Ergas v. Eastpoint Recovery Grp.
| Decision Date | 10 May 2022 |
| Docket Number | 20-CV-333S |
| Parties | MATATIAOU ERGAS, individually and on behalf of all others similarly situated, Plaintiff, v. EASTPOINT RECOVERY GROUP, INC. and UNITED HOLDINGS GROUP, LLC, Defendants. |
| Court | U.S. District Court — Western District of New York |
DECISION AND ORDER
This is a Fair Debt Collection Practices Act[1] (“FDCPA” or “the Act”) class action. Plaintiff alleges that Defendant Eastpoint Recovery Group, Inc. (“Defendant” or “Eastpoint”) sent him a dunning letter in August 2019 (or the “dunning letter”) claiming that Plaintiff owed almost $9, 700 (mostly for charitable donations paid by credit card) to an entity Plaintiff did not recognize as his creditor, Defendant United Holdings Group, LLC (or “UHG”) (Docket No 11, Am. Compl.). Because of this misidentification, Plaintiff claims the dunning letter violated several provisions of the FDCPA and purportedly committed these same violations against similarly situated New Yorkers (id.). He commenced this class action against Defendants for the FDCPA violations (id.).
Before this Court are the parties' respective Motions for Summary Judgment (Docket Nos. 52 (Defendant Eastpoint), 53 (Plaintiff)).
For the reasons stated below, Eastpoint's Motion for Summary Judgment (Docket No. 52) is granted (for lack of standing and dismissal of class allegations) and Plaintiff's Motion (Docket No. 53) is denied. This case is dismissed.
On or about March 20, 2020, Plaintiff sued Eastpoint and JTM Capital Management, LLC (Docket No. 1). After JTM Capital Management moved to dismiss (Docket No. 9), Plaintiff filed and served an Amended Complaint (Docket No. 11). There, Plaintiff sued Eastpoint and UHG, terminating JTM Capital Management as a Defendant (id.).
Defendants alleged “an obligation of Plaintiff 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” (Docket No. 11, Am. Compl. ¶¶ 27, 28). Plaintiff alleged that it was a “debt” as defined by FDCPA (id. ¶ 30). This debt was assigned or transferred and was in default when assigned (id. ¶¶ 31 -32).
Defendants contacted Plaintiff on the debt on August 4, 2019 (id. ¶ 33, Ex. 1). This letter from Eastpoint stated that the original creditor was Pentagon Federal Credit Union (“PenFed”) and United Holdings Group as “current creditor” (id., Ex. 1). The letter alleged $9, 691.08 was due (id.).
Plaintiff alleges that 15 U.S.C. § 1692g protects his interests “to receive a clear, accurate and unambiguous validation notice, which allows a consumer to confirm that he or she owes the debt sought to be collected by the debt collector” (id. ¶ 38). Section 1692e protects Plaintiff's interests “to be free from deceptive and/or misleading communications from Defendants” (id. ¶ 39).
The Amended Complaint alleges four counts and a class allegation (id. ¶¶ 41 -122, 123-29). The First Count alleges Defendants violated 15 U.S.C. § 1692g(a)(1) because the amount of the debt was not owed to Defendants (id. ¶¶ 42-50). The Second Count alleges violations of §§ 1692e, 1692e(2)(A), 1692e(10) because Defendants claimed a debt from Plaintiff it did not possess (id ¶¶ 52-74). Plaintiff here denies owing $9, 691.08 (id ¶¶ 63, 64). The Third Count claims violation of § 1692g(a)(2) because UHG did not own the debt and was not the correct name of the creditor (id. ¶¶ 76-90). The Fourth Count also alleges violation of §§ 1692e, 1692e(2)(A), 1692e(10) because the letter erroneously claimed UHG owned the debt (id. ¶¶ 92-122, 103-11).
In the original and Amended Complaints, Plaintiff also sued for a purported class of all others similarly situated New Yorkers (e.g., Docket No. 11, Am. Compl. ¶¶ 123-29). Plaintiff alleges that Defendants (within one year of the pleading) sent similar collection letters for debts not actually owed to them to this class of all such New York consumers (id. ¶ 124).
Each party submitted a Statement of Undisputed Facts (Docket Nos. 52 (Defendant), 53 (Plaintiff)) and responses thereto (Docket Nos. 56 (Plaintiff's Response), 57 (Defendant's Response)). Plaintiff filed a statement of additional facts (Docket No. 56, Pl. Response ¶¶ 36-41) and Defendant responded to Plaintiff's additional facts (Docket No. 60).
Generally, the parties accept the facts as recounted by their opponent, with Plaintiff disputing the materiality of certain facts asserted by Defendant while conceding some of them (Docket No. 56, Pl. Response ¶¶ 1-4, 7-8, 11-18, 24-28, 30, 34-35). Pursuant to this Court's Local Civil Rule 56(a)(1) and (2), this Court accepts the agreed upon facts and notes material disagreements and draws from both sides' Statements.
As summarized by Defendant (Docket No. 52, Def. Memo. at 14; Docket No. 57, Def. Memo. at 3 n.2), Plaintiff claims that UHG did not extend credit to Plaintiff, he was never involved in a transaction with UHG, Plaintiff never contracted with UHG, Plaintiff never transacted business with UHG, and Plaintiff is a stranger to UHG (see Docket No. 11, Am. Compl. ¶¶ 82-89, 104-11). Plaintiff therefore claims he does not owe a debt to UHG and Defendant's letter to Plaintiff misidentifying UHG as current creditor violates FDCPA, 15 U.S.C. §§ 1692g(a)(1), 1692g(a)(2), 1692e, 1692e(2)(A), and 1692e(10) ().
In 2018, Plaintiff opened a Visa credit card account with PenFed (Docket No. 53, Pl. Statement ¶ 2; see Docket No. 52, Def. Statement ¶ 1). Plaintiff claims he used this card only for personal expenses, such as purchasing eyeglasses for himself and his children, paying synagogue dues, and making charitable donations to Soimach Rely and Support (“Soimach”) (Docket No. 56, Pl. Memo. at 2; Docket No. 53, Def. Statement ¶¶ 23). Defendant argues that considering charitable donations to be debts under the FDCPA is a legal conclusion rather than a statement of fact (Docket No. 57, Def. Response ¶ 3).
Defendant stated that, on February 21, 2018, Plaintiff paid $4, 500 to Soimach from his Visa account (Docket No. 52, Def. Statement ¶¶ 3-4; but cf. Docket No. 56, Pl. Response ¶¶ 3-4 (materiality objection)).
Plaintiff argues that the nature of these transactions is not relevant to the subsequent collection effort and the alleged violations of the FDCPA (Docket No. 56, Pl. Response ¶¶ 3-4). Both sides acknowledge that the payment to Soimach was charitable (Docket No. 52, Def. Statement ¶¶ 5-6). Plaintiff made a second, charitable donation to Soimach on February 22, 2018, for the same amount (id. ¶¶ 8-10; but cf. Docket No. 56, Pl. Response ¶ 8 (materiality objection)). Defendant listed other transactions Plaintiff made on the Visa account in February 2018 (Docket No. 52, Def. Statement ¶¶ 13-16; but cf. Docket No. 56, Pl. Response ¶¶ 13-16).
Plaintiff began to fall behind on payment of his PenFed Visa account and PenFed purportedly transferred or otherwise placed it with Eastpoint for collection (Docket No. 56, Pl. Memo. at 2; Docket No. 53, Pl. Statement ¶ 4).
The parties agree that Defendant sent Plaintiff the dunning letter dated August 4, 2019 (e.g., Docket No. 52, Def. Statement ¶¶ 19-20). This collection letter identified PenFed as the original creditor and UHG as the “current creditor” (Docket No. 56, Pl. Memo. at 3; Docket No. 53, Pl. Statement ¶¶ 11-12, 17).
Plaintiff recognized PenFed as a creditor but not the name of the “current creditor, ” UHG (Docket No. 53, Pl. Statement ¶ 13). He claims that he became confused by the dunning letter because he did not know who or what UHG was, and he was concerned that the letter was a scam (id. ¶¶ 14, 15, 16; Docket No. 52, Def. Statement ¶ 21). Plaintiff never thought he owed either Defendant (Docket No. 52, Def. Statement ¶ 22).
Defendant contends that Plaintiff did not call either Defendant upon receipt of the letter (Docket No. 52, Def. Statement ¶¶ 27-28). Plaintiff does not dispute that he did not call but he questions the materiality of this fact (Docket No. 56, Pl. Response ¶¶ 27-28).
Plaintiff later testified that he suffered emotional distress from receiving the dunning letter because he thought it was a scam (Docket No. 52, Def. Statement ¶ 29; Docket No. 52, Def. Atty. Decl. Ex. C, Pl. Dep. Tr. at 42-43; see also Docket No. 56, Pl. Response ¶ 31). Plaintiff does not dispute that he did not seek medical attention for his emotional distress, but he disputes the materiality of that fact (Docket No. 56, Pl. Response ¶ 30; cf. Docket No. 52, Def. Statement ¶ 30; Docket No. 52, Def. Atty. Decl. Ex. C, Pl. Dep. Tr. at 43). Plaintiff concedes that he made purchases with the Visa account and that he has no documents of actual damages he suffered but he disputes the materiality of these facts (Docket No. 56, Pl. Response ¶¶ 34, 35).
C. Proceedings and Motions for Summary Judgment (Docket Nos. 52, 53) Eastpoint answered on June 2, 2020 (Docket No. 15). The Court Clerk entered default judgment against UHG on November 19, 2020 (Docket No. 27).
Plaintiff later moved for a protective Order or to quash a subpoena on non-party Soimach Rely and Support LLC (Docket No. 33). Counsel argued this Motion before Magistrate Judge Foschio on March 25, 2021 (Docket Nos. 42, 58 (transcript)). Plaintiff later argues that Defendant's arguments there were disingenuous, referring to Magistrate Judge Foschio's question during oral argument to defense counsel whether Defendant was “playing games here” (Docket No 59, Ex., Mar. 25, 2021, Tr. at 31; Docket No. 59, Pl. Reply Memo. at 1). On April 30, 2021, Magistrate Judge Foschio...
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