Barrios v. Enhanced Recovery Co.
| Decision Date | 13 November 2018 |
| Docket Number | 15-CV-5291 |
| Parties | JENNIFER BARRIOS, on behalf of herself and all others similarly situated, Plaintiff, v. ENHANCED RECOVERY COMPANY, LLC and JOHN DOES 1-25, Defendants. |
| Court | U.S. District Court — Eastern District of New York |
Presently before the Court is Defendant Enhanced Recovery Company, LLC's ("ERC") motion for summary judgment pursuant to Fed. R. Civ. P. 56 as to Plaintiff's claims under the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692, et seq. For the reasons stated herein, ERC's motion is granted.
The facts, undisputed unless otherwise indicated, are as follows. On or about December 10, 2013, someone opened a wireless service account with Cellco Partnership d/b/a Verizon Wireless ("Verizon") under the name of "Jennefer Berios." (ECF No. 51 (Def. 56.1 SOF) ¶3). The account was governed by a Verizon Wireless Customer Agreement (the "Agreement"), dated November 21, 2013, which provided, in relevant part:
If you fail to pay on time and Verizon Wireless refers your account(s) to a third party for collection, a collection fee will be assessed and will be due at the time of the referral to the third party. The fee will be calculated at the maximum percentage permitted by applicable law, not to exceed 18 percent.
(Def. 56.1 SOF ¶¶ 5, 7) (the "Collection Fee Provision").
The account became inactive on March 7, 2014. (Def. 56.1 SOF ¶ 8). On May 21, 2015, Verizon referred the account to ERC for collection. (Def. 56.1 SOF ¶ 9). The amount referred for collection consisted of $99.06 in principal debt and a collection fee of $17.83 (18% of the principal amount), amounting to a total of $116.89. (Def. 56.1 SOF ¶ 14). According to ERC, this collection fee was not a fee owed directly to them, but rather constituted part of the debt that the debtor owed Verizon pursuant to the Collection Fee Provision. (ECF No. 52 ("Davis Decl") ¶ 16). ERC states that such collection fees are not retained by ERC, but instead remitted directly to Verizon. (Davis Decl. ¶ 16).
On May 22, 2015, ERC spoke to Plaintiff over the phone. (Def. 56.1 SOF ¶ 18). During the call, Plaintiff gave her mailing address and the last four digits of her social security number, which matched the information that ERC had on file for the account. (Def. 56.1 SOF ¶¶ 13, 19). That same day, ERC sent an initial collection letter addressed to "Jennefer Berios" at that mailing address. (Def. 56.1 SOF ¶ 16). In the header, the letter itemized the debt owed, indicating that a "Principal" of $99.06 and "Collection Fees" of $17.83 were due, for an "Amount of Debt" of $116.89. (ECF No. 52-2). The letter also indicated that the "Creditor" was "Verizon Wireless." (ECF No. 52-2). The body of the letter read, in relevant part, as follows:
(ECF No. 52-2). Thereafter, ERC made subsequent efforts to reach Plaintiff by phone, but these were not successful. (Davis Decl. ¶ 14). Prior to the commencement of these proceedings, Plaintiff did not dispute the validity of the debt with ERC, either verbally or in writing. (Def. 56.1 SOF ¶¶ 24, 25).
In September 2015, Plaintiff brought this action on behalf of herself and all others similarly situated, alleging that ERC violated various provisions of the FDCPA. (ECF No. 1 ("Compl.")). The factual basis for Plaintiff's claim is that she "did not owe Verizon Wireless 'Collection Fees' of $17.83," that ERC "demand[ed] an amount for collection fees in its collection letters to Plaintiff and others similarly situated when said charges were not yet, if at all, due," and that ERC "represent[ed] to Plaintiff and others similarly situated that an amount was due for collection fees in its collection letters when said collection charges weren't yet, if at all, due." (Compl. ¶¶ 23, 49-50).
On November 11, 2016, ERC informed the Court that, during discovery, Plaintiff had given sworn deposition testimony suggesting—apparently for the first time—that the Verizon account was fraudulently opened by an unknown third party. (ECF No. 33, at 2). Plaintiff never amended her pleadings to reflect this allegation. Nevertheless, Magistrate Pollak granted ERC leave to amend its answer to assert an affirmative defense of bona fide error. (ECF No. 45). See 15 U.S.C. § 1692k(c).
ERC moves for summary judgment on all claims.
Summary judgment should be granted where the "materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations(including those made for purposes of the motion only), admissions, interrogatory answers, or other materials" "show[] that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a), (c). "Where, as here, the party opposing summary judgment bears the burden of proof at trial, summary judgment should be granted if the moving party can 'point to an absence of evidence to support an essential element of the nonmoving party's claim.' " Gemmink v. Jay Peak Inc., 807 F.3d 46, 48 (2d Cir. 2015) (quoting Goenaga v. March of Dimes Birth Defects Foundation, 51 F.3d 14, 18 (2d Cir. 1995)), cert. denied, 136 S.Ct. 1684 (2016). If the movant satisfies this initial burden, summary judgment must be entered unless the non-movant "go[es] beyond the pleadings and ... designate[s] specific facts showing that there is a genuine issue for trial." Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986) (quotations omitted); see In re World Trade Center Lower Manhattan Disaster Site Litigation, 758 F.3d 202, 212 (2d Cir. 2014). A properly supported motion for summary judgment may not be defeated by assertions that are too threadbare, unsubstantiated, speculative or conclusory for a reasonable trier of fact to return a verdict in the plaintiff's favor. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986) (); Matsuhita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 547, 586 (1986) (); see also Major League Baseball Properties, Inc. v. Salvino, Inc., 542 F.3d 290, 310 (2d Cir. 2008) (collecting cases).
The only specific subsections of the FDCPA that are claimed to apply in this case are: 15 U.S.C. § 1692f(1) (); 15 U.S.C. § 1692f (); 15 U.S.C. § 1692e(2)(A) (); U.S.C. § 1692e(10) (); and 15 U.S.C. § 1692e (). (Compl. ¶¶ 49-50). The Court will address each subsection in turn.
Under the FDCPA, "[a] debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt." 15 U.S.C. § 1692f. Such "unfair and unconscionable means" are defined to include, inter alia, "[t]he collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law." Id. § 1692f(1). In Tuttle v. Equifax Check, 190 F.3d 9 (2d Cir. 1999), the Second Circuit devised a three-part test to determine whether a charge runs afoul of subsection 1692f(1):
Id. at 13 (emphasis in the original). Plaintiff concedes that the collection fee assessed in this case is not expressly prohibited under New York law, and that the third Tuttle prong therefore applies.
Plaintiff has failed to show that there exists a triable issue of fact as to whether ERC violated 15 U.S.C. § 1692f(1). It is undisputed that Collection Fee Provision reproduced above governs the Verizon account and unambiguously imposes a fee, "calculated at the maximum percentage permitted by applicable law, not to exceed 18 percent," in the event that the debtor "fail[s] to pay on time and Verizon Wireless refers [the debtor's] account(s) to a third party for collection." The contract specifies that the fee is "due at the time of the referral," which in this case occurred on May 21, 2015. Accordingly, the fee was valid and due when the collection letter was sent on May 22, 2015. ERC did not collect or attempt to collect "any amount" that was not "expressly authorized by the agreement." 15 U.S.C. § 1692f(1).
Plaintiff notes that the contract only provides for the imposition of collection fees "permitted by applicable law" and...
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