Hoover v. Monarch Recovery Management, Inc.

Citations: 888 F. Supp. 2d 589; 2012 WL 3638680; 2012 U.S. Dist. LEXIS 120948Docket: Civil Action No. 11-CV-04322

Court: District Court, E.D. Pennsylvania; August 24, 2012; Federal District Court

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Defendant Monarch Recovery Management, Inc.'s Motion for Judgment on the Pleadings, filed on October 25, 2011, is partially granted and partially denied. The court dismisses with prejudice Count I of Plaintiff Angela Hoover's Complaint, which alleged violations under 15 U.S.C. § 1692d of the Fair Debt Collection Practices Act (FDCPA) concerning harassment. Claims under the FDCPA alleging deceptive and unfair practices are dismissed without prejudice, allowing for repleading. Additionally, Count II, alleging violations of the Telephone Consumer Protection Act (TCPA), is dismissed with prejudice due to insufficient factual support. However, the court finds that Count I supports a reasonable inference of violations under § 1692d(5) concerning repeated calls. Plaintiff is granted the opportunity to file an amended complaint to provide sufficient facts for claims under §§ 1692c(b) and 1692g of the FDCPA and to substantiate the general FDCPA violations. The court has jurisdiction based on federal questions under the FDCPA and TCPA and proper venue as the events occurred in Strasburg, Pennsylvania. Judgment on the pleadings can only be granted if there are no material issues of fact, with the court viewing facts in favor of the nonmoving party.

A party may file a motion for judgment on the pleadings once pleadings are closed, as defined by Federal Rule of Civil Procedure 12(c). Pleadings are considered closed after an answer is filed unless a reply to additional claims in the answer is pending. In evaluating such a motion, the court reviews the pleadings, any attached documents, and public records. When the motion claims that the plaintiff fails to state a claim for relief, it is assessed using the standard applicable to a Rule 12(b)(6) motion. This involves examining the complaint's sufficiency, which must comply with Rule 8(a)(2) by providing a short, plain statement demonstrating entitlement to relief. The court accepts all factual allegations as true and construes them in the light most favorable to the plaintiff, while disregarding conclusory statements. A claim can only be dismissed if it lacks sufficient factual support to suggest a plausible entitlement to relief. The analysis for a Rule 12(b)(6) motion involves separating factual assertions from legal conclusions and determining if the facts presented make a plausible claim for relief. In the case presented, plaintiff Angela Hoover accuses Monarch Recovery Management, Inc. of violating the Fair Debt Collection Practices Act and the Telephone Consumer Protection Act.

In Count I, the plaintiff, Angela Hoover, alleges multiple violations of the Fair Debt Collection Practices Act (FDCPA) by the defendant, Monarch Recovery Management, Inc. These violations include: 1) general FDCPA violations; 2) harassment under § 1692d; 3) repeated calls with intent to harass under § 1692d(5); 4) using false or misleading means under § 1692e; 5) employing unfair practices under § 1692f; and 6) engaging in deceptive, unfair, and unconscionable conduct. In Count II, the plaintiff asserts a violation of the Telephone Consumer Protection Act (TCPA) § 227(b)(1)(B), which prohibits calls to residential phones using an artificial or prerecorded voice without consent.

The factual basis for the complaint states that the defendant contacted the plaintiff repeatedly from late May 2010 to early August 2010 regarding an alleged consumer debt related to personal, family, and household transactions. The defendant allegedly used an automated dialing system to contact the plaintiff more than ten times per week and left automated messages that could be heard by her family, including minor children. These messages identified the caller as a debt collector and requested the plaintiff to acknowledge her identity. The plaintiff never provided consent for such calls, and the defendant was aware of this lack of consent. Additionally, during conversations with the defendant’s representatives, the plaintiff was asked personal questions about her marital status and dependents, which she claims constitutes harassment under § 1692d of the FDCPA.

The Third Circuit mandates that district courts evaluate the Fair Debt Collection Practices Act (FDCPA) requirements from the perspective of the least sophisticated consumer. Violations of § 1692d pertain to tactics aimed at embarrassing or distressing debtors. Determining whether conduct constitutes harassment, oppression, or abuse typically falls to a jury, but the plaintiff must provide sufficient facts to support a plausible claim under § 1692d. Courts will not entertain unusual interpretations of collection notices. The FDCPA aims to protect consumers from debt collectors revealing their private information, as indicated by § 1692d(3), which restricts debt collectors from publishing lists of consumers who refuse to pay debts. However, the act does not prevent debtors from disclosing their personal information. The plaintiff failed to demonstrate that a debt collector's request for personal information constitutes harassment under § 1692d. Previous cases dismissed similar claims when the conduct, though aggressive, did not meet the threshold of seriousness intended for protection under § 1692d. The court concluded that the mere act of requesting personal information is insufficient to establish a plausible claim under § 1692d and granted the defendant's motion for judgment on the pleadings, dismissing the general § 1692d claim with prejudice.

Plaintiff alleges that the defendant violated § 1692d(5) by making repeated and continuous phone calls intended to annoy, abuse, or harass her. To establish a plausible claim, the plaintiff must show both the frequency of the calls and the intent behind them. The plaintiff reports receiving over ten calls per week for approximately eleven weeks, totaling 110 calls. The determination of actionable harassment depends on both the volume and pattern of calls. Citing precedents, the court notes that while the plaintiff did not request cessation of calls, the volume and consistency of the calls—similar to those in Shand-Pistilli—support an inference of intent to harass. Other cited cases indicate that courts in this district generally allow cases involving high call volumes to proceed to discovery, even if intent is not explicitly detailed. In contrast, cases with lower call volumes have resulted in dismissals; however, the defendant has not provided examples of cases with a comparable call volume being dismissed at the discovery stage. The court distinguishes the current case from Dudley v. Powell Law Office, where only four calls were made in one day, as insufficient for a claim under § 1692d(5). Overall, the case indicates a judicial trend favoring plaintiffs with substantial call volumes in proceeding to discovery.

Defendant contacted plaintiff twice daily for eleven weeks, raising the issue of potential harassment under the Fair Debt Collection Practices Act (FDCPA), specifically § 1692d(5). The court finds that the plaintiff has sufficiently alleged facts to support a reasonable inference of harassment, denying the defendant's motion for judgment on this claim. 

Regarding § 1692e, which prohibits false or misleading representations in debt collection, the plaintiff argues that the defendant failed to disclose the amount of the debt and the creditor's identity in voice messages. However, the plaintiff did not allege a violation of § 1692g, which mandates that a debt collector must send written notice containing this information within five days of initial communication, unless included in that communication. The court notes that omissions under § 1692g do not constitute violations of § 1692e, as Congress intended for these requirements to be treated separately. The plaintiff does not claim that the defendant failed to communicate the debt amount or creditor identity initially or in subsequent writings. 

As there is no authority supporting the plaintiff's claim under § 1692e for the omission of this information, the court grants the defendant's motion for judgment on the pleadings regarding the § 1692e claim but allows the plaintiff to amend her complaint to possibly state a claim under § 1692g.

Section 1692f of the Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors from using unfair or unconscionable means to collect debts. The plaintiff alleges that the defendant violated this section by leaving voice messages that were overheard by her family, including minor children. Although § 1692f serves as a catchall for unfair conduct not explicitly covered by other FDCPA sections, the court finds that the conduct in question is more appropriately addressed under § 1692c(b), which prohibits debt collectors from communicating debt-related information to third parties without consent or legal permission. The FDCPA operates under strict liability, meaning intent is not required for a violation.

Citing the Zortman case, where similar circumstances were deemed to violate § 1692c(b), the court emphasizes that third-party disclosures are not covered by § 1692f, as Congress did not include such provisions there. The plaintiff's failure to cite authority for a violation of § 1692f further weakens her claim, as misconduct must be identified beyond what is alleged under other FDCPA sections. Consequently, the court grants the defendant's motion for judgment on the pleadings concerning the § 1692f claim but allows the plaintiff the opportunity to amend her complaint to potentially state a claim under § 1692c(b).

Additionally, the plaintiff has broader claims against the defendant for general FDCPA violations (claim 1) and for deceptive and unfair practices (claim 6). The defendant did not seek judgment on these claims in its motion.

Defendant argues for judgment on the pleadings, claiming that plaintiff fails to provide credible facts supporting her claims under the Fair Debt Collection Practices Act (FDCPA) and the Telephone Consumer Protection Act (TCPA). The complaint lacks clarity, particularly in claims (1) and (6) of Count I, with no distinct facts alleged for the general FDCPA violation or the specific sections § 1692e and § 1692f. If plaintiff intends to allege a violation of another FDCPA section, she must specify the separate conduct and relevant sections, as current allegations do not provide sufficient notice to the defendant. The court may direct plaintiffs to clarify their allegations, and it finds this an appropriate case to allow plaintiff to file an amended complaint.

Regarding the TCPA, it prohibits initiating telephone calls using artificial or prerecorded voices without prior consent, with certain exceptions. The FCC has the authority to create rules regarding these exemptions, ensuring they do not infringe on privacy rights or include unsolicited advertisements. In 1992, the FCC established that calls to individuals with an existing business relationship or for commercial purposes (that do not involve unsolicited advertisements) are exempt. This stance was reaffirmed in subsequent years, indicating that debt collection calls fall under these exemptions due to the existing business relationship.

Calls are exempt from regulations if they are made by a party with an established business relationship with the subscriber or if they do not transmit unsolicited advertisements but serve a commercial purpose. An "established business relationship" is defined as one formed through voluntary communication based on purchases or inquiries within specified timeframes, provided it has not been terminated by either party. Most courts, including the Eleventh Circuit, defer to the FCC’s interpretation that all debt collection calls, including erroneous ones to non-debtors, are exempt from the Telephone Consumer Protection Act (TCPA), despite non-debtors lacking a direct relationship with the creditor. Conversely, some district courts argue that the FCC’s exemptions do not apply to erroneous calls to non-debtors, as these calls do not involve an established business relationship. Courts adhering to this view assess whether such calls negatively impact privacy rights or involve unsolicited advertisements. Nonetheless, the majority position supports the FCC's broad classification of all debt collection calls as exempt under the TCPA. The FCC's authority is recognized in determining whether non-debtors' privacy rights have been compromised, affirming that debt collection calls fall within the established exemptions.

Discretion is exercised not to question the FCC's determination regarding the TCPA, which has remained unchanged since the Watson decision. Even if privacy rights violations were considered, the TCPA claim would still be dismissed. The Watson court found that the FCC did not account for non-debtors in its TCPA exceptions and evaluated whether the case fell under any exceptions, concluding that the only relevant exception pertained to commercial calls that did not transfer unsolicited advertisements. Although calls to non-debtors could fit this exception, the court must still assess potential privacy violations. The TCPA’s provisions ensure that FCC exceptions do not diminish the privacy rights intended to be protected. The Watson case established that non-debtors possess greater privacy rights than debtors, highlighted by a plaintiff who received numerous unwanted calls and struggled to stop them.

In contrast, the current plaintiff does not claim to have attempted to communicate her non-debtor status or to halt the calls, distinguishing her situation from that in Watson. Even assuming the plaintiff was a non-debtor, she did not demonstrate being powerless to stop the calls. The Watson court's ruling against the FCC’s broad exemption for debt collection calls stemmed from the extreme circumstances in that case, which the FCC likely did not foresee. Since the current plaintiff's privacy rights were not violated to the same degree as in Watson, the court defers to the FCC's stance that all debt collection calls are exempt from the TCPA, ruling that the calls to the plaintiff do not constitute a legal invasion of privacy.

As a result, the defendant's motion for judgment on the pleadings regarding the TCPA claim in Count II is granted, leading to the dismissal of Count II with prejudice. The court grants the defendant’s motion in part and denies it in part, dismissing the plaintiff's claims under the Fair Debt Collection Practices Act and TCPA with prejudice, while allowing the plaintiff to file an amended complaint for a claim under a specific section of the Act.

The court has dismissed the plaintiff's claim under 15 U.S.C. § 1692f with prejudice but allows the plaintiff to file an amended complaint to attempt to state a claim under § 1692e(b). Additionally, allegations in Count I of the plaintiff's Complaint regarding a general violation of the Fair Debt Collection Practices Act (FDCPA) and claims of deceptive, unfair, or unconscionable actions by the defendant are also dismissed, with leave granted for the plaintiff to clarify these claims in an amended complaint. The court has denied the defendant’s motion in all other respects and permits the plaintiff's claim under § 1692d(5) to proceed. 

The court considered the defendant’s motion, the plaintiff’s opposition, various briefs, and the pleadings from both parties. The relevant statutes, including § 1692k(d), allow actions to enforce FDCPA liabilities to be filed within one year of the violation. The excerpt references case law indicating that TCPA claims can proceed if there is an independent basis for jurisdiction. The court emphasizes the "facial plausibility" standard for pleading, as articulated in Ashcroft v. Iqbal and Fowler v. UPMC Shadyside, which requires a reasonable inference of the defendant's liability for the misconduct alleged. The plaintiff has made assertions about inquiries made by the defendant regarding her personal information but has not specified that these inquiries were made repeatedly or how many times she interacted with the defendant.

Angela Hoover's complaint includes references to various pages and sections, indicating her opposition to Monarch Recovery Management, Inc.'s motion for judgment on the pleadings. Key points include her arguments against the motion, particularly highlighted on pages 8, 9, 15, and 16 of her brief. The court recognizes a precedent from Jenkins v. Allied Interstate, Inc., which suggests that erroneous calls made by debt collectors to incorrect cell phone numbers fall under the regulation of the TCPA. The excerpt also cites Rule 15 of the Federal Rules of Civil Procedure, emphasizing that courts should allow amendments to complaints unless deemed futile. Consequently, the court has granted Hoover permission to file an amended complaint to pursue claims under specific provisions of the Fair Debt Collection Practices Act (FDCPA), namely § 1692c(b) and § 1692g.