Pittman v. Experian Information Solutions, Inc. et al
Filing
143
ORDER Granting 138 Plaintiff's Motion for Default Judgment. Signed by District Judge Victoria A. Roberts. (LVer)
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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
HOWARD PITTMAN,
Plaintiff,
Case No. 14-13591
HON. VICTORIA A. ROBERTS
v.
EXPERIAN INFORMATION
SOLUTIONS, et al.
Defendants.
____________________________/
ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT
[ECF No. 138]
I.
INTRODUCTION
Before the Court is Howard Pittman’s Motion for Default Judgment
against iServe Servicing, Inc. Pittman seeks damages arising from iServe’s
alleged violation of the Fair Credit Reporting Act, (“FCRA”) 15 U.S.C. § 1681
et seq.
Pittman is entitled to a default judgment. The Court held an evidentiary
hearing via videoconference on April 20, 2020 to determine the appropriate
damages.
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II.
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BACKGROUND
On November 11, 2014, Pittman filed an amended complaint against
several defendants including iServe Servicing, Inc. The complaint arises
from Pittman’s borrowing of funds to purchase a home in August 2008.
Pittman purchased the home with funds borrowed from Citicorp Trust Bank
and secured a mortgage on the property. iServe serviced the loan originally
and granted Pittman a loan modification around December 2011. Pittman
says he paid his mortgage timely. On May 31, 2012, iServe told Pittman that
the servicing on his loan was “assigned, sold, or transferred,” to BSI Financial
Services, Inc., another Defendant in this case.
In June 2014, Pittman says he learned that BSI and iServe reported
his mortgage payments as past due. He disputes these reports and says
they were made in violation of the FCRA.
iServe actively participated in this case until February 2018. On
December 18, 2018, then Magistrate Judge Stephanie Dawkins Davis
scheduled a settlement conference. The order required that the conference
be attended by trial counsel and an authorized representative of each party,
unless expressly excused by the Court. The order cautioned “[f]ailure to
produce the appropriate person(s) at the conference may result in an award
of costs and attorney fees incurred by the other parties in connection with
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the conference and/or other sanctions against the noncomplying party and/or
counsel.” [ECF No. 125, PageID.2746].
No company representative for iServe appeared at the settlement
conference. However, Pittman’s counsel certifies in his motion that he spoke
with iServe’s then counsel of record during the settlement conference. He
says iServe’s counsel stated iServe was closing its business, would not
oppose this motion, and that he would withdraw as iServe’s counsel. iServe’s
counsel withdrew on February 1, 2019.
The Clerk of the Court entered default against iServe on November 5,
2019. [ECF No. 137].
III.
LEGAL STANDARD
Default judgments are governed by Fed. R. Civ. P. 55. Pursuant to
Rule 55(b), the Court may enter a judgment of default against a defendant
who fails to plead or otherwise defend against an action. To obtain a
judgment by default, the moving party must first request for the Clerk of the
Court to enter a default under Fed. R. Civ. P. 55(a). Shepard Claims Serv.
Inc. v. Williams Darrah & Assoc., 796 F.2d 190, 193 (6th Cir. 1986).
Upon entry of a default, all well-pled allegations of the plaintiff’s
complaint are deemed admitted. Ford Motor Co. v. Cross, 441 F. Supp. 2d
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837, 846 (E.D. Mich. Jun. 9, 2006) (citing Visioneering Construction v. U.S.
Fidelity and Guaranty, 661 F.2d 119, 124 (6th Cir. 1981)). A default judgment
on well-pled allegations only establishes a defendant’s liability; the plaintiff
must still establish the extent of damages. RQSI Global Asset Allocation
Master Fund, Ltd. v. APERCU International PR LLC, 2019 WL 1922052, at
*4 (internal citations omitted).
IV.
ANALYSIS
a. Pittman is Entitled to a Default Judgment
The Clerk of the Court entered default against iServe on November 5,
2019. [ECF No. 137]. iServe has neither made a request to set aside the
default nor responded to Pittman’s motion. Further, Pittman’s counsel
certifies iServe’s then-counsel of record stated iServe closed its business
and would not oppose this motion.
As explained above, upon entry of default by the Clerk of the Court,
the well-pled factual allegations in the complaint are deemed admitted. Ford
Motor Co. v. Cross, 441 F. Supp. 2d 837, 846 (E.D. Mich. Jun. 9, 2006)
(citing Visioneering Construction v. U.S. Fidelity and Guaranty, 661 F.2d
119, 124 (6th Cir. 1981)). As such, the Court finds Pittman’s amended
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complaint sufficiently alleges facts to support his claims of negligent and
willful violation of the FCRA.
Pittman is entitled to default judgment.
b. Pittman is Entitled to Damages
Pittman seeks the following damages: (1) actual damages in the
amount of $25,000 based on the denial of a Home Depot credit card, the
refinancing of his auto loan to 1.99% interest, and his difficulty sleeping and
increased blood pressure due to the inaccurate reporting; (2) punitive
damages in the amount of $25,000 based on Pittman’s financial vulnerability;
and (3) costs and attorney’s fees in the amount of $110,665.15, for a total of
$160,665.15.
The Court must conduct an inquiry to ascertain the amount of damages
with reasonable certainty. Vesligaj v. Peterson, 331 F. App’x. 351, 355 (6th
Cir. 2009). Rule 55(b) authorizes the Court to hold a hearing to determine
the amount of damages. The Court may also rely on affidavits and other
documentary evidence to determine the appropriate damages amount. Hart
v. Estes, 2018 WL 1914295 at *2 (W.D. Ky. Apr. 23, 2018).
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1. Compensatory Damages
Pittman seeks $25,000 in compensatory damages. He says he was
denied a Home Depot credit card and a low interest rate on an auto loan. He
also notes difficulty sleeping and an unhealthy increase in his blood
pressure, resulting in a higher dosage of blood pressure medication. He
attributes all of this to iServe’s conduct. Pittman testified to the same at the
evidentiary hearing.
This district has held that testimony alone is enough to substantiate an
award for emotional distress. Green v. Nationwide Arbitration Services, LLC,
2015 WL 7717165 (E.D. Mich. Nov. 30, 2015). In Green, the Court awarded
plaintiff actual monetary damages and damages for emotional distress. The
court noted the plaintiff “appeared and testified to her actual monetary
damages and damages for emotional distress.” Id. at *1. Green relied on
Zhang v. American Gem Seafoods, Inc., 339 F.3d 1020, 1040 (9th Cir. 2003),
where the Ninth Circuit upheld an award for emotional distress damages
based on the plaintiff’s testimony.
The Court finds Pittman’s testimony credible. His testimony is
supported by a previously submitted affidavit. [ECF No. 91-16]. Pittman is
entitled to actual and emotional distress damages in the amount of $25,000.
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2. Punitive Damages
Pittman seeks $25,000 in punitive damages. The Supreme Court has
not created a formulaic system to gauge the constitutionality of punitive
damage awards. Bach v. First Union Nat. Bank, 486 F.3d 150, 156 (6th Cir.
2007). The constitutionally correct amount of punitive damages is a “highly
fact-intensive exercise.” Id. The Court considers three factors in determining
punitive damages: (1) the reprehensibility of the defendant’s misconduct; (2)
the disparity between the actual or potential harm suffered by the plaintiff –
the injury covered by compensatory damages – and the punitive damages
award; and (3) the difference between the relevant punitive damages award
and the civil penalties authorized or imposed in similar cases. Id. at 153.
The most important factor the Court must consider is the first – the
reprehensibility of iServe. The Court must consider whether: “the harm
caused was physical as opposed to economic; the tortious conduct evinced
an indifference to or a reckless disregard of the health or safety of others;
the target of the conduct had financial vulnerability; the conduct involved
repeated actions or was an isolated incident; and the harm was the result of
intentional malice, trickery, or deceit, or mere accident.” State Farm Mut.
Auto. Ins. Co. v. Campbell, 538 U.S. 408, 419 (2003). The Supreme Court
instructed that the existence of any one factor weighing in favor of a plaintiff
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may not be sufficient to sustain a punitive damages award, and the absence
of all will render any award suspect. Id. The Supreme Court said “[i]t should
be presumed a plaintiff has been made whole for his injuries by
compensatory damages, so punitive damages should only be awarded if the
defendant’s culpability, after having paid compensatory damages, is so
reprehensible as to warrant the imposition of further sanctions to achieve
punishment or deterrence.” Id.
Like Bach, Pittman satisfies two of these factors: he is financially
vulnerable, and the conduct involved repeated actions. Pittman testified that
he was denied a Home Depot credit card and was denied a low interest rate
for an auto loan that he would have qualified for absent iServe’s conduct.
iServe continuously reported his mortgage payments as past due even after
he advised them its reporting was inaccurate. Although the punitive damages
award in Bach followed a jury trial rather than a default judgment, the Court
applies the same reasoning here.
In Bach, the Sixth Circuit found a punitive damages award at or near
the amount of the compensatory damages were appropriate where the
defendant, First Union National Bank, continued to report unfavorable credit
information regarding Bach, even after Bach notified them that the
information was inaccurate – the same as Pittman. 486 F.3d at 155. The
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Sixth Circuit called First Union National Bank’s conduct “blameworthy,” and
noted its actions “merit strong disapproval and justify an award of punitive
damages.” Id. at 155. The Court finds iServe’s conduct justifies an award of
punitive damages to achieve deterrence, and an award in the same amount
of the compensatory actual damages is appropriate.
3. Costs and Attorney’s Fees
Pittman seeks attorney’s fees in the amount of $110,665.15.
The Court has broad discretion to determine a reasonable hourly rate
for an attorney. The Northeast Ohio Coalition for the Homeless v. Husted,
831 F.3d 686, 715 (6th Cir. 2016). To do so, courts use as a guideline the
prevailing market rate, which is defined as “‘the rate that lawyers of
comparable skill and experience can reasonably expect to command within
the venue of the court of record.’” Id. (quoting Geier v. Sundquist, 372 F.3d
784, 791 (6th Cir. 2004). Pittman’s counsel submits the statement of costs
and attorney’s fees and the 2017 State Bar of Michigan Economics of Law
Practice Report. The Court finds the State Bar of Michigan’s Economics of
Law Practice Survey is a reliable tool and, given the longevity of this case,
finds Pittman’s attorneys’ fees are reasonable.
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V.
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CONCLUSION
Pittman is entitled to judgment; $25,000 in compensatory damages,
$25,000 in punitive damages, and $110,665.15 in attorney’s fees and costs.
The Court enters default judgment for Pittman in the amount of
$160,665.15 against iServe Servicing, Inc.
IT IS ORDERED.
Dated: June 3, 2020
s/ Victoria A. Roberts
Victoria A. Roberts
United States District Court Judge
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