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Hart v. Credit Service Company, Inc.

United States District Court, D. Colorado

October 15, 2014

JAMES HART, Plaintiff,
v.
CREDIT SERVICE COMPANY, INC., Defendant.

ORDER REGARDING SUMMARY JUDGMENT

RAYMOND P. MOORE, District Judge.

This matter is before the Court on cross motions for summary judgment filed by Plaintiff James Hart ("Plaintiff") (ECF No. 15) and Defendant Credit Service Company, Inc. ("Defendant" or "CSC") (ECF No. 16).[1] This is a case arising under the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. Jurisdiction is proper pursuant to 15 U.S.C. § 1692k(d) and 28 U.S.C. § 1331.

I. BACKGROUND

A. Legal Background

Congress enacted the FDCPA "to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses." 15 U.S.C. § 1692(e). Plaintiff's FDCPA claim against CSC, brought under 15 U.S.C. § 1692, alleges that CSC violated: § 1692(d) by engaging in behavior the natural consequence of which was to harass, oppress or abuse the Plaintiff in connection with the collection of a debt; § 1692(e)(2) by misrepresenting the character, amount and legal status of the debt; and § 1692(f) by using unfair and unconscionable means to collect a debt.

Summary judgment is appropriate only if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Henderson v. Inter-Chem Coal Co., Inc., 41 F.3d 567, 569 (10th Cir. 1994). Whether there is a genuine dispute as to a material fact depends upon whether the evidence presents a sufficient disagreement to require submission to a jury or, conversely, is so one-sided that one party must prevail as a matter of law. Anderson v. Liberty Lobby, 477 U.S. 242, 248-49 (1986); Stone v. Autoliv ASP, Inc., 210 F.3d 1132 (10th Cir. 2000); Carey v. U.S. Postal Service, 812 F.2d 621, 623 (10th Cir. 1987). Anderson v. Liberty Lobby, 477 U.S. 242, 248-49 (1986).

A fact is "material" if it pertains to an element of a claim or defense; a factual dispute is "genuine" if the evidence is so contradictory that if the matter went to trial, a reasonable jury could return a verdict for either party. Anderson, 477 U.S. at 248. The Court must resolve factual ambiguities against the moving party, thus favoring the right to a trial. Quaker State Mini-Lube, Inc. v. Fireman's Fund Ins. Co., 52 F.3d 1522, 1527 (10th Cir. 1995); Houston v. Nat'l General Ins. Co., 817 F.2d 83, 85 (10th Cir. 1987).

B. Facts

The following facts are undisputed unless otherwise noted. Plaintiff incurred a debt for the cost of vacuum cleaner, for which he paid $150 down and financed the remainder; the total amount financed was $2, 174.14. (ECF No. 15-3, "Hart Affidavit, " at 2; ECF No. 17-1, "Colorado Retail Installment Contract, " at 2.) The debt was initially owed to Clean Air Safety ("CAS"), the company which sold the vacuum, and then to its successor, Advanced Air Solutions, Inc. ("Advanced"). (ECF No. 17-1; ECF No. 15-3 at 2; ECF No. 16-2, "Gaetz Affidavit, " at 1.) CAS sold or assigned the debt to Preferred Credit, Inc. ("Preferred") pursuant to an agreement. (ECF No. 16-2 at 1.) That agreement provided that if Preferred did not receive payment from Plaintiff, Preferred would then receive payment from Advanced, and Advanced would have the right to collect from Plaintiff. (ECF No. 16-3, "Affidavit of Henry Hall, " at 1.) Plaintiff did not pay the debt to Preferred. ( Id. ) Preferred then was paid the amount due by Advanced. ( Id. ) As related to Plaintiff, Preferred charged off its account and issued an IRS form 1099-C, Cancellation of Debt. (ECF No. 15-3 at 3; ECF No. 16-2 at 2.) Advanced then placed the debt, at that time totaling $1899.91, with CSC for collection. (ECF No. 16-3 at 1.)

In May of 2013, CSC received the account and mailed a notice to Plaintiff. (ECF No. 15-4, "Defendant's Answers to Interrogatories, " at 8.) By this time, Plaintiff had received the 1099-C form from Preferred showing $1899.91 on line 2 as "Amount of debt discharged." (ECF No. 15-3 at 3; ECF No. 15-4 at 8; ECF No. 16-4 at 1.) In July of 2013, CSC began making collection calls. Plaintiff told CSC that he disputed the debt. (ECF No. 15-3 at 3) CSC noted that the account was disputed, but then resumed collection calls after an investigation revealed the foregoing. (ECF No. 15-2 at 6-9.)

In addition, Plaintiff contends that he returned the vacuum cleaner to Advanced and that, consequently, Preferred cancelled or discharged his debt. (ECF No. 15-3.) This contention, as least as it pertains to Preferred's actions, is disputed by CSC which tendered an affidavit from the Vice President of Preferred. (ECF No. 16-2.)

II. DISCUSSION

Plaintiff's Complaint included claims based on three separate provisions of the FDCPA, but as to 15 U.S.C. §§ 1692(d) and (f), Plaintiff has presented neither argument nor evidence regarding harassing behaviors or unfair or unconscionable means on the part of CSC. Plaintiff only specifically referenced 15 U.S.C. § 1692(e) in his summary judgment brief. Defendant also moved for summary judgment on all claims, and in response to that motion, Plaintiff alleged only that CSC violated 15 U.S.C. § 1692(e). This Order will substantively discuss only the § 1692(e) argument. The Court finds that no independent evidence exists to support either of Plaintiff's other two claims, separate and apart from the claim that Defendant attempted to collect a debt which had been discharged. While cast as alternative legal theories, there is simply one core event which Plaintiff claims was in violation of the relevant statute-the attempt to collect a "discharged" debt.

Plaintiff's argument that CSC acted in contravention of the FDCPA rests on two issues: (1) whether he returned the vacuum cleaner to Advanced in exchange for full settlement of the debt by Preferred; and (2) whether the Form 1099-C legally constituted "debt forgiveness" by Preferred, (ECF No. 15 at 3), such that CSC's attempts to ...


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