Hernandez v. Asset Acceptance, LLC

• Decision Date: 10 September 2013
• Docket Number: Civil Action No. 12–cv–02082–MSK–KMT.
• Citation: 970 F.Supp.2d 1194
• Parties: Christina HERNANDEZ, Plaintiff, v. ASSET ACCEPTANCE, LLC, a Delaware limited liability company, Defendant.
• Court: U.S. District Court — District of Colorado

970 F.Supp.2d 1194

Christina HERNANDEZ, Plaintiff,

v.ASSET ACCEPTANCE, LLC, a Delaware limited liability company, Defendant.

Civil Action No. 12–cv–02082–MSK–KMT.

United States District Court,

D. Colorado.

Sept. 10, 2013.

David Michael Larson, David M. Larson, Attorney at Law, Englewood, CO, for Plaintiff.

Joseph J. Lico, Steven J. Wienczkowski, Adam L. Plotkin, P.C., Denver, CO, for Defendant.

OPINION AND ORDER ADOPTING RECOMMENDATION AND DISMISSING PLAINTIFF'S CLAIMS

MARCIA S. KRIEGER, Chief Judge.

THIS MATTER comes before the Court on the Recommendation (# 41) of United States Magistrate Judge Kathleen M. Tafoya that the Defendant Asset Acceptance's Motion to Dismiss (# 13) be granted. The Plaintiff Christina Hernandez timely filed Objections (# 45) to the Recommendation.

When a magistrate judge issues a recommendation on a dispositive motion, the parties may file specific, written objections within fourteen days after being served with a copy of the recommendation. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b). The district court shall make a de novo determination of those portions of the recommendation to which timely and specific objection is made. U.S. v. One Parcel of Real Prop. Known as 2121 E. 30th St., 73 F.3d 1057, 1060 (10th Cir.1996).

In her Amended Complaint (# 11), Ms. Hernandez claims that the Defendant, a debt collection agency, violated the Fair Debt Collection Practice Act (FDCPA), 15 U.S.C. § 1692e(2)(A), e(8), e(10), and § 1692f, when it failed to communicate to Experian, a credit reporting agency that she disputed a debt she had incurred. According to the Amended Complaint, Ms. Hernandez allegedly incurred a debt with Xcel Energy and defaulted on the debt. The account was transferred to the Defendant for collection. In May 2011, Ms. Hernandez reviewed a copy of her Experian credit report and saw the Defendant's entry for the Xcel account on the report. On May 5, 2011, she called the Defendant to dispute the account. In June, August, October, and November 2011, the Defendant allegedly failed to communicate to Experian that Ms. Hernandez's Xcel Energy account was disputed. Ms. Hernandez asserts that this “Complaint and Jury Demand only seeks relief for activity that occurred after August 7, 2011.” She seeks statutory damages available under the FDCPA, as well as attorney fees and costs.

By way of additional background, the Court notes that on July 1, 2011, Ms. Hernandez initiated Civil Action No. 11–cv–01729 ( Hernandez I ). ¹ In that case, Ms. Hernandez claimed that in June 2011, the Defendant violated the FDCPA by failing to report the Xcel Energy account as disputed between May 5, 2011 and July 1, 2011. She alleged violations of 15 U.S.C. § 1692e(2)(A), e(8), e(10) and § 1692f A two-day jury trial was held on September 10, 2012. The jury returned a verdict in favor of the Defendant. Final judgment was entered in Hernandez I on September 21, 2012.

As relevant here, the Defendant moved to dismiss (# 13) Ms. Hernandez's claims in this case under the doctrine of res judicata, also referred to as claim preclusion. The matter was referred to the Magistrate Judge, who recommends that the motion be granted. The Magistrate Judge found that Ms. Hernandez's claims must be dismissed because the claims asserted in this case arise from the same transaction, or series of transactions, as the claims asserted in Hernandez I.

Ms. Hernandez objects to the Magistrate Judge's factual conclusion that her claims in this case arise out of the same transaction as those asserted in Hernandez I. Specifically, she argues that her claims here can be proven with evidence of new facts that occurred after Hernandez I. She alleges that here, she can rely on pleadings filed in Hernandez I to establish that she disputed the account, rather than rely on evidence of the May 5, 2011 phone call. She argues that because Hernandez I occurred after the conduct she alleged in that action, her claims in this case rely on independent facts.

“Under res judicata, or claim preclusion, a final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in the prior action.” Wilkes v. Wyoming Dep't of Emp't, 314 F.3d 501, 504–05 (10th Cir.2002) (citing Satsky v. Paramount Commc'ns, Inc., 7 F.3d 1464 (10th Cir.1993)) (emphasis in original). Claim preclusion requires a judgment on the merits in an earlier action, identity of the parties in the two suits, and identity of the cause of action in both suits. Yapp v. Excel Corp., 186 F.3d 1222, 1226 (10th Cir.1999). To determine whether the claims in two suits are identical, it must be determined whether the claims arise out of the same transaction, or series of connected transactions. Id. at 1227. “[A] new action will be permitted only where it raises new and independent claims, not part of the previous transaction, based on the new facts.” Hatch v. Boulder Town Council, 471 F.3d 1142, 1150 (10th Cir.2006) (emphasis in original).

Upon de novo review of the Recommendation, the Court reaches the same conclusions articulated in the Recommendation for substantially the same reasons. Contrary to Ms. Hernandez's view, her claims in this action are not independent simply because they allege conduct that occurred after Hernandez I. Even if she were to rely on pleadings in that case to establish that she disputed the account, the pleadings depend on the fact of the May 5, 2011 phone call to establish the dispute. The claims here relate to the same disputed account, and they involve separate instances of the same course of conduct by the Defendant—that is, the Defendant's failure to report the account as disputed after the May 5, 2011 phone call. Thus, although the Defendant's conduct in August, October, and November 2011 could have amounted to additional violations of the FDCPA, those violations are not independent from the claims at issue in Hernandez I.

Finally, the Court sees no reason why Ms. Hernandez could not have moved to amend her complaint in Hernandez I to include allegations of the conduct that occurred in August, October, and November 2011. The trial in Hernandez I occurred over a year after she filed her complaint in that case. Had she amended her complaint in Hernandez I, the jury could have been called upon to determine whether the Defendant's additional communications with Experian constituted violations of the FDCPA. A plaintiff cannot “avoid supplementing his complaint with facts that are part of the same transaction asserted in the complaint, in the hope of bringing a new action arising out of the same transaction on some later occasion.” Hatch, 471 F.3d at 1150 (emphasis in original).

For the forgoing reasons, the Plaintiff's Objections (# 45) are OVERRULED and the Recommendation (# 41) is ADOPTED to the extent it recommends that the Plaintiff's claims be dismissed. The Defendant's Motion to Dismiss (# 13) is GRANTED and the Plaintiff's claims in this case are DISMISSED in their entirety, with prejudice. The Clerk of the Court shall close this case.

ORDER AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

KATHLEEN M. TAFOYA, United States Magistrate Judge.

This matter comes before the court on “Defendant Asset Acceptance, LLC's Motion to Dismiss.” (Doc. No. 13, filed Oct. 4, 2012 [“Mot.”].) Additionally, the court considers “Plaintiff's Motion to Compel the Defendant's Responses to the Plaintiff's Written Discovery Requests Pursuant to Fed.R.Civ.P. 33, 34, and 37.” (Doc. No. 33, filed March 8, 2013.)

I. FACTUAL AND PROCEDURAL BACKGROUND

The following facts are taken from Plaintiff's Amended Complaint (Doc. No. 11 [“Am. Compl.”] ) and documents attached to or incorporated by reference therein.¹ Plaintiff maintains that, on severaloccasions, Defendant violated the Fair Debt Collection Practices Act (“FDCPA”) by communicating to Experian, a credit reporting agency, information regarding a debt without also communicating that Plaintiff “disputed” the debt.

Plaintiff allegedly incurred a financial obligation (“the Debt”) to Xcel Energy and defaulted on the Debt. (Am. Compl., ¶¶ 18, 20.) Defendant acquired the Debt for collection purposes. ( Id., ¶ 21.)

On May 5, 2011, Plaintiff placed a phone call to Defendant and stated to one of its employees that she disputed the Debt. ( Id., ¶¶ 34–43.) In June 2011, Defendant communicated information regarding the Debt to Experian, a credit reporting agency, but did not communicate the fact that Plaintiff disputed the Debt. (Ex. 4; see also Scheduling Order, Doc. No. 34 at 4–5, Hernandez v. Asset Acceptance, LLC, Case No. 11–cv–01729–PAB–MEH [hereinafter “ Hernandez I ”].)

On July 1, 2011, Plaintiff commenced a lawsuit, Hernandez I, against Defendant, alleging violations of 15 U.S.C. §§ 1692e(2)(A), e(8), e(10), and 1692f for Defendant's failure to report the Debt as disputed between May 5, 2011 and July 1, 2011. ( See Ex. A; Compl.; Doc. No. 1, Hernandez I.) ² In August 2011, approximately one month after filing her Complaint in Hernandez I, Defendant again communicated information to Experian about the Debt, but allegedly did not communicate that Plaintiff disputed the debt. (Am. Compl. ¶¶ 64, 69.) Defendant allegedly did so again in October and November 2011. (Am. Compl., ¶¶ 71, 76, 78, 83.)

Just over four weeks prior to trial in Hernandez I, Plaintiff commenced this lawsuit in order to challenge Defendant's August, October, and November 2011 communications with Experian. ( See Compl., Doc. No. 1.) On August 10, 2012, Plaintiff filed a Notice of Case Association pursuant to Local Rule 7.5 to inform this court of Hernandez I. (Doc. No 4.)

Beginning on September 10, 2012, a jury trial was held in Hernandez I. ( See Courtroom Minutes, Doc. No. 61, Hernandez I.) On September 11, 2012, the jury rendered a verdict in favor of Defendant. ( See Courtroom Minutes, Doc. No. 62, Hernandez I.) Final judgment was entered in favor of Defendant on September 21, 2012....