Scott v. Portfolio Recovery Assocs., LLC

Decision Date16 October 2015
Docket NumberNo. 3:14–cv–00093–JEG,3:14–cv–00093–JEG
Parties Denise Scott, Plaintiff, v. Portfolio Recovery Associates, LLC, Defendant.
CourtU.S. District Court — Southern District of Iowa

Raymond H. Johnson, Johnson Law Firm, West Des Moines, IA, for Plaintiff.

Joshua C. Dickinson, Spencer Fane Britt & Browne, LLP, Omaha, NE, for Defendant.



, Senior Judge

This matter comes before the Court on a Motion for Summary Judgment filed by Defendant Portfolio Recovery Associates, LLC (Portfolio), which Plaintiff Denise Scott (Plaintiff) resists, and a Motion for Partial Summary Judgment on the Issue of Liability filed by Plaintiff, which Portfolio resists. The parties have not requested a hearing, and the Court finds a hearing is unnecessary. The Motions are fully submitted and ready for consideration.


The following relevant facts are either undisputed or viewed in the light most favorable to the non-moving party.1

Portfolio is a debt collector. Plaintiff is a senior technical design manager employed by Wal–Mart Stores, Inc. (Wal–Mart), living in Rogers, Arkansas. In early 2005, Portfolio was assigned a defaulted debt owed to Ford Motor Credit by a person named Denise A . Scott (the Debtor). Plaintiff's name is Denise S . Scott. Portfolio was unsuccessful recovering the Ford Motor Credit debt owed by the Debtor. As a general practice, when Portfolio takes legal action to collect debts, it hires outside legal counsel admitted in the jurisdiction where the legal action takes place. In April 2009, Portfolio retained attorney Kevin Abbott (Abbott) to collect the Ford Motor Credit debt. Portfolio transferred to Abbott the entire Ford Motor Credit account, including the information about the account Portfolio possessed at the time. Thereafter, Portfolio was not actively involved in collecting the debt. In May 2009, Portfolio received additional documentation regarding the debt, which included the Debtor's Social Security number. In June 2009, Abbott filed an action in Iowa District Court for Johnson County, Portfolio Recovery Assoc., LLC, EIN # 54–1794735 v. Mike A. Scott and Denise A. Scott (Portfolio v. Mike A. and Denise A. Scott), Case No. LACV 070826, against the Debtor and her husband, Mike A. Scott, alleging that the two were in default of the Ford Motor Credit debt. Portfolio obtained a default judgment against the Debtor and Mike A. Scott in July 2009 for $7,862.39. Plaintiff has never owed money to Portfolio or Ford Motor Credit. Portfolio has not sued Plaintiff and has no judgment against her.

Abbott sought to garnish the Debtor's wages too execute on Portfolio's default judgment. In order to do so, Abbott needed the Debtor's credit report, Social Security number, and place of employment. According to the declaration of Jennifer R. Cullen (Cullen), Portfolio's Assistant Vice President of Legal Recovery, Abbott told Portfolio that he "ran Denise Scott's credit report on September 22, 2009 and added a Social Security number to his file based on the credit report." Cullen Decl. ¶ 11; Def's App. 11, ECF No. 7–3. In contrast, Abbott states in his own declaration that he "utilized a service called ‘Accurint,’ which is offered by LexisNexis, to obtain Denise Scott's Social Security number based on the address that was in the account records." Abbott Decl. ¶ 4, Def.'s App. 13–14, ECF No. 7–3. Abbott avows that Accurint "is promoted as being utilized by numerous entities, including government agencies, to obtain consumer data" and that he "believed this service to be reliable and ... relied upon it." Id. Abbott declares that he then "confirmed through a service called ‘The WorkNumber,’ which is a leading employment and income verification service, that Denise Scott was employed at Wal–Mart." Id. Significantly, neither Cullen's nor Abbott's declaration provides a middle initial or otherwise distinguishes the "Denise Scott" for whom Abbott allegedly received information. Furthermore, neither Cullen nor Abbott identifies the relevant information Abbott already possessed to perform this fact-gathering. Cullen attests that Portfolio did not direct Abbott to run the credit report, and that until August 11, 2014, after Plaintiff initiated this action, Portfolio was unaware of Abbott's efforts to gather information about the Debtor.

The state court docket sheet for Portfolio v. Mike A. and Denise A. Scott, Case No. LACV 070826, shows that on November 9, 2009, an execution of judgment was filed with the Polk County Sheriff. Docket—Portfolio v. Mike A. and Denise A. Scott, Pl.'s Ex. 3, ECF No. 8–2. The "comments" for the docket entry on November 30, 2009, show an "Answer of the Garnishee" was filed, and the comments indicate that Denise Scott was not employed at Wal–Mart. Id. A return of service was filed on March 29, 2010, indicating that the execution of judgment was returned unsatisfied. Id.

On January 10, 2014, Abbott filed a notice of garnishment requesting that the Polk County Sheriff garnish Plaintiff's wages at Wal–Mart.2 The Sheriff served a notice of garnishment on Wal–Mart, and on February 5, 2014, Wal–Mart served answers to garnishment interrogatories.3 On February 14, 2014, Plaintiff called Abbott and told him she was not the Debtor. Nonetheless, on March 10, 2014, the Polk County Sheriff garnished $916.07 of Plaintiff's wages. In response to Plaintiff's call, Abbott faxed a release of garnishment to the Polk County Sheriff's Office, requesting that the garnished funds be returned to "the defendant." However, the defendant in Portfolio v. Mike A. and Denise A. Scott, Case No. LACV070826, was the Debtor, not Plaintiff, whose wages were erroneously garnished. On February 17, 2014, Plaintiff called Abbott again and asked him to fax a copy of the release of garnishment to Wal–Mart, which Abbott did that day.4 Pointing solely to Cullen's affidavit, Portfolio asserts it did not exercise control over Abbott, was not involved in obtaining Plaintiff's Social Security number, did not direct Abbott to serve a garnishment on Wal–Mart regarding Plaintiff, and did not know of the garnishment until Plaintiff initiated this action.

At the inception of this litigation, Plaintiff's lawyer, Raymond Johnson (Johnson), told Portfolio's lawyer, Joshua Dickinson (Dickinson), that the garnished funds had not been returned to Plaintiff. Sometime after July 28, 2014, Dickinson's law firm investigated whether the funds had been returned to Plaintiff and was informed that Wal–Mart had sent the funds to the Sheriff, who then sent the funds to the Johnson County Clerk of Court. Dickinson contacted Johnson, informed him that he believed the funds were held by the Johnson County Clerk of Court, and offered to help Plaintiff retrieve the funds.

On September 5, 2014, Abbott filed an application with the Johnson County Clerk of Court to condemn funds. However, on the application, as with the release of garnishment Abbott sent to the Polk County Sheriff in March 2014, Abbott indicated that the funds should be condemned in favor of Denise A. Scott, the defendant in Portfolio v. Mike A. and Denise A. Scott, Case No. LACV070826. Also on September 5, 2014, the Johnson County District Court ordered the Clerk of Court to pay all funds held directly to "Denise Scott" and to mail the funds to Plaintiff's address previously provided by Johnson. On September 8, 2014, Dickinson asked Johnson to notify him if Plaintiff did not receive the missing funds. In January and again in March 2015, Dickinson asked Johnson whether he had Plaintiff's correct address. On March 11, 2015, Johnson told Dickinson that Plaintiff had not received the funds, and on March 25, 2015, Johnson gave Dickinson Plaintiff's updated address. Plaintiff has nonetheless never received the funds. Both Abbott and Portfolio assert that they did not obtain any funds from the garnishment.

Plaintiff filed an action against Portfolio in the Iowa District Court for Johnson County on June 19, 2014, alleging violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq.,

and Iowa Debt Collection Practices Act (IDCPA), Iowa Code § 537.7103. On August 7, 2014, Portfolio timely removed the case pursuant to 28 U.S.C. § 1446. On July 1, 2015, Portfolio filed a Motion for Summary Judgment pursuant to Federal Rule of Civil Procedure 56 asking the Court to dismiss Plaintiff's Complaint in its entirety. The same day, Plaintiff also filed a Motion for Partial Summary Judgment on the issue of Portfolio's liability for violations of the FDCPA and IDCPA.

A. Jurisdiction

This Court has original jurisdiction over Plaintiff's FDCPA claims pursuant to 28 U.S.C. § 1331

("[t]he district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States"), and has supplemental jurisdiction over Plaintiff's IDCPA claims to 28 U.S.C. § 1367(a) ("[except as otherwise provided,] in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action ... that they form part of the same case or controversy").

B. Standard for Motions for Summary Judgment

"Summary judgment is appropriate when no genuine issue of material fact remains and the movant is entitled to judgment as a matter of law.... [I]f the record as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Walnut Grove Partners, L.P. v. Am. Fam. Mut. Ins. Co., 479 F.3d 949, 951–52 (8th Cir.2007)

(quoting Rifkin v. McDonnell Douglas Corp., 78 F.3d 1277, 1280 (8th Cir.1996) ); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "The moving party bears the burden of showing that the material facts in the case are undisputed." Pace v. Portfolio Recovery Assoc., LLC, 872 F.Supp.2d 861, 863 (W.D.Mo.2012) (citing ...

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