Perry v. JTM Capital Management, LLC
Filing
87
ORDER denying 80 Motion for Sanctions. Signed by Hon. H. Kenneth Schroeder Jr. on 2/22/2021. (KER)
Case 1:18-cv-00566-LJV-HKS Document 87 Filed 02/22/21 Page 1 of 5
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
_________________________________
THERESA MULLERY,
Plaintiff,
v.
18-CV-549V(Sr)
JTM CAPITAL MANAGEMENT, LLC,
Defendant.
_________________________________
AMANDA PERRY,
Plaintiff,
18-CV-566V(Sr)
v.
JTM CAPITAL MANAGEMENT, LLC,
Defendant.
_________________________________
DECISION AND ORDER
These matters were referred to the undersigned by the Hon. Lawrence J.
Vilardo, in accordance with 28 U.S.C. § 636(b), for all pretrial matters and to hear and
report upon dispositive motions. 18-CV-549 at Dkt. #27; 18-CV-566 at Dkt. #26.
Plaintiff Mullery’s complaint1 alleges that plaintiff fell behind on debt
payments to Continental Finance Company (“Continental”), prompting her to seek the
assistance of a legal aid attorney who, by letter dated April 21, 2015, informed
1
Plaintiff Mullery’s complaint was filed in the Northern District of Illinois and transferred
to the Western District of New York, where plaintiff resides and defendant maintains its principal
place of business. Dkt. #19 & Dkt. #23.
Case 1:18-cv-00566-LJV-HKS Document 87 Filed 02/22/21 Page 2 of 5
Continental that plaintiff was represented by counsel and directed that Continental
cease contact with plaintiff and cease further collection activities on the debt because
plaintiff’s income was protected from levy, attachment or garnishment by federal law
and plaintiff had no income available for payment or settlement of the debt. Dkt. #1,
¶¶ 8-9 & Dkt. #1-3. Defendant acquired the Continental account and, ignoring
Continental’s account notes identifying plaintiff’s attorney, “had another debt collector,
Northstar Location Services, send [plaintiff] a collection letter, dated January 26, 2017,
demanding payment of the Continental debt.” Dkt. #1, ¶ 10. The letter from Northstar
Location Services, LLC (“Northstar”), informs plaintiff that the Continental debt had
been referred to Northstar by defendant for collection. Dkt. #1-4.
Plaintiff Perry’s complaint2 alleges that plaintiff fell behind on debt
payments to Comenity Bank, prompting her to seek the assistance of a legal aid
attorney who, by letter dated August 27, 2015, informed Comenity Bank that plaintiff
was represented by counsel and directed that Comenity Bank cease contact with
plaintiff and cease further collection activities on the debt because plaintiff’s income
was protected from levy, attachment or garnishment by federal law and plaintiff had no
income available for payment or settlement of the debt. Dkt. #1, ¶¶ 8-9 & Dkt. #1-3.
Defendant acquired the Comenity Bank account and, ignoring Comenity Bank’s account
notes identifying plaintiff’s attorney, “had its attorney debt collector, Weltman, Weinberg
& Reis Co., send [plaintiff] a collection letter, dated March 4, 2017, dem anding payment
2
Plaintiff Perry’s complaint was filed in the Northern District of Illinois and transferred to
the Western District of New York, where defendant maintains its principal place of business.
Dkt. #18 & Dkt. #22.
-2-
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of the Comenity Bank debt.” Dkt. #1, ¶ 10. The letter from the attorney debt collector
informs plaintiff that the Comenity Bank debt had been referred to the attorney debt
collector by defendant for collection. Dkt. #1-4.
Plaintiffs allege that defendant violated the Fair Debt Collection Practices
Act (“FDCPA”), specifically, 15 U.S.C. § 1692c(c), which prohibits a debt collector from
communicating with a consumer after being directed to cease communications and
from continuing to demand payment of a debt that the consumer has indicated they
refuse to pay, and 15 U.S.C. § 1692c(a)(2), which prohibits a debt collector from
communicating with a consumer if the debt collector knows the consumer is
represented by an attorney with respect to such debt and has knowledge of, or can
readily ascertain the attorney’s name and address. Dkt. #1.
By Decision and Order entered April 23, 2020, the Court resolved
plaintiffs’ motions to compel by directing, inter alia, that defendant produce documents
sought in plaintiff’s request for production of documents #6, specifically: all documents
regarding plaintiffs’ alleged account, including but not limited to, any asset
purchase/forward flow agreements, assignments, signed account agreements, card
carriers, terms and conditions and any correspondence from plaintiffs’ attorneys. 18CV-549 at Dkt. #63-2, p.7; 18-CV-566 at Dkt. #61-2, p.7. Def endant responded that
other than what was attached to plaintiffs’ complaints, it “does not possess any
correspondence from Plaintiff or her attorney or any additional documents responsive to
this Request.” Dkt. #80-3, pp.3 & 5.
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Currently before the Court are plaintiffs’ motion for sanctions. Dkt. #80.
Plaintiffs seek to have defendant held in contempt for its failure to comply with the
Court’s Order dated April 23, 2020 and request an order precluding defendant from
presenting evidence or arguing that it had no knowledge that plaintiffs were represented
by counsel and had refused to pay their debts. Dkt. #80.
In response to the motion, defendant’s President, Jacob Adamo, declares
that defendant conducted a diligent search for documents in its possession, custody or
control responsive to plaintiffs’ request for production of documents #6 and is not in
possession of any responsive documents beyond its own account notes, information
concerning plaintiffs’ accounts and a collection services agreement with the third party
debt collector with whom it contracted to collect plaintiffs’ accounts, which were all
previously produced to plaintiffs. Dkt. #84-1. Defendant argues that it cannot produce
what it does not possess. Dkt.#84, p.2.
Plaintiffs reply that it is inconceivable that defendant purchased two
separate portfolios of debts without any written agreements. Dkt. #85, p.2. Plaintiffs
further reply that defendant fails to offer any reason why such documents are not in its
possession or where they might be. Dkt. #85, p.8. Plaintiffs note that defendant has
produced no proof that it owned the debts that it attempted to collect from plaintiffs. Dkt.
#85, p.9.
Defendant has complied with the Court’s directive that it respond to
plaintiffs’ request for production of documents #6. Dkt. #80-3, pp.3 & 5. In addition to its
-4-
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response, defendant has declared that it conducted a diligent search and produced all
documents in its possession, custody or control. Dkt. #84-1, ¶¶ 4-5. In reliance upon
this representation, plaintiffs’ motions for sanctions (Dkt. #80), are denied without
prejudice to future motion practice as may be warranted by defendant’s response to
questions at deposition regarding whether the documents at issue were ever in
defendant’s possession and, if so, what happened to them, or, if not, the basis of its
authority to proceed against plaintiffs’ debts. In the absence of any such motion,
summary judgment motions shall be filed no later than June 18, 2021.
SO ORDERED.
DATED:
Buffalo, New York
February 22, 2021
s/ H. Kenneth Schroeder, Jr.
H. KENNETH SCHROEDER, JR.
United States Magistrate Judge
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