Morales v. The Rausch Group & Associates LLC

CourtDistrict Court, N.D. Texas
DecidedNovember 10, 2020
Docket3:19-cv-02850
StatusUnknown

This text of Morales v. The Rausch Group & Associates LLC (Morales v. The Rausch Group & Associates LLC) is published on Counsel Stack Legal Research, covering District Court, N.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Morales v. The Rausch Group & Associates LLC, (N.D. Tex. 2020).

Opinion

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF TEXAS DALLAS DIVISION CARLOS MORALES, § § Plaintiff, § § v. § CIVIL ACTION NO. 3:19-CV-2850-B § THE RAUSCH GROUP & § ASSOCIATES, LLC, § § Defendant. § MEMORANDUM OPINION AND ORDER Before the Court is Plaintiff Carlos Morales’s Motion for Default Judgment (Doc. 8), filed August 7, 2020. For the reasons discussed below, the Court GRANTS IN PART and DENIES IN PART Morales’s motion. I. BACKGROUND1 This is a Fair Debt Collection Practices Act (FDCPA) suit. On November 27, 2019, Morales filed a complaint against The Rausch Group & Associates, LLC, alleging Rausch violated the FDCPA when, on or around October 17, 2019, its representatives phoned Morales and sent a letter to him in reference to an alleged medical debt. See generally, Doc. 1, Compl. First, Rausch called Morales, but Morales terminated the call. Doc. 8-1, Aff. of Pl., ¶ 6. The same day, Rausch called Morales’s employer “about wage garnishment,” and Morales’s employer notified Morales of the call. Id. ¶¶ 7–9. Morales “immediately” attempted to contact Rausch, but 1 The Court draws the facts from Morales’s complaint (Doc. 1) and affidavit (Doc. 8-1). - 1 - Rausch did not answer his call. Id. ¶ 10. Rausch’s representative then returned Morales’s call and informed him of a fifteen-year-old outstanding hospital bill in the amount of $3,877.74. Id. ¶ 11. The representative informed Morales that Rausch mailed Morales letters seven years ago regarding this

debt, but Morales claims he never received them. Id. ¶¶ 12–13. Rausch’s representative also told Morales that if he did not pay the hospital bill immediately, Rausch would sue him. Id. ¶ 14. Later, Morales received “an electronic letter” from Rausch. Id. ¶ 15. The letter did not state the current legal owner of the debt—only that Dallas Regional was the original creditor. Id. ¶ 16. The letter threatened that Rausch would sue Morales on the debt and initiate liens on his “automobile, assets, and real estate” if he did not settle the debt. Id. ¶¶ 17–18. However, in the letter, Rausch stated that it would accept $2,700.00 to satisfy the debt if Morales paid immediately. Id. ¶ 20. Morales paid

Rausch $2,700.00 to satisfy the debt. Id. ¶¶ 25, 32. Based on the letter, Morales thought a judgment had been obtained against him, that attorneys were involved, and that if he did not pay, his assets would be taken and his wages garnished. Id. ¶¶ 27–28. In this action against Rausch, Morales now first asserts that the statute of limitations to collect on the debt had expired when Rausch collected it, and Rausch thus violated the FDCPA by attempting to collect a time-barred debt. Doc. 1, Compl., ¶¶ 28–42, 47c, 47f. Second, Morales

alleges that Rausch, through its representatives, failed to disclose its status as a debt collector as required under 15 U.S.C. § 1692e(11). Id. ¶ 47h. Third, Morales sues under other various sections of the FDCPA but fails to support these violations with specific factual allegations. See id. ¶ 47 (listing alleged violations of the FDCPA). Last, Morales alleges that as a result of Rausch’s violations, he “has suffered, and continues to suffer, personal humiliation, embarrassment, mental anguish, and emotional distress.” Id. ¶ 48. - 2 - Therefore, Morales seeks compensatory, actual, and statutory damages under 15 U.S.C. § 1692k, costs and attorneys’ fees, and any other relief the Court deems appropriate. Id. at 7. Morales served Rausch on December 4, 2019. See Doc. 5-1, Proof of Service, 2. To date, Rausch has not answered

or otherwise made an appearance in this case. Consequently, Morales requested the Clerk enter default against Rausch on February 5, 2020, Doc. 5, Request, 1, which it did that same day. Doc. 6, Clerk’s Entry of Default. Subsequently, the Court ordered Morales to file any motion for default judgment on or before August 7, 2020. Doc. 7, Order, 1. Morales moved for a default judgment against Rausch on August 7, 2020. Doc. 8, Mot. for Default J., 1. The Court now considers that motion. II.

LEGAL STANDARD Federal Rule of Civil Procedure 55 provides for the entry of default judgments in federal court. According to Rule 55, “[w]hen a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend, . . . the clerk must enter the party’s default.” Fed. R. Civ. P. 55(a). Once default has been entered, the Court may enter a default judgment against the defaulting defendant upon motion of the plaintiff. Fed. R. Civ. P. 55(b)(2).

That being said, “[d]efault judgments are a drastic remedy, not favored by the Federal Rules and resorted to by courts only in extreme situations.” Sun Bank of Ocala v. Pelican Homestead & Sav. Ass’n, 874 F.2d 274, 276 (5th Cir. 1989) (citations omitted). A party is not entitled to a default judgment merely because the defendant is technically in default. Ganther v. Ingle, 75 F.3d 207, 212 (5th Cir. 1996) (citations omitted). “Rather, a default judgment is generally committed to the discretion of the district court.” United States v. 1998 Freightliner Vin #: 1FUYCZYB3WP886986, 548 - 3 - F. Supp. 2d 381, 384 (W.D. Tex. 2008) (citing Mason v. Lister, 562 F.2d 343, 345 (5th Cir. 1977)). In determining whether to enter default judgment against a defendant, courts have developed a three-part analysis. See, e.g., id. (citation omitted). First, courts consider whether the entry of

default judgment is procedurally warranted. See Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th Cir. 1998). The factors relevant to this inquiry include: (1) “whether material issues of fact” exist; (2) “whether there has been substantial prejudice”; (3) “whether the grounds for default are clearly established”; (4) “whether the default was caused by a good faith mistake or excusable neglect”; (5) “the harshness of a default judgment”; and (6) “whether the court would think itself obliged to set aside the default on the defendant’s motion.” Id. Second, courts assess the substantive merits of the plaintiff’s claims and determine whether

there is a sufficient basis in the pleadings for the judgment. See Nishimatsu Constr. Co., Ltd. v. Hous. Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975) (noting that “default is not treated as an absolute confession by the defendant of his liability and of the plaintiff’s right to recover”). In doing so, the Court is to assume that due to its default, the defendant admits all well-pleaded facts in the plaintiff’s complaint. Id. However, the “defendant is not held to admit facts that are not well pleaded or to admit conclusions of law.” Id.

Third, courts determine what form of relief, if any, the plaintiff should receive. Ins. Co. of the W. v. H & G Contractors, Inc., 2011 WL 4738197, at *4 (S.D. Tex. Oct. 5, 2011) (“A defendant’s default concedes the truth of the allegations of the Complaint concerning the defendant’s liability, but not damages.” (citing Jackson v. FIE Corp., 302 F.3d 515, 524–25 (5th Cir. 2002)).

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Bluebook (online)
Morales v. The Rausch Group & Associates LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/morales-v-the-rausch-group-associates-llc-txnd-2020.