Kimmel v. Cavalry Portfolio Serv. LLC, CIVIL ACTION NO. 10-680

DR. MURRAY H. KIMMEL, Plaintiff/Counterclaim Defendant, v. CAVALRY PORTFOLIO SERVICES, LLC, Defendant/Counterclaim Plaintiff.

CIVIL ACTION NO. 10-680

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA

July 27, 2011

MEMORANDUM

BUCKWALTER, S. J.

Plaintiff Dr. Murray H. Kimmel ("Plaintiff") has filed the present Motion for Reconsideration of the Court's May 25, 2011 Order granting Defendant Cavalry Portfolio Services, LLC's ("Defendant") Motion for Summary Judgment on Plaintiff's Claims. For the following reasons, the Motion is granted.

I. FACTUAL AND PROCEDURAL HISTORY

According to the Complaint, Defendant sent to Plaintiff correspondence dated December 8, 2009, in which Defendant offered Plaintiff an opportunity to settle an alleged Bank of America credit card debt of $12,479.32. (Compl. ¶¶ 13-23.) Defendant asserts that it acquired the rights to the debt from Bank of America on October 2, 2009. (Am. Countercl. ¶¶ 26-32). Plaintiff claims that Defendant violated the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692, et seq. ("FDCPA") in attempting to collect on this debt by: (1) using false, deceptive, or misleading representations or means in connection with the collection of a debt, in violation of 15 U.S.C. §1692e; (2) using false representation or deceptive means to collect or attempt to collect a debt,in violation of 15 U.S.C. § 1692e(10); (3) acting in an otherwise unfair and unconscionable manner to collect or attempt to collect a debt, in violation of 15 U.S.C. § 1692f; and (4) failing to provide, within five days after its initial written communication with Plaintiff, written notice containing information on Plaintiff's right to dispute the debt, request validation, or request the name of the original creditor, in violation of 15 U.S.C. § 1692g(a). (Compl. ¶ 27.)

Defendant filed an Amended Counterclaim on April 8, 2010 alleging breach of contract and unjust enrichment based on Plaintiff's failure to pay $12,019.75 owed on the credit card account cited in the Complaint ("Account 0174"), as well as a separate debt of $85,809.89 from another credit card account that was not referenced in the Complaint ("Account 09540"). (Am. Countercl. ¶¶ 7-57.) Plaintiff filed a Motion to Dismiss Defendant's Counterclaim on April 20,

2010, which this Court denied on September 29, 2010. See Kimmel v. Cavalry Portfolio Servs., LLC, 747 F. Supp. 2d 427 (E.D. Pa. 2010). Defendant filed two separate Motions for Summary Judgment on September 13, 2010, which were denied without prejudice by this Court after the parties stipulated to an extension of the discovery deadline on October 5, 2010. On February 7, 2011, Defendant again filed Motions for Summary Judgment on Plaintiff's claims and its own Counterclaim, and the Court granted both Motions on May 25, 2011. See Kimmel v. Cavalry Portfolio Servs., LLC, No. CIV.A.10-680, 2011 WL 2039049 (E.D. Pa. May 25, 2011). Shortly thereafter, on June 3, 2011, Plaintiff filed the present Motion for Reconsideration. Defendant filed a Response in Opposition on June 17, 2011, Plaintiff filed a Reply Brief on July 1, 2011, and Defendant filed a Motion for Leave to File a Sur-Reply Brief on July 7, 2011.

II. STANDARD OF REVIEW

A party may move to alter or amend a judgment pursuant to Federal Rule of CivilProcedure 59(e). FED. R. CIV. P. 59(e); see also E.D. PA. CIV. R. 7.1(g) ("Motions for reconsideration or reargument shall be served and filed within fourteen (14) days after the entry of the judgment, order, or decree concerned."). A party moving for reconsideration of a court's decision must demonstrate "at least one of the following grounds: (1) an intervening change in the controlling law; (2) the availability of new evidence that was not available when the court granted the motion for summary judgment; or (3) the need to correct a clear error of law or fact or to prevent manifest injustice." Max's Seafood Cafe ex rel. Lou-Ann, Inc. v. Quinteros, 176 F.3d 669, 677 (3d Cir. 1999) (citing N. River Ins. Co. v. CIGNA Reins. Co., 52 F.3d 1194, 1218 (3d Cir. 1995)). "Because of the courts' interest in the finality of judgments, motions for reconsideration should be granted sparingly." Tomasso v. Boeing Co., No. CIV.A.03-4220, 2007 WL 2458557, at *2 (E.D. Pa. Aug. 24, 2007) (citing United States v. Bullock, No. CIV.A.98-5023, 2005 WL 352854, at *1 (E.D. Pa. Jan. 24, 2005)).

III. DISCUSSION

A. Motion for Reconsideration

Under the FDCPA, "debt" is defined as "any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for personal, family, or household purposes, whether or not such obligation has been reduced to judgment." 15 U.S.C. § 1692a(5). On May 25, 2011, this Court granted Defendant's Motion for Summary Judgment on Plaintiff's FDCPA claims because it found that Plaintiff failed to demonstrate that the money Defendant sought to collect derived from a debt that was for personal, family, or household purposes. See Kimmel, 2011 WL 2039049, at *2-5. Plaintiff now asks the Court to reconsider this decisionbased primarily on the fact that, in response to Plaintiff's Request for Admissions, Defendant admitted that it was a "debt collector" and that Plaintiff was a "consumer" within the meaning of the FDCPA. (Pl.'s Mot. Recons. 4-7.)¹ This evidence was available before the Court decided Defendant's Motion for Summary Judgment, but was not brought to the Court's attention until this time.

In response, Defendant contends that even though it admitted it was a debt collector and Plaintiff was a consumer under the FDCPA, it never actually conceded that the money Plaintiff owed satisfied the statute's definition of "debt." (Def.'s Resp. Opp'n 5-8.) Defendant also argues that there are no errors of law or fact, that there would be no manifest injustice in denying Plaintiff's Motion, and that Plaintiff's failure to present this additional evidence previously is not the result of any excusable neglect. (Id. at 11-14.)

In most circumstances, a motion for reconsideration is denied when it is based solely on evidence that was available at the time of summary judgment. See Bailey v. United Airlines, 279 F.3d 194, 201 (3d Cir. 2002) ("A district court may properly refuse to consider evidence presented in a motion for reconsideration when the evidence was available prior to summary judgment.") (citing Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3d Cir. 1985)). Here, it is not entirely clear why Plaintiff did not include Defendant's answers to his Request for Admissionswhen responding to the Motion for Summary Judgment.² Nevertheless, because the omission appears to have been a mere mistake - and because a motion for reconsideration may be granted even when the evidence was previously available in order to prevent manifest injustice - the Court will consider Plaintiff's Motion on the merits.

The FDCPA defines "debt collector" as "any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another." 15 U.S.C.A. § 1692a(6). A "consumer" is defined as "any natural person obligated or allegedly obligated to pay any debt." 15 U.S.C.A. § 1692a(4). As noted above, Defendant admitted that it was a debt collector and Plaintiff was a consumer within the meaning of the FDCPA. In making these admissions, however, Defendant denies conceding that the money Plaintiff owed met the definition of "debt" as set forth in the FDCPA. (Def.'s Resp. Opp'n 6-7.) Rather, Defendant has interpreted the terms "consumer," "debt collector," and "debt" to have separate, distinct meanings, so that "Cavalry can be a debt collector, and Plaintiff can be a consumer, all while Plaintiff's account is not a debt for purposesof the FDCPA." (Id. at 8; see also Def.'s Mot. Leave File Sur-Reply Br., Ex. A.)

The Court is unpersuaded. If the definitions contained in the FDCPA are unrelated, as Defendant suggests, then the reference to "debt" in the definitions of "debt collector" and "consumer" could be read to include all debts, even those obtained for commercial purposes or are otherwise beyond the scope of the FDCPA. As the Supreme Court has held, however, "[i]t is a 'fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme.'" Food & Drug Admin. v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 133 (2000) (quoting Davis v. Michigan Dept. of Treasury, 489 U.S. 803, 809 (1989)). Therefore, when the FDCPA states that a debt collector is someone who engages in "the collection of any debts" and a consumer is a person obligated to "pay any debt," it is referring to "debt" as defined in the statute itself, i.e. one that is obtained for personal, family, or household purposes. Any other interpretation would not make sense in the context of the FDCPA's plain language and purpose.³ As such, the Court finds that when Defendant admitted that it was a "debt collector" and that Plaintiff was a "consumer" for purposes of the FDCPA, it admitted that the debt at issue in this case fell within the meaning of the statute as well.

In light of this finding, the Court's original basis for granting summary judgment is no longer tenable, and it would be manifestly unjust to deny Plaintiff the opportunity to pursue his claims. The Motion for Reconsideration is therefore granted, and the Court vacates its prior Order granting summary judgment to Defendant on Plaintiff's claims.

B. The Merits of Plaintiff's FDCPA Claims

In its Motion for Summary Judgment, Defendant challenged the merits of each individual claim made by Plaintiff under the FDCPA. Because the Court found Plaintiff did not meet the...