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Ozmun v. Portfolio Recovery Associates, LLC

United States District Court, W.D. Texas, Austin Division

July 24, 2017

JOSEPH OZMUN, Plaintiff,
v.
PORTFOLIO RECOVERY ASSOCIATES, LLC; RAUSCH, STRUM, ISRAEL, ENERSON & HORNIK LLC; WESTERN SURETY COMPANY; and TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA, Defendants.

          ORDER

          SAM SPARKS UNITED STATES DISTRICT JUDGE.

         BE IT REMEMBERED on the 6th day of June 2017, the Court held a hearing in the above-styled cause and the parties appeared through counsel. Before the Court are Defendants Travelers Casualty and Surety Company of America (Travelers) and Rausch, Sturm, Israel, Emerson, & Hornik LLC (RSIEH)'s Motion for Summary Judgment [#36], Plaintiff Joseph Ozmun (Plaintiff)'s Response [#47] in opposition, and Travelers and RSIEH's Reply [#51] in support; Portfolio Recovery Associates, LLC (PRA) and Western Surety Company (Western)'s Motion for Summary Judgment [#62], Plaintiff s Response and Cross-Motion for Summary Judgment [#64], and PRA and Western's Reply [#70]; and PRA and Western's Second Motion to Strike Response [#69], Plaintiff s Response [#71] in opposition, and PRA and Western's Reply [#73] in support.[1] Having reviewed the documents, the arguments of counsel made at the hearing, the relevant law, and the file as a whole, the Court now enters the following opinion and orders.

         Background

         I. Factual History

         This lawsuit concerns PRA's efforts to collect Plaintiffs outstanding credit card debt of $2, 065.21 (the Debt) after Plaintiff defaulted.

         On March 20, 2015, PRA, represented by RSIEH, filed a petition against Plaintiff in Texas state court to recover the Debt (Underlying Lawsuit). Compl. [#1-1] Ex. C (Pet.) at 1. The petition listed the Debt balance as $2, 065.21 and requested "[a]ctual damages in the amount of $2, 065.21." Id. at 1, 3. Plaintiff was served with the petition in the Underlying Lawsuit. Sometime after being served in the Underlying Lawsuit, Plaintiff paid $57.00 of his debt. PRA Mot. Summ. J. [#62] at 2; PL's Second Resp. [#64] at 3.

         Subsequently, because Plaintiff failed to timely answer the Underlying Lawsuit and a maj ority of the Debt was still outstanding, RSIEH filed a motion for default judgment on PRA's behalf on November 5, 2015. The version of the motion for default judgment docketed with the state court includes the motion for default judgment pleading as well as supporting documents. See PL's Second Resp. [#64-6] Ex. E (Docketed Mot.). One such document is the affidavit of Meryl Dreano, the custodian of records for PRA, indicating the Debt totaled $2, 065.21 as of the date of the affidavit. Id. (Dreano Aff.) at 10. The affidavit was signed January 14, 2015. Id. No proposed default judgment was included with motion for default judgment docketed in the state court. See Id. Nevertheless, the motion for default judgment pleading expressly asked the state court to "grant [PRA]'s Motion for Default Judgment and award [PRA] the relief requested in [PRA]'s petition by signing and entering the attached proposed Default Judgment." Id. at 4. No specific amount was requested nor was the balance of the Debt listed in PRA's pleading. See Id. at 2-A. It is disputed whether PRA's motion for default judgment was served on Plaintiff, but a default judgment was never entered in the Underlying Lawsuit.

         Following PRA's motion for default judgment, PRA received a letter listing Plaintiff as the sender and dated May 31, 2016, stating the following:

I am writing to you regarding the account referenced above. I refuse to pay this debt.
My monthly expenses exceed my monthly income; as such there is no reason for you to continue contacting me, and the amount you are reporting is not accurate either. If my circumstances should change I will be in touch.

         Am. Compl. [#53-1] Ex. F (Debt Letter). On July 8, 2016, PRA informed a consumer reporting agency of the Debt. PRA reported a balance of $2, 008.21 on the Debt and did not indicate the Debt was disputed.

         Some months later, PRA moved for summary judgment in the Underlying Lawsuit. On March 29, 2017, the state court granted PRA's motion for summary judgment, issuing a judgment in "the amount of $2008.21, which includes credit for payments already made totaling $57.00 as actual damages" PRA Mot. Summ. J. [#62-1] App. (State Court Order) at l.[2]

         II. Procedural History

         On August 3, 2016, Plaintiff filed a complaint in this Court alleging violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692-1692p, and the Texas Debt Collection Act (TDCA), Tex. Fin. Code § 392.001-404, against PRA, Western, RSIEH, and Travelers. Compl. [#1]. In particular, Plaintiff claims PRA and RSIEH (1) violated the FDCPA and TDCA by misrepresenting the Debt balance and attempting to collect an extra $57.00 from Plaintiff in the Underlying Lawsuit and (2) PRA violated the FDCPA and TDCA by failing to report the Debt was disputed. Am. Compl. [#53] ¶¶ 64-71. Western is the surety company for the bond PRA has on file with the Texas Secretary of State; Travelers is the surety company for RSIEH's bond. Id. ¶¶ 9, 13.

         On February 21, 2017, Travelers and RSIEH filed a joint motion for summary judgment. RSIEH Mot. Summ. J. [#36]. Following two extensions, Plaintiff responded. PL's First Resp. [#47]. Plaintiff also filed an amended complaint with the Court's permission. See Am. Compl. [#53]. Travelers and RSIEH submitted a reply in support of their motion for summary judgment, and shortly thereafter the Court entered an order postponing ruling on the pending motion for summary judgment to enable the parties to confer. Order of Apr. 12, 2017 [#56]. Giving the parties thirty days from the entry of the order to parley, the Court noted it "expect[ed] a dismissal in this lawsuit . . . ." Id. Nevertheless, the parties were unable reach an agreement.

         Following the expiration of the thirty-day period, PRA and Western filed a motion for summary judgment on May 25, 2017. PRA Mot. Summ. J. [#62]. On June 6, 2017, the Court held a hearing to gain perspective on the status of the issues. Subsequently, on June 8, 2017, Plaintiff filed his response to the second motion for summary judgment in combination with a cross-motion for summary judgment. PL's Second Resp. [#64]. PRA and Western filed a motion to strike Plaintiffs response, and in the alternative, motion for a more definite statement, as well as a reply in support of their motion for summary judgment. Second Mot. Strike [#69]; PRA Reply [#70]. The pending motions are now ripe for the Court's consideration.

         Analysis

         I. Legal Standard-Summary Judgment

         Summary judgment shall be rendered when the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986); Washburn v. Harvey, 504 F.3d 505, 508 (5th Cir. 2007). A dispute regarding a material fact is "genuine" if the evidence is such that a reasonable jury could return a verdict in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). When ruling on a motion for summary judgment, the court is required to view all inferences drawn from the factual record in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986); Washburn, 504 F.3d at 508. Further, a court "may not make credibility determinations or weigh the evidence" in ruling on a motion for summary judgment. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000); Anderson, 477 U.S. at 254-55.

         Once the moving party makes an initial showing that there is no evidence to support the nonmoving party's case, the party opposing the motion must come forward with competent summary judgment evidence of the existence of a genuine fact issue. Matsushita, 475 U.S. at 586. Mere conclusory allegations are not competent summary judgment evidence, and thus are insufficient to defeat a motion for summary judgment. Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007). Unsubstantiated assertions, improbable inferences, and unsupported speculation are not competent summary judgment evidence. Id. The party opposing summary judgment is required to identify specific evidence in the record and to articulate the precise manner in which that evidence supports his claim. Adams v. Travelers Indem. Co. of Conn., 465 F.3d 156, 164 (5th Cir. 2006). Rule 56 does not impose a duty on the court to "sift through the record in search of evidence" to support the nonmovant's opposition to the motion for summary judgment. Id.

         "Only disputes over facts that might affect the outcome of the suit under the governing laws will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248. Disputed fact issues that are "irrelevant and unnecessary" will not be considered by a court in ruling on a summary judgment motion. Id. If the nonmoving party fails to make a showing sufficient to establish the existence of an element essential to its case and on which it will bear the burden of proof at trial, summary judgment must be granted. Celotex, 477 U.S. at 322-23.

         II. Application

         As an initial matter, the Court first considers PRA and Western's second motion to strike and, in the alternative, motion for a more definite statement. See Second Mot. Strike [#69]. PRA and Western argue the Court should strike Plaintiffs combined response and cross-motion for summary judgment because the motion exceeded the page limit and Plaintiff failed to file his dispositive motion by May 25, 2017-the deadline listed in the scheduling order. Id. Alternatively, PRA and Western ask the Court to strike the portion of Plaintiff s response requesting summary judgment or require Plaintiff to provide a more definite statement by filing separate motions. Id.

         Plaintiffs response does not appear to exceed the page limit when taking into account items such as the caption and signature block. See Local Rule CV-7(e)(3) ("These page limits are exclusive of the caption, signature block, any certificate, and accompanying documents."). Additionally, while Plaintiffs cross-motion for summary judgment was filed late-for which no good cause has been shown-the Court nevertheless considers Plaintiffs summary judgment motion for its own convenience. Granting Defendants' request to strike Plaintiffs motion for summary judgment at this point would only delay the Court's summary judgment decision and prolong this lawsuit. Therefore, the Court DENIES PRA and Western's second motion to strike and, in the alternative, motion for a more definite statement.

         The Court now turns to the merits of the cross-motions for summary judgment. As stated above, Plaintiff alleges violations of the FDCPA and the TDCA. Travelers and RSIEH ask the Court to grant summary judgment in their favor, arguing there was no misrepresentation as to the amount of the Debt in the motion for default judgment and Plaintiff presented no basis for the joinder of Travelers. Travelers and RSIEH also request their fees and costs based on Plaintiffs alleged bad faith in bringing this suit. Additionally, PRA and Western request summary judgment, arguing PRA sought the correct Debt amount in the motion for default judgment, Plaintiff does not have standing, Plaintiff did not actually dispute his debt, ...


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