Johnson v. Duncan et al
Filing
49
MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 2/1/2017. (aos, Deputy Clerk)
~
IN THE UNITED STATES DISTRICT couln
FOR HIE DISTRICT OF MAIH'LAND
Soutltem Dh'i.~io"
,.. - ~
,(\
.JOSEPH .JOHNSON, .JR.
C:
J9
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Plaintiff,
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v.
Cllse No.: G.JII-15-18211
*
ARNE DUNCAN, ef tIl.,
*
Defendants.
*
*
*
*
*
*
*
*
MEMORANDUM
*
*
*
*
*
*
OPINION
Plainti 1'1'
Joseph Johnson . .II'. brings this action against Arnc Duncan. Seerctary of the
Unitcd States Dcpartmcnt
(collectively.
cnrichmcnt.
of Education. and thc Dcpartmcnt of Education (".thc Dcpartmcnt")
"Dcfendants")
for brcach of conditional
Improvcmcnt
Act of 1996. and the Ilighcr Education Act of 1965. Prcscntly
pcnding ncliJre thc Court is Plaintitrs
Motion for Partial Summary Judgmcnt.
Motion liJr Judgmcnt on thc Pleadings.
Loc. R. 105.6. For thc liJllowing reasons. l'iaintifTs
dcnied. and Defcndants'
part.
promissory estoppel. unjust
and violations of thc Consumcr Credit Reporting Rclimn Act of 1996 (OOCCRRA
00).
thc Dcbt Collcction
Defendants'
scttlement.
ECF No. 27. and
ECF No. 3R. No hearing is ncccssary. See
Motion lor Partial Summary Judgment
is
Motion liJr Judgment on the Pleadings is granted. in part. and denicd. in
I.
BACKGROUND
This case marks Joseph Johnson.
Jr.'s c1eventh action
I
in a long-standing
effort to avoid
paying back student loans he took out Irom 1993 to 1996. SI!I! lOCI' No. I 0 ~ 9: '/ohl1.l'IJ/l \'. U.S.
IJl!p'l
ojEduc .. 5XO F. Supp. 2d 154. 155 (O.D.C.
Cir. Apr. 10.2009)
loans Mr. Johnson
C'UMUC")
consolidated
Throughout
(""'/olm.l'oll
[')2 These litigations
op .. No. OX-5468 (D.C.
stem li'om Icderally-guaranteed
took out to attend classes at the University
of Maryland
University
student
College
li'om 1993 to 1996. ,/OhIlSOIl I. 580 F. Supp. 2d at 155. In April 2004. Johnson
his student loans into a single federal Direct Loan ("the Loan"). ECF No. I ~ 6.
2011. disputes -
entities. including
and several lawsuits -
the Depal1ment
and Xerox Education
Solutions
Solutions).
the amount.
regarding
of Education.
(a.k.a. Aftiliated
2-3: ECF No. 27-1 at 4-9: '/olm.mll
purportedly
2008). aj!"d wilholl/
arose between
Plaintiff and various
the Direct Loan Servicing
Computer
Services.
paymelll. and administration
Center. Sallie Mae.
Inc. or ACS Education
of his Loan. SI!I! ECF No. 10 at
III!. 105 Fed. CI. At 89-90.3 By January 2012. the balance
owed on the Loan was $35.556.58.
ECF NO.1 0 ~ 10.
I Johllsoll \'. u.s. Del''' ojEelllc .. 580 F. Supp. 2d 154. 155 (D. D.C. 2008). a[felll'ilholll
01'.. No. 08-5468 (D.C. Cir.
Apr. 10.2009) ("".I0/1I1.\,(1I1r); .I0h11S011 \'. Duncan. 746 F. Supp. 2<.1
163 (D.D.C. lOIO) ("./ohnson!r); .I0/1I1S011\',
..I[liIialeei COII/Pllli'!'Sen's .. IlIc.. No. 31 0-CV-2333-B. 20 II WL 40 I 1429 (N.D. Tex. Sept. 9. 201 I). a[l'eI. 500 F.
App'.\: 265 (5th Cif. 2012) (".Io/m.wm II{'): Johnson \', Xerox Educ. ,\'ols LLC £I.ka . ..ICS. No. 050200145112012 (D.
Ct. Prince George's ely.). No. CAL 12-26946 (Cif. C1. Prince George's ely. 2(12) r"Johnson /I ~'): .!o!lIlS0I11', .\~allie
,\taL'. Inc. (Cif. Cl. Prince George's elY. 2011) C'./o/mwl1
'-'); ./ohnson\',
Sallie .,lIae, In('.. No. 050200-l432&201 0
(Cir. Ct. Prince Georgc's Cty, 2011) ("./O/I1I.WII f'T):./o/msOI1\',
UnifedSfafes.
105 Fed, CI. &5 (Ct. Fcd, CI. 2012)
("'JohIlSOIl "1["): .Iolmsoll \'. Xerox Edllc. Sols. LLC. No. 050200025722014 (D. Cl. Prince George's Cty. 2014). No.
C i\ L 14-05640 (Cir. Ct. Prince George -s Oy. 2014). GJ 11-14-1542 (D. Md. 2014) ("".Iolmsoll I'll n: .IohllSoll ".
P/'emie/' Crdi! o(N. Am. LLC. No. 050200077212014 (D. Ct. Prince George's Cly. 2014) No. Ci\1.14-17920 (Cir.
CI. Princc George' s Cty, 2014) r'./o/msnJ1 IX' or the "Xerox casc"); ./0/1I1.WI11l', E'periaJ1 "~/h.5inls,. P\VG-15-55&.
2015 WL 7769502 (D, Md, Nov, 17. 2015) r'./o/msoJ1.\~'), Othcr judicial opinions notc that additional actions exist.
such as ./O/m.WIl \'. Ct!f1fral ("o/leclioll
Unif, Dep 'f (~l
BlU~'.!,t!f and ,.\I~mf .. DBA M-CCU-O 1-06--47614 (Md, Office
of Admin. 1Ir"gs. Apr. 9. 2007). ",jet! Jo/m.wl1 I'll. 105 Fed. CI. at 90,
! To minimize confusion. the COLIrtwillutilizc
thc same al';brcvIated names that Judge Grilllll1used in.Jo/1I1.wn \'.
Expaiall/ll/i,. Sols.. PWG-15-558. 2015 WI. 7769502 (D. Md. Nov. 17.2015) ("'.Iohllsoll.I").
~ Pin citcs t~)doculllcnts filed on the COLlrt"S
electronic filing system (CM/ECF) refcr to thc page numbers generated
by that system.
2
In an effort to "sellle" the debt. Plainti ITsent the Department
$12.390.00
and a "detailed
Selliement").
selliement
of any claims. demands
PlaintilT on the disputed debt:'
contained
the payee aeknowledges
in the accompanying
outstanding
loan balance. See id
See
id'i 23.
bureaus that PlaintilTwas
$49.483.58
dated February
cashed the check li,)r $12.390.00
'i'ii
that beeause Defendants
paid and satisfied.
cheek stated ..[b Jy negotiating
this
and agrees to be bound by the terms and eonditions
correspondence
subsequently
"Defendants
14. 2012 (..the Purported
and monies owed or alleged to be owed by
and that the selliement
Department
assertion
Ieller" on February
a check f(lr
ECF No. 10'i 12. Plaintiff claims that he tendered the check "as a linal payment in
lilii. accord and satisitlction
instrument.
transmillal
of Education
17.22. Plaintiffs
14.2012:'
Id.'i
13. The
and applied it to PlaintifTs
pending claims now stem li'OI11his
eashed the check. they agreed to declare Plaintilrs
Plaintiff claims that Defendants
delinquent
on the disputed debt:'
doubled the balance on the disputed
and then sent it to third-party
actions have caused him "consequential.
Id
entire debt
"falsely reported to credit
'i 24. PlaintilTalso
debt by increasing
alleges that
it from $23.251.51
to about
Id ~ 25. PlaintitT states that these
collection
agencies:'
economic.
and pecuniary
damages:'
ECF No. 10 at 8-
14.
In his Amended
(Count I). promissory
III). "accounting"
Complaint.
PlaintilT asserts claims of breach of conditional
estoppel and detrimental
selliement
reliance (Count II). unjust enrichment
(Count IV). violation of the CCRRA
(Count V). and statutory
(Count
violations
of
"Title 31 U.S.c. ~ 3711. 4 C.F.R. Part 103.31 C.F.R. Part 902. 903"" of the Debt Collection
Improvement
Act of 1996 and "sections
432(a) and 468" of the Higher Education
a Motion IiII' Partial Summary
(Count VI). ECF No. 10 at 7-14.PlaintiITsubmilled
March 31. 2016 on his breach of contract e1aims (Count I) and violations
,
.'
Act of 1965
Judgment
of the Fair Credit
on
Reporting Act (Count V): ECF No. 27. On June 23. 2016. Defendants
Judgment
on the Pleadings.
ECF No. 38. PlaintifTsubmitted
filed a Motion f()r
his Response and Opposition
on
August 8. 2016. ECF No. 44. Defendant submitted a Reply on August 23. 2016. ECT No. 46.
II.
STANDARD OF REVIEW
A. l\1otion for .Judgment on the Pleadings
A motion j())"judgment on the pleadings pursuant to Rule 12(c) is governed by the same
standard of revie\V as a motion to dismiss under Rule 12(b)( 6). Therefore.
on the pleadings
should be granted "it: alter accepting all \Vcll-pleaded allegations
plaintiff-s complaint
plaintiffs
a motion 1())"udgment
j
as true and dra\Ving all reasonable
Illctual inlerences
in the
from those Illcts in the
favor. it appears certain that the plaintiff cannot prove any set of laets in support of his
claim entitling him to rclief." Drager t.. PUlA USA. 11K.. 741 F.3d 470. 474 (4th Cir. 2014)
(quoting E(iJrards r. Cil)' oj'Go!c!.l'lwro. 178 F.3d 231. 244 (4th Cir. 1999). A motion under Rule
12(c) tests the adequacy of the complaint
and "docs not rcsolve the mcrits of the plaintiffs
claims or any disputes of fact:' !d. (citations omitted). To overcome such a motion. a complaint
must allege enough tacts to state a plausible claim lor reliet: Asllcro/i r. !clhal. 556 U.S. 662. 678
(2009). A claim is plausible
dra\V the reasonable
inference that the defendant
In evaluating
the Complaint
\Vhen ..the plaintiff plcads tactual content that allows the Court to
is liable tt))"the misconduct
thc suf'liciency ofPlaintiirs
claims. the Court accepts tltctual allegations
as truc and construes the factual allegations
Plaintiff. See Lall/helll
1'.
3d o(Coll/lI/'rs
.
alleged." !d.
o/Dal'idsol7
.
in
in the light most fllvorable to the
. 407 FJd 266. 268 (4th Cir. 2005)
01' ..
~ \Vhile PlaintifToriginally pleaded his claims ill Count V pursuant to the "Consumer Credit Reporting Reform Act
of t996:' ECF No. to ot 11. he hos clorilied in 10lcr brielings thot Count V is osscrted under the Foir Credit
Reporting Act. 15 U.S.C. ~ 1681 "I ''"If .. which the CCRRA omcnded. ECI' No. 27-1 ot 25: "ee "I"" Ii"H ".
F.DIC.. 625 F.3d SOs. 813 (4th Cir. 2010).
4
(citing ZiI1Cr/1UJI1\', lJurch. 494 U,S. 113. 118 (1990): Schclicr v, Rhodcs. 416 U.S. 232 (1974 )).
However. a court need not accept a plaintiffs legal conclusions as true. as ..[tJhreadbarc recitals
of the elements of a cause of action. supported by mere conclusory statcments. do not surtice"
Ashcrofi
v. Ilfhal.
556 U.S, 662. 678 (2009). The Complaint must contain more than "legal
conclusions. elements of a cause of action. and bare assertions devoid of further I~lctual
enhancement." NCIIICI ChC\'/'O/CI, LId
1',
COI1.\'/IIl1cl'lIlfilirs, COlli, I11C
..
591 F.3d 250. 255 (4th Cir.
2009).
B. Summary .Jud~ment
A party may also move Ii.)rsummary judgment under Fed, R. Civ, 1'. 56(a). identifying
each claim or delense on which summary judgment is sought. Fed. R, Civ. P. 56(a). A coul1
"shall grant summary judgment 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. 1'. 56(c), A
material 1:1Cts one that "might allect the outcome of the suit under the governing law,"
i
/lm/er,1011 \', Ubcrly
Loh!J)'. I11C
..
477 U.S. 242. 248 (1986), A genuine issue over a material fact
exists "if the evidence is such that a reasonable jury could return a verdict Ii.)rthe nonmoving
party," ld In undertaking this inquiry. the Court must consider the facts and all reasonable
inferences in the light most I:lVorable to the nonmoving party. SCOII \', !larris.
550 U.S. 372. 378
(2007), However. this Court must also abide by its artirmative obligation to prevent factually
unsupported claims and de lenses Irom going to trial. Drc\I'ill
Cir. 1993),
5
v. 1'I'lIII,
999 F,2d 774. 778-79 (4th
III.
ANALYSIS
A. Collateral
Estoppel
The Court adheres to ,.thc related doctrines of rcs judicata and collateral estoppel." AI/en
\'. MeCl/ny.
449 U.S. 90. 94 (1980). Under res judicata. "a Iinaljudgmcnt on the mcrits of an
action precludcs the partics or their privics from relitigating issucs that were or could havc bcen
raised in that action:' Id. (citing Cl'Ol1IlI'e//
I'.
COl/11Iy o(Sae.
94 U.S. 351. 352 (I 876)). With
respect to eollatcral cstoppel. "once a court has decided an issue of lact or law nccessary to its
judgment. that decision may prccludc rclitigation of the issuc in a suit on a different cause of
action involving a party to the first easc:'Id.
(citing Mon/ana
\'. UniledS/a/es.
440 U.S. 147. 153
(1979»). As this Court and other courts have recognizcd. "res judicata and collateral estoppel
relieve parties of the cost and vexation of multiple lawsuits. conscrve judicial resources, and. by
prevcnting inconsistent decisions. encourage reliancc on adjudication:'
Id.
The party asserting collateral estoppel bears thc burdcn of"cstablishling]
its predicates,
and this of coursc includcs presenting an adequate record for the purpose:' A//en \'. Zl/I'ieh In.l'.
Co.. 667 F.2d 1162. 1166 (4th Cir. 1982), When considering"a
of res judicata
I or collatcral
motion to dismiss on the ground
estoppel]. a court may take judicial not icc of j~\cts Ii'om a prior
judicial proeceding when the res judicata defense raiscs no disputed issue of fact:' Andl'ell's
Doll'.
\'.
201 F.3d 521. 524 n.1 (4th Cir. 2(00): IJl'Ooks \'. AI'I/1II1'. 626 F.3d 194. 199 n.6 (4th Cir.
2(10). Fcderal courts must an
9
Md. 148. 162 (2015) (noting that "ltJhe traditional principle of mutuality of parties as an element
of collateral estoppel has not always been required 'if one of the parties in the original case is
involved in relitigating one of the issues determined against a ditTerent party in a succcssive
suit. "'). Indeed. a primary purpose of the doctrine is that the
"r djefensive
use of collateral
estoppel preeludes a plaintiff trom relitigating identical issues by merely 'switching
adversaries .... ['ark/al1e Ilosie/)'
Alllerica
Co ..
Nal. Tl'lIsl & S(/\'il1g\ AsslI ..
439 U.S. at 329 (1979) (citing !Jemhard
I'.
Balik of'
19 Cal.2d. at 813 (1942)). lIence. issue preelusion still
applies. even though the Department of Education was not a party in ./O/lIIS011 1)( or ./ohllsoll X.
As to the lack of a written opinion in ./ohnl'Ol1 IX. ..[ e Iven in the absence of all)' opinion. a
judgment bars relitigation of an issue necessary to the judgment ... so it is plain the
adjudicator's silence on the issue is relevant only insofar as it may tend to obscure whether the
issue was truly litigated." Alii. 11'1111 Slee/ln,'I,
&
V. U.S. E,[',A .. 886 F.2d 390. 397 (D.C. Cir.
1989). Notwithstanding the fact that the Circuit Court issued no written opinion in ./ohll.loll
IX.
the Court in ./O/IIIS011X did issue its own in-depth analysis. coneluding:
In order to grant Xerox's motion lor summary judgment. the circuit
court had to lind either (I) Xerox did not have a settlement
agreement with Johnson or (2) Xerox did not take actions in breach
of that agrcement. Because only the tirst element was contested.
the circuit court necessarily accepted Xerox's argument that the
letter was /101 a bona tide settlement of the student loan accounts
that could serve as a basis lor Johnson's breach of contract e1aim.
./ohllsoll
I'.
1:\'l'erialllll/il.
So/s .. IlIc ..
No. PWG-15-558. 2015 WI. 7769502. at *7 (D. Md. Nov.
17.2015). a/!"d. No. 16-1691. 2016 WL 6833354 (4th Cir. Nov. 21. 2016). Thus. considering
.10/111.\'011/.1
and ./ohnl'OlI
X together. the validity of the Purported Settlement has undoubtedly
been "actually determined" I(lr estoppel purposes. Sedlack. 134 FJd at 224.
The question then becomes whether the tinding on this issue estops all of Plaintilfs
elaims in the present action. In Count I. PlaintitTalieges breach of conditional settlement relating
10
to his "February
24.2012
... conditional
settlemenlto
compromise
and settle Plaintitrs
disputed debt'" ECF No. 10 at8. In Count II. Plainti ITalleges promissory estoppel based upon
Defendants'
"clear and definite promises to PlaintilTto compromise.
residue of the disputed debt ... by knowingly
settle. and relinquish the
accepting. cashing. and retaining Plainlitrs
$12.390.00
conditional
settlement check'" Id. at 9. In Count III. PlaintilTalleges
enrichment
because "Plaintiff conferred a benefit upon the Defendants by. inter alia. paying the
Defendants
$12.390.00
to fully settle his disputed debt'" Id. at 10. In Count IV. Plaintiff requests
that the Court "pass an order requiring an accounting
credits. and adjustments
unjust
due to Plaintiffas
Count VI. Plaintiff claims that Defendants
showing the amount of all payments.
a result of the conditional
settlement."
111. at 11. In
"have continued to claim that the Plaintiff owe money
on the disputed debt which was settled by the conditional
settlement:
and have continued to
collect the disputed debt in amount not owed by Plaintiff" in violation of the Debt Collection
Improvement
Act and the Iligher Education Act of 1965. Id. at 13. Thus. Counts 1. 11. 111.IV. and
VI clearly rely on the validity of the Purported Settlemcnt.
and are barrcd by the doctrine of
collateral estoppel. These claims are dismissed with prejudice. Accordingly.
Plaintiffs
Motion
for Partial Summary Judgment on Count I is also denied fl)l' these reasons.
B. FCRA Claims
Count V. violation of the Consumer Credit Reporting Reform Act or Fair Credit
Rcporting Act. presents a closer question because it does not expressly mention the Purported
Settlemcnt.
PlaintilTalleges
that "Defendants
have continuously
reported and filrnished or causcd
to be reported and furnished inaccurate and false inllJrmation relating to Plaintitrs
disputed debt
to third parties'" ECF No. f0 at 11. While Plainti ITdoes not specify in his Amended Complaint
the provision of the "Consumer
Credit Reporting Reform Ace under which he brings his elaims.
11
Plaintiff states in his Motion Illr Partial Summary
asserted under the Fair Credit Reporting
under ~ 1681 s-2(b).
Act. 15 U.S.c.
Plaintiff must establish:
CRAs of the disputed
information.
(3) that [DefendantsJ
"(
then failed to investigate
DlI\'elll'Orl
I'.
Judgment
J )
that the claims in Count V are
~ 168Is-2(b).
To bring a cause of action
that he notified the [credit reporting
(2) that the CRAs notified [DelcndantsJ
and modify the inaccurate
Sallie Mae. 111(' No. CIV. PJM 12-1475.2013
..
1
agencies
of the dispute. and
inllJrlllation:'
WL 4010983.
at *3 (D. Md. Aug. 2.
2(13).
Johnson
declares that "1 have never been dclinquent
the Department
disputed
of Education
this inaccurate
Reporting
Agencies
and have always paid on time. For the last four years. I have
infllrmation
["CRAs"]:'
in writing with the Defendants
lOCI' No. 27-2'156:
states that "On multiple occasions.
inaccurate
inlonllation
amount allegedly
ECF NO.1
Delcndants
the inaccurate
O'i
Agencies
information
complained
appearing
of concerns.
owed on Plaintiffs
48: lOCI' No. 27-2'i
disputed
Experian.
have notified the Defendants
Trans
of my
It!. '1 57. "The
that "[nJotwithstanding
and modi I)' the inaccurate
Agencies
and del~llIlt:.
m)' efforts. the
information.
and
that the debt was in dispute:'
ECF
0'152.
PlaintilTcould
issues raised in prior cases. But as Defendants
the first Amended
including
debt and the Itlct of delinquency
have failed to note with any of the Credit Reporting
Taken out of context.
Agencies
in my credit reports:'
59. Johnson contends
J
Credit
among other things. the payment history. the
have failed and/or refused to investigate
No. 27-2 ~ 60: see a/so lOCI' No.
and the Consumer
see also ECF No. 10 '150. Johnson further
the Credit Reporting
Union. Equilax. and Innovis Credit Reporting
dispute regarding
or del~llIlted on my student loan with
arguably
be relcrring
correctly
Complaint ... the only reasonable
12
to a separate matter than the
note. in the context of the allegations
inference that can be drawn is that the
of
. inaccurate information"
that Johnson alleges the Department of Euucation is reporting or
furnishing in violation of the Consumer Creuit Reporting Rcftmn Act results fi.OIn not
acknowledging
that the Purported Settlement
resolveu his student loan obligations"')
38-1 at 14: SI'I' also Johnson X. 2015 WI. 7769502. at *8 (dismissing
ECF No.
credit reporting claims on
collateral estoppel grounds). Thus. the COUl1's holding that collateral estoppel bars further
litigation of the validity of the Purported Settlement
Plaintiffs
IV.
warrants dismissal of Count V as well.
Motion for Partial Summary Judgment on Count V is also denied for these reasons.
CONCLUSION
For the foregoing reasons. Plaintitrs
ECF No. 27. Defendants'
Motion filr Partial Summary Judgment
is denied.
Motion ttlr Judgment on the Pleadings is granted. ECF No. 38. A
separate Order shall issue.
Date: Februarv
I
&~-
.2017
,
George J. Ilazcl
United States District Judge
7 \Vithout such an inference. Count V would be dismissed for failure to state a claim as it would be ullclear what the
inaccurate information being reported could be.
13
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