Finney v. HSBC Bank Nevada, National Association et al
Filing
35
MEMORANDUM OPINION & ORDER granting the 33 MOTION to Substitute Party; granting the plaintiff's 18 MOTION for Default Judgment Pursuant to Rule 55(b)(2), FRCivP as to Count I of the complaint and otherwise denied; the plaintiff is awarded against MIG Capital, Inc. the sum of $1,000.00 in damages; the plaintiff is awarded against MIG Capital, Inc. the sum of $3,373.53 in attorney's fees; the plaintiff is awarded against MIG Capital, Inc. the sum of $390.00 in costs. Signed by Judge John T. Copenhaver, Jr. on 3/27/2014. (cc: attys; defendant, by certified mail, return receipt requested at 5811 Memorial Highway, Suite 206, Tampa, Florida, 33615) (tmh)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF WEST VIRGINIA
AT CHARLESTON
DIANNA FINNEY,
Plaintiff,
v.
Civil Action No. 2:13-02778
MIG CAPITAL MANAGEMENT, INC.,
Defendant.
MEMORANDUM OPINION & ORDER
Pending are the plaintiff’s motion for default
judgment, filed August 12, 2013, and a motion filed on February
28, 2014 seeking to substitute Cindy Easter, in her capacity as
Administratrix of the Estate of Dianna Finney, as the plaintiff
in this case.
I.
Factual and Procedural Background
Sometime prior to 2011, Dianna Finney (“Finney” or
“the decedent”), incurred a debt to HSBC Bank d/b/a Home Bank
(“HSBC”) for an unspecified amount.
Compl. ¶ 9.
The complaint
does not describe the precise nature of the debt, but Finney
asserts that it was primarily for personal, family or household
purposes.
Id.
Beginning in 2011, Finney became unable to make
minimum payments on her debt to HSBC.
Id.
Sometime thereafter,
also in 2011, MIG Capital Management (“MIG”) began contacting
Finney, attempting to collect the debt.
Id.
The complaint
states that MIG undertook these efforts either on HSBC’s behalf,
or “because MIG purchased the account” from HSBC.
Id.
Finney retained The Palmer Firm, P.C. (“Palmer”), a
law firm located in Dallas, Texas, in February 2012.
Id. ¶ 10.
On or about February 23, 2012, Palmer sent a letter to MIG
advising that Palmer represented Finney, demanding that MIG
“immediately cease all attempts to contact” Finney, and
requesting that any further correspondence regarding the debt be
directed, in writing, to Palmer.
See Plaintiff’s Motion for
Default Judgment, Ex. B (“Palmer Letter”).
According to the
complaint, Palmer also sent a “demand letter alleging violations
of the Federal Fair Debt Collection Practices Act” on May 11,
2012, Compl. ¶ 12; however, the complaint does not indicate to
whom this second letter was addressed. 1
Notwithstanding the February 23, 2012 letter, the
complaint alleges that MIG continued to contact Finney “on
several occasions” by calling her “home or cellular phone[.]”
Id. ¶¶ 24, 28.
In an affidavit submitted in support of the
pending motion for default judgment, Finney specifically claims
1
The complaint stated that the demand letter was attached and
incorporated by reference as Exhibit A; however, no letter was
attached to the complaint.
2
that MIG called her approximately three times per week between
February 23, 2012 and May 15, 2012, and claims that MIG was
“oftentimes rude and aggressive, and frequently threatened to
sue [her] with regard to the debt” during these calls.
See
Plaintiff’s Supplemental Motion for Default Judgment, Ex. A
(“Finney Aff.”) ¶¶ 7-9.
On February 15, 2013 Finney commenced this action.
In
Count I, she claimed that HSBC violated the Fair Debt Collection
Practices Act, 15 U.S.C. § 1692, et seq. (“FDCPA”), by placing
harassing phone calls to her regarding the debt.
18.
Compl. ¶¶ 13-
It appears that Finney intended to plead Count I against
MIG as well.
Count I does not refer to MIG specifically at any
point, see Compl. ¶¶ 13-18 (“First Cause of Action . . . Against
Defendants HSBC Bank Nevada . . . and Household Bank”); id. ¶ 16
(“Defendants, HSBC . . . and Household Bank[,] violated The
Federal Fair Debt Collection Practices Act”), but the complaint
does request damages under the FDCPA against all defendants, see
id. ¶ 18 (“As a result of each and every [defendant’s]
violations of the FDCPA, [plaintiff is] entitled to actual
damages . . . statutory damages . . . and reasonable attorney’s
fees and costs[.]” (emphasis added)); id. at Prayer for Relief
(requesting an award of actual and statutory damages against
“each and every [d]efendant” under the FDCPA), and other
3
language in the complaint suggests that Finney did intend to
plead Count I against MIG, see id. ¶ 5 (alleging that “MIG was a
debt collector pursuant to 15 U.S.C. [§] 1692a(6)).
In Count II, Finney asserted a claim for “tort in se”
against HSBC and MIG.
Id. ¶¶ 19-20.
The remainder of the
complaint charged MIG alone with violations of the West Virginia
Consumer Credit Protection Act (“WVCCPA”) (Count III); invasion
of privacy (Count IV); and negligent and intentional infliction
of emotional distress (Counts V and VI, respectively).
Id. ¶¶
21-34.
HSBC was dismissed from this case with prejudice
pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii) on
April 5, 2013.
The Secretary of State accepted service of
process on MIG’s behalf on March 26, 2013, and the Secretary’s
website indicates that MIG’s registered agent signed for a
certified mailing of the complaint on March 28, 2013.
MIG has
not, however, answered the complaint nor made any appearance in
this matter.
As a result, Finney first moved for default
judgment against MIG on May 16, 2013.
In an order dated May 20,
2013, the court denied the motion, noting that MIG’s default had
not yet been entered by the Clerk.
In response, on July 23,
2013, Finney moved for an entry of default, and the Clerk
entered default on July 24, 2013.
4
Thereafter, on August 12,
2013, Finney renewed her motion for default judgment against
MIG.
She sought statutory damages in the amount of $141,000 2 for
thirty violations of section 46A-2-128(e) of the WVCCPA, an
order extinguishing her debt, an unspecified additional amount
of damages to be determined based on evidence yet to be
presented, and attorney’s fees and costs.
See Plaintiff’s
Motion for Default Judgment (“Mot. Default”) at 1-2.
In her
brief in support of the motion for default, Finney also
suggested that MIG was liable, generally, for violations of the
FDCPA and for the common law torts of invasion of privacy and
infliction of emotional distress.
Plaintiff’s Memorandum of Law
in Support of Motion for Default Judgment (“Default Mem.”) at 7.
Finney noted that her damages on those latter theories of
liability could not be reduced to a sum certain, and therefore
requested “that a hearing be conducted to determine the amount
of damages that [Finney wa]s entitled to . . . for the claims
she assert[ed] in addition to those violations of the [WVCCPA.]”
Id. at 7-8.
On November 15, 2013, the court held an evidentiary
hearing in order to allow Finney to submit evidence and argument
2
The plaintiff’s motion for default judgment requests $114,000,
but her memorandum of law in support of that motion requests
$141,000. The plaintiff asserts that she is entitled to $4,700
for each of the thirty alleged violations of the WVCCPA, which
would result in a total damages award of $141,000.
5
in support of her request for a default judgment.
The plaintiff
was not present at the hearing, and no evidence was submitted.
Counsel for the plaintiff did appear, however, and he clarified
that, as a practical matter, Finney was seeking default judgment
solely on the basis of her Count III claim for violations of the
WVCCPA:
THE COURT: Let me ask, as well, whether or not the
plaintiff seeks judgment as a practical matter on
anything other than the violation of the West Virginia
statute in [§] 128(e).
MR. COOK:
Your Honor, as a practical matter, the
plaintiff does not seek further recovery.
Hearing Transcript at 8:12-20, Finney v. MIG Capital Mgmt.,
Inc., No. 13-2778 (S.D. W. Va. Nov. 15, 2013).
The court
continued the hearing until 2:30 p.m. on November 21, 2013 in
order to afford Finney further opportunity to offer testimony
and additional evidence concerning the appropriate damages
award.
See id. at 8:21-9:6 (noting the substantial range of
statutory damages available under the WVCCPA and indicating that
testimony and further detail could be relevant to the damages
calculation).
Prior to the rescheduled hearing, Finney’s attorney
advised the court that the plaintiff’s absence at the November
15, 2013 hearing was the result of ongoing medical issues, and
requested that the hearing be further continued for one month.
In an order dated November 21, 2013, the court assented to that
6
request and continued the hearing to December 18, 2013.
On
December 17, 2013, however, Finney’s attorney advised the court
that his client’s medical condition had not improved, and that
Finney would not be able to appear at the hearing scheduled for
the following afternoon.
In response, the court once again
continued the evidentiary hearing to January 24, 2014.
On January 22, 2014, the court received word that
Finney had, unfortunately, died.
Thereafter, on February 28,
2014, Cindy Easter, in her capacity as Administratrix of the
Estate of Dianna Finney (“the Estate”), filed a statement
formally noting Finney’s death on the record in accordance with
Federal Rule of Civil Procedure 25(a).
The Estate also filed on
that same day a motion seeking to replace Finney as the
plaintiff in this matter. 3
MIG, as has been its custom
throughout these proceedings, has not responded in any way to
the motion to substitute.
3
The motion to substitute is phrased as though it were filed on
Finney’s behalf. This is, of course, no longer practically
possible due to Finney’s unfortunate death, but it is also not
legally permissible because counsel’s authority to act on behalf
of a client is extinguished when the client dies. Coppinger v.
Schantag, No. 05-2380, 2006 WL 38946, at *1 (D. Md. Jan. 5,
2006) (noting that “under well-established principles of agency
law, an agent’s authority terminates upon the death of a
principal” (internal quotation marks and citation omitted)).
Finney’s former counsel has, however, entered an appearance on
behalf of the Estate, and the court will therefore construe the
motion as though it were submitted on behalf of the Estate.
7
II.
Motion to Substitute
The substitution of a successor or representative to
replace a deceased party is governed by Rule 25(a) of the
Federal Rules of Civil Procedure, which provides, in relevant
part, as follows:
If a party dies and the claim is not extinguished, the
court may order substitution of the proper party.
A
motion for substitution may be made by any party or by
the decedent’s successor or representative.
Fed. R. Civ. P. 25(a); see also Fariss v. Lynchburg Foundry, 769
F.2d 958, 961 (4th Cir. 1985) (“Rule 25(a)(1) governs
substitution of the proper successor or representative of a
deceased party[.]”).
As the text of the rule indicates, a
motion to substitute raises two primary questions: First,
whether the decedent’s claims survive death; and, second,
whether the party to be substituted is a “proper” party.
A. Survival
The court must first determine whether Finney’s claims
survive her death.
Not every claim pled in the complaint is
relevant to this step in the analysis, because, as noted,
Finney, by counsel, indicated at the hearing on November 15,
2013, that she intended to pursue default judgment solely on the
8
basis of her Count III claim under the WVCCPA.
In its motion to
substitute, the Estate espouses a slightly different view,
conceding that “the statutory claims represent the gravamen” of
the motion for default,” Motion to Substitute (“Mot.
Substitute”) at 2 n.1, but suggesting that both the Count I and
Count III “claims against the [d]efendants brought under the
FDCPA and WVCCPA” are relevant and “survive [Finney’s] death,”
id. ¶ 21.
For present purposes, the court will consider whether
the Count I claim under the FDCPA and the Count III claim under
the WVCCPA survived Finney’s death.
As one might expect,
federal law governs survival where a federal claim is presented,
Fariss, 769 F.2d at 962 n.3, while the survival of state-law
claims is a matter of state law, Knauer v. Johns-Manville Corp.,
638 F. Supp. 1369, 1387 (D. Md. 1986).
In view of plaintiff’s limitation of recovery to
Counts I and III, the remaining Counts II, IV, V, and VI are
deemed abandoned.
9
1. Count I - FDCPA Claim
With respect to the FDCPA claim, survival is a
question of federal common law, unless the statute suggests
otherwise.
United States v. NEC Corp., 11 F.3d 136, 137 (11th
Cir. 1993); Smith v. Dep’t of Human Servs., 876 F.2d 832, 834-35
(10th Cir. 1989); James v. Home Constr. Co. of Mobile, Inc., 621
F.2d 727, 729 (5th Cir. 1980); Cook v. Hairston, 948 F.2d 1288
(6th Cir. 1991) (table decision); cf. Carlson v. Green, 446 U.S.
14, 23 (1980) (“Bivens actions are a creation of federal law
and, therefore, the question whether respondent’s action
survived Jones’ death is a question of federal law.”).
The
FDCPA is silent regarding the survival of claims, so the court
will look to the general common law rule, which provides that
claims that are remedial in nature survive the claimant’s death,
while claims that are penal in nature do not.
Faircloth v.
Finesod, 938 F.2d 513, 518 (4th Cir. 1991) (describing the
federal common law rule).
Whether a claim is remedial or penal
is determined by reference to three factors: (1) whether the
statute was designed to redress harms to individuals or harms to
the public; (2) whether recovery accrues to the individual or to
the public; and (3) whether the recovery is proportional to the
harm suffered.
E.g., Murphy v. Household Fin. Corp., 560 F.2d
10
206, 209 (6th Cir. 1977); Green v. City of Welch, 467 F. Supp.
2d 656, 665-66 (S.D. W. Va. 2006).
Here, all three factors suggest that claims under the
FDCPA are remedial, rather than penal.
Regarding the first
factor, the statutory text of the FDCPA clearly indicates that
it was designed to protect individuals.
For example, the
Congressional findings and declaration of purpose accompanying
the bill note that abusive debt collection practices “contribute
to . . . personal bankruptcies, to martial instability, to the
loss of jobs, and to invasions of individual privacy.”
U.S.C. § 1692(a).
15
Moreover, Congress indicated that the FDCPA
was necessary because “[e]xisting laws and procedures for
redressing th[o]se injuries [we]re inadequate,” and clarified
that the purpose of the FDCPA was to “protect consumers against
debt collection abuses.”
15 U.S.C. § 1692(b), (e).
With
respect to the second factor, § 1692k indicates that FDCPA
damages are designed to redress harms to individuals, rather
than harms to the general public.
Specifically, that section
provides that “any debt collector who fails to comply” with the
FDCPA “with respect to any person is liable to such person in an
amount equal to the sum of . . . any actual damages sustained by
such person as a result of such failure[.]”
1692k(a)(1) (emphases added).
15 U.S.C. §
Finally, the text of the statute
11
also demonstrates that recovery under the FDCPA is designed to
be proportional to the harm suffered.
For example, § 1692k(b)
provides that “[i]n determining the amount of liability in any
action” by an individual, “the court shall consider . . . the
frequency and persistence of noncompliance by the debt
collector, the nature of such noncompliance, and the extent to
which such noncompliance was intentional[.]”
1692k(b)(1).
See 15 U.S.C. §
And, while it is true that the FDCPA also provides
for statutory damages not to exceed $1,000, the award of such
damages is tied to the conduct of the debt collector.
Compare
Frazier v. Absolute Collection Serv., Inc., 767 F. Supp. 2d
1354, 1365-66 (N.D. Ga. 2011) (imposing statutory maximum of
$1,000 in damages for repeated, willful violations of FDCPA),
with Weiss v. Zwicker & Assocs., P.C., 664 F. Supp. 2d 214, 218
(E.D.N.Y. 2009) (awarding $500 in statutory damages where
violations were technical, rather than intentional).
In sum, all three factors suggest that claims under
the FDCPA are remedial rather than penal, and, accordingly,
Count I survives Finney’s death.
See Jewett v. Bishop, White
Marshall & Weibel, P.S., No. 12-10142, 2013 WL 6818245, at *2-3
(C.D. Cal. Feb. 25, 2013) (holding that FDCPA claim survived
plaintiff’s death); Bracken v. Harris & Zide, L.L.P., 219 F.R.D.
12
481, 481-85 (N.D. Cal. 2004) (holding that FDCPA claim survived
defendant’s death).
2. Count III - WVCCPA Claim
The survival of claims under West Virginia law is
governed by a combination of common law precedent and statute.
Specifically, West Virginia Code § 55-7-8a(a) states that,
[i]n addition to the causes of action which survive at
common law, causes of action for injuries to property,
real or personal, or injuries to the person and not
resulting in death, or for deceit or fraud, also shall
survive;
and
such
actions
may
be
brought
notwithstanding the death of the person entitled to
recover or the death of the person liable.
W. Va. Code § 55-7-8a(a).
Section 55-7-8a(b) further provides
that, “[i]f any such action is begun during the lifetime of the
injured party . . . and such injured party dies pending the
action it may be revived in favor of the personal representative
of such injured party and prosecuted to judgment[.]”
7-8a(b).
Id. § 55-
Finally, section 55-7-8a(f) clarifies that “[n]othing
contained in [section 55-7-8a(a)] shall be construed to extend
the time within which an action for any other tort shall be
brought[.]”
Id. § 55-7-8a(f).
Read together, these sections
indicate that, in cases like this one, the personal
representative of a deceased plaintiff may revive a cause of
action if the claims of the deceased plaintiff would have
13
survived at common law, or if those claims fall within the
enumerated categories of actions that survive under section 557-8a(a).
In this case, Count III alleges that MIG violated
section 128(e) of the WVCCPA, which prohibits a debt collector
from communicating with a consumer who is represented by
counsel.
W. Va. Code § 46A-2-128(e).
That claim is a statutory
creation of relatively recent vintage, and common law principles
of survival are therefore inapplicable.
Cf. Wilt v. State Auto.
Mut. Ins. Co., 506 S.E.2d 608, 614 (W. Va. 1998) (“Given its
recent statutory genesis, an unfair settlement practices claim
clearly did not survive at common law[.]”).
Instead, the
relevant question is whether a claim under section 128(e)
survives under the remaining terms of section 55-7-8a(a) because
it can be characterized as a claim for an injury to real or
personal property, a claim for a non-fatal personal injury, or a
claim for deceit or fraud.
See W. Va. Code § 55-7-8a(a).
The
Supreme Court of Appeals of West Virginia has noted that the
“broad terminology” of the survival statute provides relatively
little guidance concerning the “types of causes of action [that]
will survive.”
See Stanley v. Sewell Coal Co., 285 S.E.2d 679,
683 (W. Va. 1981).
Nevertheless, the court must assess whether
a claim survives by “apply[ing] the general terms [of the
14
statute] to the particular case,” and “determining whether a
particular cause of action fits into one of the[] broad
categories” of actions enumerated in section 55-7-8a(a).
See
id.
Finney’s Count III claim cannot be characterized as an
injury to property or a personal injury.
Nothing in Count III
implicates an interest in property, and section 128(e)’s
prohibition on contacting consumers bears no resemblance to
causes of action such as trespass or conversion that would
ordinarily ameliorate an injury to property.
Similarly, “the
term ‘personal injury’ historically has referred to physical
injuries to the person such as an automobile accident, slip and
fall, etc.,” Wilt, 506 S.E.2d at 612, and decisions from the
Supreme Court of Appeals of West Virginia suggest that personal
injury claims that survive under section 55-7-8a(a) must be at
least tangentially linked to a physical injury, see id. at 61213 (holding that statutory claim for unfair settlement practices
is not a “personal injury”); Courtney v. Courtney, 437 S.E.2d
436, 437-43 (W. Va. 1993) (holding that infliction of emotional
distress was a “personal injury” where it arose out of assault
and battery witnessed by plaintiff).
In contrast, claims based
on purely dignitary injuries unrelated to any physical harm
apparently do not survive.
See Wilt, 506 S.E.2d at 613
15
(“Numerous torts such as libel, defamation, false arrest, false
imprisonment, and malicious prosecution . . . . do not fall
within the realm of personal injury[, and] . . . do not survive
the death of a party.”).
The complaint does not suggest that
Count III is linked in any way to any sort of physical injury
caused by or related to MIG’s debt-collection calls, therefore
Count III cannot be characterized as a claim for a personal
injury.
That leaves only section 55-7-8a(a)’s remaining
category of claims for fraud or deceit.
Unfortunately, case law
from this State provides no clear answer concerning the manner
in which this provision of the statute should be interpreted and
applied.
In Stanley v. Sewell Coal Co., 285 S.E.2d 679 (W. Va.
1981), the Supreme Court of Appeals suggested that a claim can
be characterized as an action for fraud or deceit if it is
sufficiently “analogous to” or “clearly compatible with” the
broad, general principles underpinning fraud claims.
In that
case, the plaintiff sued for retaliatory discharge, alleging
that he was fired in order to prevent the discovery of his
employer’s “false reporting of accidents to the Mine Enforcement
Safety Administration.”
Id. at 681.
As the court explained, a
claim for retaliatory discharge is based on the “underlying
rationale” that “where the employer’s motivation for
16
[discharging an employee] is to contravene some substantial
public policy principle, then the employer may be liable to the
employee for damages occasioned by this discharge.”
Id. at 682
(quoting Syl. Pt. 1, Harless v. First Nat’l Bank in Fairmont,
246 S.E.2d 270 (W. Va. 1978)).
Although the court acknowledged
that the cause of action “did not expressly utilize fraud
concepts,” it nevertheless concluded that retaliatory discharge
claims could be characterized as a specie of “constructive
fraud,” which the court described as “a breach of a legal or
equitable duty, which, irrespective of moral guilt of the fraud
feasor, the law declares fraudulent, because of its tendency to
deceive others, to violate public or private confidence, or to
injure public interests.”
Id. at 682-83.
In effect, the court
reasoned that “constructive fraud closely parallels [a claim
for] wrongful discharge,” inasmuch as both causes of action are
designed to provide a remedy for conduct that, “although not
actually fraudulent, ought to be so treated,” because it
“contravene[s] a substantial public policy principle.”
Id. at
683 (“The law indulges in an assumption of fraud for the
protection of valuable social interests based upon an enforced
concept of confidence, both public and private.”).
In a more recent decision, however, the Supreme Court
of Appeals appeared to retreat from the expansive interpretative
17
method articulated in Sewell Coal, suggesting instead that a
claim would only be considered an action for “fraud” within the
meaning of section 55-7-8a(a) if it contained “those elements
necessary to prove fraud” at common law.
See Wilt v. State
Auto. Mut. Ins. Co., 506 S.E.2d 608, 610-12 (W. Va. 1998).
As
earlier noted, in Wilt, the plaintiffs attempted to characterize
a statutory tort claim for unfair settlement practices made
pursuant to the West Virginia Unfair Trade Practices Act
(“UTPA”) as a claim for fraud.
The court acknowledged that
certain conduct proscribed by the UTPA might resemble the
“traditionally recognized elements of a fraud claim,” but
ultimately rejected the analogy, reasoning that “[v]iewing
claims under the [UTPA] as necessarily fraudulent in nature
[wa]s problematic . . . because the type of conduct that
constitutes an unfair settlement claim may include a variety of
factual scenarios which lack the requisite elements of a fraud
claim.”
Id. at 610-11.
Specifically, the court explained that
while the UTPA prohibited outright “misrepresentation or
deception” in claims settlement, it also created rules designed
to foster timely and fair claims-processing standards that were
not “aimed strictly at the elimination of conduct that is
fraudulent in character.”
Id. at 611-12.
As a result, the
court concluded that claims under the UTPA did not survive under
section 55-7-8a(a) because they did not “expressly fall[] within
18
the classification of property damage, personal injury, or fraud
or deceit.” 4
See id. at 613-14.
In doing so, the court did not
discuss or overrule Sewell Coal directly; however, the court did
reference and disapprove of an unpublished federal district
court decision that relied on Sewell Coal to reach the
conclusion “that claims alleging unfair settlement practices
[we]re analogous to constructive fraud.”
Id. at 612-14.
“When there is no case law from the forum state which
is directly on point, the district court attempts to do as the
state court would do if confronted with the same fact pattern.”
Roe v. Doe, 28 F.3d 404, 407 (4th Cir. 1994).
Here, the
dissonance between Sewell Coal and Wilt leaves the court without
a clear answer.
The former suggests that a claim survives if it
resembles a claim for common law fraud; the latter indicates
that only actual common law fraud claims survive.
In this case,
however, the court is persuaded that the Supreme Court of
Appeals would apply the approach articulated in Wilt to claims
made under the WVCCPA for two reasons.
4
Wilt specifically held that “claims involving unfair settlement
practices that arise under the [UTPA] are governed by the oneyear statute of limitations set forth in West Virginia Code §
55-2-12(c).” Wilt, 506 S.E.2d at 614. But that determination
was predicated upon the conclusion that “survivability -- either
common law or statutory -- [] determines the applicable
limitations period[.]” Id.
19
First, although Sewell Coal suggested that the
survival statute was “remedial in nature” and therefore to be
“liberally construed,” the majority of cases interpreting
section 55-7-8a(a) appear to adopt a considerably more
conservative approach.
For example, earlier in Snodgrass v.
Sisson’s Mobile Home Sales, Inc., 244 S.E.2d 321 (W. Va. 1978),
the court stated that “the statutory survivability created by
[section 55-7-8a(a)] is limited to the causes of action
designated therein,” and emphasized that “the Legislature
intended to exclude . . . other personal tort actions” from
“statutory survivability[.]”
Id. at 325.
The court explained
that this narrow interpretation of section 55-7-8a(a) was
further confirmed by the text of section 55-7-8a(f), which
“specifically limit[s] the survivability of personal tort
actions to those set out in [section 55-7-8a(a)] by the words,
‘Nothing contained in this section shall be construed to extend
the time within which an action for any other tort shall be
brought.’”
55-7-8a(f)).
Snodgrass, 244 S.E.2d at 325 (quoting W. Va. Code §
In Slack v. Kanawha County Housing and
Redevelopment Authority, 423 S.E.2d 547 (W. Va. 1992), the court
applied that narrow understanding of the survival statute and
concluded that “invasion of privacy [wa]s a personal action that
d[id] not survive the death of the individual . . . under
[section 55-7-8a(a)]” because it was not one of the causes of
20
action specifically articulated in the survival statute.
Id. at
551.
Other cases have construed the survival statute
through a similarly narrow lens.
See, e.g., Cavendish v.
Moffitt, 253 S.E.2d 558, 559 (W. Va. 1979) (per curiam)
(reiterating that the Legislature intended to exclude certain
claims from the scope of the survival statute and holding that a
claim for libel “lack[s] statutory survivability” under section
55-7-8a(a)).
It appears that the court in Wilt aligned with
these cases when it emphasized that it was “[o]nly through
express statutory designation [that] fraud and deceit survive
the death of the victim.”
Wilt, 506 S.E.2d at 613.
Wilt’s
conclusion that claims do not survive unless they “expressly
fall[] within the classification of property damage, personal
injury, or fraud or deceit,” id., appears to reflect the
dominant interpretive approach.
Second, in the few instances where the court has shown
any willingness to apply a more relaxed interpretation of
section 55-7-8a(a), it has done so in cases involving commonlaw, rather than statutory, claims.
See, e.g., Courtney v.
Courtney, 437 S.E.2d at 437-43 (holding that intentional
infliction of emotional distress was a “personal injury” within
the meaning of the survival statute); Sewell Coal, 285 S.E.2d at
21
682-83 (holding that claim for retaliatory discharge survived).
By contrast, the Supreme Court of Appeals has been particularly
reluctant to find that statutory tort claims survive under
section 55-7-8a(a).
For example, in Snodgrass, the court
summarily concluded that an action to collect a civil penalty
under the State’s usury statute did “not fall within the
categories of causes of action which survive by virtue of”
section 55-7-8a(a).
244 S.E.2d at 325-26.
And in Thompson v.
Branches-Domestic Violence Shelter of Huntington, W. Va., Inc.,
534 S.E.2d 33 (W. Va. 2000), the court similarly held that “the
tort of breach of confidentiality in violation of a statute” did
not fall within the categories of claims enumerated in section
55-7-8a(a).
Id. at 38-39.
Given that Count III is a statutory
tort akin to the causes of action at issue in Snodgrass,
Thompson, and Wilt, it seems likely that the Supreme Court of
Appeals would apply Wilt’s narrow interpretation of the survival
statute in this case.
Construing the survival statute’s definition of fraud
narrowly, Count III does not survive.
As the court in Wilt
explained,
The essential elements in an action for fraud are: (1)
that the act claimed to be fraudulent was the act of
the defendant or induced by him; (2) that it was
material and false; that plaintiff relied on it and
was justified under the circumstances in relying upon
22
it; and (3) that he was damaged because he relied on
it.
Wilt, 506 S.E.2d at 610 (quoting Syl. Pt. 2, Muzelak v. King
Chevrolet, Inc., 368 S.E.2d 710 (W. Va. 1988)).
By contrast,
section 128(e) of the WVCCPA prohibits “[a]ny communication with
a consumer whenever it appears that the consumer is represented
by an attorney[.]”
W. Va. Code § 46A-2-128(e).
This court has
previously recognized that section 128(e) is designed in part to
prevent “a skilled and deceptive [debt] collector from
accomplishing an end-run around counsel to the client’s
potentially severe detriment,” Lenhart v. EverBank, No. 12-4184,
2013 WL 5745602, at *8-9 (S.D. W. Va. Oct. 23, 2013), but that
alone is not enough to transform a claim under section 128(e)
into a claim for fraud.
Cf. Martin v. State Farm Mut. Auto.
Ins. Co., No. 10-144, 2010 WL 3852337, at *3-4 (S.D. W. Va.
Sept. 30, 2010) (“Plaintiff . . . has not alleged fraud or
deceit or personal injury claims, and the underlying fraud and
deceit components to the common-law bad faith and UTPA claims do
not transform them into such claims.”).
Indeed, to plead a
violation of section 128(e) the plaintiff need-not -- and Finney
did not -- allege any false statements on the part of the debtcollector or any detrimental reliance on the part of the
consumer.
23
As the court in Wilt noted, certain deceptive
practices may be prohibited by statute because they are unfair,
without necessarily amounting to fraud.
Wilt, 506 S.E.2d at
610-11 (“Viewing claims under the [UTPA] as necessarily
fraudulent is problematic . . . because the type of conduct that
constitutes an unfair settlement claim may include a variety of
factual scenarios which lack the requisite elements of a fraud
claim.”).
The same is true here.
It may be “unfair or
unconscionable” for a debt collector to contact directly a
consumer known to be represented by counsel.
2-128(e).
W. Va. Code § 46A-
But that statutory designation does not transform the
underlying conduct into a common law claim for fraud.
Accordingly, Count III does not survive Finney’s
death.
B. Proper Party
Having determined that Count I survives Finney’s
death, the court next considers whether the Estate is a proper
party to be substituted.
No significant analysis is required.
As noted, Rule 25 provides that “[a] motion for substitution may
be made by any party or by the decedent’s successor or
representative.”
Fed. R. Civ. P. 25(a)(1).
24
“[C]ourts are in
agreement that the ‘successor or representative’ mentioned in
Rule 25(a)(1) refers to the administrator of the estate[.]”
Susko v. City of Weirton, No. 09-1, 2010 WL 2925937, at *2 (N.D.
W. Va. July 22, 2010).
Accordingly, Ms. Easter, as
administratrix for the Estate, is a proper party for
substitution.
Ashley v. Ill. Cent. Gulf R.R. Co., 98 F.R.D.
722, 724 (S.D. Miss. 1983) (“Unless the estate of a deceased
party has been distributed at the time of making the motion for
substitution, the ‘proper’ party for substitution would be
either the executor or administrator of the estate of the
deceased.”); accord Rende v. Kay, 415 F.2d 983, 985 (D.C. Cir.
1969) (explaining that the text of Rule 25 “plainly
contemplate[s] that the suggestion [of death] emanating from the
side of the deceased would identify a representative of the
state, such as an executor or administrator, who could be
substituted for the deceased as a party[.]”).
*
*
*
In sum, Count I survives Finney’s death, and the
Estate is a proper party for substitution.
Accordingly, the
motion to substitute the Estate as plaintiff in this action is
granted as to Count I.
25
III. Motion for Default Judgment
A. Standard of Review
Default judgments are governed by Rule 55 of the
Federal Rules of Civil Procedure.
Rule 55(a) states that if a
party has “failed to plead or otherwise defend, and that failure
is shown by affidavit or otherwise, the clerk must enter the
party’s default.”
Once default has been entered by the clerk,
the plaintiff may move the court to enter a default judgment
against the defendant pursuant to Rule 55(b)(2).
When considering a motion for a default judgment, the
court accepts the well-pleaded factual allegations in the
complaint regarding liability as true.
See Ryan v. Homecomings
Fin. Network, 253 F.3d 778, 780-81 (4th Cir. 2001).
Nevertheless, “liability is not deemed established simply
because of default . . . and the court, in its discretion, may
require some proof of the facts that must be established in
order to determine liability.”
Int’l Painters & Allied Trades
Indus. Pension Fund v. Capital Restoration & Painting Co., 919
F. Supp. 2d 680, 684 (D. Md. 2013)(quoting Charles A. Wright,
Arthur R. Miller & Mary Kay Kane, Federal Practice & Procedure §
2688 (3d ed. 1998)).
26
Once liability has been established, the court must
make an independent determination concerning the damages to be
awarded.
See S.E.C. v. Lawbaugh, 359 F. Supp. 2d 418, 422 (D.
Md. 2005); see also Ryan, 253 F.3d at 780-81.
Courts will not
simply accept the plaintiff’s statement of damages, but instead
must ensure that damages are appropriate.
Adams v. Barker, No.
10-423, 2013 WL 310561, at *3 (S.D. W. Va. Jan. 25, 2013)
(citing Transatl. Marine Claims Agency, Inc. v. Ace Shipping
Corp., 109 F.3d 105, 111 (2d Cir. 1997)).
To this end, Rule
55(b) authorizes the court to “conduct hearings or make
referrals” in order to, inter alia, “determine the amount of
damages[,] establish the truth of any allegation by evidence[,]
or investigate any other matter.”
Fed. R. Civ. P. 55(b).
The
court may also rely on affidavits and other documentary evidence
to determine the appropriate damages amount.
Monge v. Portofino
Ristorante, 751 F. Supp. 2d 789, 795-96 (D. Md. 2010).
B. Discussion
As noted, the Estate maintains that “the statutory
claims represent the gravamen of” the pending motion for default
judgment; Mot. Substitute at 2 n.1, however, only the Count I
claim under the FDCPA survived Finney’s death.
27
1. Liability
“To prevail on a FDCPA claim, a plaintiff must
sufficiently allege that (1) [s]he was the object of collection
activity arising from a consumer debt as defined by the FDCPA,
(2) the defendant is a debt collector as defined by the FDCPA,
and (3) the defendant engaged in an act or omission prohibited
by the FDCPA.”
Johnson v. BAC Home Loans Servicing, LP, 867 F.
Supp. 2d 766, 776 (E.D.N.C. 2011).
With respect to the first element, a consumer debt is
defined as an obligation or alleged obligation “to pay money
arising out of a transaction in which the money, property,
insurance, or services which are the subject of the transaction
are primarily for personal, family, or household purposes[.]”
15 U.S.C. § 1692a(5).
In this case, the complaint states that
Finney “incurred a financial obligation that was primarily for
personal, family or household purposes,” Compl. ¶ 9, and that
“MIG attempt[ed] to collect” on that debt on several occasions,
id. ¶¶ 9, 32-33.
As a result, the well-pleaded facts in the
complaint establish that Finney was the object of collection
activity arising from a consumer debt as defined by the FDCPA.
Regarding the second element, the FDCPA defines a debt
collector as:
28
any person who uses any instrumentality of interstate
commerce or the mails in any business the principal
purpose of which is the collection of any debts, or
who
regularly
collects
or
attempts
to
collect,
directly or indirectly, debts owed or due or asserted
to be owed or due another.
15 U.S.C. § 1692a(6).
Here, it appears that MIG is a debt
collector within that definition inasmuch as the complaint
establishes that MIG is a Florida company engaged in the
principal business of debt collection; that MIG used the mail
and telephone to engage in debt collection; and that MIG
attempted to collect Finney’s debt “on behalf of HSBC[.]”
Compl. ¶¶ 5, 9.
As for the third element, the complaint appears to
assert that MIG violated the FDCPA by engaging in “conduct the
natural consequence of which [wa]s to harass, oppress, or abuse
[Finney] in connection with collecting the alleged debt.”
Compl. ¶ 16; see also id. ¶ 18 (asserting that Finney is
entitled to damages “[a]s a result of each and every
[d]efendant’s violations of the FDCPA”).
Section 1692d of the
FDCPA prohibits debt collectors from engaging in “any conduct
the natural consequence of which is to harass, oppress, or abuse
any person in connection with the collection of a debt.”
15 U.S.C. § 1692d.
That statute includes a non-exhaustive list
of conduct that constitutes harassment, oppression or abuse,
including, among other things, “[c]ausing a telephone to ring or
29
engaging any person in telephone conversation repeatedly or
continuously with intent to annoy, abuse, or harass.”
Id. §
1692d(5).
There is no bright-line test for determining whether
debt-collection calls constitute actionable harassment.
Rather,
courts weigh and consider a number of factors, including the
frequency, pattern, and nature of the calls, to determine
whether they violate § 1692d(5).
See Bassett v. I.C. Sys.,
Inc., 715 F. Supp. 2d 803, 809-10 (N.D. Ill. 2010)
(“[A]ctionable harassment or annoyance turns on the volume and
pattern of calls made[.]” (internal citations and quotation
marks omitted)); Akalwadi v. Risk Mgmt. Alternatives, Inc., 336
F. Supp. 2d 492, 505-06 (D. Md. 2004) (same); Joseph v. J.J. Mac
Intyre Cos., LLC, 238 F. Supp. 2d 1158, 1168 (N.D. Cal. 2002)
(same); see also Bridge v. Ocwen F. Bank, FSB, 681 F.3d 355, 363
(6th Cir. 2012) (considering it relevant, at motion to dismiss
stage, that debt collector ignored repeated requests to cease
communications with consumer); Fox v. Citicorp Credit Servs.,
Inc., 15 F.3d 1507, 1516 (9th Cir. 1994) (“Threatening and
intimidating calls to a consumer at an inconvenient time or
place could rationally support a jury finding of harassing
conduct.”).
30
In some instances, the sheer volume of debt collection
calls may be sufficient to establish a violation.
Compare,
e.g., Hoover v. Monarch Recovery Mgmt., Inc., 888 F. Supp. 2d
589, 597-99 (E.D. Pa. 2012) (holding that ten calls per week for
eleven week period was sufficient volume of calls to state a
claim under § 1692d(5)), with, e.g., Breeders v. Gulf Coast
Collection Bureau, 796 F. Supp. 2d 1335, 1338 (M.D. Fla. 2011)
(holding that calls placed between 8:00 a.m. and 11:00 a.m. no
more than once every two days did not violate FDCPA).
But the
requisite “intent to annoy, abuse, or harass” on the part of the
debt collector may also be inferred from other conduct, such as
continuing to place calls to a consumer who has asked not to be
contacted, Gilroy v. Ameriquest Mortg. Co., 632 F. Supp. 2d 132,
136 (D.N.H. 2009); or engaging in a course of conduct -- such as
contacting a consumer known to be represented by counsel -- that
would constitute a violation of some separate section of the
FDCPA, cf. Fox, 15 F.3d at 1516 n.10 (holding that conduct that
would violate § 1692c would be “relevant to a harassment claim”
under § 1692d).
In this case, the well-pleaded facts in the complaint
establish that Finney retained Palmer to represent her in her
efforts to resolve her debt to HSBC; that Palmer notified MIG
that it represented Finney in February of 2012; and that MIG
31
thereafter continued to communicate with Finney by calling her
“home or cellular telephone on numerous occasions after a notice
of representation . . . had been received by” MIG.
10, 11, 24, 28.
Compl. ¶¶
In an affidavit submitted in support of her
motion for default judgment, Finney clarified that Palmer “sent
a letter dated February 23, 2012 to [MIG] in which, among other
things, it was communicated on [her] behalf that the debt was
disputed and that [MIG] and its representatives should cease all
communications with [her] directly and[,] instead, direct all
communication related to the debt to” Palmer.
Finney Aff. ¶ 6.
Finney further explained that MIG “ignored [her] request and
continued calling [her] directly with regard to the debt . . . .
approximately three times per week” between February 23, 2012
and May 15, 2012, at which point MIG’s calls “eventually
ceased[.]”
Finney Aff. ¶¶ 7, 9.
Finally, Finney also stated
that these callers were “oftentimes rude and aggressive, and
frequently threatened to sue [her] with regard to the debt.”
Finney Aff. ¶ 8.
Taken together, the well-pleaded facts in the
complaint and the supplementary information contained in
Finney’s affidavit are sufficient to establish a violation of §
1692d(5).
MIG continued to contact Finney approximately three
times per week for over eleven weeks after Palmer’s letter,
32
aggregating thirty-three or more telephone calls.
Although this
call volume alone might not indicate an intent to annoy, abuse,
or harass in violation of § 1692d(5), the fact that these calls
were placed after Finney informed MIG that the debt was disputed
and after Finney requested that all further communication be
directed to Palmer suggests otherwise.
Indeed, MIG’s conduct in
this regard would be sufficient to establish independent
violations of § 1692c(a)(2), which prohibits communication with
a consumer “if the debt collector knows the consumer is
represented by an attorney with respect to such debt,” 15 U.S.C.
§ 1692c(a)(2), as well as § 1692c(c), which prohibits a debt
collector from communicating with a consumer if the consumer
indicates, in writing, that he or she “wishes the debt collector
to cease further communication,” id. § 1692c(c).
Although
Finney did not allege violations of either of those two sections
of the FDCPA, the Ninth Circuit has recognized that such
“conduct may be relevant to a harassment claim” under §
1692d(5), “even [in the] absen[ce] of a separate [§] 1692c
claim[.]”
Fox, 15 F.3d at 1516 & n.10.
Likewise, courts have
concluded that a debt collector’s failure to respect a
consumer’s request to cease communications concerning a debt may
be indicative of intent to harass or annoy.
See, e.g., Gilroy,
632 F. Supp. 2d at 136 (“Intent may also be inferred by evidence
that the debt collector continued to call the debtor after the
33
debtor had asked not to be called[.]”).
Accordingly, given that
Finney asked MIG to stop contacting her and directed all further
communications regarding the debt to Palmer, the fact that MIG
nevertheless continued to call her on over thirty occasions is
sufficient to establish a violation of § 1692d(5).
See Harmon
v. Virtuoso Sourcing Grp., LLC, No. 11-334, 2012 WL 4018504, at
*4 (S.D. W. Va. Sept. 12, 2012) (granting default judgment under
§ 1692d(5) where defendant debt collector continued to call
after consumer asked debt collector to stop calling); Jensen v.
Omni Credit Servs. of Fla., Inc., No. 12-405, 2013 WL 1183317,
at *1-2 (D. Or. Feb. 25, 2013) (report and recommendation)
(granting default judgment under § 1692d(5) where plaintiff
disputed debt and debt collector thereafter “continued to harass
[p]laintiff with further calls”), adopted, 2013 WL 1183316 (D.
Or. March 21, 2013).
2. Damages
With respect to damages, the FDCPA provides, in
pertinent part, as follows:
[A]ny debt collector who fails to comply with any
provision of this subchapter with respect to any
person is liable to such person in an amount equal to
the sum of-(1) any actual damage sustained by such person as
a result of such failure;
34
(2)(A) in the case of any action by an
individual, such additional damages as the court
may allow, but not exceeding $1,000
15 U.S.C. § 1692k(a).
“In determining the amount of liability,”
§ 1692k(b) further provides that, “the court shall consider,
among other relevant factors[,] . . . the frequency and
persistence of noncompliance by the debt collector, the nature
of such noncompliance, and the extent to which such
noncompliance was intentional[.]”
Id. § 1692k(b)(1).
Finally,
actual damages are not a prerequisite to the recovery of
statutory damages.
See Miller v. Wolpoff & Abarmson, L.L.P.,
321 F.3d 292, 307 (2d Cir. 2003) (“The FDCPA provides for
liability . . . and permits the recovery of statutory damages up
to $1,000 in the absence of actual damages.”); Keele v. Wexler,
149 F.3d 589, 593-94 (7th Cir. 1998) (same); Baker v. G.C.
Servs. Corp., 677 F.2d 775, 780 (9th Cir. 1982) (“There is no
indication in the statute that award of statutory damages must
be based on proof of actual damages.”); see also Shoup v.
McCurdy & Chandler, LLC, 465 F. App’x 882, 885 (11th Cir. 2012)
(per curiam) (stating that the FDCPA “provides a claim for
statutory damages based on any violation of the statute.”).
Here, the complaint alleges that Finney suffered
“damages in the form of anger, anxiety, emotional distress,
fear, frustration, upset, humiliation, [and] embarrassment” as a
35
proximate result of MIG’s “violations of the FDCPA,” and
requests “actual damages[,] . . . statutory damages in an amount
up to $1,000[, and] . . . reasonable attorney’s fees and
costs[.]”
Compl. ¶¶ 17-18.
Nothing in the record supports an award of actual
damages in this case.
The factual pleadings in the complaint
concerning liability are accepted as true upon default, but
allegations with respect to damages are not.
S.E.C. v.
Lawbaugh, 359 F. Supp. 2d 418, 422 (D. Md. 2005) (citing Dundee
Cement Co. v. Howard Pipe & Concrete Prods., Inc., 722 F.2d
1319, 1323 (7th Cir. 1983)).
Although Finney claims that she
suffered a variety of dignitary harms as a result of MIG’s debt
collection calls, she did not avail herself of the opportunity
to present damages at any of the three hearings scheduled by the
court for that purpose.
Moreover, nothing in her affidavit
(which constitutes the entire corpus of evidence outside the
pleadings in this matter 5) substantiates or quantifies any of
these purported injuries.
On the other hand, an award of statutory damages is
appropriate in this case.
As noted, the FDCPA permits the
recovery of statutory damages even in the absence of actual
5
Counsel for the Estate has advised the court that there is no
need for a further hearing on damages in this matter.
36
damages.
See, e.g., Miller, 321 F.3d at 307.
And, on this
score, Finney’s affidavit is of some use inasmuch as it
clarifies that MIG contacted her on over thirty occasions after
Palmer’s letter requested that MIG cease communicating with her
about the alleged debt.
Accordingly, in light of the number of
calls and given that MIG’s conduct would also have established a
violation of § 1692c, the court concludes that Finney is
entitled to $1,000 in statutory damages pursuant to
§ 1692k(a)(2)(A).
See Frazier v. Absolute Collection Serv.,
Inc., 767 F. Supp. 2d 1354, 1365-66 (N.D. Ga. 2011) (adopting
report and recommendation) (awarding $1,000 in statutory damages
for “a handful” of FDCPA violations); Obenauf v. Frontier Fin.
Grp., Inc., 785 F. Supp. 2d 1188, 1194-95 (D.N.M. 2011)
(awarding $300 in statutory damages for a single phone call in
violation of FDCPA); Jensen, 2013 WL 1183317 at *2 (awarding
$1,000 for some unspecified number of calls in violation of
FDCPA); Hutchens v. West Asset Mgmt., Inc., No. 11-996, 2013 WL
1337178, at *6 (S.D. W. Va. March 29, 2013) (awarding $1,000 in
statutory damages for FDCPA violations); cf. also DIRECTV, Inc.
v. Huynh, 318 F. Supp. 2d 1122, 1129-31 (M.D. Ala. 2004)
(holding that a damages hearing is not necessary to calculate
statutory damages and awarding statutory damages on the basis of
affidavits and record evidence).
37
3. Attorney’s Fees and Costs
Section 1692(a)(3) provides that, “in the case of any
successful action to enforce” liability under the FDCPA, “the
costs of the action, together with a reasonable attorney’s fee
as determined by the court” shall be awarded.
15 U.S.C. §
1692k(a)(3); Carroll v. Wolpoff & Abramson, 53 F.3d 626, 628
(4th Cir. 1995) (explaining that fee award under § 1692k is
“mandatory in all but the most unusual circumstances”).
As our
court of appeals recently summarized:
[T]he district court[’s] . . . discretion in awarding
attorney’s fees [under the FDCPA] is guided by the
twelve factors first set forth in Johnson v. Ga.
Highway Express, Inc., and adopted by [the Fourth
Circuit] in Barber v. Kimbrell’s, Inc.
The Barber
factors include such considerations as the time and
labor
required,
the
difficulty
of
the
issues
litigated, customary fees in similar situations, and
the results obtained. These factors, however, usually
are subsumed within the initial calculation of hours
reasonably expended at a reasonable hourly rate[,
i.e., the lodestar].
When . . . the applicant for a
fee has carried his burden of showing that the claimed
rate and number of hours [expended] are reasonable,
the [lodestar] is presumed to be the reasonable fee
contemplated by the statute. The FDCPA, however, does
not mandate a fee award in the lodestar amount, and
the district court maintains the discretion to depart
from it in appropriate circumstances.
Randle v. H&P Capital, Inc., 513 F. App’x 282, 283-84 (4th Cir.
2013) (per curiam) (internal quotation marks and citations
omitted) (fourth, fifth, and sixth alterations in the original).
38
When calculating reasonable fees, establishing the
hourly rate is generally the critical inquiry. Westmoreland Coal
Co. v. Cox, 602 F.3d 276, 289 (4th Cir. 2010) (quoting Plyler v.
Evatt, 902 F.2d 273, 277 (4th Cir. 1990) (internal citations and
quotations omitted)). The fee applicant bears the burden of
establishing the reasonableness of the requested rate. Id.
In addition to the attorney’s own affidavits, the fee
applicant must produce satisfactory specific evidence
of the prevailing market rates in the relevant
community for the type of work for which he seeks an
award. Although the determination of a “market rate”
in the legal profession is inherently problematic, as
wide variations in skill and reputation render the
usual laws of supply and demand largely inapplicable,
the Court has nonetheless emphasized that market rate
should guide the fee inquiry.
Id. (quoting Plyler, 902 F.2d at 277 (internal citations and
quotations omitted)). In determining the market rate, the court
should consider evidence of what attorneys earn for performing
similar services in similar circumstances, “which, of course,
may include evidence of what the plaintiff’s attorney actually
charged his client.” Id. (quoting Depaoli v. Vacation Sales
Assocs., L.L.C., 489 F.3d 615, 622 (4th Cir. 2007)).
Examples
of the specific evidence that courts have found “sufficient to
verify the prevailing market rates are affidavits of other local
lawyers who are familiar both with the skills of the fee
applicants and more generally with the type of work in the
39
relevant community.” Id. (quoting Robinson v. Equifax Info.
Servs., LLC, 560 F.3d 235, 245 (4th Cir. 2009)).
In this case, the Estate seeks to recover fees for
work performed by the attorneys and paralegal who have
represented Finney, and now the Estate, throughout the course of
this action.
Specifically, a timesheet attached to the motion
for default judgment indicates that three attorneys expended a
total of just under eleven and one-half hours of work on the
case, at a rate of $250 per hour, for a total fee of $2,854.
Additionally, a paralegal spent just over five hours on the
case, at a rate of $95 per hour, aggregating $483.
The
timesheet is accompanied by an affidavit attesting to its
accuracy as a record of the time expended in this matter.
While the Estate has not submitted any information of
the prevailing market rate for similar services in the
community, the court is aware from its allowances in other
recent cases that the rate sought is reasonable.
In view of the
relatively modest amount sought, no further evidence of
reasonableness of rate is necessary.
Upon review, the court
also finds the time expended in this matter to be reasonable.
Cf., e.g., Nero v. Law Office of Sam Streeter, P.L.L.C., 655 F.
Supp. 2d 200, 212 (E.D.N.Y. 2009) (awarding fees for 9.2 hours
of work in FDCPA case following default judgment); Overcash v.
40
United Abstract Grp., Inc., 549 F. Supp. 2d 193, 197 (N.D.N.Y.
2008) (awarding fees for 11 hours of work in FDCPA case
following default judgment).
Accordingly, the request for
attorney and related paralegal fees is granted in the amount of
$3,337.00, together with legal research fees of $36.53,
aggregating $3,373.53.
With respect to costs, several courts have concluded
that § 1692k(a)(3) permits litigants to recover the costs
allowed under 28 U.S.C. § 1920, which include filing fees and
fees for service of process.
E.g., Hutchens v. West Asset
Mgmt., Inc., No. 11-996, 2013 WL 1337178, at *6 (S.D. W. Va.
March 29, 2013) (explaining that the “costs of the action” under
§ 1692k(a)(3) are “limited to the costs allowed under 28 U.S.C.
§ 1920” and collecting authority).
Here, the Estate seeks to
recover a $350 filing fee and $40 service fee, both of which are
recoverable.
Accordingly, the request for costs is granted in
the amount of $390.
41
IV.
Conclusion
Based upon the foregoing analysis, it is ORDERED as
follows:
1. That the motion to substitute the Estate as plaintiff in
this case be, and it hereby is, granted;
2. That the plaintiff’s motion for default judgment be, and it
hereby is, granted as to Count I of the complaint and
otherwise denied;
3. That the plaintiff be, and hereby is, awarded against MIG
Capital, Inc. the sum of $1,000.00 in damages;
4. That the plaintiff be, and hereby is, awarded against MIG
Capital, Inc. the sum of $3,373.53 in attorney’s fees; and
5. That the plaintiff be, and hereby is, awarded against MIG
Capital, Inc. the sum of $390.00 in costs.
The Clerk is directed to forward copies of this order
to all counsel of record and to the defendant, by certified
mail, return receipt requested at 5811 Memorial Highway, Suite
206, Tampa, Florida, 33615.
DATED: March 27, 2014
John T. Copenhaver, Jr.
United States District Judge
42
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