Perez v. Mccreary, Veselka, Bragg & Allen, P.C.

MARIELA PEREZ, on behalf of herself and all others similarly situated, Plaintiff, v. MCCREARY, VESELKA, BRAGG & ALLEN, P.C., and MVBA, LLC Defendants.

No. 1:19-CV-724-RP

United States District Court, W.D. Texas, Austin Division

August 17, 2021

ORDER

ROBERT PITMAN, UNITED STATES DISTRICT JUDGE

Before the Court are cross-motions for summary judgment filed by Plaintiff Mariela Perez (“Perez”), (Dkt. 73), and Defendants McCreary, Veselka, Bragg & Allen, P.C. (“MVBA PC”) and MVBA, LLC (together “Defendants”), (Dkt. 72). Also before the Court is Perez's motion to certify a class. (Dkt. 71). Having considered the parties' arguments, the evidence, and the relevant law, the Court issues the following order.

I. BACKGROUND

Perez brings claims under the Fair Debt Collection Practices Act (“FDCPA”). 15 U.S.C. §1692, et seq. Shortly after May 2, 2019, Perez received a letter stating that “MVBA has been retained to collect an outstanding debt due, ” with regards to a utility bill for $486.57 that was delinquent as of May 1, 2015. (Letter, Dkt. 67-1; see Pl. Mot. Summ. J., Dkt. 173, at 4). The letter was dated May 2, 2019. (Letter, Dkt. 67-1). The letter included a heading at the top that stated “MVBA LLC ” and requested payment be mailed to “McCreary Veselka Bragg & Allen, L.L.C.” and “MVBA” at the bottom of the letter. (Id.). The letter states that “[p]ayment in full . . . is required.” (Id.). Because the debt was more than four years old, it was no longer legally enforceable under the Texas statute of limitations. TEX. CIV. PRAC. & REM. CODE §16.004(a)(3).

Perez's debt account was placed with MVBA LLC prior to May 2019. (Whigham Decl., Dkt. 72-1, at 1). MVBA LLC used a program to identify accounts that were delinquent for more than four years, after which they would be placed on “hold” and collection activity would not occur on those accounts. (Id. at 2). Despite this policy, the letter was printed and mailed to Perez on May 2, 2019. (Id.). Additionally, fifty-five similar letters were mailed to Texas residents more than four years after debt had been delinquent. (Defs.' Interrogatories, Dkt. 71-6, at 8).

MVBA PC is the sole owner of MVBA LLC. (Allen Depo., Dkt. 73-7, at 15:13-15). MVBA LLC works with consumer accounts subject to the FDPCA, whereas MVBA PC collects debts not subject to the FDCPA. (Whigham Decl., Dkt. 72-1, at 3; Allen Decl., Dkt. 72-2, at 2). Defendants argue that only MVBA LLC drafted and sent the letter to Perez, and MVBA PC “does not exercise any daily control or oversight over MVBA LLC and its letter processes.” (Defs.' Mot. Summ. J., Dkt. 72, at 2) (citing Whigham Decl., Dkt. 72-1, at ¶¶ 17-18; Allen Decl., Dkt. 72-2, at ¶¶ 7-8).

Perez claims the letter is “false and misleading to the least sophisticated consumer because it failed to disclose a) that the alleged Debt was time barred debt and unenforceable, and b) that any partial payment could reinstate the applicable statute of limitations.” (2d. Am. Compl., Dkt. 67, at 5); 15 U.S.C. §1692(e)(2)(A) and (10).^[1] Perez also brings a claim under 15 U.S.C. §1692(f), which states that a “debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt.” (2d. Am. Compl., Dkt. 67, at 11).

Perez and Defendants each seek summary judgment in their favor, and Perez moves for class certification. (Defs.' Mot. Summ. J., Dkt. 72; Pl.'s Mot. Summ. J., Dkt. 73; (Mot. Certify Class, Dkt. 71). The Court will consider each motion in turn.

II. LEGAL STANDARD

Summary judgment is appropriate when there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986). A dispute regarding a material fact is “genuine” if the evidence is such that a reasonable jury could return a verdict in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “A fact is material if its resolution in favor of one party might affect the outcome of the lawsuit under governing law.” Sossamon v. Lone Star State of Tex., 560 F.3d 316, 326 (5th Cir. 2009) (quotations and footnote omitted). When reviewing a summary judgment motion, “[t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor.” Anderson, 477 U.S. at 255. Further, a court may not make credibility determinations or weigh the evidence in ruling on a motion for summary judgment. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000).

If the moving party does not bear the ultimate burden of proof, after it has made an initial showing that there is no evidence to support the nonmoving party's case, the party opposing the motion must come forward with competent summary judgment evidence of the existence of a genuine fact issue. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986). When the movant bears the burden of proof, she must establish all the essential elements of her claim that warrant judgment in her favor. See Chaplin v. NationsCredit Corp., 307 F.3d 368, 372 (5th Cir. 2002). In such cases, the burden then shifts to the nonmoving party to establish the existence of a genuine issue for trial. Austin v. Kroger Tex., L.P., 864 F.3d 326, 335 (5th Cir. 2017).

Unsubstantiated assertions, improbable inferences, and unsupported speculation are not competent summary judgment evidence, and thus are insufficient to defeat a motion for summary judgment. Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007). Furthermore, the nonmovant is required to identify specific evidence in the record and to articulate the precise manner in which that evidence supports his claim. Adams v. Travelers Indem. Co. of Conn., 465 F.3d 156, 164 (5th Cir. 2006). Rule 56 does not impose a duty on the court to “sift through the record in search of evidence” to support the nonmovant's opposition to the motion for summary judgment. Id. After the nonmovant has been given the opportunity to raise a genuine factual issue, if no reasonable juror could find for the nonmovant, summary judgment will be granted. Miss. River Basin All. v. Westphal, 230 F.3d 170, 175 (5th Cir. 2000). Cross-motions for summary judgment “must be considered separately, as each movant bears the burden of establishing that no genuine issue of material fact exists and that it is entitled to judgment as a matter of law.” Shaw Constructors v. ICF KaiserEng'rs, Inc., 395 F.3d 533, 538-39 (5th Cir. 2004).

III. DISCUSSION

A. Defendants' Motion for Summary Judgment

1. Standing

Defendants first argue that Perez lacks standing because she was not injured. (Mot. Summ. J., Dkt. 72, at 3-4). To establish Article III standing, a plaintiff must demonstrate that she has (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992). For an injury in fact, a plaintiff must show that she suffered “‘an invasion of a legally protected interest' that is ‘concrete and particularized' and ‘actual or imminent, not conjectural or hypothetical.'” Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1548 (2016).

Although the Supreme Court has not addressed standing under the FDCPA, it recently addressed standing under the Fair Credit Reporting Act (“FCRA”) in Spokeo, Inc. v. Robins, observing that “a plaintiff does not automatically satisfy the injury-in-fact requirement whenever a statute grants a right and purports to authorize a suit to vindicate it. Article III standing requires a concrete injury even in the context of a statutory violation.” 136 S.Ct. at 1543. The Fifth Circuit has since applied Spokeo to the FDCPA. See Sayles v. Advanced Recovery Sys., 865 F.3d 246 (5th Cir. 2017). However, “the Fifth Circuit has not directly addressed whether a consumer bringing an FDCPA claim must establish actual damages to assert standing or recover damages, but it has recognized the FDCPA was intended to have a ‘broad remedial scope.'” Ghanta v. Immediate Credit Recovery, Inc., No. 3:16-CV-00573-O, 2017 WL 1423597, at *3 (N.D. Tex. Apr. 18, 2017) (quoting Hamilton v. United Healthcare of La., Inc., 310 F.3d 385, 392 (5th Cir. 2002)). Generally speaking, the “jurisprudence distinguishes between the provision of the FCRA at issue in Spokeo, which contains ‘procedural requirements,' and the FDCPA, which creates ‘substantive right[s].'” Ngo v. NPAS, Inc., No. 20-566, 2021 U.S. Dist. LEXIS 8183 at*8, 2021 WL 149121, at *4 (E.D. La. Jan. 15, 2021) (citing Guerrero v. GC Servs. Ltd. P'ship, No. 15-7449, 2017 WL 1133358, at *10 (E.D.N.Y. Mar. 23, 2017) (“[T]he majority of post-Spokeo decisions which have analyzed standing within the context of the FDCPA have determined that, unlike the FCRA section at issue in Spokeo, which contains only procedural requirements, the FDCPA creates a substantive right, the violation of which would itself give rise to a concrete injury.”)).

Perez has standing to bring her claims under 15 U.S.C §1692(e)(2)(A) and (10). Perez argues that she has a concrete injury regarding her “right to receive the required disclosures in communications governed by the FDCPA” and because she was “‘confused' by receiving false and conflicting information.” (Pl.'s Resp., Dkt. 79, at 8) (citing Church v. Accretive Health, Inc., 654 Fed.Appx. 990, 994 (11th Cir. 2016); Rodriguez v. Codilis & Assiciates, P.C., No. 17-CV-03656, 2018 WL 1565596, at *3 (N.D. Ill. Mar. 30, 2018)). Defendants respond that “the state of confusion is not itself an injury, ” and because Perez testified that she knew about the four-year statute of limitations of the debt, “she could not have been...