Cir. 1979)).
The Ninth Circuit has stated that a court must weigh
multiple factors when considering a motion for change of venue.
See Jones, 211 F.3d at 498.
For example, a court may consider:
(1) the location where the relevant
agreements were negotiated and executed,
(2) the state that is most familiar with the
governing law, (3) the plaintiff’s choice of
forum, (4) the respective parties’ contacts
with the forum, (5) the contacts relating to
the plaintiff’s cause of action in the chosen
forum, (6) the differences in the costs of
litigation in the two forums, (7) the
availability of compulsory process to compel
attendance of unwilling non-party witnesses,
and (8) the ease of access to sources of
proof.
40
Id. at 498-99 (internal footnotes omitted).
The Ninth Circuit has also directed courts to consider
private and public interest factors affecting the convenience of
a forum.
Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d
834, 843 (9th Cir. 1986) (citing Piper Aircraft Co. v. Reyno, 454
U.S. 235, 241 (1981)).
Private interest factors include “the
‘relative ease of access to sources of proof; availability of
compulsory process for attendance of unwilling, and the cost of
obtaining attendance of willing, witnesses; possibility of view
of premises, if view would be appropriate to the action; and all
other practical problems that make trial of a case easy,
expeditious and inexpensive.’”
Id. (quoting Gulf Oil Corp. v.
Gilbert, 330 U.S. 501, 508 (1947)).
Public interest factors
include “the administrative difficulties flowing from court
congestion; the ‘local interest in having localized controversies
decided at home’; . . . and the unfairness of burdening citizens
in an unrelated forum with jury duty.”
Id. (quoting Piper
Aircraft, 454 U.S. at 241 n.6).
Courts have noted that the inconvenience to witnesses
is often the most important factor when considering whether a
transfer of venue is appropriate.
See Saleh v. Titan Corp., 361
F. Supp. 2d 1152, 1160 (S.D. Cal. 2005) (quoting State Street
Capital Corp. v. Dente, 855 F. Supp. 192, 197 (S.D. Tex. 1994));
see also Ruiz v. Affinity Logistics, 2005 WL 5490240, at *8 (N.D.
41
Cal. Nov 7, 2005).
The convenience of nonparty witnesses is more
important than the convenience of party witnesses.
Saleh, 361 F.
Supp. 2d at 1160 (quoting Aquatic Amusement Assocs., Ltd. v. Walt
Disney World Co., 734 F. Supp. 54, 57 (N.D.N.Y. 1990)).
Ultimately, the moving party has the burden of showing
that the alternative venue is more appropriate.
Ah Sing v.
Kimoto, 2012 WL 1366600, *2 (D. Haw. Apr. 18, 2012) (citing
Tamashiro v. Harvey, 487 F. Supp. 2d 1162, 1168 (D. Haw. 2006)).
To determine whether transfer is appropriate, this
court needs a better understanding than it now has of Peters’s
remaining claims.
The court is therefore requesting that the
parties submit supplemental briefing and/or motions concerning
the remaining claims.
In the usual case, this court would not
need such supplemental briefing to get an understanding of a
plaintiff’s claims sufficient to support a determination as to
whether a transfer is appropriate.
usual case.
However, this is not the
Instead, it appears to this court that Peters has
attempted to “shoehorn” various claims into legal theories that
may not be an appropriate “fit.”
This court is having difficulty
discerning the true nature and viability of the claims and
concludes that it must do so before deciding the transfer issue.
42
1.
First Claim for Relief--FDCPA.
Given the court’s rulings in the earlier portions of
this order, the only FDCPA claim remaining concerns a letter of
May 12, 2011, from the law firm of Roberts Markel to Peters and
Angela.
This remaining claim may proceed against the law firm.
Uncertain which provisions of the FDCPA Peters believes were
violated by this letter and why, this court has earlier in this
order directed Peters to clarify this matter no later than
Friday, June 1, 2012.
See Local Rule 7.6 (“Citations shall be
made to the applicable United States Code provision(s), rather
than only to the section(s) of a named act or code, although
reference may be made to both.”).
The identification of the subsections of the FDCPA at
issue will allow this court to better determine whether any part
of this action should ultimately be transferred to Texas.
If the
court continues to have before it any FDCPA claim, the court will
keep that claim here, recognizing that Congress did not intend in
passing the FDCPA to burden claimants with farflung litigation.
See Maloon v. Schwartz, Zweben & Sling-Baum, L.L.P., 399 F. Supp.
2d 1108, 1114 (D. Haw. 2005).
The court may then be reluctant to
split this case into two by transferring other claims.
The court recognizes that the clarification that Peters
is being directed to file may give rise to the law firm’s
conclusion that it should redirect its efforts.
43
For that reason,
the court will permit the law firm to file another dispositive
motion concerning the remaining FDCPA claim, if applicable.
Any
such motion must be filed no later than July 23, 2012, if
intended to affect this court’s transfer decision.
Any such
motion filed by July 23, 2012, will be heard by this judge at
11:15 a.m. on August 27, 2012.
2.
Second and Fifth Claims for Relief--Theft and
Breach of Contract.
Peters alleges that Bentwater Yacht and Country Club
contracted with him to provide him club services in return for
the membership dues he paid on the property held in his name
alone.
Peters says that, in attempting to collect the social
dues allegedly owed by Angela on her individual property,
Bentwater Yacht and Country Club barred Angela and her family
from using club facilities, thereby breaching its contract to
provide Peters with services in connection with his own lot.
Complaint, Fifth Claim for Relief.
See
According to Peters,
Bentwater Yacht and Country Club also stole his money by
continuing to automatically debit the Florida checking account
for membership dues relating to Peters’s individual property
while barring him from using the club’s facilities because fees
relating to Angela’s lot were unpaid.
See Complaint, Second
Claim for Relief.
Although the factual allegations of the Complaint
appear to limit these claims to Bentwater Yacht and Country Club,
44
the Complaint also appears to assert all claims against all
Defendants.
No later than Friday, June 1, 2012, Peters must
state whether the breach of contract and theft claims are
asserted against only Bentwater Yacht and Country Club.
The
statement on this subject may be included in the same document
that Peters has been directed to file with respect to the
remaining FDCPA claim.
This information will likely affect this
court’s determination as to whether a transfer of any part of
this case is appropriate.
3.
Third Claim For Relief--RICO.
The object and scope of the alleged RICO violations
alleged in the Complaint’s Third Claim for Relief are not
entirely clear.
It may well be necessary for this court to
determine the nature and validity of Peters’s RICO claim before
determining whether a transfer of any part of this case is
appropriate.
If, for example, the RICO claim is determined to
lack viability, the court may be more likely to transfer other
claims arising out of actions occurring in Texas, especially if
the court determines that those other claims are so distinct from
the facts underlying any surviving FDCPA claim that they cannot
be said to arise “out of the same transaction, occurrence, or
series of transactions or occurrences.”
20(a).
See Fed. R. Civ. P.
To assist the court in making an informed decision on the
transfer request, Defendants may want to consider conducting the
45
special RICO discovery detailed in Local Rule 33.1.
So that the
court will be able to decide the transfer issue at the earliest
time possible, and especially because the current motions have
been pending for more than seven months given prior continuation
of the hearing, the court sua sponte orders that such discovery
may occur and will not count against any limit on
interrogatories.
The court’s experience with similar RICO claims in
Walter v. Drayson, 496 F. Supp. 2d 1162 (D. Haw. 2007), aff’d 538
F.3d 1244 (9th Cir. 2008), gives the court heightened concern
about whether and how Peters’s RICO claim should affect the
court’s transfer decision.
To the extent the parties conclude
that further dispositive motions concerning the RICO claim are
appropriate, any such motions filed by July 23, 2012, will be
heard at 11:15 a.m. on August 27, 2012, before a decision on the
transfer issue is made.
4.
Fourth Claim For Relief--Wrongful Lien Under
State Law.
Because the court has granted summary judgment on the
wrongful lien claim asserted by Peters under the FDCPA, the
Fourth Claim for Relief is limited to state law bases concerning
the filing of a wrongful lien by “defendants.”
These state law
wrongful lien claims are possibly asserted against Ortego and
Roberts Markel only, but the court would find it helpful in
making its transfer decision if Peters provided clarification on
46
this point.
Peters is therefore directed to file such
clarification no later than Friday, June 1, 2012.
The
clarification as to which parties are being sued in the state law
wrongful lien claim may be included in the document concerning
the remaining FDCPA claim and the theft and breach of contract
claims.
Peters’s briefing of all issues with respect to which
the court has set a deadline of June 1, 2012, may not exceed
2,500 words.
No later than Monday, August 6, 2012, all parties may
submit supplemental briefing as to whether Peters has standing to
assert the wrongful lien claims under Texas law based on the lien
placed on Angela’s property.
exceed 2,500 words.
No party’s brief on this issue may
This supplemental briefing should include a
discussion of Peters’s argument that, because Texas is a
community property state, any lien on his wife’s property is also
a lien on his property.
The parties may want to consult with
Texas lawyers versed in that state’s community property law.
IV.
CONCLUSION.
For the foregoing reasons, the court grants summary
judgment with respect to all but one of Peters’s FDCPA claims.
The court denies summary judgment with respect to the FDCPA claim
against Roberts Markel arising out of the May 12, 2011, letter
from that law firm to Peters and Angela.
The court also
overrules Defendants’ Objections at ECF Nos. 122, and 123.
47
The court orders additional statements and requests and
allows supplemental briefing, discovery, and motions as set forth
above.
Finally, the court continues the remaining portions of
the motions currently before this court until August 27, 2012, at
11:15.
IT IS SO ORDERED.
DATED: Honolulu, May 24, 2012.
/s/ Susan Oki Mollway
Susan Oki Mollway
Chief United States District
Judge
Peters v. Rovberts Markel, PC, et al., Civ. No. 11-00331 SOM/KSC; ORDER GRANTING IN
PART, DENYING IN PART, AND CONTINUING IN PART MOTIONS FOR SUMMARY JUDGMENT AND MOTIONS
TO DISMISS OR TRANSFER VENUE
48
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