Hunt v. Check Recovery Systems, Inc., No. C05-04993 MJJ.

CourtUnited States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California
Writing for the CourtJerkins
Citation478 F.Supp.2d 1157
PartiesHUNT, Plaintiff, v. CHECK RECOVERY SYSTEMS, INC., Defendant.
Decision Date21 March 2007
Docket NumberNo. C05-02037 MJJ.,No. C05-04993 MJJ.

Page 1157

478 F.Supp.2d 1157
HUNT, Plaintiff,
v.
CHECK RECOVERY SYSTEMS, INC., Defendant.
No. C05-04993 MJJ.
No. C05-02037 MJJ.
United States District Court, N.D. California.
March 21, 2007.

Page 1158

Irving L. Berg, The Berg Law Group, Corte Madera, CA, O. Randolph Bragg, Horwitz Horwitz & Associates, Ltd., Attorneys & Counselors at Law, Chicago, IL, Paul Arons, Law Office of Paul Arons, Friday Harbor, WA, Jason K. Singleton, Law Office of Jason K. Singleton, Eureka, CA, for Plaintiff.

Clark Garen, Law Offices of Clark Garen, Palm Springs, CA, John M. Vrieze, Mitchell, Brisso, Delaney & Vrieze, Attorneys at Law, Eureka, CA, for Defendant.

ORDER DENYING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND GRANTING IN PART PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT

JERKINS, District Judge.


INTRODUCTION

Before the Court are Defendant Imperial Merchant Services d.b.a. Check Recovery Systems' ("Defendant" or "Imperial") and Plaintiffs Brandy Hunt ("Hunt") and Brian Castillo's ("Castillo") (collectively, "Plaintiffs") cross motions for summary judgment.1 The parties oppose each other's motions. For the following reasons, the Court DENIES Defendant's Motion for Summary Judgment and GRANTS, in part, Plaintiffs' Motion for Summary Judgment.

FACTUAL BACKGROUND

Except as otherwise noted, the Court finds the following facts to be undisputed.

A. Procedural History

Hunt and Castillo filed their complaints on December 5, 2005 and March 16, 2006, respectively; On May 9, 2006, this Court issued a Related Case Order relating Plaintiffs' cases. Both Plaintiffs seek damages under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. ("FDCPA"). Plaintiffs allege that Imperial's debt collection practices of including an interest charge, in addition to their attempt to collect both a check amount and a statutory service charge violates the FDCPA. In particular, Plaintiffs allege that Defendant's debt collection practices: (1) use false, deceptive or misleading representations in violation of § 1692e; (2)

Page 1159

falsely represent the character, amount, or legal status of the debt in violation of § 1692e(2)(A); (3) use unfair or unconscionable means to collect or attempt to collect the debt in violation § 1692f; and (4) exceed the amount expressly permitted by law in violation of § 1692f(1). Both parties now seek summary judgment.

Plaintiffs ask this Court to issue an order granting summary judgment as to the liability of Defendant for violations of the FDCPA. Plaintiffs do not request an award of a specific amount of damages, restitution, or interest by this motion. Defendant requests summary judgment, and in the alternative, for an immediate appeal under 28 U.S.C. § 1292(b).

B. The Parties

On July 5, 2004, Hunt wrote a check in the amount of $137.15 to Pak `n Save. (Joint Statement of Undisputed Fact ("JSUF"), ¶ 2.) On November 28, 2004, Castillo wrote a check in the amount of $276.36 to Pak `n Save. (Id., ¶ 1.) Both checks were written for personal, family, or household purposes, and both checks were returned unpaid due to insufficient funds. (Id., ¶¶ 1-2, 5.) Pak `n Save is operated by Safeway, Inc. ("Safeway"). (Id., ¶ 3.) After the Castillo and Hunt checks were returned unpaid, Safeway referred the checks to Imperial for collection. (Id., ¶ 4.) The parties agree that Imperial's debt collection conduct is governed by the FDCPA. (Id., ¶ 5.)

C. Defendant's Debt Collection Practices

The principal purpose of Imperial is to collect debts. (Id., ¶ 5.) When Safeway refers unpaid checks written in California to Imperial, Safeway asks Imperial to collect the check amount and the service charge provided under California Civil Code § 1719. (Id., ¶ 6.) Imperial retains 27% of the amount collected for the check and the statutory service charge. (Id.) After a check has been referred to Imperial, Imperial adds an interest charge, which is calculated at the rate of 10% per annum, accruing from the date the check was written. (Id.) Imperial retains 100% of the interest that it collects. (Id.) Safeway and Imperial followed these practices in connection with the Hunt and Castillo checks. (Id.)

1. Castillo's Check

Safeway referred the Castillo check to Imperial to collect the check amount plus a $25.00 statutory service charge. (Id., 117.) Imperial mailed Castillo a collection letter dated, March 17, 2005 in which Imperial demanded $276.36 for the check amount, $25.00 as a "Misc." charge, and $8.99 as interest. (Id.) Subsequently, Imperial mailed Castillo a collection letter dated, December 2, 2005, in which Imperial demanded $276.36 for the check amount, $25.00 as a "Misc." charge, and $30.43 as interest. (Id.)

2. Hunt's Check

Safeway referred the Hunt check to Imperial to collect the check amount plus a $35.00 statutory service charge. (Id., ¶ 8.) Subsequently, Imperial mailed Hunt two collection demands. (Id.) The second demand, dated December 6, 2005, included a demand for the check amount, a "Misc." charge of $35.00, and interest of $7.26, for a total of $179.41.

LEGAL STANDARDS

A. Summary Judgment

Rule 56(c) of the Federal Rules of Civil Procedure authorizes summary judgment if there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.E d.2d 202

Page 1160

(1986). The moving party bears the initial burden of demonstrating the basis for the motion and identifying the portions of the pleadings, depositions, answers to interrogatories, affidavits, and admissions on file that establish the absence of a triable issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the moving party meets this initial burden, the burden then shifts to the non-moving party to present specific facts showing that there is a genuine issue for trial. Fed.R.Civ.P. 56(e); Celotex, 477 U.S. at 324, 106 S.Ct. 2548; Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The non-movant's bare assertions, standing alone, are insufficient to create a material issue of fact and defeat a motion for summary judgment. Id. at 247-48, 106 S.Ct. 2505. An issue of fact is material if, under the substantive law of the case, resolution of the factual dispute might affect the case's outcome. Anderson, 477 U.S. at 248, 106 S.Ct. 2505. Factual disputes are genuine if they "properly can be resolved in favor of either party." Id. at 250, 106 S.Ct. 2505. Thus, a genuine issue for trial exists if the non-movant presents evidence from which a reasonable jury, viewing the evidence in the light most favorable to that party, could resolve the material issue in his or her favor. Id. "If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Id. at 249-50, 106 S.Ct. 2505 (internal citations omitted).

B. Judicial Notice

Judicial notice may be taken of "adjudicative facts" such as court records, pleadings and other facts not subject to reasonable dispute and either "generally known" in the community or "capable of accurate and ready determination by reference to sources whose accuracy cannot be reasonably questioned." Hon. William W. Schwarzer, Federal Civil Procedure Before Trial § 14:190 (2006) (citing Fed. Rule Evid. 201(b)). A court may take judicial notice of "matters of public record" including prior court proceedings. Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001); Del Puerto Water District v. U.S. Bureau of Reclamation, 271 F.Supp.2d 1224, 1232 (E.D.Cal.2003). A court may also take judicial notice of the legislative history of a statute. See Fed.R.Evid. 201; Palmer v. Stassinos, 348 F.Supp.2d 1070, 1077 (N.D.Cal.2004).

ANALYSIS

A. Judicial Notice

Both Plaintiffs and Defendant have submitted requests for judicial notice in support of their motions for summary judgment. Both parties request this Court to take judicial notice of the legislative history of California Civil Code § 1719.

Defendant separately requests the Court take judicial notice of certain court documents from other pending actions. Defendant requests judicial notice of its Motion for Summary Judgment filed in United States Bankruptcy Court in the cases of In Re. Brandy Hunt, Case No. 05-33473 DM and Imperial Merchant Services, Inc. v. Hunt, Case No. 05-3499 DM along with certain evidentiary declarations filed in support of that motion. Defendant also requests judicial notice of the pending criminal complaint in the case of People v. Brandy G. Hunt, Case No. NM349421A in San Mateo County. Plaintiffs separately request the Court judicially notice an official legal guide publication issued by the California Department of Consumer Affairs along with the legislative history of A.B. 1226 and 2463 as previously filed in the case of Palmer v. Stassinos, Civ. No. 04-3026.

Page 1161

The Court finds that the legislative history and other court documents for which the parties seek judicial notice constitute judicial facts sufficiently capable of accurate and ready determination and therefore takes judicial notice of them. However, as to California Department of Consumer Affairs legal guide, the Court finds that it is not the proper subject of judicial notice, nor is its interpretation of California law binding on the Court.

B. Interest on Dishonored Checks

The FDCPA prohibits a debt collector from collecting or attempting to collect any amount, including interest, fees, charges, or expenses incidental to the principal obligation, unless that amount is expressly authorized by the agreement creating the debt or otherwise permitted by law. See 15 U.S.C. § 1692f(1). In the absence of an express agreement, whether charges are permissible within the meaning of the FDCPA turns on California law. See Newman v. Checkrite California, Inc., 912 F.Supp. 1354, 1367 (E.D.Cal.1995). Here, the parties...

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41 practice notes
  • Lepp v. Yuba Cnty., No. 2:17-cv-1317-KJM-EFB PS
    • United States
    • U.S. District Court — Eastern District of California
    • March 11, 2019
    ...for judicial notice of state court records is granted. See ECF Nos. 98-2 & 98-3; see also, e.g., Hunt v. Check Recovery Sys. Inc., 478 F. Supp. 2d 1157, 1160-61 (N.D. Cal. 2007) ("Judicial notice may be taken of 'adjudicative facts' such as court records [and] pleadings . . . .&quo......
  • Sanchez v. Law Office of Lance E. Armo, Case No. 1:20-cv-00163-NONE-SKO
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Eastern District of California
    • March 31, 2021
    ...letter seeking to collect debt was a sufficient basis to state a claim under section 1692e(2)(A)); Hunt v. Check Recovery Sys., Inc., 478 F. Supp. 2d 1157, 1168-69 (N.D. Cal. 2007) (demanding unauthorized debt amount in letter violated section 1692e(2)(A)). Plaintiff also alleges that Defen......
  • Imperial Merchant Services, Inc. v. Hunt, No. S163577.
    • United States
    • United States State Supreme Court (California)
    • August 10, 2009
    ...States District Court opinion in a related class action filed by Brandy G. Hunt. (Hunt v. Check Recovery Systems, Inc. (N.D.Cal.2007) 478 F.Supp.2d 1157 (Hunt 3. The district court consolidated Hunt's action with another case against CRS filed by Brian Castillo. (Hunt I, supra, 478 F.Supp.2......
  • Diaz v. Kubler Corp., Case No. 12cv1742–MMA–BGS.
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Southern District of California)
    • November 6, 2013
    ...agreement, whether charges are permissible within the meaning of the FDCPA turns on California law.” Hunt v. Check Recovery Sys., Inc., 478 F.Supp.2d 1157, 1161 (N.D.Cal.2007) (internal citation omitted). Pursuant to the first category, Plaintiff asserts that Defendant violated § 1692f(1) b......
  • Request a trial to view additional results
41 cases
  • Lepp v. Yuba Cnty., No. 2:17-cv-1317-KJM-EFB PS
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Eastern District of California
    • March 11, 2019
    ...for judicial notice of state court records is granted. See ECF Nos. 98-2 & 98-3; see also, e.g., Hunt v. Check Recovery Sys. Inc., 478 F. Supp. 2d 1157, 1160-61 (N.D. Cal. 2007) ("Judicial notice may be taken of 'adjudicative facts' such as court records [and] pleadings . . . ."). 8. Althou......
  • Sanchez v. Law Office of Lance E. Armo, Case No. 1:20-cv-00163-NONE-SKO
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Eastern District of California
    • March 31, 2021
    ...letter seeking to collect debt was a sufficient basis to state a claim under section 1692e(2)(A)); Hunt v. Check Recovery Sys., Inc., 478 F. Supp. 2d 1157, 1168-69 (N.D. Cal. 2007) (demanding unauthorized debt amount in letter violated section 1692e(2)(A)). Plaintiff also alleges that Defen......
  • Imperial Merchant Services, Inc. v. Hunt, No. S163577.
    • United States
    • United States State Supreme Court (California)
    • August 10, 2009
    ...States District Court opinion in a related class action filed by Brandy G. Hunt. (Hunt v. Check Recovery Systems, Inc. (N.D.Cal.2007) 478 F.Supp.2d 1157 (Hunt 3. The district court consolidated Hunt's action with another case against CRS filed by Brian Castillo. (Hunt I, supra, 478 F.Supp.2......
  • Diaz v. Kubler Corp., Case No. 12cv1742–MMA–BGS.
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Southern District of California)
    • November 6, 2013
    ...agreement, whether charges are permissible within the meaning of the FDCPA turns on California law.” Hunt v. Check Recovery Sys., Inc., 478 F.Supp.2d 1157, 1161 (N.D.Cal.2007) (internal citation omitted). Pursuant to the first category, Plaintiff asserts that Defendant violated § 1692f(1) b......
  • Request a trial to view additional results

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