Henggeler v. Brumbaugh & Quandahl, P.C., LLO et al
MEMORANDUM AND ORDER denying 69 Motion for Certificate of Appealability; the 72 Motion to Extend is found moot. Ordered by Judge Joseph F. Bataillon. (ADB)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
SHARON K. HENGGELER, on behalf of
herself and all others similarly situated; and
DAVID RANDALL, on behalf of himself and
all others similarly situated;
MEMORANDUM AND ORDER
BRUMBAUGH & QUANDAHL, P.C., LLO;
KIRK E. BRUMBAUGH; MARK
QUANDAHL; LIVINGSTON FINANCIAL,
LLC; MIDLAND FUNDING, LLC, a
Fictitious Name; and LVNV FUNDING,
This matter is before the court on the motion of defendants Brumbaugh &
Quandahl, P.C., LLO, Kirk E. Brumbaugh, and Mark Quandahl (hereinafter, “the Law
Firm defendants”) for certification of an interlocutory appeal, Filing No. 69. This is a
putative class action lawsuit for alleged violations of the Fair Debt Collection Practices
Act (“FDCPA”) and the Nebraska Consumer Protection Act (“NCPA”), against a law
firm, two individual attorneys, and three debt buyers or collection agencies.
plaintiffs allege that the Law Firm defendants violated the FDCPA and NCPA by
sending allegedly misleading collection letters on behalf of those three entities and by
filing collection actions under different names. This court denied the Law Firm
defendants’ Motion to Dismiss. Filing No. 66, Memorandum & Order.
Under 28 U.S.C. § 1292(b), a district court may certify an interlocutory appeal of
an order where the court determines that “‘(1) the order involves a controlling question
of law; (2) there is substantial ground for difference of opinion; and (3) certification will
materially advance the ultimate termination of the litigation.’” Union Cnty., Iowa v. Piper
Jaffray & Co., 525 F.3d 643, 646 (8th Cir. 2008) (quoting White v. Nix, 43 F.3d 374, 377
(8th Cir.1994)). Permission to allow such appeals should only be granted sparingly and
with discrimination, since it has “‘long been the policy of the courts to discourage piecemeal appeals because most often such appeals result in additional burdens on both the
court and the litigants.’” Union Cnty., 525 F.3d at 646 (quoting Control Data Corp. v.
International Bus. Machs. Corp., 421 F.2d 323, 325 (8th Cir.1970)). The legislative
history of § 1292(b) “‘indicates that it was to be used only in extraordinary cases where
decision of an interlocutory appeal might avoid protracted and expensive litigation.’”
Union Cnty., 525 F.3d at 646 (quoting United States Rubber Co. v. Wright, 359 F.2d
784, 785 (9th Cir.1966)). Only “exceptional circumstances [will] justify a departure from
the basic policy of postponing appellate review until after the entry of a final judgment.”
Coopers & Lybrand v. Livesay, 437 U.S. 463, 475 (1978).
“The burden is on the
movant ‘to demonstrate that the case is an exceptional one in which immediate appeal
is warranted.’” White v. Nix, 43 F.3d at 376.
1. Controlling Question of Law
The Law Firm defendants argue that the issues addressed in the court’s
Memorandum and Order are purely questions of law that involve statutory interpretation.
Further, they argue that an interlocutory determination of the legal questions at issue
may resolve both the named plaintiffs’ claims and the potential claims of all prospective
class members, without the need for class certification proceedings or a lengthy and
A question of law is controlling “if reversal of the district court’s order would
terminate the action.” Klinghoffer v. S.N.C. Achille Lauro Ed Altri-Gestione Motonave
Achille Lauro in Amministrazione Straordinaria, 921 F.2d 21, 24 (2d Cir. 1990). The
court finds the court’s Memorandum and Order involves a “controlling question of law,”
in that if the court’s order were reversed, the plaintiffs’ case against them would be
dismissed. However, the case involves other issues and other parties whose claims
would not be resolved by a ruling in favor of the Law Firm defendants.
2. Substantial Ground for Difference of Opinion
The Law Firm defendants argue that, although the Eighth Circuit has not ruled on
whether individual shareholders of a debt-collecting entity are subject to personal
liability under the FDCPA absent evidence that provides a basis for piercing the
corporate veil, several circuit courts and a number of district courts are split on the
issue. They also argue that this court’s opinion is at odds with case of Rockney v.
Blohorn, 877 F.2d 637, 642 (8th Cir. 1989), which held that courts should not interpret
federal statutes as abandoning corporate limited-liability rules unless Congress clearly
evidences an intent to do so.
They assert that there is a substantial ground for
difference of opinion with respect to the court’s findings on whether the FDCPA is
violated by use of a registered trade name and whether the letters are false and
“To determine if a ‘substantial ground for difference of opinion’ exists under
§ 1292(b), courts must examine to what extent the controlling law is unclear.” Couch v.
Telescope Inc., 611 F.3d 629, 633 (9th Cir. 2010). The law may be unclear where “‘the
circuits are in dispute on the question and the court of appeals of the circuit has not
spoken on the point.’”
Id. (quoting 2 Federal Procedure, Lawyers Edition § 3:212
The Eighth Circuit has spoken on the issue at hand, recently holding that the
FDCPA’s prohibitions should be applied to attorneys engaged in litigation on a
case-by-case basis. See Hemmingsen v. Messerli & Kramer, P.A., 674 F.3d 814, 819
(8th Cir. 2012).
The splits of opinion in various district court cases is of little
consequence to this determination since those decisions are not binding on this court.
A lack of precedent on a legal question will not alone satisfy the requirement. White, 43
F.3d at 378. This action is in the same procedural posture as numerous other similar
cases around the country.
The court finds the issues require further factual
Material Advancement of the Litigation
The third requirement to obtain certification for interlocutory appeal requires a
showing that the interlocutory appeal may materially advance the ultimate termination of
the litigation. White v. Nix, 43 F.3d at 378. Specifically, the court should consider
whether the case is “an extraordinary case where the decision of an interlocutory appeal
might avoid protracted and expensive litigation.” E.E.O.C. v. Allstate Ins. Co., 2007 WL
38675, *5 (E.D. Mo. 2007) (quotation omitted). The defendants argue that “[i]f the
appeal is allowed and the Eighth Circuit reverses the Court's ruling on individual liability,
all claims against these two attorneys could be resolved without having subjected them
to the significant disruption sure to result from class certification proceedings and a
trial.” This would be true, however, in every case. The court reads the third factor in
conjunction with the Eighth Circuit’s admonition that interlocutory appeals should only
be allowed in “‘extraordinary cases’” to avoid “‘protracted’” litigation. Union Cnty., 525
F.3d at 646 (quoting U.S. Rubber Co., 359 F.2d at 785). Although resolution of this
issue in defendants’ favor would avoid the need for a trial, there has been no showing
that the litigation of this would be especially protracted, nor have the Law Firm
defendants presented the court with any reason to believe this is an “extraordinary”
case. Also, they have not shown that an interlocutory appeal would materially advance
the litigation, since the claims against other parties would remain unresolved. The court
finds the Law Firm defendants have not sustained their burden to demonstrate that the
case is an exceptional one in which immediate appeal is warranted. Accordingly,
IT IS ORDERED:
1. The Law Firm defendants’ motion for certification of an interlocutory appeal
and for a stay of proceedings (Filing No. 69) is denied.
The plaintiff’s motion for an extension of time (Filing No. 72) to file an
opposition to the defendants’ motion for certification is found moot.
DATED this 25th day of July, 2012.
BY THE COURT:
s/ Joseph F. Bataillon
United States District Judge
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