Finney v. Mig Capital Mgmt., Inc.

DIANNA FINNEY, Plaintiff, v. MIG CAPITAL MANAGEMENT, INC., Defendant.

Civil Action No. 2:13-02778

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF WEST VIRGINIA AT CHARLESTON

DATED: March 27, 2014

MEMORANDUM OPINION & ORDER

Pending are the plaintiff's motion for default judgment, filed August 12, 2013, and a motion filed on February 28, 2014 seeking to substitute Cindy Easter, in her capacity as Administratrix of the Estate of Dianna Finney, as the plaintiff in this case.

I. Factual and Procedural Background

Sometime prior to 2011, Dianna Finney ("Finney" or "the decedent"), incurred a debt to HSBC Bank d/b/a Home Bank ("HSBC") for an unspecified amount. Compl. ¶ 9. The complaint does not describe the precise nature of the debt, but Finney asserts that it was primarily for personal, family or household purposes. Id.

Beginning in 2011, Finney became unable to make minimum payments on her debt to HSBC. Id. Sometime thereafter,also in 2011, MIG Capital Management ("MIG") began contacting Finney, attempting to collect the debt. Id. The complaint states that MIG undertook these efforts either on HSBC's behalf, or "because MIG purchased the account" from HSBC. Id.

Finney retained The Palmer Firm, P.C. ("Palmer"), a law firm located in Dallas, Texas, in February 2012. Id. ¶ 10. On or about February 23, 2012, Palmer sent a letter to MIG advising that Palmer represented Finney, demanding that MIG "immediately cease all attempts to contact" Finney, and requesting that any further correspondence regarding the debt be directed, in writing, to Palmer. See Plaintiff's Motion for Default Judgment, Ex. B ("Palmer Letter"). According to the complaint, Palmer also sent a "demand letter alleging violations of the Federal Fair Debt Collection Practices Act" on May 11, 2012, Compl. ¶ 12; however, the complaint does not indicate to whom this second letter was addressed.¹

Notwithstanding the February 23, 2012 letter, the complaint alleges that MIG continued to contact Finney "on several occasions" by calling her "home or cellular phone[.]" Id. ¶¶ 24, 28. In an affidavit submitted in support of the pending motion for default judgment, Finney specifically claimsthat MIG called her approximately three times per week between February 23, 2012 and May 15, 2012, and claims that MIG was "oftentimes rude and aggressive, and frequently threatened to sue [her] with regard to the debt" during these calls. See Plaintiff's Supplemental Motion for Default Judgment, Ex. A ("Finney Aff.") ¶¶ 7-9.

On February 15, 2013 Finney commenced this action. In Count I, she claimed that HSBC violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. ("FDCPA"), by placing harassing phone calls to her regarding the debt. Compl. ¶¶ 13-18. It appears that Finney intended to plead Count I against MIG as well. Count I does not refer to MIG specifically at any point, see Compl. ¶¶ 13-18 ("First Cause of Action . . . Against Defendants HSBC Bank Nevada . . . and Household Bank"); id. ¶ 16 ("Defendants, HSBC . . . and Household Bank[,] violated The Federal Fair Debt Collection Practices Act"), but the complaint does request damages under the FDCPA against all defendants, see id. ¶ 18 ("As a result of each and every [defendant's] violations of the FDCPA, [plaintiff is] entitled to actual damages . . . statutory damages . . . and reasonable attorney's fees and costs[.]" (emphasis added)); id. at Prayer for Relief (requesting an award of actual and statutory damages against "each and every [d]efendant" under the FDCPA), and otherlanguage in the complaint suggests that Finney did intend to plead Count I against MIG, see id. ¶ 5 (alleging that "MIG was a debt collector pursuant to 15 U.S.C. [§] 1692a(6)).

In Count II, Finney asserted a claim for "tort in se" against HSBC and MIG. Id. ¶¶ 19-20. The remainder of the complaint charged MIG alone with violations of the West Virginia Consumer Credit Protection Act ("WVCCPA") (Count III); invasion of privacy (Count IV); and negligent and intentional infliction of emotional distress (Counts V and VI, respectively). Id. ¶¶ 21-34.

HSBC was dismissed from this case with prejudice pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii) on April 5, 2013. The Secretary of State accepted service of process on MIG's behalf on March 26, 2013, and the Secretary's website indicates that MIG's registered agent signed for a certified mailing of the complaint on March 28, 2013. MIG has not, however, answered the complaint nor made any appearance in this matter. As a result, Finney first moved for default judgment against MIG on May 16, 2013. In an order dated May 20, 2013, the court denied the motion, noting that MIG's default had not yet been entered by the Clerk. In response, on July 23, 2013, Finney moved for an entry of default, and the Clerk entered default on July 24, 2013. Thereafter, on August 12,2013, Finney renewed her motion for default judgment against MIG. She sought statutory damages in the amount of $141,000² for thirty violations of section 46A-2-128(e) of the WVCCPA, an order extinguishing her debt, an unspecified additional amount of damages to be determined based on evidence yet to be presented, and attorney's fees and costs. See Plaintiff's Motion for Default Judgment ("Mot. Default") at 1-2. In her brief in support of the motion for default, Finney also suggested that MIG was liable, generally, for violations of the FDCPA and for the common law torts of invasion of privacy and infliction of emotional distress. Plaintiff's Memorandum of Law in Support of Motion for Default Judgment ("Default Mem.") at 7. Finney noted that her damages on those latter theories of liability could not be reduced to a sum certain, and therefore requested "that a hearing be conducted to determine the amount of damages that [Finney wa]s entitled to . . . for the claims she assert[ed] in addition to those violations of the [WVCCPA.]" Id. at 7-8.

On November 15, 2013, the court held an evidentiary hearing in order to allow Finney to submit evidence and argumentin support of her request for a default judgment. The plaintiff was not present at the hearing, and no evidence was submitted. Counsel for the plaintiff did appear, however, and he clarified that, as a practical matter, Finney was seeking default judgment solely on the basis of her Count III claim for violations of the WVCCPA:

THE COURT: Let me ask, as well, whether or not the plaintiff seeks judgment as a practical matter on anything other than the violation of the West Virginia statute in [§] 128(e).

MR. COOK: Your Honor, as a practical matter, the plaintiff does not seek further recovery.

Hearing Transcript at 8:12-20, Finney v. MIG Capital Mgmt., Inc., No. 13-2778 (S.D. W. Va. Nov. 15, 2013). The court continued the hearing until 2:30 p.m. on November 21, 2013 in order to afford Finney further opportunity to offer testimony and additional evidence concerning the appropriate damages award. See id. at 8:21-9:6 (noting the substantial range of statutory damages available under the WVCCPA and indicating that testimony and further detail could be relevant to the damages calculation).

Prior to the rescheduled hearing, Finney's attorney advised the court that the plaintiff's absence at the November 15, 2013 hearing was the result of ongoing medical issues, and requested that the hearing be further continued for one month. In an order dated November 21, 2013, the court assented to thatrequest and continued the hearing to December 18, 2013. On December 17, 2013, however, Finney's attorney advised the court that his client's medical condition had not improved, and that Finney would not be able to appear at the hearing scheduled for the following afternoon. In response, the court once again continued the evidentiary hearing to January 24, 2014.

On January 22, 2014, the court received word that Finney had, unfortunately, died. Thereafter, on February 28, 2014, Cindy Easter, in her capacity as Administratrix of the Estate of Dianna Finney ("the Estate"), filed a statement formally noting Finney's death on the record in accordance with Federal Rule of Civil Procedure 25(a). The Estate also filed on that same day a motion seeking to replace Finney as the plaintiff in this matter.³ MIG, as has been its custom throughout these proceedings, has not responded in any way to the motion to substitute.

II. Motion to Substitute

The substitution of a successor or representative to replace a deceased party is governed by Rule 25(a) of the Federal Rules of Civil Procedure, which provides, in relevant part, as follows:

If a party dies and the claim is not extinguished, the court may order substitution of the proper party. A motion for substitution may be made by any party or by the decedent's successor or representative.

Fed. R. Civ. P. 25(a); see also Fariss v. Lynchburg Foundry, 769 F.2d 958, 961 (4th Cir. 1985) ("Rule 25(a)(1) governs substitution of the proper successor or representative of a deceased party[.]"). As the text of the rule indicates, a motion to substitute raises two primary questions: First, whether the decedent's claims survive death; and, second, whether the party to be substituted is a "proper" party.

A. Survival

The court must first determine whether Finney's claims survive her death. Not every claim pled in the complaint is relevant to this step in the analysis, because, as noted, Finney, by counsel, indicated at the hearing on November 15, 2013, that she intended to pursue default judgment solely on thebasis of her Count III claim under the WVCCPA. In its motion to substitute, the Estate espouses a slightly different view, conceding that "the statutory claims represent the gravamen" of the motion for default," Motion to Substitute ("Mot. Substitute") at 2 n.1, but suggesting that both the Count I and Count III "claims against the [d]efendants brought under the FDCPA and WVCCPA" are relevant and "survive [Finney's] death," id. ¶ 21.

For present purposes, the court will consider...