IN RE: Albert R. Wiser And Susan E. Wiser
| Decision Date | 21 June 2010 |
| Docket Number | Case No.: 08-02592-jw,Adv. Pro. No: 10-80001-jw |
| Parties | IN RE: Albert R. Wiser and Susan E. Wiser, Debtors Albert R. Wiser and Susan E. Wiser, Plaintiffs, v. Rent-A-Center,Defendant. Rent-A-Center,Third Party Plaintiff v. Chris Wiser and Glenda K. Wiser Third Party Defendants |
| Court | U.S. Bankruptcy Court — District of South Carolina |
Based on the findings of fact and conclusions of law recited in the attached order of the Court, Rent-A-Center's Motion for Summary Judgment is granted with respect to all causes of action set forth in the Complaint filed by Albert R. Wiser and Susan E. Wiser and the Complaint is dismissed with prejudice. A hearing will be held on July 12, 2010 at 1:30 p.m. at the United States Bankruptcy Court, 145 King Street, Room 225, Charleston, South Carolina to determine Rent-A-Center's damages related to its third-party complaint against Chris Wiser and Glenda K. Wiser.
John E. Waites
Chief US Bankruptcy Judge District of South Carolina
This matter comes before the Court on the Motion of Rent-A-Center, Inc. ("Rent-A-Center" or "RAC"), for Summary Judgment ("Motion") as to the causes of actions alleged in this adversary proceeding and the Memorandum in Opposition to Defendant's Motion for Summary Judgment filed by the Plaintiffs, Albert and Susan Wiser ("Debtors"). In support of its Motion, RAC provided the Affidavits of Mathew W. Gynwald and Charles Green. Debtors filed affidavits but did not provide any evidence to contest any material fact presented. Pursuant to
Fed. R. Bankr. P. 7056, the Court makes the following Findings of Fact and Conclusions of Law.1
2. RAC is a Delaware corporation that operates a national system of rent-to-own stores providing its customers with household furnishings, appliances and electronics through consumer rental-purchase agreements. RAC does business in the State of South Carolina through its subsidiary, Rent-A-Center East, Inc., pursuant to Title 37 of the South Carolina Consumer Protection Code.
3. Debtors are former customers of RAC. Debtors did not name RAC as a creditor of the estate by the Debtors, and RAC did not file a claim against the bankruptcy estate.
4. Chris Wiser ("Chris") is Debtors' son and is married to Glenda K. Wiser ("Katie"). Chris is a former employee of RAC. He was a store manager of the RAC Store #3626, located in Goose Creek, South Carolina.
5. Onor about April 25, 2009, while employed by RAC, Chris requested to lease a refrigerator ("Refrigerator") from RAC under RAC's employee purchase program. Chris stated that his refrigerator had "gone out" and he needed an immediate replacement. RAC's policy requires that a consumer rental-purchase agreement with an employee be prepared by the supervising District Manager.
6. At the time Chris applied for the rental-purchase agreement, the District Manager was not available to complete the transaction. A rental-purchase agreement, dated April 25, 2009 (the "Agreement" or "April 25th Agreement"), was prepared to meet Chris's urgent need for the Refrigerator. In order to avoid violating the company policy prohibiting rental to employeeswithout District Manager approval, the Agreement was prepared on an interim basis under the name of Al Wiser and Susan Wiser. RAC has asserted, and Debtors do not dispute, that Chris was aware that the Agreement was structured in this way at the time it was prepared. All RAC's employees present at the time of the Agreement, including Chris, were aware that the paperwork was temporary and done to accommodate Chris's immediate need for the Refrigerator.
7. On April 25, 2009, RAC delivered the Refrigerator to the home of Chris and Katie as requested. At the time of the delivery, Katie signed the rental-purchase agreement acknowledging receipt in the following manner, "Susan Wiser, Glenda K. Wiser per Charles Green."2
8. Debtors did not sign or ratify the Agreement and were not bound thereby.
9. RAC never attempted to obtain or access a credit report on Debtors, Chris, or Katie relating to the April 25th Agreement. RAC took no action to report any information to any credit reporting agency regarding Debtors, Chris, or Katie.
10. On May 5, 2009, as soon as a District Manager was available, the Agreement was marked canceled, and a new rental-purchase agreement was prepared for and executed by Chris and Katie. RAC made an internal notation on its computer records that the Refrigerator was "returned" and the reason for the return was a "request." The notation made on RAC's computer records was for its own internal account and inventory management and was not information shared with any other entity.
11. RAC did not publicize or profit from the Agreement, the Debtors' name, likeness or any other aspect of the Debtors' personal identity. The only known people to have come into control of the April 25th Agreement are RAC's employees and Chris and Katie. The only personal information contained on the Agreement was Debtors' names, address, and telephone number, which information was independently known to Chris and Katie.
12. After the commencement of this adversary, RAC filed a third party complaint against Chris and Katie for indemnification, conversion, and breach of fiduciary duty. Chris and Katie did not file a timely answer, thereby admitting the allegations of RAC. A default judgment was entered against Chris and Katie in favor of RAC.
Pursuant to Fed. R. Civ. P. 56(c), made applicable to this adversary proceeding by Fed. R. Bankr. P. 7056, summary judgment is appropriate "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." When a motion for summary judgment is filed, the Court does not weigh the evidence, but determines if there is a genuine issue for trial. Listak v. Centennial Life Ins. Co., 977 F. Supp. 739, 743 (D.S.C. 1997) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S. Ct. 2505, 2511 (1986)).
The party seeking summary judgment bears the initial burden of demonstrating the absence of a genuine issue of material fact. Bouchat v. Baltimore Ravens Football Club, Inc., 346 F.3d 514, 522 (4th Cir. 2003). Upon making this showing, the burden shifts to the nonmoving party to go beyond the pleadings and set forth specific facts demonstrating that a genuine issue exists for trial. Fed. R. Civ. P. 56(3); Campbell v. Capital One Bank (In re Broughton), C/A No. 99-06953-W, Adv. Pro. No. 00-80143-W, slip op. at 4-5 (Bankr. D.S.C. Mar. 20, 2001). "If no material factual disputes remain, then summary judgment should be granted against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which the party bears the burden of proof at trial." Listak, 977 F. Supp. at 743 (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2552 (1986)).
"Where a movant [supports] its motion with affidavits or other evidence which, unopposed, would establish its right to judgment, the non-movant must proffer counteringevidence sufficient to create a genuine factual dispute." In re Dig It, Inc., 129 B.R. 65, 66 (Bank. D.S.C. 1991). "To counter a motion for summary judgment, the non-movant may not rest on its pleadings or mere assertions of counsel." Td. at 66-67. The "obligation of the nonmoving party is 'particularly strong when the nonmoving party bears the burden of proof."' Hughes v. Bedsole, 48 F.3d 1376, 1381 (4th Cir. 1995) (quoting Pachaly v. City of Lvnchburg, 897 F.2d 723, 725 (4th Cir. 1999)). The mere existence of disputed facts does not require that a case go to trial. Thompson Everett, Inc. v. Nat'l Cable Adver., L.P., 57 F.3d 1317, 1323-24. "The disputed facts must be material to an issue necessary for the proper resolution of the case, and the quality and quantity of the evidence offered to create a question of fact must be adequate to support a jury verdict." Id. Any inferences drawn in favor of the nonmoving party must "fall within the range of reasonable probability and not be so tenuous as to amount to speculation or conjecture." Id.
I. Debtors' First Cause of Action (FACTA and Consumer Protection Act)
For their First Cause of Action, Debtors assert that RAC violated the notice requirements under the Fair and Accurate Credit Transaction Act of 2003 (16 C.F.R. § 602) or the Consumer Credit Protection Act (15 U.S.C. §1602(u)). 1. Fair and Accurate Credit Transaction Act of 2003
Congress amended the Fair Credit Reporting Act ("FCRA") by the Fair and Accurate Credit Transaction Act of 2003 ("FACTA") (codified as amended at 15 U.S.C. §§1681-1681x (2003)). "'The purpose of the [FCRA and FACTA] is to require that 'consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit...'" Adams v. Nat'l Engineering Service Corporation, 620 F.Supp.2d 319, 327 (D.Conn. 2009) (quoting 15 U.S.C. § 1681).. Congress stated that the purpose of FACTA was "to prevent identity theft, improve resolution of consumer disputes, improve the accuracy of consumer records, [and] make improvements in the use of, and consumer access to, credit information..." Pub. L. No. 108-159, 117 Stat. 1952 (2003). The enactment of FACTA, however, did not abolish the Fair Credit Reporting Act ("FCRA"), as FACTA was intended by Congress to bolster FCRA.
"[T]he FCRA regulates 'consumer reporting agencies' in their preparation and dissemination of 'consumer reports, ' and imposes civil liability upon consumer reporting agencies that willfully or negligently violate the statute." Adams, 620 F.Supp.2d at 327. FCRA defines the term "consumer reporting agency" to...
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