Gregory v. Barton
| Decision Date | 31 December 2020 |
| Docket Number | Case No. 4:20-cv-00982-SRC |
| Citation | 510 F.Supp.3d 829 |
| Parties | Todd D. GREGORY, Plaintiff, v. Dennis J. BARTON, III, et al., Defendants. |
| Court | U.S. District Court — Eastern District of Missouri |
Traci L. Severs, Traci L. Severs, LLC, Manchester, MO, for Plaintiff.
Dennis J. Barton, III, Barton Law Group LLC, Chesterfield, MO, for Defendants.
This matter comes before the Court on [13] Defendants’ Motion to Dismiss. Defendants Dennis J. Barton, The Barton Law Group, LLC, and Consumer Adjustment Company, Inc. move under Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss Plaintiff Todd D. Gregory's Complaint, Doc. 1, for failure to state a claim. The Court grants, in part, and denies, in part, Defendants’ motion.
The Court accepts Gregory's well-pleaded factual allegations as true for purposes of the motion to dismiss. Gregory's Complaint, Doc. 1, alleges the following:
Todd Gregory was married to his late wife, Angela Gregory, until her death from metastatic cancer in December 2017. Docs. 1 at ¶¶ 28–29 and 1-7. Angela's1 long battle with cancer incurred significant medical bills. Id. One medical provider that billed Angela was St. Luke's Hospital. Id. at ¶ 27. In January 2015, St. Luke's sent Angela three billing statements for medical services, totaling $3,398.63. Doc. 1-4. Gregory was unaware of the billing statements addressed and sent to Angela, and St. Luke's did not send him a billing statement or a demand for payment before or after Angela's death. Id. at ¶¶ 23, 34.
Four years passed. St. Luke's assigned its claim for unpaid medical bills against Gregory to Consumer Adjustment Company, Inc. Doc. 14-2. On July 29, 2019, Barton—an attorney retained by Consumer Adjustment Company—sent a collection letter to Gregory. The letter stated that "Barton Law Group, LLC represents St. Luke's Episcopal-Presbyterian Hospitals d/b/a St. Luke's Hospital." Doc. 1-3. The letter further advised that Barton and Barton Law Group were "debt collectors in an attempt to collect a debt." Id. Finally, the letter stated:
As of the date of this letter, you owe $4741.97. Because of interest, the amount due on the day you pay will be greater.
Id. The following month, Barton filed a collection action in state court on behalf of Consumer Adjust Company, Inc. against Gregory. Doc. 14-1. The petition in the collection action alleged that Gregory incurred charges with St. Luke's totaling $3,398.63. Id. The petition further alleged that "there remains a balance due on said account in the amount of $3398.63 plus interest starting on 03/09/2015." Id.
Gregory then filed the present action, alleging that Defendants’ conduct violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. (FDCPA), and the Missouri Merchandising Practices Act, Mo. Rev. Stat. § 407.010, et seq. (MMPA). Doc. 1.
Under Rule 12(b)(6) of the Federal Rules of Civil Procedure a party may move to dismiss a claim for "failure to state a claim upon which relief can be granted." The notice pleading standard of Rule 8(a)(2) requires a plaintiff to give "a short and plain statement showing that the pleader is entitled to relief." To meet this standard and to survive a Rule 12(b)(6) motion to dismiss, "a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (internal quotations and citation omitted). This requirement of facial plausibility means the factual content of the plaintiff's allegations must "allow[ ] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Park Irmat Drug Corp. v. Express Scripts Holding Co. , 911 F.3d 505, 512 (8th Cir. 2018) (quoting Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 ). The Court must grant all reasonable inferences in favor of the nonmoving party. Lustgraaf v. Behrens , 619 F.3d 867, 872-73 (8th Cir. 2010). Ordinarily, only the facts alleged in the complaint are considered for purposes of a motion to dismiss; however, materials attached to the complaint may also be considered in construing its sufficiency. Reynolds v. Dormire , 636 F.3d 976, 979 (8th Cir. 2011).
When ruling on a motion to dismiss, a court "must liberally construe a complaint in favor of the plaintiff[.]" Huggins v. FedEx Ground Package Sys., Inc. , 592 F.3d 853, 862 (8th Cir. 2010). However, if a claim fails to allege one of the elements necessary to recover on a legal theory, the Court must dismiss that claim for failure to state a claim upon which relief can be granted. Crest Constr. II, Inc. v. Doe , 660 F.3d 346, 355 (8th Cir. 2011). Threadbare recitals of a cause of action, supported by mere conclusory statements, do not suffice. Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 ; Bell Atlantic v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Although courts must accept all factual allegations as true, they are not bound to take as true a legal conclusion couched as a factual allegation. Twombly , 550 U.S. at 555, 127 S.Ct. 1955 (internal quotations and citation omitted); Iqbal , 556 U.S. at 677-78, 129 S.Ct. 1937.
Defendants move to dismiss all claims in Gregory's Complaint. The Complaint alleges violations of the FDCPA, sections 1692e and 1692f, and the MMPA. The Court first considers Defendants’ motion to dismiss Gregory's FDCPA claims.
The stated purpose of the FDCPA is to "eliminate abusive debt collection practices by debt collectors." 15 U.S.C. § 1692. The statute defines "debt collector" as:
any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.
15 U.S.C. § 1692a. Gregory alleges that Defendants are "debt collectors" within the meaning of the statute because they "regularly engage in the collection of debts owed to others in Missouri using mail, telephone and legal process." Doc. 1 at ¶¶ 8–15.
Gregory further alleges that Defendants violated sections 1692e and 1692f of the FDCPA by falsely representing that he owed interest on his deceased wife's medical bills and attempting to collect that interest. Section 1692e prohibits a debt collector from using "any false representation or means in connection with the collection of any debt," including, among others, "the false representation of the character, amount, or legal status of any debt." 15 U.S.C. § 1692e(2)(A). Section 1692f prohibits a debt collector from using "unfair on unconscionable means to collect or attempt to collect any debt," including, among others, "[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." 15 U.S.C. § 1692f(1).
In Coyne v. Midland Funding LLC , 895 F.3d 1035 (8th Cir. 2018), the Eighth Circuit considered the application of these sections to the attempted collection of interest not authorized by state law. The Court held that "an attempt to collect a debt not owed is a material violation of § 1692f(1)" and that "a false representation of the amount of a debt that overstates what is owed under state law materially violates § 1692e(2)(A)." Id. at 1038. In Coyne , the plaintiff alleged that a debt collector tried to collect compound interest the plaintiff had not agreed to. Accordingly, because Minnesota law does not permit compounding interest unless provided for in a contract, the Eighth Circuit reversed the district court's dismissal for failure to state a claim. Id.
In the present case, Gregory alleges that Defendants falsely represented he owed interest not authorized by Missouri law and attempted to collect that interest, in violation of FDCPA sections 1692e and 1692f. Doc. 1 at ¶ 51-58. Defendants argue that Gregory's Complaint fails to state a claim because Missouri law allows them to collect the disputed interest. Doc. 13. Specifically, Defendants contend that Missouri's doctrine of necessaries and statutory interest provision combine to authorize prejudgment interest on these facts. Id.
"The common law doctrine of necessaries is the law in Missouri." Med. Servs. Ass'n v. Perry , 819 S.W.2d 82, 83 (Mo. Ct. App. 1991). The doctrine of necessaries "requires a husband to pay the necessary medical expenses of his wife." Id. at 84 ; see also Wilt v. Moody , 254 S.W.2d 15, 19 (Mo. 1953) (). "Although historically the doctrine originally required only a husband to pay the necessary expenses of his wife, the doctrine is now gender neutral and applies equally to each spouse." Perry , 819 S.W.2d at 83. The parties agree that the doctrine of necessaries applies in this case. Doc. 16 at 6. Accordingly, Gregory does not dispute that he is financially responsible for the principal balance of Angela's medical bills. He only disputes that he owes Defendants prejudgment interest.
Defendants argue they are entitled to prejudgment interest under Mo. Rev. Stat. § 408.020. That statute provides in relevant part:
Creditors shall be allowed to receive interest at the rate of nine percent per annum, when no other rate is agreed upon, for all moneys after they become due and payable, on written contracts, and on accounts after they become due and demand of payment is made [.]
Id. (emphasis added). Gregory's Complaint alleges that Defendants did not demand payment of him, and that he was unaware of the amount of his wife's medical debt, until he received Defendants’ collection letter. Doc. 1 at ¶¶ 31-34. Defendants contend that interest began to accrue under the...
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