Jackson v. Sagal

• Decision Date: 29 March 2019
• Docket Number: Civil Case No. GLR-18-495
• Citation: 370 F.Supp.3d 592
• Parties: Crystal JACKSON, Plaintiff, v. Stuart L. SAGAL, et al., Defendants.
• Court: U.S. District Court — District of Maryland

370 F.Supp.3d 592

Crystal JACKSON, Plaintiff,

v.Stuart L. SAGAL, et al., Defendants.

Civil Case No. GLR-18-495

United States District Court, D. Maryland.

Signed March 29, 2019

Emanwel Josef Turnbull, Peter A. Holland, The Holland Law Firm PC, Annapolis, MD, Scott C. Borison, Legg Law Firm LLP, San Mateo, CA, for Plaintiff.

Jessica Lynn Swadow, Shirlie Norris Lake, Eccleston and Wolf PC, Hanover, MD, for Defendants.

MEMORANDUM OPINION

George L. Russell, III, United States District Judge

THIS MATTER is before the Court on Defendants Stuart L. Sagal ("Sagal") and Sagal, Filbert, Quasney & Betten, P.A.'s ("SFQB") Motion to Dismiss, or in the Alternative, Motion for Summary Judgment and Request for Hearing (ECF No. 7). This putative class action arises from a debt collection dispute between SFQB, a law firm representing The Maryland Management Company ("MMC"), and Plaintiff Crystal Jackson, a former MMC lessee. The Motion is ripe for disposition, and no hearing is necessary. See Local Rule 105.6 (D. Md. 2018). For the reasons outlined below, the Court will deny the Motion.

I. BACKGROUND¹

From 2009 until 2010, Jackson and her husband lived in a property MMC managed. (Compl. ¶ 1, ECF No. 1). After wearying of various living conditions on and around the property, Jackson ultimately gave MMC sixty days' advance notice, and then moved out. (Id. ¶¶ 2–3).

In 2014, SFQB, on behalf of MMC, sued Jackson in the District Court of Maryland for Baltimore City for owed rent, late fees, court costs, utilities, and attorney's fees. (Id. ¶ 4). The court awarded judgment for SFQB but did not award attorney's fees. (Id. ¶ 5). On August 15, 2017, the judgment was vacated, and the lawsuit was dismissed in response to a class-action settlement in another case, Claiborne v. The Maryland Management Co., 24-C-16-004505, 2016 WL 4255002 (Circ. Ct. Balt. City filed Aug. 11, 2016). (Id. ¶ 6).

On October 26, 2017, Sagal sent Jackson a collection letter on SFQB letterhead (the "Letter") that stated she owed, "$ 1253.58 plus attorney fees of $ 188.03 and interest." (Id. ¶¶ 7, 37; Defs.' Mot. Dismiss ["Defs.' Mot."] Ex. 1A ["Letter"] at 7, ECF No. 7-3). The Letter also stated, "[U]nless suitable arrangements are made to liquidate this indebtedness, we shall have no alternative but to instigate legal proceedings. Such action will require additional cost and expense to you as well as the inconvenience of appearing at the trial of the case." (Compl. ¶ 42; Letter at 1).

On February 16, 2018, Jackson filed three-count Class Action Complaint for Violations of the Fair Debt Collection Practices Act (the "Complaint") against Defendants. (ECF No. 1), alleging violations of the Fair Debt Collection Practices Act (the "FDCPA"), 15 U.S.C. §§ 1692 et seq. (2018). (ECF No. 1). Jackson alleges that Defendants' Letter falsely stated that she: owed attorney's fees when no fees were due (Count I); would inevitably owe additional costs and expenses if she were sued (Count II); and would be forced to attend court in person if she were sued. (Compl. ¶¶ 61–77, ECF No. 1). Jackson seeks compensatory damages, statutory damages, and attorney's fees. (Id. ¶¶ 66, 72, 78).

On March 30, 2018, Defendants filed their Motion to Dismiss, or in the Alternative, Motion for Summary Judgment and Request for Hearing. (ECF No. 7). On April 19, 2018, Jackson filed an Opposition. (ECF No. 10). On May 10, 2018, Defendants filed a Reply. (ECF No. 13). On October 6, 2018, Jackson filed a Surreply.² (ECF No. 18).

II. DISCUSSION

A. Conversion of the Motion

Defendants style their Motion as one to dismiss under Federal Rule of Civil Procedure 12(b)(6) or, in the alternative, for summary judgment under Rule 56. A motion styled in this manner implicates the Court's discretion under Rule 12(d). See Kensington Volunteer Fire Dep't., Inc. v. Montgomery Cty., 788 F.Supp.2d 431, 436–37 (D. Md. 2011), aff'd, 684 F.3d 462 (4th Cir. 2012). This Rule provides that when "matters outside the pleadings are presented to and not excluded by the court, the [ Rule 12(b)(6) ] motion must be treated as one for summary judgment under Rule 56." Fed.R.Civ.P. 12(d). The Court "has ‘complete discretion to determine whether or not to accept the submission of any material beyond the pleadings that is offered in conjunction with a Rule 12(b)(6) motion and rely on it, thereby converting the motion, or to reject it or simply not consider it.’ " Wells-Bey v. Kopp, No. ELH-12-2319, 2013 WL 1700927, at *5 (D. Md. Apr. 16, 2013) (quoting 5C Wright & Miller, Federal Practice & Procedure § 1366, at 159 (3d ed. 2004, 2012 Supp.) ).

The United States Court of Appeals for the Fourth Circuit has articulated two requirements for proper conversion of a Rule 12(b)(6) motion to a Rule 56 motion: notice and a reasonable opportunity for discovery. See Greater Balt. Ctr. for Pregnancy Concerns, Inc. v. Mayor of Balt., 721 F.3d 264, 281 (4th Cir. 2013). When the movant expressly captions its motion "in the alternative" as one for summary judgment and submits matters outside the pleadings for the court's consideration, the parties are deemed to be on notice that conversion under Rule 12(d) may occur. See Moret v. Harvey, 381 F.Supp.2d 458, 464 (D. Md. 2005).

Ordinarily, summary judgment is inappropriate when "the parties have not had an opportunity for reasonable discovery." E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 448 (4th Cir. 2011). Yet, "the party opposing summary judgment ‘cannot complain that summary judgment was granted without discovery unless that party had made an attempt to oppose the motion on the grounds that more time was needed for discovery.’ " Harrods Ltd. v. Sixty Internet Domain Names, 302 F.3d 214, 244 (4th Cir. 2002) (quoting Evans v. Techs. Applications & Serv. Co., 80 F.3d 954, 961 (4th Cir. 1996) ). To raise sufficiently the issue that more discovery is needed, the non-movant must typically file an affidavit or declaration under Rule 56(d), explaining the "specified reasons" why "it cannot present facts essential to justify its opposition." Fed.R.Civ.P. 56(d). A Rule 56(d) affidavit is inadequate if it simply demands "discovery for the sake of discovery." Hamilton v. Mayor of Balt., 807 F.Supp.2d 331, 342 (D. Md. 2011) (citation omitted). A Rule 56(d) request for discovery is properly denied when "the additional evidence sought for discovery would not have by itself created a genuine issue of material fact sufficient to defeat summary judgment." Ingle ex rel. Estate of Ingle v. Yelton, 439 F.3d 191, 195 (4th Cir. 2006) (quoting Strag v. Bd. of Trs., Craven Cmty. Coll., 55 F.3d 943, 953 (4th Cir. 1995) ).

Here, Jackson contends that it would be premature to construe Defendants' Motion as one for summary judgment because she has not had a reasonable opportunity for discovery. To support her position, Jackson submitted a Rule 56(d) affidavit from Attorney Peter A. Holland (the "Holland Declaration"). (Holland Decl., ECF No. 10-1). The Holland Declaration lists multiple items for which Jackson seeks additional discovery. Holland avers that Jackson needs written and deposition discovery to oppose Defendants' affidavit regarding their fee agreement with MMC and fees paid—such discovery "includ[ing] a redacted fee agreement, invoices, cancelled checks, and testimony from a representative of Sagal." (Holland Decl. ¶¶ 2–3). Some of the items listed in the Holland Declaration may not be material to Jackson's claims, but Jackson is entitled to any discovery relevant to her claims. See Hunt Valley Baptist Church, Inc. v. Baltimore Cty., No. ELH-17-804, 2017 WL 4801542, at *17 (D. Md. Oct. 24, 2017) (declining to convert the defendants' motion because "[a]lthough it may not be necessary for plaintiff to explore each of its proposed discovery topics, ... plaintiff is entitled to conduct discovery relevant to its claims"). Further, Defendants do not dispute the Holland Declaration's compliance with Rule 56(d)'s requirement that an affidavit set forth "specified reasons" as to why more discovery is needed.

Thus, the Court concludes that Jackson's Rule 56(d) affidavit sufficiently establishes that discovery is necessary. As a result, the Court will not convert the Motion and will construe it as a motion to dismiss.³

B. Standard of Review

The purpose of a motion under Rule 12(b)(6) is to "test[ ] the sufficiency of a complaint," not to "resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses." King v. Rubenstein, 825 F.3d 206, 214 (4th Cir. 2016) (quoting Edwards v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999) ). A complaint fails to state a claim if it does not contain "a short and plain statement of the claim showing that the pleader is entitled to relief," Fed.R.Civ.P. 8(a)(2), or does not "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) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). A claim is facially plausible "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955 ). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. (citing Twombly, 550 U.S. at 555, 127 S.Ct. 1955 ). Though the plaintiff is not required to forecast evidence to prove the elements of the claim, the complaint must allege sufficient facts to establish each element. Goss v. Bank of America, N.A., 917 F.Supp.2d 445, 449 (D. Md. 2013) (quoting Walters v. McMahen, 684 F.3d 435, 439 (4th Cir. 2012) ), aff'd sub nom. Goss v. Bank of America, NA, 546 F.App'x 165 (4th Cir. 2013).

In considering a Rule 12(b)(6) motion, a court must examine the complaint as a whole, consider the factual allegations in the complaint as true, and construe the factual...