Schaefer v. Seattle Serv. Bureau, Inc.

AMANDA SCHAEFER, individuallyand on behalf of others similarly situated Plaintiff, v. SEATTLE SERVICE BUREAU, INC.and STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendants.

Case No: 2:15-cv-444-FtM-38CM

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA FORT MYERS DIVISION

December 15, 2015

ORDER¹

This matter comes before the Court on Defendant, Seattle Service Bureau, Inc. d/b/a National Service Bureau's (NSB) Motion to Dismiss or in the alternative Motion for Judgment on the Pleadings (Doc. #3) filed on July 27, 2015. The Plaintiff Amanda Schaefer filed her Response in Opposition (Doc. #26) on August 20, 2015. The Motion to Dismiss is now fully briefed and ripe for the Court's review.

BACKGROUND

On July 12, 2013, Schaefer was involved in an auto accident in Fort Myers, Florida. The vehicle struck by Schaefer was damaged and there was also a claim for bodily injuries. The other vehicle and driver were insured by State Farm, Schaefer was drivingwithout liability insurance. Schaefer received a citation from the Florida Highway Patrol (FHP) for her role in the accident. State Farm paid the claim submitted by its insured.

After State Farm paid the insured's damages, it subrogated the damages claim and referred the matter to NSB to collect the alleged damages amount from Schaefer. On January 6, 2015, NSB sent Schaefer a demand letter seeking to collect a debt in the amount of $21,366.90. NSB identified itself as a debt collector attempting to collect on the claim.

On April 6, 2015, NSB sent a second letter to Schaefer informing her that it had sent a letter to Florida authorities requesting that her driver's license and car registration tag be suspended due to the outstanding debt. At the time the letters were sent from NSB, no judgment had been entered against Schaefer by NSB or State Farm.

As a result of NSB's collection attempts, Schaefer filed a six (6) count Complaint on behalf of herself and all persons similarly situated against State Farm and NSB in the Circuit Court for the Twentieth Judicial Circuit in and for Lee County, Florida. The Complaint alleges as follows: Count I, alleges NSB violated Fla. Stat. § 559.72(9) Florida Consumer Credit Protection Act (FCCPA); Count II, alleges a violation for FCCPA Fla. Stat. § 559.72(10); Count III, requests injunctive relief; Count IV, declaratory relief; and Count V, alleges a violation of Fla. Stat. § 501.24 Florida Deceptive Unfair Trade Practices Act (FDUTPA); and Count VI, alleges unjust enrichment.

On July 23, 2015, State Farm removed the Complaint to this Court under the Class Action Fairness Act (CAFA). Schaefer moved to remand but the remand was denied. NSB now moves the Court to dismiss the Complaint or in the alternative for judgment on the pleadings.

STANDARD OF REVIEW

In deciding a motion to dismiss, the Court must accept all factual allegations in a complaint as true and take them in the light most favorable to the plaintiffs. Christopher v Harbury, 536 U.S. 403, 406, 122 S. Ct. 2179, 153 L. Ed. 2d 413 (2002). However, dismissal for failure to state a claim upon which relief may be granted does not require appearance, beyond a doubt. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 561- 563, S. Ct. 127 S. Ct. 1955, 167 L. Ed 2d 929 (2007) (aboragating Conley v. Gibson, 355 U.S. 41, 45-46, 78 S. Ct. 99, 2 L. Ed. 2d 80 (1957)). While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the "grounds" of his "entitlement" to relief requires more than labels, conclusions, and a formulaic recitation of the cause of actions elements. Bell Atlantic, 550 U.S. 544, 561- 563.

To satisfy the pleading requirements of Fed. R. Civ. P. 8, a complaint must simply give the defendants fair notice of what the plaintiff's claim is and the grounds upon which it rests. Id. at 555; Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512, 122 S. Ct. 992, 152 L. Ed. 2d 1 (2002). Although the pleading standard announced in Fed R. Civ. P. 8 does not require "detailed factual allegations," it does demand more than an unadorned, "the-defendant-unlawfully-harmed-me accusation." Sinaltrainal v. Coca-Cola Co., 578 F. 3d 1252, 1268 (11th Cir. 2009) (citing Ascroft v. Iqbal, ----- U.S.----, 129 S. Ct. 1937, 1949, 173 L. Ed 2d 868 (2009). Furthermore, unwarranted deductions of fact in a complaint are not admitted as true for the purpose of testing the sufficiency of the allegations. Sinaltrainal, 578 F. 3d at 1268 (citing Aldana v. Del Monte Fresh Produce, N.A., Inc., 416 F.3d 1242, 1248 (11th Cir. 2005)). The facts as pled must state a claim for relief that isplausible on its face. Sinaltrainal, 578 F. 3d at 1268 (citing Iqbal, 129 S. Ct. at 1950). Dismissal is warranted under Fed. R. Civ. P. 12(b)(6) if, assuming the truth of the factual allegations of plaintiff's complaint, there is a dispositive legal issue which precludes relief. Simplexgrinnell, L.P. v. Ghiran, 2007 WL 2480352 (M.D. Fla. August 29, 2007) (citing Neitzke v. Williams, 490 U.S. 319, 326, 109 S. Ct. 1827, 104 L. Ed. 2d 338 (1989); Brown v. Crawford County, Georgia, 960 F.2d 1002, 1009-1010 (11th Cir. 1992).

Federal Rule of Civil Procedure No. 12(c) permits a party to move for judgment on the pleadings. In evaluating a motion for judgment on the pleadings, a court will accept the facts in the complaint as true and view them in the light most favorable to the nonmoving party. Maxum Indem. Co. v. Florida Const. Servs., Inc., 59 F. Supp. 3d 1382, 1384-85 (M.D. Fla. 2014) (citing Cunningham v. Dist. Attorney's Office for Escambia County, 592 F.3d 1237, 1255 (11th Cir.2010). "Judgment on the pleadings is proper when no issues of material fact exist, and the moving party is entitled to judgment as a matter of law based on the substance of the pleadings and any judicially noticed facts." Id.

DISCUSSION

NSB contends the subrogated claim is not a debt as defined by the Fla. Stat. § 559.72(9) and (10) FCCPA. Therefore, Counts I and II filed pursuant to the FCCPA should be dismissed. NSB also argues that Schaefer has no standing to file a claim pursuant to FDUPTA. Schaefer responds that the statue's terms are ambiguous and that this is a case of first impression in Florida and should not be dismissed.

(1) Whether the Subrogated Claim is a Debt Under the FCCPA, Counts I and II

Schaeffer alleges that Defendants violated §§ 559.72(9) and/or (10) of the FCCPA, which provide:

(9) Claim, attempt, or threaten to enforce a debt when such person knows that the debt is not legitimate, or assert the existence of some other legal right when such person knows that the right does not exist.

(10) Use a communication that simulates in any manner legal or judicial process or that gives the appearance of being authorized, issued, or approved by a government, governmental agency, or attorney at law, when it is not.

Fla. Stat. 559.72(9) and (10).

NSB argues that the debt in this case is not a consumer debt that falls under the FCCPA but a subrogated debt. NSB argues that the FCCPA defines consumer debt the same as the FDCPA, and therefore, NSB contends that by applying the Eleventh Circuit's analysis under the FDCPA to Schaefer's FCCPA claims, Counts I and II should be dismissed.

The FDCPA is a strict liability statute, the purpose of which is "to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses." 15 U.S.C. § 1692e. The Eleventh Circuit, in Oppenheim v. I.C. System, Inc., 627 F.3d 833, 836-37 (11th Cir.2010), held that "[t]o recover under both the FDCPA and the FCCPA (a Florida state analogue to the federal FDCPA), a plaintiff must make a threshold showing that the money being collected qualifies as a 'debt.' " In the FDCPA and the FCCPA, "debt" means 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 ofthe 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); Fla. Stat. § 559.55(1). Accordingly, the Oppenheim court held that "the FDCPA and FCCPA apply only to payment obligations of a (1) consumer debt arising out of a(2) transaction in which the money, property, insurance, or services at issue are (3) primarily for personal, family, or household purposes. Elmore v. Ne. Florida Credit Bureau, Inc., No. 3:10-CV-573-J-37JBT, 2011 WL 4480419, at *1 (M.D. Fla. Sept. 27, 2011) (emphasis in original). The statute thus makes clear that a mere obligation to pay does not constitute 'debt' under the FDCPA." Oppenheim, 627 F.3d at 837 (emphasis in original).

This appears to be a case of first impression in Florida, therefore, the Court will look to how courts have applied the FDCPA to the same issues. The FCCPA speaks directly to the issue by noting that great weight should be given to the federal courts and Federal Trade Commission's interpretations of the FDCPA when applying the FCCPA. The FCCPA provides in pertinent part:

(5) In applying and construing this section, due consideration and great weight shall be given to the interpretations of the Federal Trade Commission and the federal courts relating to the federal Fair Debt Collection Practices Act.

Fla. Stat. § 559.55(5). Therefore, the Court will apply the rulings from the Eleventh Circuit and Middle District of Florida regarding the FDCPA to its analysis of the FCCPA.

NSB relies on Hawthorne v. MAC Adjustment, Inc., 140 F. 3d 1367 (11th Cir. 1998), for its position that a debt arising from a subrogation claim is not a consumer debt under the FCCPA. Hawthorne, like the instant case involved the collection of a subrogation debt of an unpaid insurance claim. Hawthorne was involved in an...