Opinion
CV NO. 03-00402 DAE-BMK
Oct 16, 2003
The court heard Defendant's Motion to Dismiss and plaintiff's Counter Motion for Partial Summary Judgment on October 14, 2003. John Harris Paer, Esq., appeared on behalf of Plaintiff; Philip W. Miyoshi, Esq., appeared on behalf of Defendant. After reviewing the motions and the supporting and opposing memoranda, the court GRANTS IN PART and DENIES IN PART Defendant's Motion to Dismiss ("Defendant's Motion") and GRANTS IN PART and DENIES IN PART plaintiff's Counter Motion for Partial Summary Judgment ("Plaintiff's Counter Motion").
The Motion will be treated as one for summary judgment. See, infra.
BACKGROUND
During the calendar year 2001, Plaintiff entered into a contract with Nextel Partners, Inc., ("Nextel") for cell phone service. Plaintiff asserts that he has been a resident of Honolulu, Hawai'i, for sixteen years, and, that he both entered into the agreement with Nextel in Hawafi and used the phone for personal use exclusively in Hawai'i. See plaintiff's Counter Motion, at 4. According to Plaintiff, he received his monthly Nextel bill at his former address, 1669 S. Beretania Street, Apt. 4, Honolulu, Hawai'i, 96826. However, on December 1, 2002, he moved to his present address, located at 47-283 C Hui Iwa Street, Kaneohe, Hawai'i, 96744.Defendant maintains that plaintiff's last payment to Nextel occurred on February 2, 2002, and was in the amount of $179.13. See Defendant's Reply Memorandum in Support of Its Motion to Dismiss and Opposition to plaintiff's Counter Motion ("Defendant's Reply"), filed October 3, 2003, Ex. B. Defendant asserts that Plaintiff continued to use the account through June 2002 but did not make any additional payments. Defendant's Reply, at 25. Plaintiff, however, maintains that his service was cancelled because he refused to pay $60 in late charges. See Declaration of Jason Powell, filed October 9, 2003 ("October 9, 2003 Powell Decl."), ¶¶ 3-5. Despite the cancellation of service, Plaintiff states that Defendant continued to bill him for the monthly charges. Id.
Although it is unclear whether and if so, when, Nextel allegedly cancelled plaintiff's service, Defendant asserts that the balance on plaintiff's Nextel account as of July 13, 2002 was $1052.70. The account balance continued to accrue late charges and interest. Nextel assigned the account, in the amount of $1158.34 in principal and 60 cents in interest, to Defendant in December 2002.
On December 24, 2002, Defendant sent Plaintiff a notice of collection for the full amount assigned to it by Nextel. This notice was sent to plaintiff's previous address and Plaintiff claims that as a result of the forwarding delay, he did not receive the notice until "the middle of January." plaintiff's Counter Motion, at 5. Plaintiff asserts that the debt was incurred for personal, family, or household purposes. Complaint, ¶ 6. Defendant sent a second notice on January 14, 2003, which Plaintiff asserts he received at the end of January.
The Fair Debt Collection Practices Act precludes debt collectors from implementing unlawful debt collection tactics against consumers.Slenk v. Transworld Systems, Inc., 236 F.3d 1072, 1074 (9th Cir. 2001). Consequently, the act applies to consumer debts and not to business loans. Id. (quoting Bloom v. I.C. System. Inc., 972 F.2d 1067, 1068 (9th Cir. 1992)).
On February 4, 2003, plaintiff's counsel asserts that he faxed Defendant a letter informing Defendant that Plaintiff had counsel, that Defendant's prior collection attempts did not comply with the Fair Debt Collection Practices Act ("FDCPA"), codified at 15 U.S.C. § 1692, et seq., and that Defendant's notices were improper, as well as confusing and misleading. See Complaint, Ex. C. In the transmission, plaintiff's counsel stated that Plaintiff disputed the alleged debt and requested that Defendant provide him with a verification of the debt. He requested that all subsequent communication be made to plaintiff's counsel and stated that Plaintiff would accept payment of $3000.00 for the actual and statutory damages suffered by Plaintiff, as well as to cover attorney's fees.
Although Plaintiff has produced evidence that he made a long distance call to a number that appears to belong to Defendant, Defendant asserts that it did not receive the February 4, 2003 fax transmission and that its first contact with plaintiff's counsel came in a fax sent on March 5, 2003. In this transmission, plaintiff's counsel stated that he was following up on the February 4, 2003 transmission. Defendant refers to its account summary records as evidence that its first encounter with plaintiff's counsel occurred with the March 5, 2003 fax and that Defendant immediately responded with a telephone call to plaintiff's counsel the same day. There is no evidence, and Defendant does not dispute, that it did not provide Plaintiff with verification of the alleged debt.
Defendant claims that because it had no knowledge of the fax transmission, it sent another notice of collection to Plaintiff on February 12, 2003, which Plaintiff claims he received at the end of February. Upon learning on March 5, 2003, that Plaintiff was represented by counsel, Defendant ceased debt collection and entered into a correspondence with Plaintiff's attorney. Defendant asserts that this exchange was unproductive and that plaintiff's attorney continued to threaten litigation under the FDCPA, resulting in Defendant's alleged conclusion that such actions were not undertaken in good faith.
Defendant notes that this notice was sent to Plaintiff at his new residence.
On April 25, 2003, Defendant filed an action against Plaintiff in the Central District of the Superior Court of California. Complaint, ¶ 11. Defendant sought to hold Plaintiff and his attorney liable for violations of Section 17200 of the California Business and Professions Code. Defendant's Concise Facts, ¶ 32. Plaintiff states that he hired mainland counsel to represent him in the action and the Complaint was dismissed in an order filed on July 28, 2003, for lack of personal jurisdiction. See plaintiff's Counter Motion, Ex. F; see also Declaration of Jason Powell ("Plaintiff Decl."), dated September 8, 2003.
On July 25, 2003, Plaintiff filed the underlying Complaint in this action, alleging in Count I violations of the FDCPA. See Complaint, ¶¶ 15-16; 18. Although Plaintiff did not identify the specific provisions under the FDCPA, it appears from the text of the Complaint that Plaintiff asserts the following violations: (1) false or misleading misrepresentations under 15 U.S.C. § 1692e; (2) unfair practices under 15 U.S.C. § 1692f; and (3) improper notice and validation of debts under 15 U.S.C. § 1692g.
Plaintiff also alleges in Count II state claims under Hawai'i Revised Statutes ("HRS") §§ 443B and 480. Defendant's state law claims consist of allegations of unfair and deceptive practices, as well as immoral, unethical, oppressive, unscrupulous, and substantially injurious contacts, demands and disclosures involving Defendant's collection efforts. Complaint, ¶¶ 19-20. Plaintiff seeks to recover actual and statutory damages, as well as reasonable attorney's fees and costs of litigation, for Defendant's alleged misrepresentations and failure to disclose information in the collection of a debt.
On August 18, 2003, Defendant filed this Motion, claiming that plaintiff's Complaint alleging violations of FDCPA should be dismissed for failure to state a claim. Plaintiff filed his Counter Motion and Opposition to Defendant's Motion to Dismiss on September 25, 2003. Defendant filed a Reply on October 3, 2003, in which it requested the court to convert its Motion to Dismiss into a Motion for Summary Judgment. Plaintiff filed a Reply Memorandum in Response to Defendant's Motion to Dismiss ("Plaintiff's Reply") on October 9, 2003.
STANDARD OF REVIEW
I. Motion to Dismiss
Rule 12(b) of the Federal Rules of Civil Procedure ("FRCP") allows the consideration at the pre-trial stage of any defense, objection, or request "which is capable of determination without the trial of the general issue." A motion to dismiss is generally "capable of determination" before trial "if it involves questions of law rather than fact." See United States v. Shortt Accountancy Corp., 785 F.2d 1448, 1452 (9th Cir. 1986). Although the court may make preliminary findings of fact necessary to decide the legal questions presented by the motion, the court may not "invade the province of the ultimate finder of fact." Id. (internal quotations and citations omitted).
A motion to dismiss will be granted where the plaintiff fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). A complaint should not be dismissed unless it appears to a certainty that Plaintiff "would be entitled to no relief under any set of facts that could be proved." Fidelity Fin. Corp. v. Federal Home Loan Bank, 792 F.2d 1432, 1435 (9th Cir. 1986), cert. denied. 479 U.S. 1064 (1987);Stender v. Lucky Stores, Inc., 766 F. Supp. 830, 831 (N.D. Cal. 1991). All allegations of material fact are taken as true and construed in a light most favorable to Plaintiff. Stender, 766 F. Supp. at 831.
If matters outside the pleadings are submitted, the motion to dismiss under Rule 12(b)(6) is treated as one for summary judgment under Rule 56. See Fed.R.Civ.P. 12(b); Del Monte Dunes at Monterey, Ltd, v. City of Monterey. 920 F.2d 1496, 1507-08 (9th Cir. 1990). In ruling on Defendant's Motion to Dismiss, this court will be obliged to consider numerous materials outside of the pleadings. Therefore, the court will treat Defendant's original Motion to Dismiss as a Motion for Summary Judgment.
II. Summary Judgment
Rule 56(c) of the FRCP provides that summary judgment shall be entered when:
. . . the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law.
Fed.R.Civ.P. 56(c). The moving party has the initial burden of demonstrating for the court that there is no genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986) (citingAdickes v. S.H. Kress Co., 398 U.S. 144 (1970)). The moving party, however, need not produce evidence negating the existence of an element for which the opposing party will bear the burden of proof at trial. See id at 323.
Once the movant has met its burden, the opposing party has the affirmative burden of coming forward with specific facts evidencing a need for trial. See Fed.R.Civ.P. 56(e). The opposing party cannot stand on its pleadings, nor simply assert that it will be able to discredit the movant's evidence at trial. See T.W. Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987); Fed.R.Civ.P. 56(e). Moreover, there is no genuine issue of fact "where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986) (internal quotation marks and citations omitted).
A material fact is one that may affect the decision, so that the finding of that fact is relevant and necessary to the proceedings. See Anderson v. Liberty Lobby. Inc., 477 U.S. 242, 248 (1986). A genuine issue is shown to exist if sufficient evidence is presented such that a reasonable fact finder could decide the question in favor of the nonmoving party. See id. The evidence submitted by the nonmovant, in opposition to a motion for summary judgment, "is to be believed, and all justifiable inferences are to be drawn in [its] favor." Id. at 255.
In ruling on a motion for summary judgment, the court must bear in mind the actual quantum and quality of proof necessary to support liability under the applicable law. See id. at 254. The court must assess the adequacy of the nonmovant's response and must determine whether the showing the nonmovant asserts it will make at trial would be sufficient to carry its burden of proof. See Celotex, 477 U.S. at 322.
Although highly fact-based cases are not generally suitable for summary judgment, the nonmoving party must demonstrate that sufficient evidence of a factual dispute exists to require a jury or judge to resolve the parties' differing versions of the truth at trial. In ruling on such a motion, this court may not make credibility determinations or weigh conflicting evidence. See Musick v. Burke, 913 F.2d 1390, 1394 (9th Cir. 1990). Thus, the standard for determining a motion for summary judgment is the same standard used to determine a motion for directed verdict: does the evidence present a sufficient disagreement to require submission to a jury or is it so one-sided that one party must prevail as a matter of law? See id. (internal quotation marks and citations omitted).
DISCUSSION
As set forth above in the standard of review section, this court will treat Defendant's original Motion as one for summary judgment. The court has been presented with extensive evidence outside of the pleadings such that the nature of the Motion necessarily has become one for summary judgment.
In addition, the court notes that in the course of these pretrial proceedings, Plaintiff has raised new grounds for relief under the FDCPA that were not included in the two counts of his underlying Complaint. In his Counter Motion, for example, Plaintiff asserts the following claims: (1) improper communication with a represented party under Section 1692c; (2) filing of an action in an inconvenient forum in violation of Section 1692i; and (3) failure to disclose that Defendant is a "debt collector" under Section 1692e. Plaintiff has also asserted in his Counter Motion a claim against Defendant for violation of HRS § 480-2, which requires collection agencies to be licensed in Hawaii. Although Plaintiff need only provide notice pleading under the FRCP, these claims were not previously alleged in the two-count Complaint. It does not appear that Plaintiff has requested formally to amend his Complaint, which he must do before the court may consider these alleged violations. Therefore, the "claims" do not exist in this action at present and will not be addressed in this order.
I. Liability under the FDCPA
With respect to plaintiff's federal claims, Defendant maintains that plaintiff's allegations in Count I and II are insufficient. Specifically, Defendant argues that there is no evidence that it committed violations under any provisions of the FDCPA, which the Ninth Circuit has affirmed was enacted by Congress to "eliminate the recurring problem of debt collectors dunning the wrong person or attempting to collect debts which the consumer has already paid." Terran v. Kaplan. 109 F.3d 1428, 1431 (9th Cir. 1997) (internal quotation marks and citations omitted). The court will treat each potentially applicable provision of the FDCPA individually.
Under 15 U.S.C. § 1692g ("Section 1692g"), a debtor wishing to collect on a debt must provide the alleged debtor with the following information:
(1) the amount of the debt;
(2) the name of the creditor to whom the debt is owed;
(3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;
(4) a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and
(5) a statement that, upon the consumer's written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.
See 15 U.S.C. § 1692g(a).
Defendant maintains that upon review of the initial notice it sent to Plaintiff, dated December 24, 2002, it is clear that Defendant complied with the above requirements. As an initial matter, the court notes that this analysis involves a pure matter of law because it is "based on an analysis of the contractual language and an application of the principles of contract interpretation." Terran, 109 F.3d at 1432. According to the well-established precedent of the Ninth Circuit, in making its determination the court applies the objective test of the "hypothetical `least sophisticated debtor'." Id. at 1431; Wade v. Reg'l Credit Ass'n, 87 F.3d 1098, 1100 (9th Cir. 1996) (quoting Swanson v. Southern Or. Credit Serv., 869 F.2d 1222, 1225 (9th Cir. 1988)): see also Baker v. G.C. Serv. Corp., 677 F.2d 775, 779 (9th Cir. 1982). As the Ninth Circuit in Terran held, notice must be conveyed effectively to the debtor; it must be "large enough to be easily read and sufficiently prominent to be noticed." Id., at 1432. Moreover, the language conveying notice must not be "overshadowed or contradicted by other messages or notices appearing in the initial communication from the collection agency." Id.
The court agrees with Defendant's assertion that the December 24, 2002 debt collection notice included all the required information. In assessing whether plaintiff's assertions meet the test set forth inTerran, the court must consider the precise language of the notice. Upon review of the exhibit marked "A" attached to plaintiff's Complaint, it is clear that all the information enumerated in Section 1692g(a) is included, practically verbatim, in this seemingly standard form of notice.
Plaintiff, however, argues that Defendant's demands for payment were misleading and confusing because they listed an amount that included substantially more than Plaintiff thought he reasonably could have owed in cell phone charges. plaintiff's Counter Motion at 6. The notice also included late charges and charges for interest accrued, which Plaintiff claims he did not agree to in his contract and did not understand. Also, Plaintiff claims that Defendant's second letter, dated January 14, 2003, was confusing because it "demanded payment during the time period that they had previously given him to dispute the debt." plaintiff's Counter Motion, at 6.
With respect to plaintiff's allegation that the amount of the alleged debt was substantially greater than Plaintiff thought conceivable, the court finds this contention insufficient grounds for a Section 1692g challenge. Defendant states in its Separate and Concise Statement of Facts in Opposition to plaintiff's Counter Motion ("Defendant's Concise Facts"), filed October 3, 2003, that the amount demanded was the same amount due on plaintiff's Nextel account statement, plus accrued interest. Defendant's Concise Facts, ¶ 6. Although the court recognizes that Plaintiff in fact disputes the actual amount, there is no allegation that the format of the notice was confusing; the print on the notice was easy to read and sufficiently prominent. Moreover, the salient information was neither overshadowed nor contradicted by other language in the notice.
To the contrary, the notice clearly states that any dispute as to the validity of the amount should be conveyed to Defendant. The notice provides both a name and a telephone number. Even the least sophisticated debtor would understand the plain language to mean that the debt amount can be disputed as to its validity. If the amount seemed outlandish to Plaintiff, it is reasonable for this court to expect that Plaintiff would have called the number listed on the notice to request clarification of the debt calculations. Indeed, plaintiff's counsel alleges that he made such an attempt to register Plaintiff's dispute via a fax transmission sent on February 4, 2003. Accordingly, plaintiff's contention that the amount of the debt constitutes plausible grounds for finding that Defendant's notices understandably misled Plaintiff is unavailing.
To address plaintiff's additional assertion that Defendant's second notice was misleading, the court refers to a Ninth Circuit opinion that recently reviewed a case with a similar factual landscape to the one presently before the court. Renick v. Dun Bradstreet Receivable Management Services, 290 F.3d 1055, 1057 (9th Cir. 2002). In Renick, the plaintiff argued that the defendant's request on its second notice for "prompt" payment and payment "today," which came only twenty days after the first collection notice, misled him into abandoning his statutory right to contest the validity of the debt within 30 days from the first notice. The court found that the language asserting that "`PROMPT PAYMENT IS REQUESTED' was in the same font as the accompanying validation notice; was followed by a statement informing Renick that he had 30 days to challenge the debt's validity; and did not convey a threat that could induce Renick to `ignore his right to take 30 days to verify his debt and act immediately.'" Id. at 1057. The court found that the request for prompt payment did not contradict the "admonition that the debtor has thirty days to contest the validity of the debt." Id. It also was not found to be of a nature that would threaten or encourage even the least sophisticated debtor to waive his statutory right to challenge the validity of the debt. Id.
In light of the court's reasoning in Renick, and, the fact that in this case Defendant's notice made no demand for "prompt" or immediate payment, the court finds that plaintiff's assertions that the amount was too large, and, that the subsequent notices were misleading, insufficient bases to conclude that Plaintiff suffered a violation of Section 1692g. The notices did not convey a threat and did inform Plaintiff of his right to contest the validity of the debt within thirty days.
The above finding notwithstanding, the court must consider plaintiff's assertion that Defendant did not respond to his February 4, 2003 request for verification of the alleged debt. The court recognizes that Section 1692g provides that the debtor has thirty days from receipt of the initial communication to notify the debt collector in writing that s/he disputes the debt. 15 U.S.C. § 1692g(a)(3). Upon notification, the debt collector must cease pursuit of the debt until verification of the debt can be obtained and provided to the debtor. 15 U.S.C. § 1692g(b).
Defendant contends in its moving papers that Plaintiff made his request outside the statutory time frame such that Defendant's statutory duty to provide Plaintiff details verifying the debt was not triggered. Specifically, Defendant asserts that a letter sent from Las Vegas, Nevada, to Kaneohe, Hawal'i, should take no more than seven days in transit. Defendant's Motion, at 11-12. In this case, the letter was dated, and, allegedly sent on December 24, 2002. Although normal delivery would have it arriving on or around December 31, 2002, Plaintiff has asserted a legitimate reason for not receiving it until "the middle of January," namely, his change of residence and the concomitant delay in the mail forwarding process. Moreover, the fact that Plaintiff was a mere five days late in making the request does not constitute justifiable grounds for failing to respond to his request for verification. In Mahon v. Credit Bureau of Placer County, for example, the plaintiff's did not respond to the notice of collection for nine months. 171 F.3d 1197, 1202-03 (9th Cir. 1997). However, upon receipt of the request for verification, the credit agency responded immediately. Here, Plaintiff was at most five days late. Moreover, Plaintiff appears to have responded in a timely fashion under the circumstances.
In the same fashion that this court finds it appropriate to give Plaintiff the benefit of the doubt as to the precise date of receipt of Defendant's initial notice, it is compelled to consider Defendant's proffer of evidence that it did not receive plaintiff's February 4, 2003 fax transmission. Although Plaintiff presents his attorney's records indicating that the fax was sent successfully, Plaintiff fails to provide evidence that Defendant actually received the transmission. Defendant's evidence indicates that it did not receive plaintiff's transmission until plaintiff's attorney re-faxed it on March 5, 2003. The court must refrain from weighing the evidence presented by both parties. It finds that each side has presented sufficient evidence to demonstrate the existence of genuine material issues of fact as to the precise dates of receipt of the correspondence and transmissions at issue, as well as to the significance of these dates. In any event, it is clear that Defendant knew as of March 5, 2003 that Plaintiff disputed the debt.
The court notes that plaintiff's evidence consists of his attorney's testimony that he sent the fax on February 4, 2003, as well as his records confirming the transmission. As Defendant notes, fax transmissions do not have the same presumption of receipt as do mail deliveries. Plaintiff did not send a copy of the transmission via mail, which would allow him to use the presumption.
Defendant claims that upon receipt of the March 5, 2003 fax transmission, it ceased collecting on the debt amount. Accordingly, Defendant argues that it was no longer required to verify the debt. Plaintiff, however, argues that Defendant still was required to obtain verification of the debt. He argues that there is nothing in the statute which indicates that the debt collector is excused from its obligation to verify a debt where the agency has elected to cease collection. Plaintiff cites to Bailey v. TRW Receivables Management Services, Inc., in which this court found that the clear wording of the FDCPA requires debt collectors to provide verification if requested within 30 days pursuant to § 1692g(a)(4). See Civil No. 90-00192 DAE (slip op. Aug. 16, 1990) (finding that "when a consumer first paid the debt and then timely requested verification of the debt, the debt collector violated the FDCPA by failing to provide such verification and keeping the consumer's payment"). In Bailey, the court found a violation of the FDCPA for failure to provide verification of the debt after requested to do so, even though the debt had been paid. Section 1692g(b) was not found to excuse the debt collector from fulfilling its statutory obligation to verify, as established in Section 1692g(a)(4).
However, this court's holding in Sambor v. Omnia Credit Services, Inc. limited the prior ruling and found that Bailey is not so broad as to require that every failure to verify a debt constitutes a violation of the FDCPA. See 183 F. Supp.2d 1234, 1243 (D. Haw. 2002). The court inSambor reviewed the case law in different jurisdictions and concluded that the FDCPA does not require both cessation of collection efforts and verification of a debt. Specifically, the court held that pursuant to Section 1692g(b), when a debtor notifies a debt collector in writing that a debt is disputed, the plain language of the provisions requires the debt collector to "cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt . . ., and a copy of such verification . . . is mailed to the consumer by the debt collector." 15 U.S.C. § 1692g(b). Thus, the court interpreted Section 1692g(b) as relieving the collection agency of its duty to verify the alleged debt once it had ceased to collect on that debt. In Sambor. the agency had not only ceased to collect the debt, it had returned the files to the original creditor. Thus, the court was wary of holding an agency liable for verifying the debt when it was no longer in a position to do so. Plaintiff also cites to this court's more recent decision in DeCoito v.Unifund Corporation, Civil No. 01-00379 DAE-BMK (slip op. June 4, 2002). In DeCoito. Plaintiff had brought a specific claim under Section 1692g(a)(4). The court found that according to the specific wording of Section 1692g(a)(4), the debt collector was required to provide verification of the debt, and, that this duty did not terminate with the cessation of the collection action under Section 1692g(b). Significantly, this court referred to the holding in Bailey and found that Section 1692g(b) did not relieve the collection agency of its obligation to verify the debt. Rather, it determined that Section 1692g(b) merely provided that the collection agency must cease collection "until" it verifies the debt.
The court re-affirms this interpretation of the relationship between these two provisions and finds that Section 1692g(b) does not excuse a collection agency from its duty to verify the debt upon request. It merely acts to prevent collection agencies from continuing in their efforts to secure payment from the alleged debtor until the debtor has the necessary information regarding the original creditors. Despite the clash with the conclusion in Sambor, the court finds the factual differences significant. In Sambor. the collection agency no longer had the documents in its possession. In light of the fact that the collection agency could not actually verify the debt, the court was careful not to hold it liable under the FDCPA.
In both Sambor and DeCoito there was no dispute that the debt collection had ceased. In Sambor. the defendant in fact had returned the plaintiff's account to the original creditor. Here, however, Defendant simply states that it ceased to collect on the debt amount. It has presented no evidence that it actually returned the files and related documents to the original creditor. Moreover, Plaintiff argues persuasively that Defendant's April 25, 2003 lawsuit is evidence that Defendant did not in fact cease to act on the debt. Although Defendant maintains that the action was entirely unrelated to its previous efforts to collect, the court is not in a position to weigh the conflicting evidence as to the intent behind the lawsuit. Instead, it must find that the presentation of evidence by both parties indicates that genuine issues of material fact exist.
Accordingly, the court finds that as a matter of law, Defendant was required to provide Plaintiff with verification of its debt pursuant to Section 1692g(a)(4). Defendant was also required to cease collection of the debt until it had provided such verification to Plaintiff. However, this latter duty did not relieve Defendant of its obligation to provide verification. B. 15 U.S.C. § 1692e
Section 1692e provides that: "a debt collector who uses any false, deceptive, or misleading representation or means in connection with the collection of any debt" violates the FDCPA. This section also includes a non-exhaustive list of possible violations. In accordance with this court's finding, supra, that Defendant's notices per se did not violate Section 1692g, the court also finds plaintiff's allegation that Defendant violated Section 1692e by virtue of the form of its notices unsupported by the evidence. Renick, 290 F.3d at 1057-58.
However, under Section 1692e(2)(a), the court finds that Plaintiff has met his burden by demonstrating the existence of genuine issues of material fact as to the actual amount of debt owed by Plaintiff. In his October 9, 2003 Declaration, Plaintiff states that he believed the amount of debt he owed Defendant to be approximately $537.00. October 9, 2003 Plaintiff Decl., ¶ 3. Moreover, he claims that Nextel continued to register monthly charges on his account despite the fact that it had cancelled his service. Although Defendant presents the account summaries indicating that charges were accrued, it does not resolve the issue of whether those charges were accrued properly. C. 15 U.S.C. § 1692f
Plaintiff's claim that Defendant engaged in unfair or unconscionable means to collect or attempt to collect any debt appear to fall under Section 1692f. As with the court's finding in the previous section, summary judgment is inappropriate because of the conflicting evidence regarding Defendant's actions. Aside from Defendant's failure to provide Plaintiff with verification of the alleged debt, there is scant evidence under Section 1692f, especially with respect to the notices, that Defendant employed any unconscionable or unfair tactics to the detriment of Plaintiff. However, Plaintiff has presented evidence related to Defendant's April 25, 2003 suit to suggest that Defendant may indeed have engaged in violations of Section 1692f. Accordingly, the court DENIES summary judgment under this provision. II. HRS §§ 443B 480
Plaintiff also alleges that as result of its FDCPA violations, Defendant has violated HRS §§ 480 and 443B. The plain language of HRS § 480 creates liability where a defendant engages in "unfair or deceptive acts or practices in the conduct of any trade or commerce." Similarly, HRS § 443B-18 provides: "No collection agency shall use any fraudulent, deceptive, or misleading representation or means to collect, or attempt to collect, claims or to obtain information concerning a debtor or alleged debtor."
Here, Plaintiff alleges generally that Defendant's collection notice violated both statutory provisions. Although the court found, supra, that plaintiff's claim under Section 1692g regarding Defendant's failure to provide Plaintiff with verification of his debt survived Defendant's motion for summary judgment, some of the state claims hinge on those aspects of Plaintiff's federal claims that this court found unsupported in the previous section. See also Renick, 290 F.3d at 1058. The failure to provide verification, for example, does not necessarily constitute a fraudulent, deceptive or misleading representation, although it may constitute an unfair act, forming a possible basis for liability.
Specifically, HRS § 480-2 deals with unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce. As this court previously found in DeCoito. Defendant's violation of Section 1692g(a)(4) is a technical violation, and does not indicate that Defendant engaged in a deceptive act. Accordingly, such a violation of the FDCPA does not in and of itself constitute a violation of HRS § 480-2. As discussed above, Plaintiff thus has failed to present sufficient evidence that Defendant used false, deceptive or misleading representations in connection with the collection of the debt. This finding notwithstanding, the court is not in a position to determine whether Defendant's April 25, 2003 suit constitutes, as a matter of law, an unfair or deceptive practice under Hawai'i law. Indeed, the court would have to weigh the evidence of intent presented by both parties to determine whether Defendant's primary purpose was to "chill this litigation" or to address concerns it had regarding plaintiff's threats to file an allegedly frivolous FDCPA. The court is barred by the standard for adjudicating summary judgment issues from engaging in such an analysis.
Similarly, plaintiff's allegation that Defendant violated state law by misrepresenting the amount of the debt cannot be adjudicated in this proceeding because Defendant has introduced evidence suggesting that genuine issues of material fact exist as to the actual amount of the debt. As a result, there is no way for the court to determine whether the debt was incorrectly assessed without weighing the conflicting evidence presented by both parties as to the underlying amount. Thus, summary judgment as to this contention is DENIED.
CONCLUSION
For the reasons stated above, the court DENIES IN PART and GRANTS IN PART Defendant's Motion to Dismiss. The court also GRANTS IN PART and DENIES IN PART plaintiff's Counter Motion for Partial Summary Judgment all as provided herein.IT IS SO ORDERED.
Jason Powell vs. J.M. Mac Intyre Co., Inc., Civil No. 03-00402 DAE-BMK; ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS; ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF'S COUNTER MOTION FOR PARTIAL SUMMARY JUDGMENT