Hines v. Portfolio Recovery Associates, LLC

Filing 17

ORDER denying 4 Motion to Certify Class - In this posture, the court finds that it is appropriate to DENY the motion for class certification [DE-4] without prejudice to renew by a deadline set forth in a scheduling order of this court. Signed by Senior Judge James C. Fox on 4/8/2015. (Grady, B.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:14-cv-752-F
JOANN HINES, Individually and on
behalf of all other similarly situated,
Plaintiff,

v.
PORTFOLIO RECOVERY
ASSOCIATES, LLC,
Defendant.

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ORDER

This matter is before the court on PlaintiffJoann Haines' Motion for Class Certification [DE4].
Hines initiated this action by filing the Complaint [DE-l] in this court on November 1, 2014,
alleging claims on behalf of herself and all other similarly situated individuals under the Electronic
Funds Transfers Act, 15 U.S.C. § 1693, et seq. ("EFTA"). Contemporaneously with her filing of the
Complaint, Hines filed the motion seeking class certification. Hines stated:
This motion is being filed contemporaneously with the Complaint, in order to prevent
the defendant from mooting this case through an individual Offer of Judgment or
settlement offer. See Damasco v. Clearwire Corp., 662 F.3d 891 (7th Cir. 2011). 1

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In Damas co, the Seventh Circuit Court of Appeals held that defendant can moot a class action by extending
an offer of judgment to a named plaintiffbefore the plaintiff has moved for certification. 662 F.3d at 896.
Other circuit courts have reached a different conclusion, holding that a motion for certification made after
an offer of judgment to the named plaintiff "relates back" to the date the case is filed. See Weiss v. Regal
Collections, 385 F.3d 337 (3d Cir. 2004); Sandez v. Cingular Wireless LLC, 553 F.3d 913 (5th Cir. 2008);
Lucero v. Bureau ofCollection Recovery, Inc., 639 F.3d 1239 (lOth Cir. 2011); Pitts v. Terrible Herbst, Inc.,
653 F.3d 1081 (9th Cir. 2011); Stein v. Buccaneers Ltd P'ship, _ _ F.3d_, 2014 WL 6734819 (11th Cir.
2014 ). The courts reaching a differing conclusion from Damas co have highlighted the unfairness and judicial
inefficiency of "allowing the defendants to 'pick off a representative plaintiff with an offer of judgment"
extended shortly after the filing of class complaint. Weiss, 385 F. 3d at 344-45. The Seventh Circuit in

The plaintiff respectfully requests that this Court enter and continue this motion
generally and stay briefing on the same and allow for the Plaintiff to obtain discovery
sufficient to further support and supplement this motion.
Pl.'s Mot. for Class Certification [DE-4] ~ 1. The Certificate of Service attached to the motion states:
I, Mitchel Luxenburg, an attorney, certify that, I shall cause to be served a copy of Plaintifrs

Motion for Class Certification, upon the above named individual(s) by sending it to be served
concurrently with the Complaint and Summons by a process serve forthwith." !d. at p. 3.
In an order filed on December 16, 2014, the court declined to enter a general stay of the
action. The court recognized, however, that there was no proof of service filed as to Defendant
Portfolio Recovery Associates, Inc., and without such proof of service of the Complaint, the court
could not be certain that Defendant has been served with the Motion for Class Certification. The
court accordingly found it premature to rule on the motion, and instead, the court ordered that the
time for Defendant to respond the Motion for Class Certification was thirty (30) days from the date
of service ofthe Complaint. See December 16,2014 Order [DE-7] at 2. The court also directed the
Clerk of Court to resubmit the motion either upon the failure of Defendant to timely respond, or
when the reply time has passed, whichever is applicable.
Hines never filed proof of service indicating when she served Defendant with the Complaint
and the accompanying Motion for Class Certification. Counsel for Defendant, however (1)filed a
Notice of Appearance [DE-8] on January 15, 2015; (2) sought-and was granted-two consent

Damasco rejected such concerns, reasoning that"[ c]lass-action plaintiffs can move to certifY the class at the
same time that they file their complaint." 662 F.3d at 896. The Seventh Circuit rejected the argument that
such an arrangement would provoke plaintiffs to file class certification motions prematurely, stating that
parties "can also ask the district court to delay its ruling to provide time for additional discovery or
investigation." !d. As at least one Circuit Court has observed, the Damasco ruling has resulted in
"unnecessary and premature certification motions in some cases and unnecessary gamesmanship in others."
Stein,_ F.3d at_, 2014 WL 6734819, at *9. The Fourth Circuit has yet to address the issue.

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motions for extension of time to file a response to the Complaint; and (3) filed an Answer on
February 19, 2015 [DE-14]. Additionally, Defendant filed the parties' Rule 26(±) Report [DE-16].
Therein, the parties state the following under "other matters":
Plaintiff shall file a motion for class certification by March 14, 20 16; defendant shall
file an opposition brief by April15, 20 16; and plaintiff shall file any reply in support
of class certification by May 16, 2016.
Rule 26(±) Report [DE-16] at 3. It is thus apparent that more than 30 days has passed since
Defendant was served with the Complaint and Motion for Class Certification. It also is apparent that
the parties desire that Plaintiff have the opportunity to file a motion for class certification in the
future, after the opportunity for discovery.
In this posture, the court finds that it is appropriate to DENY the motion for class certification
[DE-4] without prejudice to renew by a deadline set forth in a scheduling order of this court.
SO ORDERED.
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This the_!__ day of April, 2015.

Ja#sC.Fox
Senior United States District Judge

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