Kirk v. Gobel

• Court: U.S. District Court — District of Washington
• Writing for the Court: Edward F. Shea
• Citation: Kirk v. Gobel, 622 F.Supp.2d 1039 (E.D. Wash. 2009)
• Decision Date: 03 June 2009
• Docket Number: No. CV-08-0344-EFS.,CV-08-0344-EFS.
• Parties: Ron KIRK; and all others similarly situated, Plaintiff, v. Terry D. GOBEL and Jane Doe Gobel, husband and wife, Defendants.

622 F.Supp.2d 1039

Ron KIRK; and all others similarly situated, Plaintiff, v. Terry D. GOBEL and Jane Doe Gobel, husband and wife, Defendants.

No. CV-08-0344-EFS.

United States District Court, E.D. Washington.

June 3, 2009.

COPYRIGHT MATERIAL OMITTED

Alan Lynn McNeil, University Legal Assistance, Michael David Kinkley, Michael D. Kinkley PS, Spokane, WA, for Plaintiff.

Beverly Anderson, Carl Edward Hueber, Winston & Cashatt, Spokane, WA, for Defendants.

ORDER RULING ON CROSS SUMMARY JUDGMENT MOTIONS, MOTION TO STRIKE, AND 56(f) MOTION TO CONTINUE

EDWARD F. SHEA, District Judge.

A hearing occurred in the above-captioned matter on May 26, 2009. Plaintiff Ron Kirk was present and represented by Michael Kinkley and Alan L. McNeil. Carl Hueber appeared on behalf of Defendants Terry and Jane Doe Gobel—Mr. Gobel was present. Before the Court were four motions. First, Defendants ask the Court to enter summary judgment in their favor on Plaintiff's Fair Debt Collections Practices Act (FDCPA) and Washington Consumer Protection Act (WCPA) claims. (Ct. Rec. 9.) Plaintiff opposes their motion and also filed a motion for summary judgment (Ct. Rec. 27) and a motion to continue (Ct. Rec. 19) Defendants' motion in part. Plaintiff's summary judgment motion asks the Court to find that Mr. Gobel violated the FDCPA by making misrepresentations and using unfair practices to recover attorney fees and unregistered process server costs in a state court action.¹ Defendants oppose Plaintiff's motions, contending that Plaintiff's claims are barred by the Rooker-Feldman doctrine and res judicata and that no FDCPA violation occurred because the attorney fees and collection costs were legally awarded by the state court under the contracts. Defendants also filed a motion to strike paragraph 7 of Laura Miller's Affidavit. (Ct. Rec. 44.)

After reviewing the submitted materials and relevant authority and hearing oral argument, the Court is fully informed. For the reasons given below, the Court 1) denies Plaintiff's Rule 56(f) continuance request because discovery regarding the attorney fees calculation and underlying contracts is unnecessary, 2) denies Defendants' motion to strike paragraph 7 of Ms. Miller's Affidavit, and 3) grants and denies in part both summary judgment motions, ruling a) neither Rooker-Feldman nor res judicata apply, b) Mr. Gobel is a debt collector, c) Mr. Gobel did not violate the FDCPA or WCPA by asserting RCW 4.84.250 as an alternative grounds for attorney fees in the state court complaint or equity as an alternative grounds for attorney fees in either the complaint or the motion for default judgment, d) Mr. Gobel did violate the FDCPA by seeking attorney fees under RCW 4.84.250 in the motion for default judgment and recovery for unregistered process server costs in the complaint and motion for default judgment, and e) Mr. Gobel may pursue the bona fide error affirmative defense.

A. Undisputed Facts²

Mr. Kirk hired Independent Services Corp. (ISC) to provide in-home health care and signed two contracts—a Basic Service Agreement and a Client Registration and Home Plan—on January 18, 2005. (Ct. Rec. 17-2: Runcorn Aff. ¶ 2.) The Basic Service Agreement provided in part:

Collection of Payment for Services. In the event it becomes necessary to collect any amounts from services rendered under this agreement, client agrees to pay all costs of fees/collection, including any attorneys fees.

Id. ex. A. The Client Registration and Home Plan provided in part:

IF EITHER PARTY MUST RETAIN AN ATTORNEY TO ENFORCE ANY RIGHTS OR RESPONSIBILITIES ARISING UNDER THIS AGREEMENT, IT IS AGREED THAT ATTORNEY FEES AND COURT COST WILL BE AWARDED TO THE PREVAILING PARTY. VENUE FOR ANY LITIGATION ARISING FROM THIS AGREEMENT SHALL BE IN SPOKANE COUNTY. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF WASHINGTON.

Id. ex. B.

ISC believed Mr. Kirk to be in default and retained Mr. Gobel, an attorney who advertises that he regularly does collection work against consumers, to pursue collection. Id. ¶ 4; Ct. Rec. 32: McNeil Aff. On December 22, 2006, Mr. Gobel filed a summons and complaint in Spokane County District Court on ISC's behalf against Mr. Kirk seeking payment of the alleged outstanding contractual obligation. (Ct. Rec. 13: Gobel Aff. exs. B & C.) The complaint drafted by Mr. Gobel included the following recovery request:

5. For the collection costs and reasonable collection attorney fees under contract and/or RCW 4.84 in damage cases under $10,000; equitable attorney's fees under Miotke v. Spokane, 101 Wash.2d 307, 338 [678 P.2d 803] (1984).

Id. ex. C.

Mr. Gobel contracted William B. Gillingham, Jr. to serve the summons and complaint on Mr. Kirk. Mr. Gillingham was not registered as a process server as required by Washington law and therefore a process server registration number was not listed on the affidavit of service, which was prepared by Mr. Gobel's office, as required by RCW 18.180.030(1). (Ct. Rec. 18: Bundy Aff.; Ct. Rec. 22 pp. 5-6 & 22.)

Mr. Kirk did not appear in the matter. Mr. Gobel, on ISC's behalf, filed a Motion and Affidavit for Order of Default and Default Judgment in which he sought $670.25 in attorney fees and $70.00 for service fees. (Ct. Rec. 22 pp. 17-20.) The motion stated:

Authority for reasonable attorney fees: Per the contract and fee provision and/or for collection costs and reasonable collection attorney fees under RCW 4.84 in damage cases under $10,000; or attorney fees according to local rule in case of Defendants' default; equitable attorney's fees under Miotke v. Spokane, 101 Wash.2d 307, 338 [678 P.2d 803] (1984).

(Ct. Rec. 22 p. 19.) Without viewing the ISC contracts, the state court entered default against Mr. Kirk and awarded ISC the requested relief, including process server costs and attorney fees. Id.

Mr. Gobel then filed for supplemental proceedings to aid in collecting on the judgment—a process he regularly engages in for each ISC case in which a default judgment is obtained. (Ct. Rec. 31: Miller Aff.) Mr. Gobel hired Mr. Gillingham to serve the supplemental proceeding materials; again, Mr. Gillingham was not a registered process server at this time as statutorily required. (Ct. Rec. 18.)

On November 10, 2008, Mr. Kirk filed this lawsuit alleging that Mr. Gobel violated the FDCPA, 15 U.S.C. § 1692e et seq., and Washington Consumer Protect Act, RCW 19.86 et seq., by making misrepresentations and using unfair practices to recover unregistered process server and attorney fees based on RCW 4.84.250 and the equitable bad faith doctrine. (Ct. Rec. 1.) Mr. Kirk is a "consumer" as defined by 15 U.S.C. 1692a(3). (Ct. Rec. 6 § 3.2.)

Also, on November 10, 2008, Mr. Kirk filed a motion in Spokane County District Court to set aside the judgment entered against him. In response to the state court motion, ISC produced a copy of the signed ISC contracts. On May 22, 2009, the Spokane County District Court granted Mr. Kirk's motion in part by striking the unregistered process server costs and reducing the attorney fees, finding no basis for attorney fees under RCW 4.84.250 or equity. (Ct. Rec. 69.) ISC appealed the decision to Spokane County Superior Court. (Ct. Rec. 72.)

B. Standard

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 moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). Once a party has moved for summary judgment, the opposing party must point to specific facts establishing that there is a genuine issue for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the nonmoving party fails to make such a showing for any of the elements essential to its case for which it bears the burden of proof, the trial court should grant the summary judgment motion. Id. at 322, 106 S.Ct. 2548. "When the moving party has carried its burden of [showing that it is entitled to judgment as a matter of law], its opponent must do more than show that there is some metaphysical doubt as to material facts. In the language of [Rule 56], the nonmoving party must come forward with `specific facts showing that there is a genuine issue for trial.'" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (citations omitted) (emphasis in original opinion).

When considering a motion for summary judgment, a court should not weigh the evidence or assess credibility; instead, "the evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). This does not mean that a court will accept as true assertions made by the non-moving party that are flatly contradicted by the record. See Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) ("When opposing parties tell two different stories, one of which is blatantly contradicted by the record, so that no reasonable jury could believe it, a court should not adopt that version of the facts for purposes of ruling on a motion for summary judgment.").

When parties file cross-motions for summary judgment, "the court must rule on each party's motion on an individual and separate basis, determining, for each side, whether a judgment may be entered in accordance with the Rule 56 standard." Fair Housing Council of Riverside County v. Riverside Two, 249 F.3d 1132, 1136 (9th Cir.2001). In fulfilling its duty to review each cross-motion separately, the court must review the evidence submitted in support of each cross-motion. Id.

C. Authority and Analysis

Before addressing the issues surrounding Mr. Gobel's state-court conduct, the Court must address the jurisdictional Rooker-Feldman³ doctrine and related res judicata arguments raised by ...