Baker v. Citibank (South Dakota) N.A., Civil No. 97-1107-R (RBB).

• Decision Date: 14 July 1998
• Docket Number: Civil No. 97-1107-R (RBB).
• Parties: Cynthia BAKER, Plaintiff, v. CITIBANK (SOUTH DAKOTA) N.A. et al., Defendants.
• Court: U.S. District Court — Southern District of California

13 F.Supp.2d 1037

Cynthia BAKER, Plaintiff, v. CITIBANK (SOUTH DAKOTA) N.A. et al., Defendants.

Civil No. 97-1107-R (RBB).

United States District Court, S.D. California.

July 14, 1998.

COPYRIGHT MATERIAL OMITTED

M. David Meagher, Law Offices of Davis & Meagher, Solana Beach, CA, for Plaintiff.

Lawrence E. Duffy, Jr., Walsworth, Franklin, Bevins & McCall, Orange, CA, for Defendant Citibank.

Stephen H. Turner, Carlson, Messer & Turner L.L.P., Los Angeles, CA, for Defendant California Financial.

ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF'S MOTION FOR PARTIAL SUMMARY JUDGMENT; DENYING DEFENDANT'S MOTION FOR PARTIAL JUDGMENT ON THE PLEADINGS; AND DENYING DEFENDANT'S MOTION FOR PARTIAL SUMMARY JUDGMENT

RHOADES, District Judge.

I. Overview

Plaintiff Cynthia Baker has filed a Motion for Partial Summary Judgment against Defendant California Financial Credit Association ("California Financial"). Defendant Citibank (South Dakota) N.A. ("Citibank") has filed a Motion for Partial Judgment on the Pleadings and a Motion for Partial Summary Judgment. For the reasons stated below, the Court grants Plaintiff's motion in part and denies it in part. The Court denies Citibank's motions.

II. Background¹

Plaintiff Cynthia Baker had a good credit history until an imposter began using her name and social security number to obtain credit. Plaintiff eventually learned of the imposter's activities and promptly notified credit reporting agencies.

Subsequently, the imposter applied for and received a credit card from Citibank in Plaintiff's name. The imposter charged thousands of dollars to the account, but did not pay the bills. Citibank then used the services of a collection agency to seek payment from Plaintiff. Plaintiff informed the collection agency that she had not incurred the charges; the imposter had. Accordingly, the collection agency returned the account to Citibank.

Citibank then used the services of California Financial, another collection agency, to seek payment from Plaintiff. California Financial tried to telephone Plaintiff on several occasions. However, California Financial repeatedly called the wrong telephone number.

In early June 1996, California Financial sent Plaintiff an undated letter that sought payment. The letter stated: "We have tried repeatedly to talk to you, but to no avail.... It is not a good idea to just ignore us." (Pl.'s Mot. for Summ.J.Ex. 1.)

On June 12, 1996, California Financial sent Plaintiff another letter. This letter stated:

Since this account has already been to another agency, it is apparent that corresponding with you is useless. IMMEDIATELY REVIEW FOR LEGAL EFFORT NEXT. To avoid the trouble of litigation and to save legal and/or attorneys fees, PLEASE SEND THE BALANCE NOW OR CALL FOR ADDITIONAL TIME.

(Id. Ex. 2 at 2.) Plaintiff later explained to California Financial that she had not incurred the charges. Nevertheless, California Financial continued to seek payment from her.

Plaintiff then sued Citibank and California Financial.² Plaintiff alleges in her first cause of action that California Financial violated the federal Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. Plaintiff claims in her fourth cause of action that Citibank violated the Robbins-Rosenthal Fair Debt Collection Practices Act ("RFDCPA"), California Civil Code §§ 1788 - 1788.32. Plaintiff alleges in her second cause of action that Citibank violated the Song-Beverly Credit Card Act of 1971 ("SCCA"), California Civil Code §§ 1747 — 1748.7.

III. Discussion

Plaintiff has filed a Motion for Partial Summary Judgment on her first cause of action. Citibank has filed a Motion for Partial Judgment on the Pleadings on the fourth cause of action. Citibank has also filed a Motion for Partial Summary Judgment on the fourth and second causes of action.

The Court will discuss each motion in turn.

A. Plaintiff's Motion For Partial Summary Judgment

1. Legal Standards Governing Summary Judgment

Under Federal Rule of Civil Procedure 56(c), the Court must grant summary judgment if the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). In considering a motion for summary judgment, the Court examines all the evidence in the light most favorable to the nonmoving party. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962).

In moving for summary judgment on an issue on which the movant bears the burden of proof at trial, the movant must make a strong showing.

Rule 56(c) requires the moving party to show not only the absence of a disputed fact but also that [the moving party] is entitled to judgment as a matter of law.... Where the moving party has the burden ... [the] showing must be sufficient for the court to hold that no reasonable trier of fact could find other than for the moving party.

Calderone v. United States, 799 F.2d 254, 259 (6th Cir.1986) (emphasis removed); see also Holeman v. Neils, 803 F.Supp. 237, 241 (D.Ariz.1992).

The movant bears a much lighter burden, however, when moving for summary judgment on an issue on which the non movant bears the burden of proof at trial (e.g., where the defendant moves for summary judgment on the plaintiff's claims). In this situation, "the burden on the moving party may be discharged by ... pointing out to the district court ... that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); see also United Steelworkers v. Phelps Dodge Corp., 865 F.2d 1539, 1542 (9th Cir.1989) (en banc).

Once the moving party satisfies its initial burden, then the burden shifts to the nonmovant. The nonmovant must "set forth specific facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The nonmovant may not "rest on mere allegations or denials of [the] pleadings." Id. at 259, 106 S.Ct. 2505. Rather, the nonmovant must go beyond the pleadings to designate specific facts showing that a genuine issue remains for trial. See Celotex, 477 U.S. at 325, 106 S.Ct. 2548. If the nonmovant fails to meet its burden after the moving party first meets its burden, the movant deserves judgment as a matter of law. See id.

2. The Merits

The FDCPA seeks to "eliminate the recurring problem of debt collectors dunning the wrong person or attempting to collect debts which the consumer has already paid." Swanson v. Southern Oregon Credit Service, Inc., 869 F.2d 1222, 1225 (9th Cir.1988) (internal quotation marks and citation omitted). Accordingly, the Act requires debt collectors to give debtors "debt validation notices." The debt validation notices tell debtors that they have the right to dispute their debts within thirty days of their initial contact with the debt collectors. See 15 U.S.C. § 1692g(a). Debt collectors also must tell debtors that if they dispute the debts, the debt collectors will obtain verifications of the debts before pursuing them further. See id.

In addition, the FDCPA prohibits debt collectors from making false or misleading statements. See 15 U.S.C. § 1692e. Among other things, the Act prohibits debt collectors from threatening legal action if they cannot legally take such action. See 15 U.S .C. § 1692e(5). Further, the FDCPA prohibits debt collectors from contacting debtors in certain circumstances. See 15 U.S.C. 1692c(c).

Plaintiff alleges that California Financial violated the FDCPA in three ways. First, she claims that California Financial did not adequately inform her of her right to dispute the debt within thirty days. Second, she claims that California Financial made various misleading statements. Third, she alleges that California Financial improperly contacted her.

a. Whether California Financial Adequately Informed Plaintiff Of Her Right To Dispute The Debt

Plaintiff argues that California Financial did not adequately inform her of her right to dispute the debt within thirty days. The second letter that California Financial sent states: "To avoid the trouble of litigation and to save legal and/or attorneys fees, PLEASE SEND THE BALANCE NOW OR CALL FOR ADDITIONAL TIME." (Mot.Ex. 2 at 1.)

Directly underneath this language appears the message: "SEE OTHER SIDE FOR IMPORTANT MESSAGE." (Id.) This sentence appears in a slightly smaller typeface than the rest of the letter, but it appears in red ink and all capital letters.

The back of the letter contains a heading in a very large typeface that reads: "IMPORTANT MESSAGE." (Id. at 2.) Underneath this heading, in a typeface that seems to be the same size as the typeface on the front of the letter, appears the required debt validation notice that explicitly advises Plaintiff of her right to dispute the debt within thirty days. (See id.) This message also appears in all capital letters.

Plaintiff recognizes that the back of the letter explicitly advises her of her right to dispute the debt. Nevertheless, Plaintiff argues that the message on the front of the letter overshadows and contradicts the validation notice on the back of the letter. Thus, Plaintiff argues, California Financial did not adequately inform her of her right.

Whether language violates the FDCPA is a question of law for the Court to decide. See Terran v. Kaplan, 109 F.3d 1428, 1432-33 (9th Cir.1997). "[T]he impact of language alleged to violate [the FDCPA] is judged under the `least sophisticated debtor' standard." Swanson, 869 F.2d at 1225 (quoting Baker v. G.C. Servs. Corp., 677 F.2d 775, 778 (9th Cir.1982)). This standard is objective, but "lower than simply examining whether particular language would deceive or mislead a reasonable debtor." Terran, 109 F.3d at 1432 (internal quotation marks and...