Eisner v. Enhanced Recovery Co.

407 F.Supp.3d 132

Bradley EISNER, Plaintiff,

v.ENHANCED RECOVERY COMPANY, LLC, Defendant.

17-CV-01240 (LDH) (ST)

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

Signed August 20, 2019

Edward B. Geller, Edward B. Geller, Esq., P.C., Bronx, NY, for Plaintiff.

Edward Joseph Heppt, Smith Gambrell & Russel, LLP, New York, NY, Scott S. Gallagher, Smith, Gambrell & Russell, LLP, Jacksonville, FL, Nicole Haff, Romano Law, New York, NY, for Defendant.

MEMORANDUM AND ORDER

LaSHANN DeARCY HALL United States District Judge:

Plaintiff Bradley Eisner commenced this Fair Debt Collection Practices Act ("FDCPA") action against Defendant Enhanced Recovery Company, LLC, in New York state court. (ECF No. 1-2.) Defendant subsequently removed the action to federal court and answered the complaint, asserting a counterclaim for attorney's fees pursuant to 15 U.S.C. § 1692k(a)(3). (ECF Nos. 1, 4.) Defendant moves pursuant to Rule 56 of the Federal Rules of Civil Procedure for summary judgment dismissing Plaintiff's claims. (ECF No. 59.) Defendant further moves—pursuant to Rules 36 and 54, § 1692k(a)(3), 28 U.S.C. § 1927, and the Court's inherent authority—for an award of attorney's fees. (ECF Nos. 47, 48.) In addition, on May 9, 2019, pursuant to Rule 11(c)(3), the Court ordered Plaintiff's counsel, Harvey Rephen & Associates, P.C. (the "Rephen Firm"), to show cause why it should not be sanctioned for violating Rule 11(b).

BACKGROUND¹

At some point prior to December 7, 2016, Ms. Wanda Frazier approached Plaintiff, with whom she had a prior business relationship, to discuss his credit.² (Resp. Def.'s Local Civ. R. 56.1 Statement Material Facts ("Def.'s 56.1") ¶ 7, ECF No. 25.) Plaintiff gave Ms. Frazier his identifying information, and, on December 7, Ms. Frazier obtained a copy of Plaintiff's credit report, which listed a $1,167 account being collected by Defendant for the creditor AT & T. (Id. ¶¶ 8, 9.) Plaintiff recalled that he had made a payment on the account that was not reflected in the balance on the credit report. (Id. ¶ 11.) On December 8, Ms. Frazier and Plaintiff together called Defendant to dispute the AT & T account balance. (Id. ¶ 13.) Ms. Frazier recorded the call. (Id. ¶ 25.)

On the call, Ms. Frazier learned that Defendant was also collecting on a T-Mobile USA, Inc. ("T-Mobile") account in Plaintiff's name and in the amount of $66.08.³ (Id. ¶¶ 4, 14–16.) At the time, Plaintiff's T-Mobile balance was not listed on his credit report, and neither Plaintiff nor Ms. Frazier was aware that Plaintiff's T-Mobile account had also been placed with Defendant for collection. (Id. ¶¶ 10, 12.) With Plaintiff's permission, Ms. Frazier obtained information about the account from Defendant's representative. (Id. ¶¶ 14–16.) Ms. Frazier then stated that Plaintiff wished to dispute the T-Mobile account and asked whether it would be possible to do so over the phone. (Id. ¶ 17.) Defendant's representative responded, "Absolutely." (Id. ¶ 17.) The representative then inquired as to the grounds for the dispute. (Id. ¶ 18.) Ms. Frazier stated that Plaintiff "believe[d] he paid something for that account and that [the credit report reflected] an incorrect amount." (Id. ¶ 18.) Defendant's representative confirmed that the basis of the dispute was an incorrect balance and asked if Plaintiff would be following up in writing. (Id. ¶ 20.) Ms. Frazier responded, "You would like the dispute in writing, no problem I can send it to [Defendant]?" (Id. ¶ 21.) The representative replied, "You don't have to. I have to ask if y'all intend to dispute in writing." (Id. ) Defendant's representative classified the account as disputed. (Id. ¶ 22.)

Following the call, Ms. Frazier sent her recording of the call to M. Harvey Rephen ("Mr. Rephen"), principal of the Rephen Firm. (Id. ¶ 26.) Plaintiff did not ultimately submit a written dispute of the T-Mobile account. (Id. ¶¶ 27, 52.) Nonetheless, Defendant ceased all collection activity on the account and did not attempt to collect on any other account in Plaintiff's name. (Id. ¶¶ 23, 29.) By letter dated December 9, 2016, Defendant informed Plaintiff that it had ceased collection efforts on the T-Mobile account.⁴ (Id. ¶ 28.)

Plaintiff commenced this action on January 12, 2017, seeking $25,000 in actual damages arising entirely out of Defendant's purported refusal to accept an oral dispute of the T-Mobile account. (Id. ¶¶ 2, 50.) On January 10, 2018, Defendant timely requested a pre-motion conference to discuss the filing of its proposed motion for summary judgment. (ECF No. 19.) The Court received pre-motion letters and statements of material facts pursuant to Local Civil Rule 56.1 and held a pre-motion conference on April 20, 2018. Following the conference, the Court permitted Defendant to rest on its submissions and reopened discovery on a limited issue pertinent to Defendant's anticipated motion for attorney's fees and sanctions—Ms. Frazier's relationship to the Rephen Firm.

In June 2018, Defendant apprised the Court of challenges obtaining discovery from the Rephen Firm and moved to compel it. (ECF Nos. 27, 28.) The Court held a status conference on July 13 and ordered the Rephen Firm to produce documents and to prepare and produce a corporate designee to testify at a deposition. Mr. Rephen, the corporate designee, failed to appear at the deposition the parties had scheduled for August 1. (ECF No. 32.) By order dated September 5, the Court granted in part Defendant's request for sanctions against the Rephen Firm for this failure. (ECF No. 40.) On September 8, after subsequent briefing regarding the scope of the deposition and the propriety of Mr. Rephen's stated intention to assert his Fifth Amendment privilege against self-incrimination, the Court ordered that Mr. Rephen must appear in person and would not be permitted to assert such privilege on the Rephen Firm's behalf. On September 18, Defendant formally noticed a Rule 30(b)(6) deposition of the Rephen Firm, scheduled for September 28. On October 9, Defendant informed the Court that Mr. Rephen had appeared for the deposition on behalf of the Rephen Firm but had asserted his Fifth Amendment privilege and refused to answer "the vast majority" of questions posed to the Rephen Firm. (ECF No. 42.) By order dated October 23, the Court granted Defendant's request for leave to file the instant motion for sanctions.

STANDARD OF REVIEW

Summary judgment must be granted when there is "no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A genuine dispute of material fact exists "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The movant bears the initial burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ; Feingold v. New York , 366 F.3d 138, 148 (2d Cir. 2004). Where the non-movant bears the burden of proof at trial, the movant's initial burden at summary judgment can be met by pointing to a lack of evidence supporting the non-movant's claim. Celotex Corp. , 477 U.S. at 325, 106 S.Ct. 2548. Once the movant meets its initial burden, the non-movant may defeat summary judgment only by adducing evidence of specific facts that raise a genuine issue for trial. See Fed. R. Civ. P. 56(e) ; Anderson , 477 U.S. at 250, 106 S.Ct. 2505 ; Davis v. New York , 316 F.3d 93, 100 (2d Cir. 2002). The Court is to believe the evidence of the non-movant and draw all justifiable inferences in his favor, Anderson , 477 U.S. at 255, 106 S.Ct. 2505, but the non-movant must still do more than merely assert conclusions that are unsupported by arguments or facts, Bellsouth Telecomms., Inc. v. W.R. Grace & Co. , 77 F.3d 603, 615 (2d Cir. 1996).

DISCUSSION

I. Defendant's Motion for Summary Judgment

Plaintiff asserts claims pursuant to 15 U.S.C. §§ 1692e and 1692f. Section 1692e prohibits a debt collector from using "any false, deceptive, or misleading representation or means in connection with the collection of any debt" and provides a non-exhaustive list of examples of violative conduct.⁵ Section 1692f prohibits a debt collector from using "unfair or unconscionable means to collect or attempt to collect any debt." Whether a debt collector's communication is false, deceptive, or misleading or constitutes an unfair or unconscionable means of collection under the FDCPA "is determined from the perspective of the objective least sophisticated consumer." Eades v. Kennedy, PC Law Offices , 799 F.3d 161, 173 (2d Cir. 2015) (quoting Easterling v. Collecto, Inc. , 692 F.3d 229, 233 (2d Cir. 2012) ). "Under this standard, collection [communications] can be deceptive if they are open to more than one reasonable interpretation, at least one of which is inaccurate." Id.

Here, Plaintiff's claims arise solely out of Defendant's purported refusal during the December 8, 2016 phone call to accept Ms. Frazier's oral dispute of the T-Mobile account on Plaintiff's behalf. (Def.'s 56.1 ¶ 50.) Defendant argues that the factual record belies Plaintiff's claims. (ECF No. 19.) The Court agrees.

The undisputed evidence permits only one reasonable interpretation of Defendant's accurate collection communication to Plaintiff (through Ms. Frazier): that Defendant would accept Plaintiff's oral dispute of the T-Mobile account over the phone. On the call, Ms. Frazier stated, "At the present time, Mr. Eisner would like to dispute this account. Can we dispute it with you over the phone?" (Def.'s 56.1 ¶ 17.) Defendant's representative answered unequivocally: "Absolutely." (Id. ) After the representative asked whether the dispute would also be submitted in writing and Ms. Frazier stated, "You would like the dispute in writing, no problem, I can send it to [Defendant]," the representative corrected her: "You don't have to." (Id. ¶¶...