Malone v. Accounts Receivable Res., Inc., CASE NO. 18-CIV-81254-RAR
| Decision Date | 06 October 2019 |
| Docket Number | CASE NO. 18-CIV-81254-RAR |
| Citation | 408 F.Supp.3d 1335 |
| Parties | Archie MALONE, Plaintiff, v. ACCOUNTS RECEIVABLE RESOURCES, INC., Defendant. |
| Court | U.S. District Court — Southern District of Florida |
Andree Quaresima, Sean Martin Holas, Scott David Owens, Scott D. Owens, P.A., Hollywood, FL, Paul Aaron Herman, Consumer Advocates Law Group, PLLC, Delray Beach, FL, for Plaintiff.
Charles James McHale, Jr., Golden Scaz Gagain, PLLC, Tampa, FL, for Defendant.
ORDER GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANT'S MOTION FOR SUMMARY JUDGEMENT
Archie Malone ("Malone") suffered a work place injury and received medical care at JFK Medical Center, Emergency Physician Solutions of South Florida ("Medical Center"). Because Malone was injured at work and during the scope of his employment, Malone's injuries were covered by workers' compensation insurance. To Malone's dismay, he received a letter from Accounts Receivable Resources, Inc. ("ARR") more than two months after his injury, seeking to collect an outstanding medical debt owed to the Medical Center.
As a result, Malone claims ARR violated the Fair Debt Collection Practices Act ("FDCPA"). ARR maintains it did not violate the FDCPA because it was entitled to rely on information provided by the creditor. Alternatively, ARR claims it committed a bona fide error—an affirmative defense under the FDCPA. ARR also asserts that Malone waived his right to bring an affirmative lawsuit because he did dispute the debt with ARR or the Medical Center. For the reasons stated herein, the Court finds ARR violated the FDCPA as a matter of law as there is no genuine dispute of material fact. Therefore, it is hereby
ORDERED AND ADJUDGED that Malone's Motion for Summary Judgment [ECF No. 25] is GRANTED and ARR's Motion for Summary Judgment [ECF No. 26] is DENIED. Pursuant to Rule 58 of the Federal Rules of Civil Procedure, the Court enters its final judgment in favor of Malone and against ARR in a separate, forthcoming order.
The Medical Center and ARR have a contractual relationship whereby the Medical Center refers certain debt to ARR for collection.2 ARR Decl. [ECF No. 27-1] ¶¶ 17, 20. Pursuant to their agreement, the Medical Center may only refer debt that is validly due and owing. Id. at ¶¶ 17, 21; ARR Dep. 41:12-17; Pl.'s Statement of Material Facts in Support of Pl.'s Mot. Summ. J. [ECF No. 25-10], Def.'s Opposition to Pl.'s Statement of Material Facts [ECF No. 35] (collectively, "Pl. SOMF") ¶ 14. Therefore, ARR assumes the debt referred by the Medical Center is validly due and owing. ARR Dep. 41:12-17. However, if a consumer disputes the validity of the debt with either the Medical Center or ARR, ARR ceases all collection activity and seeks confirmation of the amount due from the Medical Center. ARR Dep. 48: 9-15; Def. SOMF ¶ 19. And if ARR is notified that the debt relates to a workplace injury covered by workers' compensation insurance, ARR will not accept the referral or cease all collection activity accordingly. ARR Dep. 60:13-18; Def.'s Statement of Material Facts in Support of Def.'s Mot. Summ. J. [ECF No. 27], Pl.'s Opposition to Def.'s Statement of Material Facts [ECF No. 33-1] (collectively, "Def. SOMF") ¶¶ 29-21; Pl. SOMF ¶ 17.
On September 12, 2017, the Medical Center referred Malone's account to ARR to collect an outstanding balance due. Def. SOMF ¶ 2; ARR Decl. ¶ 4. As part of the referral, the Medical Center provided ARR with certain limited information, such as Malone's name, address, and the total amount due. Def. SOMF ¶ 2; ARR Dep. 20:19-24. The Medical Center did not notify ARR that Malone's debt was incurred due to a workplace injury or note his pending workers' compensation claim with the Office of the Judge of Compensation Claims ("OJCC").3 ARR Dep. 20:19-24, 28:15-18, 63: 18-25, 64: 1-25, 65:1-3, 65:17-22; see also Def. SOMF ¶ 8. Therefore, ARR was under the presumption that Malone's debt was validly due and owing. ARR Dep. 41:12-17; see also Pl. SOMF ¶ 14.
Upon receiving the referral, ARR "scrubbed" Malone's account to determine whether Malone was deceased, whether Malone had filed for bankruptcy, and whether Malone had recently moved. ARR Decl. ¶ 28; ARR Dep. 33:24-25, 36:7-23; Pl. SOMF ¶ 13. ARR also forwarded Malone's information to an outside agency to "score" his information and determine the probability Malone would pay the referred debt. ARR Decl. ¶ 28; ARR Dep. 37:2-25, 38:1-2. Apart from these basic standard procedures, ARR did not follow any other internal procedure to verify the validity of the debt before beginning its collection efforts. ARR Dep. 41:12-17; 45:19-23; Pl. SOMF ¶ 14.
On September 18, 2017, ARR sent Malone a letter "seeking to collect an alleged medical debt purportedly owed to [the Medical Center] in the amount of $981.00" ("Collection Letter"). Pl. SOMF ¶ 10; Malone Decl. ¶ 7; see also Collection Letter [ECF No. 27-2].4 The Collection Letter included the following notice: "[u]nless you notify this office within 30 days from receiving this notice that you dispute the validity of this debt, or any portion thereof, this office will assume this debt is valid." See Collection Letter. Although Malone acknowledges receipt of the Collection Letter, Malone never contacted ARR or the Medical Center to dispute the debt. See Def. SOMF ¶¶ 5, 10; Malone Decl. ¶ 7.
On January 29, 2018, ARR received a letter from Gallagher Bassett Services, Inc. ("Gallagher"), Malone's employer's insurance carrier, indicating that Malone's account was covered by workers' compensation. Def. SOMF ¶ 7. This was the first time ARR received notice that Malone received treatment from the Medical Center due to a work-related injury. Id. at ¶ 8. Consequently, ARR submitted the bill to Gallagher, suspended all debt collecting activity, closed the account, and sent the referral back to the Medical Center. ARR Dep. 48:18-25, 49:1-10; Def. SOMF ¶ 9.
On September 17, 2018, Malone filed the above-styled action alleging ARR violated sections 1692e and 1692e(2)(A) of the FDCPA by attempting to collect a debt Malone did not owe. On July 17, 2019, Malone and ARR filed the cross-Motions for Summary Judgment [ECF Nos. 25-26] currently before the Court. Malone claims ARR violated the FDCPA as a matter of law because ARR engaged in prohibited conduct by sending a collection letter to Malone for a debt he did not owe. Malone also maintains that ARR is not entitled to a bona fide error defense because ARR does not have any policies or procedures in place to prevent the alleged conduct giving rise to this action.
ARR claims it did not violate the FDCPA as a matter of law because it was entitled to rely on the information provided by the Medical Center. Further, ARR asserts that Malone waived his right to pursue his FDCPA claim by failing to dispute the validity of the debt with either ARR or the Medical Center. ARR also maintains it is entitled to a bona fide error defense.
For the reasons stated herein, the Court finds that ARR violated the FDCPA as a matter of law despite its reliance on the information provided by the Medical Center and Malone's failure to dispute the referred debt.
Summary judgment is appropriate where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(c). In making this assessment, the Court "must view all the evidence and all factual inferences reasonably drawn from the evidence in the light most favorable to the nonmoving party," Stewart v. Happy Herman's Cheshire Bridge, Inc. , 117 F.3d 1278, 1285 (11th Cir. 1997) (citation omitted), and "must resolve all reasonable doubts about the facts in favor of the non-movant," United of Omaha Life Ins. Co. v. Sun Life Ins. Co. of Am. , 894 F.2d 1555, 1558 (11th Cir. 1990) (citation omitted).
"The mere existence of some factual dispute will not defeat summary judgment unless that factual dispute is material to an issue affecting the outcome of the case." Chapman v. Al Transport , 229 F.3d 1012, 1023 (11th Cir. 2000). Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "This materiality inquiry is independent of and separate from the question of the incorporation of the evidentiary standard into the summary judgment determination." Id. A party is not entitled to summary judgment unless there is no genuine issue of material fact. Id. "A genuine issue of material fact does not exist unless there is sufficient evidence favoring the nonmoving party for a reasonable jury to return a verdict in its favor." Id. (emphasis added).
The movant's initial burden on a motion for summary judgment "consists of a responsibility to inform the court of the basis for its motion and to identify those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact." Fitzpatrick v. City of Atlanta , 2 F.3d 1112, 1115 (11th Cir. 1993) (alterations and internal quotation marks omitted) (citing Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ). Once the moving party has shouldered its initial burden, the burden shifts to the non-moving party to " ‘set forth specific facts showing that there is a genuine issue for trial,’ not just to ‘rest upon the mere allegations or denials of the adverse party's pleading.’ " United States v. Lawrence , 276 F.3d 193, 197 (5th Cir. 2001) (quoting Resolution Trust Corp. v. Camp , 965 F.2d 25, 29 (5th Cir. 19...
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