Federal Trade Commission et al v. Affiliate Strategies, Inc. et al

Filing 450

MEMORANDUM AND ORDER denying 448 Motion for Hearing; denying 448 Motion to Transfer Case. Signed by District Judge Julie A. Robinson on 6/26/2012.Mailed to pro se party Meggie Chapman, 4563 W Shaw Butte Dr, Glendale, AZ 85304 by regular mail. (pp)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS

FEDERAL TRADE COMMISSION,
et al.,
Plaintiffs,
vs.
AFFILIATE STRATEGIES, INC., et al.,
Defendants.

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Case No. 09-4104-JAR

MEMORANDUM AND ORDER
Before the Court is Defendant Meggie Chapman’s Motion for Transfer (Doc. 448).
Plaintiffs have objected to the request. Following a bench trial on the merits on August 22–23,
2011, the Court issued Findings of Fact and Conclusions of Law in favor of Plaintiffs Federal
Trade Commission (“FTC”) and the States of Illinois, Kansas, Minnesota, and North Carolina
(collectively, “Plaintiffs”) and against Chapman on September 16, 2011.1 Judgment was entered
against Chapman in the amount of $1,682,9502 and the Court also entered a permanent
injunction against Chapman.3 The Court retained jurisdiction for purposes of construction,
modification, and enforcement of the Judgment and Permanent Injunction. On October 26,
2011, Chapman filed a Notice of Appeal; the appeal is pending before the Tenth Circuit Court of
Appeals.
On May 30, 2012, Plaintiffs applied for a Writ of Garnishment. Plaintiffs represented in

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Doc. 422.

2

Doc. 423.

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Doc. 424.

this application that Chapman has filed a Chapter 7 bankruptcy petition in the United States
District Court for the District of Arizona and that they have been stayed from attempting to
collect on the judgment in this action. Plaintiffs sought garnishment of a State Farm Fire and
Casualty Co. (“State Farm”) insurance policy that Chapman owns, which provides for payment
of judgments against her. The Clerk of this Court issued a Writ of Garnishment to State Farm on
June 6, 2012.4 On June 18, Chapman filed the instant Pro Se Request to Transfer the
garnishment proceeding, arguing that pursuing the garnishment proceeding in this court is
unduly burdensome and expensive for her given that she now lives in Oregon and is participating
in several lawsuits in the state of Arizona. In her request for transfer, Chapman does not request
a hearing or contend that she does not owe Plaintiffs the amount awarded in the final judgment.
Plaintiffs’ Writ of Garnishment was issued pursuant to the Fair Debt Collection Practices
Act (“FDCPA”), which allows a Court to issue a writ of garnishment against certain property of
the debtor “in order to satisfy the judgment against the debtor.”5 The FDCPA contains a transfer
provision: “If the debtor so requests, within 20 days after receiving the notice described in
section 3101(d) or 3202(b), the action or proceeding in which the writ, order, or judgment was
issued shall be transferred to the district court for the district in which the debtor resides.”6
Most courts have concluded that this language is not mandatory, but instead “‘merely operates to
shift the burden from the party requesting transfer—on whom the burden ordinarily rests in civil
and criminal matters—to the party opposing transfer where . . . the requirements of § 3004(b)(2)

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Doc. 447.

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28 U.S.C. § 3205(a).

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Id. § 3004(b)(2).

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are met.’”7 These courts conclude that the FDCPA grants the district courts plenary authority to
deny, limit, condition, regulate, extend, or modify any enforcement procedure, which allows
them to “deny a timely transfer motion for good cause.”8 Good cause may be shown where the
transfer is requested merely to delay or frustrate efforts to collect on the judgment.9
Here, Plaintiffs argue that good cause exists to deny Chapman’s motion because the
appeal on the merits is pending before the Tenth Circuit, Chapman is not the real party in interest
in the garnishment proceedings, judicial economy is best served by keeping the garnishment
proceeding in this Court, and transfer would be overly burdensome for Plaintiffs. For
substantially the same reasons set forth in Plaintiffs’ objections, the Court agrees. Most
importantly, the Court finds good cause exists to deny the motion to transfer based on the
pending appeal and the fact that this Court retains jurisdiction to enforce the Judgment and
Permanent Injunction issued in September 2011. It would not serve the Court’s strong interest in
judicial economy to transfer the matter. Chapman resided outside of this State for the entirety of
the underlying proceedings and managed to travel to Kansas for trial. She does not argue that
the judgment in this case is not due and owing. And she is not the subject of the writ of
garnishment—it was directed at State Farm. The Court finds that under all of these
circumstances, Plaintiffs have shown good cause to deny Chapman’s request for transfer.
IT IS THEREFORE ORDERED BY THE COURT that Defendant Meggie

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United States v. Mathews, 893 F. Supp. 2d 72, 75–76 (D.D.C. 2011) (quoting United States v. Gipson, 714
F. Supp. 2d 571, 576 (E.D. Va. 2010)). But see United States v. Nash, 175 F.3d 440, 442 (6th Cir. 1999) (“Because
the plain language of this statute is mandatory, the district court must grant such a transfer as long as it is made in a
timely manner.”).
8

Id.; see 28 U.S.C. § 3013.

9

See Gipson, 714 F. Supp. 2d at 575.

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Chapman’s Motion for Transfer (Doc. 448) is denied.
IT IS SO ORDERED.
Dated: June 26, 2012
S/ Julie A. Robinson
JULIE A. ROBINSON
UNITED STATES DISTRICT JUDGE

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