Carrera v. Allied Collection Services, Inc.

• Court: District Court, D. Nevada
• Decided: July 31, 2024
• Docket: 2:22-cv-01604
• Status: Unknown

Opinion

1 UNITED STATES DISTRICT COURT

2 DISTRICT OF NEVADA

3 MAGARITA CARRERA, ) 4 ) Plaintiff, ) Case No.: 2:22-cv-01604-GMN-DJA 5 vs. ) ) ORDER GRANTING IN PART AND 6 ALLIED COLLECTION SERVICES, Inc., ) DENYING IN PART MOTIONS FOR 7 ) SUMMARY JUDGMENT Defendant. ) 8 ) ) 9 10 Pending before the Court is the Motion for Summary Judgment, (ECF No. 18), filed by 11 Defendant Allied Collection Services, Inc. Plaintiff Margarita Carrera filed a Response, (ECF 12 No. 22), to which Defendant filed a Reply, (ECF No. 24). Also pending before the Court is 13 Plaintiff’s Motion for Summary Judgment, (ECF No. 19). Defendant filed a Response, (ECF 14 No. 21), to which Plaintiff filed a Reply, (ECF No. 25). 15 For the reasons discussed below, the Court GRANTS in part and DENIES in part 16 Defendant’s Motion for Summary Judgment and Plaintiff’s Motion for Summary Judgment. 17 I. BACKGROUND 18 This action arises from a default judgment obtained by Defendant in Nevada state court 19 in 2009, and the subsequent renewal of that judgment in 2022. (See generally Compl., ECF No. 20 1). Plaintiff alleges this judgment was improperly obtained and renewed through 21 misrepresentations and unfair conduct and brought this action to recover damages under the 22 Federal Debt Collections Practices Act (“FDCPA”). (Id.). 23 A. The Underlying Judgment 24 In 2009, Defendant sued Plaintiff in state court alleging that Plaintiff owed $12,490.70 25 plus 12% interest accruing per annum from a Chase Bank credit account ending in 0814 (the 1 “Account”) pursuant to the “terms of [an] agreement.” (State Court Collections Complaint at 2– 2 3, Ex. 1 to Pl.’s Mot. Summ. J., ECF No. 19-3). Defendant served its complaint on a “Jane 3 Smith” at Plaintiff’s former property. (Aff. Serv. At 2, Ex. 3 to Pl.’s Mot. Summ. J., ECF No. 4 19-3); (Quitclaim Deed at 2, Ex. 4 to Pl.’s Mot. Summ. J., ECF No. 19-6). After Plaintiff failed 5 to take timely action in this lawsuit, Defendant moved for and obtained default judgment 6 against Plaintiff for a principal amount of $12,490.79 plus 12% interest accruing per annum 7 and $3,373.69 in attorney’s fees and costs. (Mot. Default J., Ex. 4 to Allison Smith Decl. to 8 Def. Mot. Summ. J., ECF No. 18-2); (Default J., Ex. 5 to Pl.’s Mot. Summ. J., ECF No. 19-7). 9 B. Renewal of Underlying Judgment 10 In March 2022, Defendant filed an affidavit of renewal of judgment in state court. 11 (Affidavit Renewal, Ex. 6 to Allison Smith Decl. to Def. Mot. Summ. J., ECF No. 18-2). The 12 amount due was now $32,0507.44 with accrued interest. (Id.). According to Plaintiff, she did 13 not learn of this judgment until May 2022, when Defendant placed a judgment lien on her 14 home. (Margarita Carrera (“Carrera”) Decl. ¶¶ 6–7, Ex. 2 to Pl.’s Mot. Summ. J., ECF No. 19- 15 2); (Lien Record at 2, Ex. 6 to Pl.’s Mot. Summ. J., ECF No. 19-8). Plaintiff maintains that she 16 only began banking with Chase in 2019, so she does not own the Account associated with 17 Defendant’s state court judgment. (Carrera Decl. ¶¶ 13–16, Ex. 2 to Pl.’s Mot. Summ. J.). 18 Plaintiff sent Defendant a letter demanding “verification and validation” that the 19 Account was hers. (Demand Letter, Ex. 7 to Pl.’s Mot. Summ. J., ECF No. 19-7). Defendant 20 responded with a letter explaining that the state court judgment found that she was the owner of

21 the Account and reported that she now owed a total balance of $41,665.58. (Response Letter, 22 Ex. 8 to Pl.’s Mot. Summ. J., ECF No. 19-10). Defendant did not produce the agreement 23 showing Plaintiff owned the Account. (Id.). 24 /// 25 /// 1 C. Defendant’s Alleged Misrepresentations 2 According to Plaintiff, Defendant made false statements in the state court proceeding by 3 alleging that she owned the Account pursuant “pursuant to the terms of the agreement’” but not 4 producing said Agreement. (Pl.’s Mot. Summ. J. 4:17–19) (citing State Court Collections 5 Complaint at 2, Ex. 1 to Pl.’s Mot. Summ. J.). Plaintiff maintains that Defendant 6 misrepresented her ownership of the Account. (Id. 4:14–16) (citing Carrera Dep. 135:25– 7 136:22, Ex. 1 to Resp. Def.’s Mot. Summ. J., ECF No. 22-1). Because Plaintiff contends the 8 Account is not hers, she asserts that Defendant is improperly seeking to collect on a debt that is 9 neither authorized by an agreement nor permitted by law. (Pl.’s Mot. Summ. J. 5:5–6). 10 D. Plaintiff’s Alleged Harms 11 According to Plaintiff, the judgment lien prevented her from selling her home and 12 caused her to be denied a home equity loan. (Carrera Decl. ¶ 16, Ex. 2 to Pl.’s Mot. Summ. J.). 13 Plaintiff maintains that “[she] is being forced to wait until this lien” is removed to sell her home 14 and apply for a home equity loan. (Id. ¶¶ 17–18). She further avers that she “suffered 15 emotional distress and mental anguish as a result of this ordeal and the shame and 16 embarrassment of having [a] lien on [her] home for a debt that is not [hers].” (Id. ¶ 20). 17 E. Current Litigation 18 Plaintiff brought the instant action, alleging Defendant’s conduct violated several 19 provisions of the FDCPA. (See generally Compl.). She maintains that the validity of “the 20 alleged debt” under the Account is “immaterial to this action,” (id. ¶ 9), but expressed that her

21 intent in bringing this lawsuit is to ultimately vacate the underlying state court judgment 22 because she does not own the debt. (Carrera Dep. 96:14–97:12, 141:19–142:10, Ex. 1 to Resp. 23 Def.’s Mot. Summ. J.). The parties filed cross-motions for summary judgment, (ECF Nos. 18, 24 19), which the Court discusses below. 25 /// 1 II. LEGAL STANDARD 2 The Federal Rules of Civil Procedure provide for summary adjudication when the 3 pleadings, depositions, answers to interrogatories, and admissions on file, together with the 4 affidavits, if any, show that “there is no genuine dispute as to any material fact and the movant 5 is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). Material facts are those that 6 may affect the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 7 (1986). A dispute as to a material fact is genuine if there is a sufficient evidentiary basis on 8 which a reasonable fact-finder could rely to find for the nonmoving party. See id. “The amount 9 of evidence necessary to raise a genuine issue of material fact is enough ‘to require a jury or 10 judge to resolve the parties’ differing versions of the truth at trial.’” Aydin Corp. v. Loral Corp., 11 718 F.2d 897, 902 (9th Cir. 1983) (quoting First Nat’l Bank v. Cities Serv. Co., 391 U.S. 253, 12 288–89 (1968)). “Summary judgment is inappropriate if reasonable jurors, drawing all 13 inferences in favor of the nonmoving party, could return a verdict in the nonmoving party’s 14 favor.” Diaz v. Eagle Produce Ltd. P’ship, 521 F.3d 1201, 1207 (9th Cir. 2008). A principal 15 purpose of summary judgment is “to isolate and dispose of factually unsupported claims.” 16 Celotex Corp. v. Catrett, 477 U.S. 317, 323–24 (1986). 17 In determining summary judgment, a court applies a burden-shifting analysis. “When 18 the party moving for summary judgment would bear the burden of proof at trial, it must come 19 forward with evidence which would entitle it to a directed verdict if the evidence went 20 uncontroverted at trial. In such a case, the moving party has the initial burden of establishing

21 the absence of a genuine issue of fact on each issue material to its case.” C.A.R. Transp. 22 Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (internal quotation 23 marks and citations omitted). In contrast, when the nonmoving party bears the burden of 24 proving the claim or defense, the moving party can meet its burden in two ways: (1) by 25 presenting evidence to negate an essential element of the nonmoving party’s case; or (2) by 1 demonstrating that the nonmoving party failed to make a showing sufficient to establish an 2 element essential to that party’s case on which that party will bear the burden of proof at trial. 3 See Celotex Corp., 477 U.S. at 323–24. If the moving party fails to meet its initial burden, 4 summary judgment must be denied and the court need not consider the nonmoving party’s 5 evidence. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 159–60 (1970). 6 If the moving party satisfies its initial burden, the burden then shifts to the opposing 7 party to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. 8 Zenith Radio Corp., 475 U.S. 574, 586 (1986). To establish the existence of a factual dispute, 9 the opposing party need not establish a material issue of fact conclusively in its favor. It is 10 sufficient that “the claimed factual dispute be shown to require a jury or judge to resolve the 11 parties’ differing versions of the truth at trial.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors 12 Ass’n, 809 F.2d 626, 630 (9th Cir. 1987). However, the nonmoving party “may not rely on 13 denials in the pleadings but must produce specific evidence, through affidavits or admissible 14 discovery material, to show that the dispute exists,” Bhan v. NME Hosps., Inc., 929 F.2d 1404, 15 1409 (9th Cir. 1991), and “must do more than simply show that there is some metaphysical 16 doubt as to the material facts.” Orr v. Bank of Am., 285 F.3d 764, 783 (9th Cir. 2002) 17 (quotation marks and citation omitted). “The mere existence of a scintilla of evidence in 18 support of the plaintiff’s position will be insufficient.” Anderson, 477 U.S. at 252. In other 19 words, the nonmoving party cannot avoid summary judgment by relying solely on conclusory 20 allegations that are unsupported by factual data. See Taylor v. List, 880 F.2d 1040, 1045 (9th

21 Cir. 1989). Instead, the opposition must go beyond the assertions and allegations of the 22 pleadings and set forth specific facts by producing competent evidence that shows a genuine 23 issue for trial. See Celotex Corp., 477 U.S. at 324. 24 At summary judgment, a court’s function is not to weigh the evidence and determine the 25 truth but to determine whether there is a genuine issue for trial. See Anderson, 477 U.S. at 249. 1 The evidence of the nonmovant is “to be believed, and all justifiable inferences are to be drawn 2 in his favor.” Id. at 255. But if the evidence of the nonmoving party is “merely colorable or is 3 not significantly probative, summary judgment may be granted.” See id. at 249–50 (internal 4 citations omitted). 5 III. DISCUSSION 6 “[W]hen simultaneous cross-motions for summary judgment on the same claim are 7 before the court,” like they are here, “the court must consider the appropriate evidentiary 8 material identified and submitted in support of both motions, and in opposition to both motions, 9 before ruling on each of them.” Fair Hous. Council of Riverside Cnty., Inc. v. Riverside Two, 10 249 F.3d 1132, 1134 (9th Cir. 2001). The Court begins with Defendant’s Motion for Summary 11 Judgment. 12 A. Defendant’s Motion for Summary Judgment 13 Defendant contends it is entitled to summary judgment for three reasons. (See generally 14 Def.’s Mot. Summ. J.). First, Defendant argues that Plaintiff’s claims are barred by the Rooker- 15 Feldman doctrine. (Id. 10:11–13:11). Second, Defendant contends that this Court lacks subject 16 matter jurisdiction because Plaintiff has not suffered a concrete injury necessary for her to have 17 Article III standing. (Reply Def.’s Mot. Summ. J. 2:17–3:3, ECF No. 24). Finally, Defendant 18 advances that there is no material dispute of fact showing it violated the FDCPA. (Def.’s Mot. 19 Summ. J. 15:19–20:28). The Court begins by examining whether Plaintiff’s claims are barred 20 by the Rooker-Feldman doctrine.

21 1. Rooker-Feldman Doctrine 22 Defendant argues that Plaintiff’s FDCPA claims are barred by the Rooker-Feldman 23 doctrine because the adjudication of those claims by this Court would undermine the state court 24 judgment and serve as a de facto appeal. (Def. Mot. Summ. J. 10:10–13:11). In response, 25 Plaintiff advances that her claims are not a forbidden de facto appeal because “she asserts legal 1 wrongs by Defendant in its debt collection practices that encompass more than just obtaining 2 the [s]tate [c]ourt judgment.” (Resp. Def.’s Mot. Summ. J. 6:20–22, ECF No. 22). 3 The Rooker-Feldman doctrine derives its name from two Supreme Court cases: Rooker 4 v. Fidelity Trust Company, 263 U.S. 413 (1923), and D.C. Court of Appeals v. Feldman, 460 5 U.S. 462 (1983). The Rooker-Feldman doctrine precludes federal district courts from hearing 6 cases in which the “federal plaintiff asserts as a legal wrong an allegedly erroneous decision by 7 a state court and seeks relief from a state court judgment based on that decision.” Benavidez v. 8 Cnty. of San Diego, 993 F.3d 1134, 1142 (9th Cir. 2021) (internal quotation marks and citation 9 omitted). Review of such state court decisions may be conducted only by the United States 10 Supreme Court. See 28 U.S.C. § 1257; see also Exxon Mobil Corp. v. Saudi Basic Indust. 11 Corp., 544 U.S. 280, 291 (2005). 12 Even when a plaintiff brings a de facto appeal of a state court judgment, Rooker- 13 Feldman does not bar a federal suit if that judgment was obtained by extrinsic fraud. Kougasian 14 v. TMSL, Inc., 359 F.3d 1136, 1141 (9th Cir. 2004). Fraud on a court is “not an error by that 15 court,” but instead is “a wrongful act committed by the party or parties who engaged in the 16 fraud.” Id. “Rooker-Feldman therefore does not bar subject matter jurisdiction when a federal 17 plaintiff alleges a cause of action for extrinsic fraud on a state court and seeks to set aside a 18 state court judgment obtained by that fraud.” Id. If the parties had raised the issue of fraud 19 before the state court, however, and the state court made a determination that there was no 20 fraud, then Rooker-Feldman would apply. Reusser v. Wachovia Bank, N.A., 525 F.3d 855, 860

21 (9th Cir. 2008). 22 Broadly speaking, Plaintiff’s claims can be bifurcated into those predicated on 23 Defendant’s alleged misrepresentations in obtaining the state court default judgment, and its 24 actions taken to then collect on that judgment. The Court first examines Plaintiff’s claims 25 based on Defendant’s actions to obtain the state court judgment. 1 a. Actions to Obtain the State Court Default Judgment 2 Plaintiff advances that Defendant misrepresented in the state court action that she was 3 the owner of the Account, and falsely represented that she owed the debt underlying the 4 Account. (Resp. Def. Mot. Summ. J. 7:2–8:24). She further maintains that Defendant failed to 5 produce the agreement showing she was the owner of the Account. (Id.). Defendant contends 6 that these claims are barred by Rooker-Feldman because for Plaintiff to prevail in this case, the 7 Court would have to effectively reverse the state court judgment by finding she did not own the 8 Account. (Reply Def.’s Mot. Summ. J. 3:4–4:6). 9 Several courts in the Ninth Circuit have analyzed claims similar to those advanced by 10 Plaintiff and determined that claims brought on the execution of a default judgment for debt 11 were barred by the Rooker-Feldman doctrine. See Grant v. Unifund CCR Partners, 842 F. 12 Supp. 2d 1234, 1239 (C.D. Cal. 2012) (“Were the Court to rule that [defendant] committed any 13 of those alleged wrongs, it would undercut the state ruling that plaintiff was in fact served with 14 a copy of the summons and complaint, owed the debt to [defendant], and authorized 15 [defendant] to execute a Writ of Execution”); Tait v. Asset Acceptance, LLC, No. 12-cv-9532, 16 2013 WL 3811767, at *4 (C.D. Cal. July 22, 2013) (same); Bryant v. Gordon & Wong Law 17 Grp., P.C., 681 F. Supp. 2d 1205, 1209 (E.D. Cal. 2010) (same). 18 Nevertheless, several cases in the Ninth Circuit have come out the other way. See, e.g., 19 Britton v. ABC Legal Services, Inc., No. 17-cv-07070, 2018 WL 3207907 at *7 (N.D. Cal. June 20 29, 2018) (“Plaintiff’s assertion that [defendant] filed a fraudulent affidavit and declaration of

21 service” in state court not barred by Rooker-Feldman doctrine); Rubio v. LVNV Funding, LLC, 22 No. 14-cv-05395, 2015 WL 13650046, at *4 (N.D. Cal. July 21, 2015) (“The filing of a false 23 proof of service in order to obtain a default judgment constitutes extrinsic fraud under the Ninth 24 Circuit” and thus the Rooker-Feldman doctrine does not apply); Engelen v. Erin Capital Mgmt., 25 No. 10-cv-01125, 2011 WL 3844587, at *1 (S.D. Cal. Aug. 30, 2011) (writing that a plaintiff 1 who alleged that defendant “obtained a default judgment against Plaintiff in state court by 2 falsely representing to the state court that Plaintiff had been served with the summons and 3 complaint” was not barred by the Rooker-Feldman doctrine). 4 The second set of cases rely on the Ninth Circuit’s instruction that Rooker-Feldman does 5 not bar cases where a plaintiff alleges extrinsic fraud on the state court because “a plaintiff 6 alleging extrinsic fraud on a state court is not alleging a legal error of a state court; rather, he or 7 she is alleging a wrongful act by the adverse party.” Kougasian, 359 F.3d at 1140–41. As a 8 result, these cases all involve instances where the plaintiff asserted specific fraudulent conduct 9 undertaken by a defendant in state court. See Britton, 2018 WL 3207907, at *7; Rubio, 2015 10 WL 13650046, at *4; Engelen, 2011 WL 3844587, at *1. 11 Here, Plaintiff’s claims based on Defendant’s conduct fall into the latter rather than the 12 former camp. It is Defendant’s alleged fraudulent “conduct in bringing the lawsuit” that is the 13 basis for Plaintiff’s injury, not the state court judgment. Dexter v. Tran, 654 F. Supp. 2d 1253, 14 1260 (E.D. Wash. 2009). That is, Plaintiff’s claim is predicated on her contention that 15 Defendant committed extrinsic fraud by falsely representing she owned the Account without 16 producing the agreement. Moreover, Plaintiff seeks only statutory damages for Defendant’s 17 conduct, not “relief from the state court judgment.”1 Kougasian, 359 F.3d at 1140. 18 Accordingly, the Court finds that Plaintiff’s claims based on Defendant’s conduct in obtaining 19 the state court judgment are not barred by Rooker-Feldman. 20 ///

21 /// 22 /// 23 24 1 The Court recognizes that Plaintiff explained in her deposition testimony that her goal was to have the state court judgment vacated. (Carrera Dep. 135:25–136:22, Ex. 1 to Resp. Def.’s Mot. Summ. J.). But to focus on a 25 statement made in isolation, especially one made by an individual untrained in the vagaries of a jurisdictional doctrine, would elevate form over substance. The substance of Plaintiff’s claim raises a challenge based on extrinsic fraud, even if the form was unartfully delivered in a deposition. 1 b. Collection Actions on the State Court Judgment 2 In contrast, Plaintiff’s FDCPA claims relating to Defendant’s collection of the state 3 court judgment are not independent claims; instead, the injuries they allege are the result of the 4 state-court judgment and are thereby barred under Rooker-Feldman. For example, her 15 5 U.S.C. § 1692e claims argue that Defendant used “false, deceptive, and misleading 6 representations” in attempting to collect the state court judgment because she does not own the 7 Account, so any attempt to collect the debt is invalid. (Resp. Def.’s Mot. Summ. J. 7:1–8:12). 8 Similarly, her 15 § U.S.C. 1692f claim advances that Defendant has employed unfair or 9 unconscionable means in collection of the debt because it has not produced an agreement 10 showing Plaintiff owns the Account, so Defendant is “neither authorized by an agreement or 11 permitted by law” to collect the debt. (Id. 8:13–24). These claims ignore that by entering 12 default judgment, the state court permitted Defendant to collect on that judgment. The United 13 States District Court for the Central District of California’s decision in Riding v. Cach LLC, 14 992 F. Supp. 2d 987 (C.D. Cal. 2014), is helpful in examining Plaintiff’s claims. 15 In Riding, the plaintiff alleged a variety of different types of FDCPA claims after a state 16 court had entered judgment on the underlying debt. Id. at 992–94. The court divided the 17 FDCPA claims into those that sought to “undercut the state court ruling” and those that were 18 premised on “improper collection methods.” Id. at 994. The former was barred by Rooker– 19 Feldman but the latter were not. In context, that meant the plaintiff could not assert any 20 FDCPA claims premised on him being found not liable for the state court judgment, but the

21 plaintiff could contest the manner in which the defendant went about obtaining that judgment. 22 Id. at 994–95. 23 Here, Plaintiff does not contend, nor does the record show, that Defendant used abusive 24 language or harassing tactics to collect the state court judgment. Additionally, Defendant was 25 authorized by law to collect the debt pursuant to the state court judgment. So, Plaintiff’s claims 1 are predicated on her contention that she did not own the Account, and thereby the debt, 2 underlying the state court judgment. “Essentially, because [Plaintiff] believes the state-court 3 debt to be invalid, she contends that [Defendant’s] attempts to collect on the debt are also 4 invalid. But this Court cannot review or undo the state-court judgment.” Worley v. Simon 5 Meyrowitz & Meyrowitz, P.C., No. 23-187, 2023 WL 8664375, at *3 (2nd Cir. Dec. 15, 2023) 6 (citing Exxon Mobil Corp., 544 U.S. at 293; see also Brooks v. Laughlin Memorial Hospital, 7 Inc., No. 2:18-cv-146, 2019 WL 13216633, at *9 (E.D. Tenn. June 26, 2019) (“Plaintiff’s claim 8 that the FDCPA Defendants attempted to collect form Mrs. Brooks a debt that she did not owe 9 is indistinguishable from a challenge to the state court’s judgment that Mrs. Brooks owes the 10 debt in question.”). These claims are directly challenging the underlying debt and not 11 Defendant’s collections efforts, so they are barred by Rooker-Feldman.2 Accordingly, the 12 Court GRANTS Defendant’s summary judgment to the extent Plaintiff’s 15 U.S.C. § 1692e 13 and f claims are based on Defendant’s attempt to collect on the state court judgment. 14 2. Standing 15 Defendant next contends that this Court lacks subject matter jurisdiction. Specifically, 16 Defendant argues Plaintiff has failed to introduce evidence showing she suffered a concrete 17 injury, and therefore, cannot make the requirements for Article III standing. (Def. Mot. Summ. 18 J. 2:17–3:3). 19 To establish constitutional standing, “a plaintiff must show (1) [he or she] has suffered 20 an ‘injury in fact’ that is (a) concrete and particularized and (b) actual or imminent, not

21 conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the 22 defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be 23

24 2 Alternatively, the Court would find these claims fail on the merits. Defendant’s attempt to collect on the 25 default judgment while the state court judgment was in effect would not misrepresent the “legal status” of the judgment, 15 U.S.C. § 1692e(2)(A) or constitute a “threat to take any action that cannot be legally be taken,” id. 1692e(5), because judgment was entered against Plaintiff at the time of any collection effort. 1 redressed by a favorable decision.” Friends of the Earth v. Laidlaw Envtl. Servs., 528 U.S. 167, 2 180–81 (2000). “Plaintiff bears the burden of establishing standing, and [when] standing is 3 challenged at the summary judgment stage, plaintiff must set forth specific facts to show each 4 of the elements of standing.” Fair Hous. Council of Or. v. Travelers Home & Marine Ins. Co., 5 No. 3:15-cv-00925, 2016 WL 7423414, at *3 (D. Or. Dec. 2, 2016) (citing Lujan v. Defs. of 6 Wildlife, 504 U.S. 555, 561 (1992), and Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 884–85 7 (1990)). 8 Prior to the Supreme Court’s decision in TransUnion LLC v. Ramirez, 594 U.S. 413, 9 (2021), courts within this Circuit, including, occasionally, the Ninth Circuit itself, held that a 10 violation of the FDCPA’s statutorily conferred rights constituted a cognizable Article III injury 11 in and of itself. See, e.g., Tourgeman v. Collins Fin. Servs., Inc., 755 F.3d 1109, 1116 (9th Cir. 12 2014); Martinez v. Integrated Cap. Recovery, LLC, 513 F. Supp. 3d 1219, 1225 (E.D. Cal. 13 2021) (“This Court agrees that a violation of the FDCPA can constitute a cognizable injury 14 sufficient for standing.”). In TransUnion, however, the Supreme Court clarified that a concrete 15 injury is one that causes either a “physical or monetary injury to the plaintiff,” or alternatively, 16 if intangible, that it bears “a close relationship to harms traditionally recognized as providing a 17 basis for lawsuits in American courts.” 594 U.S. at 425. The latter inquiry “asks whether 18 plaintiffs have identified a close historical or common-law analogue for their asserted injury.” 19 Id. 20 To show concrete injury, Plaintiff relies on the damages she suffered because of the lien

21 placed on her home and the harm caused by Defendant’s alleged procedural violations of the 22 FDCPA. (See generally Reply Pl.’s Mot. Summ J., ECF No. 25). The Court finds that both are 23 sufficient to show a concrete injury, and concludes it has jurisdiction over this case. 24 First, the lien on Plaintiff’s home is a “cloud on [her] title to property” and “is a harm 25 that has been recognized by common law as actionable, providing a basis for lawsuits in 1 American courts.” Corbit v. Old Republic Ins. Co., No. 5:22-cv-031, 2023 WL 3514444, at *4 2 (N.D. Tex. May 17, 2023) (finding the plaintiff had standing because of the lien placed by 3 defendant in a FDCPA lawsuit). That is, a plaintiff “seeking to remove a cloud on their 4 property traditionally bring a quiet-title claim.” (Id.); see also Currier v. First Resolution Inv. 5 Corp., 762 F.3d 529, 534–35 (6th Cir. 2014) (describing a debt collector filing an improper 6 judgment lien as more than “mere technical violation of [state] law” which placed an “improper 7 legal burden on [the plaintiff’s] home) (citing Tucker v. Grace Enters. of Ky., LLC, No. 2003- 8 cv-002341, 2004 WL 2566518, at *1–2 (Ky. Ct. App. Nov. 12, 2004) (illustrating the use of a 9 quiet title action to remove an improper judgment lien; noting that the lien prevented the 10 conveyance of a marketable title in the property)). 11 Moreover, at least one circuit court has held that a debt collector, filing a claim of lien, is 12 a tangible harm sufficient to confer standing. See, e.g., Toste v. Beach Club at Fontainebleau 13 Park Condominium Association, Inc., No. 21-14348, 2022 WL 4091738 (11th Cir. Sept. 7, 14 2022). In Toste, the plaintiff failed to pay condominium dues, the association referred the 15 matter to a law firm, and the law firm attempted to collect the debt (by threatening to file a 16 claim of lien and then actually filing a claim a lien and threatening to foreclose if payment of 17 past due amounts was not made). Id. at *1. The plaintiff disputed the amount of the debt, had 18 to retain a lawyer, and ultimately filed a lawsuit for violation of the FDCPA. Id. The court 19 determined that the plaintiff suffered concrete harm in the form of wasted time and emotional 20 distress, and in any event the plaintiff suffered concrete harm in the form of the claim of lien,

21 which by itself was sufficient to confer standing. Id. at *4. 22 The Court finds the reasoning in Toste persuasive. A lien is an encumbrance on 23 property that is a tangible harm sufficient to give standing. This is true regardless of whether a 24 lien is considered a harm recognized at common law. Defendant’s lien was a product of its 25 /// 1 alleged improper practices in obtaining the state court judgment and is a harm sufficient to give 2 Plaintiff standing. 3 Second, the Court finds that the procedural violations of the FDCPA alleged by Plaintiff 4 are also sufficient to confer standing. Specifically, the fulcrum of Plaintiff’s claim is that 5 Defendant brough the state court action without producing the Agreement and thereby falsely 6 representing she owned the debt. This form of lawsuit bears a close relationship to the well- 7 recognized tort of the wrongful use of civil proceedings. See Viernes v. DNF Assocs., 582 F. 8 Supp. 3d 738, 750 (D. Haw. 2022) (“There is a close relationship between being subjected to an 9 unlawful lawsuit and the four elements of wrongful civil proceedings.”). Viernes’s element-by- 10 element analysis of an FDCPA claim is persuasive here. Id. at 749–52. Accordingly, the Court 11 finds Plaintiff’s claim that she was subjected to an unlawful lawsuit is a concrete harm. Id. at 12 752. Having found that the Court has jurisdiction, it now proceeds to the merits of Plaintiff’s 13 claims. 14 3. 15 U.S.C. § 1692e 15 Section 1692e provides that “[a] debt collector may not use any false, deceptive, or 16 misleading representation or means in connection with the collection of any debt.” 15 U.S.C. § 17 1692e. Section 1692e(5) prohibits a “threat to take any action that cannot legally be taken” 18 while 1692e(10) bars the “use of any false representation or deceptive means to collect or 19 attempt to collect any debt or to obtain information concerning a consumer.” 15 U.S.C. § 20 1692e(5), (10). “Whether conduct violates §§ 1692e . . . requires an objective analysis that

21 takes into account whether ‘the least sophisticated debtor would likely be misled by a 22 communication.’” Donohue v. Quick Collect, Inc., 592 F.3d 1027, 1030 (9th Cir. 2010) 23 (quoting Guerrero v. RJM Acquisitions LLC, 499 F.3d 926, 934 (9th Cir. 2007). 24 Defendant contends that Plaintiff’s § 1692e claims fail because it engaged in no 25 improper conduct in attempting to collect Plaintiff’s alleged debt after it obtained the state court 1 default judgment. (Def. Mot. Summ. J. 15:9–16:27). The Court agrees with Defendant to the 2 extent its argument is based on its actions after it obtained the state court judgment. That is, 3 Defendant was entitled to collect on a valid judgment, and Plaintiff has introduced no evidence 4 showing it used false representation or deceptive means to collect on the judgment. The Court 5 disagrees with Defendant, however, to the extent Plaintiff’s § 1692e are predicated on 6 Defendant’s alleged improper conduct in bringing the state court lawsuit despite being aware 7 that Plaintiff was not subject to the agreement. 8 The Court concludes that Plaintiff has presented triable issues of fact under § 1692e, § 9 1692e(5), and § 1692e(10). “Court filings can be a threat under the FDCPA.” Currier, 762 10 F.3d at 535; see also Sayyed v. Wolpoff & Abramson, 485 F.3d 226, 229–32 (4th Cir.2007) 11 (holding that the FDCPA applies to interrogatories and motions for summary judgment); 12 Gearing v. Check Brokerage Corp., 233 F.3d 469, 472–73 (7th Cir.2000) (holding that the 13 FDCPA applies to a complaint). And “[f]iling a state court complaint alleging a nonexistent 14 debt” violates these sections. Heathman v. Portfolio Recovery Assocs., Inc., No. 12-cv-201, 15 2013 WL 755674, at *3 (S.D. Cal. Feb. 2013). 16 Plaintiff plausibly asserts that Defendant falsely represented in state court that she owed 17 a debt and used that false representation to collect the debt from her. To date, Defendant has 18 not produced the agreement showing Plaintiff is liable for the debt. The only evidence 19 provided by the parties as to who owns the account are Plaintiff’s assertions disavowing 20 ownership. (Carrera Dep. 135:25–136:22, Ex. 1 to Resp. Def.’s Mot. Summ. J.). Viewing the

21 evidence in the light most favorable to Plaintiff, the Court finds that a material dispute of fact 22 exists as to her § 1692e claims because Defendant initiated a lawsuit to claim a nonexistent 23 debt. See, e.g., Cox v. Hilco Receivable, L.L.C., 726 F.Supp.2d 659, 666 (N.D.Tex.2010) (“[A] 24 debt collector’s representation that a debt is owed to it when it in fact is not, amounts to a 25 /// 1 misrepresentation barred by the FDCPA.”). Accordingly, the Court declines to grant 2 Defendant summary judgment as to these claims. 3 4. 15 U.S.C. § 1692f 4 Section 1692f provides that “[a] debt collector may not use unfair or unconscionable 5 means to collect or attempt to collect any debt.” 15 U.S.C. § 1692f. Further, § 1692f(1) 6 prohibits “[t]he collection of any amount (including any interest, fee, charge, or expense 7 incidental to the principal obligation) unless such amount is expressly authorized by the 8 agreement creating the debt or permitted by law.” 15 U.S.C. § 1692f(1). “Many courts have 9 interpreted [§] 1692f(1) to address the abusive practice of ‘collecting an amount greater than 10 that which is owing,’ not collecting on a debt that turns out to have been incurred by another 11 person.” Opico v. Convergent Outsourcing, Inc., No. 18-cv-1579, 2021 WL 1611505, at *9 12 (W.D. Wash. Apr. 26, 2021) (collecting cases); see also Clark, 460 F.3d at 1178 (“[W]hen [the 13 debt collector] pursues a debt it knows is overstated . . . [it] seeks to collect an amount that is 14 not permitted by law in contravention of § 1692f(1).”). 15 Plaintiff contends that Defendant violated § 1692f and (f)(1) when it sought to collect 16 amounts from her that were not authorized by the agreement creating the debt (because, as 17 Plaintiff argues, there was no debt owed by her). (Resp. Def. Mot. Summ. J. 8:19–22). In other 18 words, Plaintiff advances that Defendant violated § 1692f based on the same alleged conduct 19 underlying her § 1692e claims—i.e., that she did not ultimately owe the debt that Defendant 20 sought to collect. Defendant contends that Plaintiff’s § 1692f claims fail because they are

21 based on the same alleged misconduct that form the basis for her 1692e claims. (Reply Def. 22 Mot. Summ. J. 5:19–6:3). The Court agrees with Defendant that Plaintiff’s § 1692f claim fails 23 because it is duplicative of her other claims. It also finds that Defendant is entitled to summary 24 judgment on Plaintiff’s § 1692f(1) claim because no violation of the subsection occurred. 25 /// 1 The Ninth Circuit has held that the same alleged misconduct can support claims under 2 multiple sections of the FDCPA. See, e.g., Clark v. Cap. Credit & Collection Servs., Inc., 460 3 F.3d 1162, 1175 (9th Cir. 2006) (“[W]e (as well as other courts) routinely have allowed debtors 4 to pursue causes of action[ ] under multiple sections of the FDCPA, even though each violation 5 was based upon the same circumstances.”); Fox v. Citicorp Credit Servs., Inc., 15 F.3d 1507, 6 1516 n.10 (9th Cir. 1994) (“[I]t is not unusual for an action to violate more than one FDCPA 7 provision.”). Nevertheless, despite the Ninth Circuit’s holding in Clark, many district courts in 8 the Ninth Circuit have found a plaintiff’s § 1692f claim fails if it does not allege any 9 misconduct beyond which the plaintiff asserts violate other provisions of the FDCPA. See, e.g., 10 Muzyka v. Rash Curtis & Assocs., No. 2:18-cv-01097, 2019 WL 2869114, at *6–7 (E.D. Cal. 11 July 3, 2019); Martin v. Target Card Servs., No. 17-cv-5372, 2018 WL 2723258, at *5 (C.D. 12 Cal. Apr. 24, 2018); Muzyka v. Rash Curtis & Assocs., No. 2:18-cv-01097, 2019 WL 2869114, 13 at *6–7 (E.D. Cal. July 3, 2019); Thomas v. Loomis-Therrien, No. 5:14-cv-00979, 2014 WL 14 5335913, at *6 (C.D. Cal. Oct. 20, 2014); Amina v. WMC Mortg. Corp., No. 10--cv00165, 2011 15 WL 1869835, at *16 (D. Haw. May 13, 2011); see also Fox, 15 F.3d at 1516 (finding no 16 violation of § 1692f when “no evidence ha[d] been offered of any conduct by the defendants in 17 the least comparable with the conduct condemned [by § 1692f]”). This is because § 1692f is a 18 “backstop” for misconduct that is not specifically addressed elsewhere in the FDCPA. Midland 19 Funding, LLC v. Johnson, 137 S. Ct. 1407, 1418 n.4 (2017) (Sotomayor, J. dissenting). 20 Here, Plaintiff’s § 1692f claim is predicated on the same alleged misconduct as her §

21 1692e claim. That is, Defendant violated the FDCPA when it misrepresented to the state court 22 that Plaintiff owned the Account, and thereby the debt, pursuant to an agreement. In light of § 23 1692f’s purpose as an auxiliary “backstop”, the Court GRANTS Defendant summary judgment 24 on Plaintiff’s § 1692f claim because it is predicated on the same misconduct that underlies her 25 § 1692e claims. 1 Next, for Plaintiff to succeed on a claim brought under § 1692f(1) claim, she would need 2 to show that Plaintiff sought to collect an amount greater than that which was authorized by the 3 underlying debt agreement. Plaintiff’s filings are unclear, but her claim appears to advance that 4 Defendant violated this section by failing to collect any amount because she maintains she does 5 own any debt. Thus, “Plaintiff’s contention that [Defendant] attempted to collect a debt she did 6 not owe, does not dispute or assert that the amount [Defendant] sought to collect was greater 7 than that authorized by the underlying debt agreement.” Chavira v. U.S. Dep’t of Education, 8 No. 1:19-cv-00538, 2022 WL 1082568, at * (E.D. Cal. Apr. 11, 2022). Rather, “where the 9 amount being collected by the collection agency [is] not different than the amount owed, § 10 1692f(1) [is] inapplicable to the plaintiff’s claim that the collection agency was attempting to 11 collect the debt from the wrong person.” Blackmon v. Ad Astra Recovery Servs., Inc., No. 3:20- 12 cv-00800, 2021 WL 1541647, at *3 (S.D. Cal. Apr. 20, 2021); see Valdez v. Action Fin. Servs., 13 LLC, No. 3:20-cv-00015, 2021 WL 5108755, at *8–9 (D. Nev. Aug. 3, 2021) (granting 14 summary judgment in favor of a debt collector on a § 1692f(1) claim that was based on the debt 15 collector seeking to collect a student loan debt that did not belong to the plaintiff). 16 Accordingly, the Court also GRANTS Defendant summary judgment on Plaintiff’s § 1692f(1) 17 claim. 18 5. Bona Fide Error Defense 19 Finally, Defendant contends the bona fide error defense precludes liability for Plaintiff’s 20 § 1692e claims. (Def. Mot. Summ. J. 19:18–21:1). “The bona fide error defense is an

21 affirmative defense, for which the debt collector has the burden of proof.” McCollough v. 22 Johnson, Rodenburg & Lauinger, LLC, 637 F.3d 939, 948 (9th Cir. 2011) (citation omitted). 23 The defense provides: 24 A debt collector may not be held liable in any action brought under [the FDCPA] if the debt collector shows by a preponderance of evidence that the violation was 25 not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error. 1 15 U.S.C. § 1692k(c). “Thus, to qualify for the bona fide error defense, the defendant must 2 prove that (1) it violated the FDCPA unintentionally; (2) the violation resulted from a bona fide 3 error; and (3) it maintained procedures reasonably adapted to avoid the violation.” McCollough, 4 637 F.3d at 948. 5 Defendant’s evidence of its training and procedures are found in the declaration and 6 deposition of Allison Smith, its Legal Director. (Def. Mot. Summ. J. 20:18–26); (Smith Decl. ¶ 7 1 to Def. Mot. Summ. J.). In her declaration, Smith asserted that Defendant “has established 8 procedures for placing liens on homes of debtors. [Defendant] also has procedures for training 9 its employees to follow these procedures. There are . . . employees who are responsible for 10 supervising and making sure procedures are followed.” (Smith Decl. ¶ 25 to Def. Mot. Summ. 11 J.). In her deposition, Smith engaged with the following colloquy with Plaintiff’s attorney, 12 [Plaintiff’s Attorney]: And can you tell us why [Defendant] placed a lien 13 on Plaintiff’s home?

14 [Allison Smith]: Placing a lien on the home is one of the judgment 15 enforcement avenues that are taken when there’s a judgment obtained against a Defendant and they own property. 16 [Plaintiff’s Attorney]: Does Allied have procedures that it has established 17 for placing liens on the homes of debtors, real estate debtors? 18 [Allison Smith]: In general, yes. 19 [Plaintiff’s Attorney]: Does Allied have a system for training its 20 employees to follow these procedures?

21 [Allison Smith]: I’m sorry. Did you – can you repeat the question? 22 [Plaintiff’s Attorney]: Yes. Does Allied have procedures for training its 23 employees to follow these procedures?

24 [Allison Smith]: In general, yes. 25 [Plaintiff’s Attorney]: Okay, and does Allied have employees who are 1 responsible for supervising and making sure that these procedures are followed? 2 [Allison Smith]: In general, yes. 3

4 (Allison Smith Dep. 25:11–26:9, Ex. 11 to Def. Mot. Summ. J.). 5 Defendant has not met its burden of proving that it affirmatively maintained procedures 6 designed to avoid the type of error at issue in this case. “If the bona fide error defense is to 7 have any meaning in the context of a strict liability statute, then a showing of ‘procedures 8 reasonably adapted to avoid any such error’ must require more than a mere assertion to that 9 effect.” Reichert v. Nat’l Credit Sys. Inc., 531 F.3d 1002, 1007 (9th Cir. 2008). Rather, “[t]he 10 procedures themselves must be explained, along with the manner in which they were adapted to 11 avoid the error.” Id. Defendant’s evidence “merely alludes vaguely to broad training topics 12 without any explanation, or supporting evidence, showing what that training specifically 13 entailed and how it could have prevented” the issue underlying this case. Creager v. Columbia 14 Debt Recovery, 618 F. Supp. 3d 1094, 1105 (W.D. Wash. 2022); see Parker v. Peters & 15 Freedman, LLP, No. 17-cv-00667, 2018 WL 5904169, at *5 (C.D. Cal. Apr. 9, 2018) (finding 16 defendant's reference to an employee training program insufficient because it “does not provide 17 the Court with any facts as to how these programs are designed to avoid the specific error at 18 issue”). “Nor does Defendant offer any evidence corroborating that any such training actually 19 took place and that the employees involved in Plaintiff’s debt collection participated in it.” 20 Creager, 618 F. Supp. 3d at 1105. In short, Defendant has not met its burden of proving that it 21 affirmatively maintained specific procedures designed to avoid the type of error at issue in this 22 case. Accordingly, Defendant is not entitled to invoke the bona fide error defense. 23 /// 24 /// 25 /// 1 6. Conclusion 2 Before addressing Plaintiff’s Motion for Summary Judgment the Court seeks to clarify 3 its ruling. The Court GRANTS Defendant summary judgment on Plaintiff’s § 1692e and f 4 claims to the extent they are based on Defendant’s conduct after it obtained the state court 5 judgment. It does so because these claims are barred by the Rooker-Feldman doctrine, and, 6 alternatively, fail on the merits. The Court DENIES Defendant’s summary judgment on 7 Plaintiff’s 15 U.S.C. § 1692e claims to the extent they are based on Defendant’s conduct in 8 obtaining the state court judgment. These claims are not barred by the Rooker-Feldman 9 doctrine, based on a concrete harm suffered by Plaintiff that confers the Court with jurisdiction, 10 supported by the record, and not precluded by the bona fide defense doctrine. Having clarified 11 its ruling, the Court now turns to Plaintiff’s Motion for Summary Judgment. 12 B. Plaintiff’s Motion for Summary Judgment 13 When evaluating Plaintiff’s Motion for Summary Judgment, the Court must view 14 evidence in the light most favorable to Defendant. See Leslie v. Grupo ICA, 198 F.3d 1152, 15 1158 (9th Cir. 1999). Because Plaintiff bears the burden of proof at trial, she must 16 affirmatively demonstrate that no reasonable trier of fact could find other than for her. See 17 Celotex, 477 U.S. at 323. 18 At the outset, Defendant’s Response includes many of the same arguments that it 19 advanced in its Motion for Summary Judgment. This includes Defendant’s contention that 20 Plaintiff’s claims are barred by the Rooker-Feldman doctrine, fail because she lacks standing

21 under Article III, or are precluded by the bona fide defense doctrine. (See generally Resp., ECF 22 No. 21). The Court applies the same reasoning it employed above and reaches the same 23 outcomes. Accordingly, the Court’s analysis is limited to whether Plaintiff is entitled to 24 summary judgment on her § 1692(e) claims predicated on Defendant’s conduct in obtaining the 25 1 state court judgment.3 Here, the Court finds Plaintiff is entitled to summary judgment on these 2 claims for two reasons. 3 First, Plaintiff maintains she only began banking with Chase in 2019, so she does not 4 own the account underlying the debt. (Carrera Decl. ¶¶ 13–16, Ex. 2 to Pl.’s Mot. Summ. J.). 5 While Plaintiff’s assertions are self-serving, they are cognizable at this stage because they state 6 facts based on personal knowledge. See Rodriguez v. Airborne Express, 265 F.3d 890, 902 (9th 7 Cir. 2001) (“[S]elf-serving affidavits are cognizable to establish a genuine issue of material fact 8 so long as they state facts based on personal knowledge and are not too conclusory.”). Second, 9 it is undisputed that Defendant never produced the Agreement showing Plaintiff owned the 10 Chase account. Not only has Defendant not produced the Agreement, but it has also submitted 11 no evidence showing Plaintiff owned the Chase account. 12 Taken together, the record before the Court lends itself to the conclusion that Defendant 13 misrepresented to the state court Plaintiff’s ownership of the Chase account and initiated a legal 14 action that could not legally be taken. Plaintiff is entitled to recover damages that Defendant 15 caused by taking these improper actions, constituting extrinsic fraud to obtain default judgment, 16 which occurred before the state court judgment; and thus the state court judgment did not cause 17 her injuries. Accordingly, the Court finds Plaintiff is entitled to summary judgment on her § 18 1692e claims. 19 20

22 3 Plaintiff’s Motion only moved for summary judgment on her claim under § 1692(e)(10) and not (e) and (e)(5). 23 (See generally Pl. Mot. Summ. J.). Her Reply, however, argued that she was entitled to summary judgment on all her § 1692(e) claims. (Reply Pl. Mot. Summ. J. 3:11–4:21, ECF No. 25). “[A] district court need not consider 24 arguments raised for the first time in a reply brief.” Zamani v. Carnes, 491 F.3d 990, 997 (9th Cir. 2007). Nevertheless, Defendant’s Response noted that Plaintiff only moved for partial summary judgment, and still 25 chose to address all her claims. (Resp. Pl. Mot. Summ. J., ECF No. 21). Because Defendant addressed all of Plaintiff’s claims, the Court finds it would not be prejudiced by it considering all of Plaintiff’s § 1692(e) claims. Defendant may file a motion for reconsideration if it has new argument it failed to raise. CONCLUSION 2 IT IS HEREBY ORDERED that Defendant’s Motion for Summary Judgment, (ECF 3 || No. 18), is GRANTED in part and DENIED in part. 4 IT IS FURTHER ORDERED that Plaintiff's Motion for Summary Judgment, (ECF 5 19), is GRANTED in part and DENIED in part. 6 The Clerk of Court is kindly instructed to close the case and enter judgment in favor of 7 || Plaintiff on her § 1692e claims to the extent they are based on Defendant’s conduct in obtaining 8 || the state court default judgment. Defendant is entitled to judgment on Plaintiff's § 1692e 9 claims to the extent they are based on Defendant’s conduct after it obtained the state court 10 ||judgment, and Plaintiff is entitled to judgment on her § 1692f claims in their entirety. 1] DATED this 3] day of July, 2024. 12 13

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