Benzemann v. Houslanger & Associates, PLLC, 051319 FED2, 18-1162-cv

Docket Nº:18-1162-cv
Opinion Judge:José A. Cabranes, Circuit Judge.
Party Name:Alexander A. Benzemann, Plaintiff-Appellant, v. Houslanger & Associates, PLLC, Todd E. Houslanger, New Century Financial Services, Defendants-Appellees, Citibank N.A., Defendant.
Attorney:Andrew J. Tiajoloff, Tiajoloff & Kelly LLP, New York, NY, for Plaintiff-Appellant. Robert J. Bergson, Abrams Garfinkel Margolis Bergson, LLP, New York, NY, for Defendants-Appellees.
Judge Panel:Before Katzmann, Chief Judge, Walker and Cabranes, Circuit Judges.
Case Date:May 13, 2019
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit
 
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Alexander A. Benzemann, Plaintiff-Appellant,

v.

Houslanger & Associates, PLLC, Todd E. Houslanger, New Century Financial Services, Defendants-Appellees,

Citibank N.A., Defendant.

No. 18-1162-cv

United States Court of Appeals, Second Circuit

May 13, 2019

Argued: April 3, 2019

On Appeal from the United States District Court for the Southern District of New York

Andrew J. Tiajoloff, Tiajoloff & Kelly LLP, New York, NY, for Plaintiff-Appellant.

Robert J. Bergson, Abrams Garfinkel Margolis Bergson, LLP, New York, NY, for Defendants-Appellees.

Before Katzmann, Chief Judge, Walker and Cabranes, Circuit Judges.

José A. Cabranes, Circuit Judge.

Plaintiff-Appellant Alexander A. Benzemann ("Plaintiff") appeals from a judgment of the United States District Court for the Southern District of New York (Naomi Reice Buchwald, Judge) granting summary judgment in favor of Defendants-Appellees Houslanger & Associates, PLLC and Todd E. Houslanger on Plaintiff's Fair Debt Collection Practices Act ("FDCPA") claim. On appeal, the parties contest a single issue: whether Plaintiff's FDCPA claim is time- barred. We conclude that it is and therefore AFFIRM the District Court's March 23, 2018 judgment.

In a final attempt to salvage his Fair Debt Collection Practices Act ("FDCPA") claim against Defendants-Appellees Houslanger & Associates, PLLC and Todd E. Houslanger (jointly, "Houslanger"), Plaintiff-Appellant Alexander A. Benzemann ("Plaintiff") asks us to endorse a novel-and potentially far-reaching-construction of the FDCPA's statute of limitations. We decline the invitation.

An FDCPA claim must be filed "within one year from the date on which the violation occurs."1 Relying on certain language in our decision in Benzemann v. Citibank N.A. ("Benzemann I")2, Plaintiff contends that an FDCPA "violation" does not "occur[ ]"-and the statute of limitations does not begin to run-until an individual is injured and receives "notice of the FDCPA violation."3 The United States District Court for the Southern District of New York (Naomi Reice Buchwald, Judge) rejected Plaintiff's reading of Benzemann I, concluded that his FDCPA claim is time-barred, and granted summary judgment in Houslanger's favor. We agree and therefore AFFIRM the District Court's March 23, 2018 judgment.

I. BACKGROUND

We draw the facts, which are undisputed or presented in the light most favorable to Plaintiff, from the summary judgment record.4

A. The Restraining Notices

On April 21, 2008, Houslanger sent a restraining notice referencing a 2003 judgment against an individual named Andrew Benzemann ("Andrew") to Citibank, N.A. ("Citibank"), where Plaintiff held an account.5 The notice named Andrew as the judgment debtor, but it listed Plaintiff's social security number and address. On April 30, 2008, Citibank "froze" Plaintiff's account. After Plaintiff's attorney notified Houslanger of the error, Houslanger withdrew the restraining notice, and Citibank lifted the freeze.

More than three years later, on December 6, 2011, Houslanger (somewhat inexplicably) sent Citibank a second restraining notice containing similar information-i.e., naming Andrew as the judgment debtor but listing Plaintiff's social security number and address. Perhaps not surprisingly, Citibank froze Plaintiff's accounts. On December 13, 2011 Plaintiff became aware that he could not gain access to his Citibank accounts. He called Citibank, but the representative with whom he spoke gave him little information about why his accounts were unavailable. Distressed, Plaintiff contacted his attorney that same evening. The next day, Plaintiff learned that his accounts had been frozen pursuant to a restraining notice. By the evening of December 15, 2011, the freeze had been lifted, and Plaintiff had regained access to his funds.

About one year later, on December 14, 2012, Plaintiff commenced this action, asserting, among others, the FDCPA claim at the center of this appeal.

B. Benzemann I

On June 27, 2014, the District Court dismissed Plaintiff's FDCPA claim as untimely.6 The District Court concluded that the alleged FDCPA violation occurred, triggering the one-year statute of limitations, when Houslanger mailed the restraining notice on December 6, 2011. Because Plaintiff commenced this action one year and eight days later, the District Court held that his FDCPA claim is time-barred.

In Benzemann I, we concluded that the District Court "erred in finding that the FDCPA violation 'occurred' when Houslanger sent the restraining notice."7 Instead, we held that "where a debt collector sends an allegedly unlawful restraining notice to a bank, the FDCPA violation does not 'occur' for purposes of [the statute of limitations] until the bank freezes the debtor's account."[8]

Because the record was at that time unclear as to whether Citibank froze Plaintiff's accounts on December 13 or December 14, 2011, we remanded for further proceedings.[9] We also directed the District Court to consider, in the event it found that the freeze occurred on December 13, 2011, whether the FDCPA's statute of limitations is subject to the common-law "discovery rule."[10]

C. Additional Factual Development After Remand

After limited discovery, it became clear that Citibank froze Plaintiff's accounts on December 13, 2011.

Citibank's records, produced pursuant to a subpoena, show that Citibank "blocked" Plaintiff's accounts and an associated debit card at 6:14 p.m. on the evening of December 13, 2011. A Citibank employee testified that after that time, Plaintiff could not withdraw funds, had only limited ability to deposit funds, and did not have access to the accounts electronically.

Plaintiff's sworn declaration and deposition testimony corroborate this account. Plaintiff averred that, on December 13, 2011, in the evening, his wife informed him that "she had a problem using [his] Citibank debit card at an [automated teller machine]."11 Plaintiff attempted to gain access to his accounts electronically but was unable to do so because they "were not visible on-line."[12] At that point, he "concluded that [his] accounts had been frozen because the same thing had occurred . . . in 2008."13 This realization was "extremely distressing, "14 and by approximately 8:00 p.m. that evening, Plaintiff "thought [he] was going to have a heart attack."15

Notwithstanding his distress, Plaintiff acted immediately. He contacted Citibank by telephone to learn "what happened to [his] accounts."16 A Citibank employee informed Plaintiff that his accounts had been blocked and instructed him to call the next day for more information. Plaintiff also contacted his attorney, who represented him when Citibank erroneously froze his account in 2008, because that experience led him to believe that he "might [have] a legal problem."17

The next day, December 14, 2011, Plaintiff learned that Citibank had frozen his accounts pursuant to the second erroneous restraining notice sent by Houslanger on December 6, 2011.

D. The District Court's Memorandum and Order

After discovery, Houslanger moved for summary judgment, contending once again that Plaintiff's FDCPA claim is time-barred. The District Court agreed and granted summary judgment in Houslanger's favor.18

First, the District Court found that Citibank froze Plaintiff's accounts-i.e., that the alleged FDCPA violation occurred, triggering the statute of limitations-on December 13, 2011. Because Plaintiff filed suit on December 14, 2012, one year and one day later, the District Court held that Plaintiff's FDCPA claim is untimely.

Second, the District Court concluded that it did not need to determine whether the discovery rule applies to FDCPA claims as a general matter because the outcome in this case would be the same in any event. The evidence established that Plaintiff learned that Citibank froze his accounts on December 13, 2011, so that the date of injury and the date of discovery were the same. Accordingly, Plaintiff's claim would be time-barred even under the discovery rule.

This appeal followed.

II. DISCUSSION

A.Standard of Review

We review an award of summary judgment, including on the basis of "an affirmative defense such as the statute of limitations, "19 de novo, "construing the evidence in the light most favorable to the nonmoving party and drawing all reasonable inferences and resolving all ambiguities in [his] favor."20 Summary judgment is appropriate if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law."21

B. Interpreting Benzemann...

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