Okyere v. Palisades Collection, LLC

• Decision Date: 16 September 2013
• Docket Number: No. 12 Civ. 1453(GWG).,12 Civ. 1453(GWG).
• Citation: 961 F.Supp.2d 522
• Parties: Johnson Poku OKYERE, Plaintiff, v. PALISADES COLLECTION, LLC et al., Defendants.
• Court: U.S. District Court — Southern District of New York

961 F.Supp.2d 522

Johnson Poku OKYERE, Plaintiff,

v.PALISADES COLLECTION, LLC et al., Defendants.

No. 12 Civ. 1453(GWG).

United States District Court, S.D. New York.

Sept. 16, 2013.

Ahmad Keshavarz, Law Offices of Ahmad Keshavarz, Brooklyn, NY, Shanna Marie Tallarico, Yisroel Schulman, New York Legal Assistance Group, New York, NY, for Plaintiff.

Jonathan Justin Greystone, Spector Gadon & Rosen, P.C., Philadelphia, PA, Jay Shapiro, Areef Jalal Nurul Ahmed, White & Williams, LLP, New York, NY, for Defendants.

OPINION AND ORDER

GABRIEL W. GORENSTEIN, United States Magistrate Judge.

In this action, plaintiff Johnson Poku Okyere brings claims against defendants Todd Houslanger, Houslanger and Associates, PLLC (collectively, the “Houslanger Defendants”), and Palisades Collection, LLC (“Palisades”) for violations of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. (the “FDCPA”), and conversion. Okyere has also sued Ronald Moses, a New York City Marshal, for conversion only. All of Okyere's claims were dismissed in a previous opinion of this Court, except that we granted Okyere leave to submit additional briefing regarding his FDCPA claim under 15 U.S.C. § 1692f. For the following reasons, we conclude that the complaint states a claim for relief under section 1692f. Accordingly, defendants' motion to dismiss this claim is denied. Because the resurrection of the section 1692f claim means there is pendent jurisdiction over plaintiff's state law claims, we also consider defendants' arguments that the conversion claims should be dismissed. Having considered these arguments, defendants' motions to dismiss the conversion claims are denied.

I. BACKGROUND

We assume the allegations of the amended complaint to be true and summarize them only to the extent necessary to dispose of the remaining claims.

A. Factual Background

In 2004, Palisades filed a lawsuit against Okyere in Bronx County Civil Court seeking a judgment on a debt owed to Discover Card, which had been assigned to Palisades. See Summons and Complaint, dated Jan. 12, 2004 (annexed as part of Ex. A to Plaintiff's 1st Amended Complaint and Jury Demand, filed June 7, 2012 (Docket # 24) (“Compl.” or “complaint”)). On May 17, 2004, a default judgment was entered against Okyere in the amount of $3,954.03. See Judgment on Default, dated May 17, 2004 (annexed as part of Ex. A to Compl.). This judgment was procured based on a false affidavit of service. Compl. ¶ 12.

Nearly seven years later, on March 11, 2011, Moses restrained Okyere's bank account in order to execute the judgment. Id. ¶ 14; see also Computer Records of Marshal Moses, dated Nov. 17, 2011 (annexed as Ex. E to Compl.) (“Moses Records”), at 000062 (indicating that restraint occurred on March 30, 2011). Okyere believed the restraint related to a judgment with a different index number, which had been satisfied through a prior income execution. Compl. ¶ 16.

On April 25, 2011, Okyere, acting pro se, obtained an order to show cause to vacate the default judgment and return the restrained funds. Id. ¶ 17; Order to Show Cause, dated Apr. 25, 2011 (annexed as Ex. C to Compl.) (“April 25 Order”). In his papers, Okyere stated that he had never been served and requested a stay of further enforcement of the judgment pending resolution of the motion. Compl. ¶ 18. The order to show cause set a hearing date for May 5, 2011. Id. ¶ 19; April 25 Order. The order stated that all enforcement proceedings were “stayed” pending the hearing. April 25 Order. A copy of the order was mailed “on or before April 28, 2011” to both Moses and Mel S. Harris, the attorney who represented Palisades when the lawsuit was originally filed. Id. ¶¶ 11, 20. On April 29, 2011, Harris received the order to show cause, and on May 2, 2011, he sent a signed copy of the order to Palisades by email. Id. ¶¶ 21–23. On May 3, 2011, Palisades informed Harris that it would arrange for a different attorney to defend against the order to show cause at the May 5 hearing. Id. ¶ 24.

“On or before May 2, 2011,” Moses received a copy of the order to show cause. Id. ¶ 26; Moses Records at 000062. On the same day, a “payout request/reminder” was sent from Moses's office to Okyere's bank. Compl. ¶ 27; Moses Records at 000062.

On May 4, 2011, the Houslanger Defendants filed an opposition to the order to show cause, at the direction of Palisades. Compl. ¶ 32. At this point, the Houslanger Defendants had possession of the order. Id. ¶ 33.

On May 5, 2011, the court adjourned the hearing on the order to show cause until May 12, 2011. Id. ¶ 39. On May 11, 2011, the bank issued a check in the amount of $2,513.30 to Moses. Id. ¶ 28.

On May 12, 2011, Judge Lizbeth Gonzalez issued an order vacating the judgment against Okyere. Id. ¶ 41; Decision/Order, dated May 12, 2011 (annexed as Ex. 1 to Plaintiff's Response in Opposition to Motion to Dismiss [DE 27–29] of Houslanger Defendants, filed July 13, 2012 (Docket # 39) (“Pl. Resp. to Houslanger Defs.' MTD”)).¹ The order stated, “all restraints, levies, liens and executions issued by the plaintiff against the defendant's bank accounts are lifted. All monies, including fees, in the possession of the plaintiff, City Marshall [sic] or other agent, shall be returned to the defendant forth[with].” Decision/Order; Compl. ¶ 41. At the May 12, 2012, hearing, Palisades was present “through the Houslanger Defendants.” Compl. ¶ 43. “None of Defendants complied with the order to return the money ‘forth [with].’ ” Id.²

The complaint alleges that on May 13, 2011, Palisades and the Houslanger Defendants, “through Marshal Moses, took $2,513.30 from Mr. Okyere's bank account,” and that as of this date Moses held $2371.78 in trust for Palisades and the Houslanger Defendants. Id. ¶ 45; Moses Records at 000066. Bank records reflect that on May 16, 2011, the check was sent by the bank. Compl. ¶ 29; CitiDirect Check Image Delivery, dated May 16, 2011 (annexed as Ex. G to Compl.). On May 18, 2011, Palisades, through the Houslanger Defendants, asked Moses to continue to hold Okyere's money in trust for 60 additional days. Compl. ¶ 48; Moses Records at 000063. On June 14, 2011, there was a hearing in Court, Compl. ¶ 49, and at some point “after” that hearing—and apparently before June 28, 2011, see id. ¶¶ 50–51—Okyere sent a letter to Palisades “via Houslanger Defendants,” which attached a copy of the May 12, 2011 Order and reminded both Palisades and the Houslanger Defendants to return the money, id. ¶ 50.

On June 28, 2011, Moses asked the Houslanger Defendants about the status of Okyere's order to show cause. Id. ¶ 51; Moses Records at 000063. The Houslanger Defendants “declined to inform” Moses that the judgement against Okyere had been vacated “or affirmatively misrepresented to the Marshal the status of the court orders.” Compl. ¶ 51. On July 18, 2011, the Houslanger Defendants again asked Moses to continue holding Okyere's funds in trust for another 60 days. Id. ¶ 52; Moses Records at 000063. On August 23, 2011, the Houslanger Defendants reiterated this request. Compl. ¶ 53; Moses Records at 000063. On September 16, 2011, the Houslanger Defendants again instructed Moses to hold Okyere's money in trust for 60 additional days. Id. ¶ 58; Moses Records at 000063. The Houslanger Defendants made the same request on November 15, 2011. Compl. ¶ 59; Moses Records at 000063. On November 17, 2011, Moses returned $2,513.30 to Okyere. Compl. ¶ 61; Moses Records at 000063–64.

B. Procedural History

Okyere filed his original complaint on February 27, 2012, and later filed an amended complaint, see Compl., which now governs. After the defendants either moved to dismiss or for judgment on the pleadings, this Court issued an Opinion and Order granting defendants' motions. Okyere v. Palisades Collection, L.L.C., 961 F.Supp.2d 508, 521, 2013 WL 1173992, at *11 (S.D.N.Y. Mar. 22, 2013) (“ Okyere I” ). However, we delayed entry of judgment, noting that Okyere's briefs opposing the motions were devoid of argument or case law explaining why section 1692f of the FDCPA applies to his claims. Id. at 521 n. 9, at *11 n. 9. We granted Okyere leave to brief this single issue. Id. Following this order, the parties submitted memoranda of law regarding this claim.³

II. GOVERNING LAWA. Motions to Dismiss and Motions for Judgment on the Pleadings

A party may move to dismiss pursuant to Fed.R.Civ.P. 12(b)(6) when the opposing party's complaint “fail[s] to state a claim upon which relief can be granted.” While a court must accept as true all of the allegations contained in a complaint, that principle does not apply to legal conclusions. See Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (“[A] plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.”) (citation, internal quotation marks, and brackets omitted). In other words, “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice,” Iqbal, 556 U.S. at 678, 129 S.Ct. 1937, and thus a court's first task is to disregard any conclusory statements in a complaint, id. at 679, 129 S.Ct. 1937.

Next, a court must determine if the complaint contains “sufficient factual matter” which, if accepted as true, states a claim that is “plausible on its face.” Id. at 678, 129 S.Ct. 1937 (citation and internal quotation marks omitted); accord Port Dock & Stone Corp. v. Oldcastle Ne., Inc., 507 F.3d 117, 121 (2d Cir.2007) (“[A] complaint must allege facts that are not merely consistent with the conclusion that the defendant violated the law, but which actively and plausibly suggest that conclusion”). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable...