United States District Court, S.D. Texas, Houston Division
MEMORANDUM OPINION & ORDER
H. Miller United States District Judge
before the court is plaintiff Patty Knoerr's motion for
default judgment. Dkt. 9. After considering the complaint,
motion, evidentiary record, and applicable law, the court is
of the opinion that the motion against defendant Pinnacle
Asset Group, L.L.C. (“Pinnacle”) should be
GRANTED IN PART and DENIED IN PART.
action arises from Pinnacle's alleged violations of the
Fair Debt Collection Practices Act (“FDCPA”).
Dkt. 1 at 1 (citing 15 U.S.C. § 1692). Patty Knoerr
resides in Hempstead, Texas, and is a “consumer”
as defined by § 1692a(3). Dkt. 1 at 1. Pinnacle Asset
Group is a New York business operating as a collection agency
and is a “debt collector” as defined by §
allegedly incurred a debt to Pro Carpet. Dkt. 1 at 2. The Pro
Carpet debt was later purchased, assigned, or transferred to
Pinnacle for collection. Id. In October 2015,
Pinnacle began calling Knoerr to collect the debt.
Id. According to Knoerr, Pinnacle first threatened
to turn the debt over to the IRS if she did not pay the debt
immediately. Id. Knoerr argues this was a misleading
statement because she has not received any communications
from the IRS regarding the debt. Id. at 3. Pinnacle
later called Knoerr's mother-in-law and told her that
there was an emergency and that Knoerr needed to return the
call. Id. at 2. Knoerr claims that was false and
that the call was an unlawful intimidation tactic.
Id. at 2-3. To date, the debt has not been paid.
March 7, 2016, Knoerr brought this lawsuit, alleging that
Pinnacle violated the FDCPA by unlawfully contacting Knoerr
and using false and deceptive means to collect the debt. Dkt.
1. On April 6, 2016, Pinnacle was properly served with
process. Dkt. 5. Pinnacle's deadline to answer or
otherwise respond was April 27, 2016. See Fed. R.
Civ. P. 12(a). Pinnacle was informed of its deadline for
responding and Pinnacle has not answered or otherwise
responded to this lawsuit. Dkt. 9, Ex. 2 (DeFrancisco Aff.).
August 18, 2016, Knoerr moved for entry of default judgment
against Pinnacle. Dkt. 9, Ex. 1. Pursuant to the Local Rules
of the Southern District of Texas, Knoerr served this motion
for default judgment upon Pinnacle via certified mail, with
return receipt requested. Dkt. 9 at 3; see also S.D.
Tex. L.R. 5.5. Pinnacle failed to respond to the motion for
Federal Rule of Civil Procedure 55(a), “[w]hen a party
against whom judgment for affirmative relief is sought has
failed to plead or otherwise defend, and that failure is
shown by affidavit or otherwise, the clerk must enter the
party's default.” Fed.R.Civ.P. 55(a). Under Rule
55(b)(2), a party may apply for the court to enter a default
judgment, and the “court may conduct hearings or make
referrals-preserving any federal statutory right to a jury
trial-when, to enter or effectuate judgment, it needs to: (A)
conduct an accounting; (B) determine the amount of damages;
(C) establish the truth of any allegation by evidence; or (D)
investigate any other matter.” Fed.R.Civ.P. 55(b)(2).
Local Rule 5.5 requires that motions for default judgment
“be served on the defendant-respondent by certified
mail (return receipt requested).” S.D. Tex. L.R. 5.5.
default judgment is a “drastic remedy, not favored by
the Federal Rules[, ] and resorted to by courts only in
extreme situations.” Sun Bank of Ocala v. Pelican
Homestead & Sav. Ass'n, 874 F.2d 274, 276 (5th
Cir. 1989). “The Federal Rules of Civil Procedure are
designed for the just, speedy, and inexpensive disposition of
cases on their merits, not for the termination of litigation
by procedural maneuver.” Id.
Liability Under the FDCPA
FDCPA was enacted to “eliminate abusive debt collection
practices by debt collectors, to insure that those debt
collectors who refrain from using abusive debt collection
practices are not competitively disadvantaged, and to promote
consistent State action to protect consumers against debt
collection abuses.” 15 U.S.C. § 1692. Among other
things, the FDCPA prohibits debt collectors from “using
any false, deceptive, or misleading representation or means
in connection with the collection of any debt.” §
the FDCPA, “debt collector” includes “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.” §
1692a(6). A “debt” is defined under the FDCPA as
“any obligation or alleged obligation of a consumer 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, whether or not such obligation has been reduced to
judgment.” § 1692a(5).
“‘[C]onsumer' means any natural person
obligated or allegedly obligated to pay any debt.”
§ 1692a(3). Section 1692 is applicable here because the