Richardson v. William Sneider & Assocs., LLC

Decision Date24 July 2012
Docket NumberCase No.: 4:12CV25
CourtU.S. District Court — Eastern District of Virginia
PartiesVICTORIA RICHARDSON, Plaintiff, v. WILLIAM SNEIDER AND ASSOCIATES, LLC, Defendant.
UNITED STATES MAGISTRATE JUDGE'S REPORT AND RECOMMENDATION

This matter is before the Court on Plaintiff Victoria Richardson's Motion for Default Judgment against Defendant William Sneider and Associates, LLC ("William Sneider"). ECF No. 4. Pursuant to 28 U.S.C. § 636(b)(1)(B) and Federal Rule of Civil Procedure 72(b), Richardson's motion was referred to the undersigned United States Magistrate Judge. ECF No. 12. Based on Richardson's arguments at hearing, the record, and the findings contained herein, the undersigned RECOMMENDS that Richardson's motion for default judgment be GRANTED for Counts I through VI, that Richardson's Motion to Voluntarily Dismiss Count VII be GRANTED, and that default judgment be entered against Defendant William Sneider.

I. FACTUAL AND PROCEDURAL BACKGROUND

On February 14, 2012, Plaintiff Victoria Richardson filed a Complaint against William Sneider, Jane Roe, and John Doe. ECF No.1. Richardson voluntarily dismissed William Sneider employees Jane Roe, also known as Morgan Taylor, and John Doe, also known as John Williams, because she could not ascertain their identities,1 leaving William Sneider as the only remaining defendant. ECF Nos. 5, 8. William Sneider is a debt collection agency incorporated in Georgia with its principal place of business in Georgia. Compl. 2, ECF No. 1. Counts I through VI of the Complaint seek relief against William Sneider for violations of the Fair Debt Collections Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. Plaintiff seeks to voluntarily dismiss Count VII, which originally sought relief against William Sneider under the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227.2 ECF No. 15.

Specifically, Count I seeks relief under 15 U.S.C. § 1692g for failure to give written notice of the debt. Count II alleges violations of 15 U.S.C. §§ 1692d(6) and 1692e(ll) for failure to meaningfully disclose the company's identity. Count III asserts that William Sneider threatened to take legal action that cannot legally be taken or that it did not intend to take, in violation of15 U.S.C. § 1692e(5). In Count IV, Plaintiff claims that William Sneider violated 15 U.S.C. § 1692 by falsely representing that an individual is an attorney. Count V charges William Sneider with having unauthorized contact with a third party, which is proscribed by 15 U.S.C. § 1692c(b). Count VI alleges that William Sneider used false representations or deceptive means in violation of 15 U.S.C. § 1692e(10). Plaintiff seeks $1,000 of statutory damages under 15 U.S.C. § 1692k, $8,387.50 in reasonable attorney's fees, and $380 in court costs.

According to the Complaint, Plaintiff fell behind on her bills and applied online for a $500 installment loan through ThinkCash, a loan program controlled by ThinkFinance and First Bank of Delaware.3 Plaintiff preauthorized electronic fund transfers from her bank account to repay the loan in installments. Around September or October 2010, Plaintiff could no longer afford the payments. As Plaintiff explained in her sworn testimony, her bank closed her checking account due to the multiple overdrafts that resulted from these automatic withdrawals. Plaintiff subsequently defaulted on the loan, and the obligation was eventually sold to a third party debt collector, William Sneider. Between May 26, 2011,and July 7, 2011, William Sneider called Plaintiff on thirteen occasions. An employee of William Sneider placed six of the calls. The remaining seven were automated calls generated from an automated telephone dialing system. Plaintiff did not answer these calls, but voice messages were left on each occasion. Defendant also placed one automated call to Plaintiff's place of employment, which Plaintiff's supervisor answered. Plaintiff never authorized third party calls, and the call was not made to acquire location information, as permitted by 15 U.S.C. § 1692b. The calls threatened "a possible service warrant" for "deposit account fraud" and "depository check fraud" in Newport News,4 yet Defendant never filed a complaint against Plaintiff. On July 21, 2011, Plaintiff placed a call to William Sneider and spoke to an employee named John Williams. Williams informed the plaintiff that the case hadbeen referred to an attorney named Paul Weinstein, that William Sneider was an attorney-based firm, and that the company demanded payment on the Thinkcash debt. At no time did a written notice of debt follow the telephone calls. Plaintiff asserts that these calls caused her embarrassment, public humiliation at her workplace, and emotional distress.

William Sneider was properly served with the Complaint pursuant to Virginia Code § 12.1-19.1. ECF Nos. 2-3. The defendant never responded, and Plaintiff filed a Request for Entry of Default and a Motion for Default Judgment on April 5, 2012. ECF No. 4. On April 6, 2012, the Clerk entered default against William Sneider. ECF No. 9. On July 3, 2012, the Court issued an Order directing Plaintiff to set a hearing date for her motion and to notify all parties of said date. ECF No. 13. The Order also directed Plaintiff to submit certain documentation in support of her claim for damages. On July 6, 2012, the Plaintiff filed a Motion for Voluntary Dismissal of Count VII. ECF No. 15. The Court conducted a hearing on July 16, 2012, at 10:00 a.m. Sarah Bland, Esq., appeared at the hearing on behalf of Richardson. Ms. Bland offered argument concerning the validity of the claims and elicited live testimony from Plaintiff. William Sneider failed to appear.

II. RULE 55 STANDARD

When a party against whom judgment is sought fails to file a responsive pleading or otherwise defend the action, the plaintiffmay request, and the court may enter, default judgment against the nonresponsive party. Fed. R. Civ. P. 55. William Sneider has not filed responsive pleadings or appeared in this matter. See Fed. R. Civ. P. 12(a) (giving a defendant twenty-one days after receiving service of the complaint to serve an answer). Pursuant to Rule 55(a), Plaintiff requested the Clerk of the Court to enter default against William Sneider on April 5, 2012. ECF No. 15. The Clerk entered default against William Sneider on April 6, 2012. Plaintiff also filed a Motion for Default Judgment.

A plaintiff is not entitled to default judgment simply because the defendant fails to respond to the complaint. "A default is not treated as an absolute confession by the defendant of his liability and of the plaintiff's right to recover." Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780 (4th Cir. 2001) (citing Nishimatsu Constr. Co., Ltd. v. Hous. Nat'l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975) (quoting Thomson v. Wooster, 114 U.S. 104, 113 (1885))). Foremost, a court must be satisfied that the complaint states a legitimate cause of action. See Anderson v. Found. for Advancement, Educ. & Emp't of Am. Indians, 155 F.3d 500, 506 (4th Cir. 1998) (holding that the district court erred in granting default judgment to the plaintiff where the plaintiff failed to state a claim); GlobalSantaFe Corp. v. GlobalSantaFe.com, 250 F. Supp. 2d 610, 612 n.3 (E.D. Va. 2003) ("Upon default . . . the appropriate inquiry is whether the facts alleged [in the complaint]state a claim."). Although the Court "must accept the facts alleged in a complaint as true and construe them in the light most favorable to the plaintiff," Coleman v. Md. App., 626 F.3d 187, 188 (4th Cir. 2010), threadbare "legal conclusion[s] . . . [are] not entitled to the assumption of truth." Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009). Moreover, the well-pleaded facts of a complaint must permit the court to infer the plausibility rather than the mere possibility of misconduct entitling the plaintiff to relief. Id.; Coleman, 626 F.3d at 190; Francis v. Giacomelli, 588 F.3d 186, 193 (4th Cir. 2009).

III. JURISDICTION AND VENUE
A. Subject Matter Jurisdiction

The Court must have subject matter jurisdiction over the case and personal jurisdiction over the defaulting parties before it can render a default judgment. Venue must also be proper. The Court has subject matter jurisdiction over Richardson's FDCPA claims under 15 U.S.C. § 1692k(d), which states that n[a]n action to enforce any liability created by this subchapter may be brought in any appropriate United States district court without regard to the amount in controversy . . . within one year from the date on which the violation occurs." Because the alleged violations occurred less than one year before filing, this Court has subject matter jurisdiction over this civil action and the claims are not time-barred.

B. Personal Jurisdiction

Neither Richardson's Complaint nor her Motion for Default Judgment alleges facts in support of this Court's ability to exercise personal jurisdiction over William Sneider. Nevertheless, it appears as if personal jurisdiction is present in this case. Under Federal Rule of Civil Procedure 4(k)(1)(A), a United States district court has personal jurisdiction over a defendant if a state court in that district would have personal jurisdiction had the case been brought in state court. Virginia Code § 8.01-328.1(A)(1) grants personal jurisdiction over "a person, who acts directly or by an agent, as to a cause of action arising from the person's . . . [transacting any business in this Commonwealth."5 A single act that is "significant" and "demonstrates purposeful activity in Virginia" suffices, although "no bright-line rule exists to distinguish the level of activity sufficient to confer jurisdiction from the level that falls short." Prod. Group Int'l, Inc. v. Goldman, 337 F. Supp. 2d 788, 793 (E.D. Va. 2004).

Although Defendant was never physically present in Virginia, physical presence in the forum state is not required. See Peanut Corp. of Am. v....

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