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Briscoe v. Cohen, McNeile & Pappas, Pc

United States District Court, D. Kansas

October 1, 2014

WAYNE L. BRISCOE, Plaintiff,
v.
COHEN, MCNEILE & PAPPAS, P.C., Defendant.

MEMORANDUM AND ORDER

DANIEL D. CRABTREE, District Judge.

Plaintiff Wayne L. Briscoe brings this lawsuit against defendant Cohen, McNeile & Pappas, P.C., alleging two claims-one for violation of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692, et seq., and the other for violation of the Kansas Consumer Protection Act ("KCPA"), K.S.A. § 50-623, et seq. -arising from defendant's attempts to collect a debt from plaintiff.[1] This matter comes before the Court on defendant's Motion to Dismiss under Fed.R.Civ.P. 12(b)(6) (Doc. 13). After considering the arguments made by both parties, the Court grants in part and denies in part defendant's Motion to Dismiss.

I. Factual Background

The following facts are taken from plaintiff's Second Amended Complaint (Doc. 11) and the Court views them in the light most favorable to him. S.E.C. v. Shields, 744 F.3d 633, 640 (10th Cir. 2014) ("We accept as true all well-pleaded factual allegations in the complaint and view them in the light most favorable to the [plaintiff].") (quotation omitted). During the times relevant to this lawsuit, plaintiff maintained two bank accounts at The Baldwin State Bank ("Bank")-a personal account and a business account for Resources Advantages in Telecommunications Enterprises, Inc., also known as R.A.T.E., Inc. On or around July 29, 2010, plaintiff obtained a personal loan from the Bank in the amount of $8, 450.00. After plaintiff defaulted on that loan, the Bank, attempting to satisfy partially plaintiff's outstanding personal loan, seized funds from R.A.T.E., Inc.'s business account in the amount of $1, 500.00. In June 2011, the Bank turned the personal loan account over to a collection agency, Shaffer & Associates. Shaffer & Associates then hired defendant to initiate legal action against plaintiff to collect the amount owed on the personal loan.

On June 16, 2012, defendant sent a letter to plaintiff at his current address of 9890 Evening Star Road, Eudora, Kansas, 66025 ("the Eudora Address"). (Plaintiff has resided at the Eudora Address from 2007 to the present.) The letter stated that plaintiff had an account balance of $8, 007.38 with the Bank and that the debt had been referred to defendant for collection. The letter also demanded payment of the debt. James McNeile, an attorney who practices with defendant law firm, signed the letter.

In September 2012, defendant, acting as legal counsel for the Bank, filed a lawsuit against plaintiff in the District Court of Douglas County, Kansas. In the caption of this lawsuit, defendant stated that plaintiff resided at 239 E. 1000th Road, Baldwin City, Kansas, 66006 ("the Baldwin City Address"). Plaintiff has never lived at the Baldwin City Address. Defendant also attached several exhibits to the Petition filed in that lawsuit, including an Affidavit of Account and Verification of Business Records from the Bank's President, Tom Dillon, and the Bank's account summary of plaintiff's personal loan account. The account summary stated that plaintiff resided at the Eudora Address.

Although the account summary stated that plaintiff resided at the Eudora Address, defendant attempted to serve plaintiff with the lawsuit at the Baldwin City Address. In September of 2012, defendant filed a Service Instruction Form which instructed the Douglas County Sheriff to serve process at the Baldwin City Address. The Summons and the Return of Service of Summons also listed the Baldwin City Address.

When plaintiff failed to appear or file a timely answer in the lawsuit, defendant took a default judgment. On September 28, 2012, defendant prepared, signed and filed a Journal Entry of Judgment certifying "that the file in the... case" reflected that plaintiff was properly served with summons or process on September 13, 2012.[2] However, plaintiff was never served in the lawsuit because defendant instructed the Sheriff to serve him at an address where he had never resided (the Baldwin City Address). The District Court of Douglas County, Kansas entered a default judgment against plaintiff in the principle sum of $7, 055.91, plus post-judgment interest at the rate of 15.250% per annum and attorney's fees of $250.00.[3]

On December 18, 2012, defendant prepared, signed and filed a Request for Garnishment in Douglas County, Kansas, for service on plaintiff's employer, Sprint United Management Co. In that document, defendant listed plaintiff's address as the Baldwin City Address, although he never resided at that location. On January 8, 2013, the District Court of Douglas County, Kansas entered an Order of Garnishment in the amount of $7, 612.55, and the District Court of Johnson County, Kansas received it on January 14, 2013. The Request for Garnishment also listed plaintiff's address incorrectly, showing the Baldwin City Address. On January 15, 2013, defendant filed a Notice of Service of Notice to Judgment Debtor for service on plaintiff. In that document, defendant again listed plaintiff's address incorrectly, showing the Baldwin City Address.

On January 29, 2013, the Sheriff served the Order of Garnishment on Sprint United Management Co. In response to the garnishment order, plaintiff's employer deducted amounts from plaintiff's paycheck five separate times: (1) $278.32 on February 1, 2013; (2) $278.51 on February 15, 2013; (3) $172.69 on February 28, 2013; (4) $278.94 on March 1, 2013; and (5) $278.51 on March 15, 2013. The total amount garnished from plaintiff's wages was $1, 286.97.

On February 12, 2013, plaintiff filed a pro se motion in the lawsuit pending in the District Court of Douglas County, Kansas, titled "Motion for Relief From Judgment Pursuant to K.S.A. Chapter 60."[4] In that motion, plaintiff stated that the Summons and Return of Service filed in the lawsuit showed that plaintiff was served at the Baldwin City Address, where plaintiff claimed he never resided. Therefore, plaintiff argued that the service was defective.

In February of 2013, plaintiff filed a complaint against the Bank with the Kansas Office of the State Bank Commissioner. On March 3, 2013, the Bank wrote a check to R.A.T.E., Inc. in the amount of $1, 500.00. On March 25, 2013, defendant filed a Satisfaction of Judgment in the lawsuit pending in the District Court of Douglas County, Kansas, stating that defendant acknowledged full and complete satisfaction of the judgment. On April 22, 2013, defendant wrote a check to plaintiff in the amount of $1, 286.97.

On or about February 1, 2014, the Bank reported account information to TransUnion and Equifax about plaintiff's personal loan account with the Bank. Consequently, reports from these credit agencies show that plaintiff's personal loan account had an outstanding balance of $7, 055.00 and a past due amount ($10, 858.00 for TransUnion and $10, 940.00 for Equifax).

II. Legal Standard

Fed. R. Civ. P. 8(a)(2) provides that a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Although this Rule "does not require detailed factual allegations, '" it demands more than "[a] pleading that offers labels and conclusions' or a formulaic recitation of the elements of a cause of action'" which, as the Supreme Court explained, "will not do." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'" Id. (quoting Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556). "Under this standard, the complaint must give the court reason to believe that this plaintiff has a reasonable likelihood of mustering factual support for these claims.'" Carter v. United States, 667 F.Supp.2d 1259, 1262 (D. Kan. 2009) (quoting Ridge at Red Hawk, L.L.C. v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007)).

Although the Court must assume that the factual allegations in the complaint are true, it is "not bound to accept as true a legal conclusion couched as a factual allegation.'" Id. at 1263 (quoting Iqbal, 556 U.S. at 678). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice'" to state a claim for relief. Bixler v. Foster, 596 F.3d 751, 756 (10th Cir. 2010) (quoting Iqbal, 556 U.S. at 678).

When evaluating a motion to dismiss under Fed.R.Civ.P. 12(b)(6), the Court may consider not only the complaint itself, but also attached exhibits and documents incorporated into the complaint by reference. Smith v. United States, 561 F.3d 1090, 1098 (10th Cir. 2009) (citing Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308 (2007)) (further citations omitted). A court "may consider documents referred to in the complaint if the documents are central to the plaintiff's claim and the parties do not dispute the documents' authenticity.'" Id. (quoting Alvarado v. KOB-TV, L.L.C., 493 F.3d 1210, 1215 (10th Cir. 2007)) (internal quotation omitted).

With its motion, defendant has submitted evidence outside the pleadings in the form of an affidavit signed by Bryan Butell, Executive Vice President of the Bank. Ex. A to Def.'s Mem. in Supp. of Mot. to Dismiss (Doc. 14-1). Generally, when "matters outside the pleadings are presented to and not excluded by the court [in deciding a motion under Rule 12(b)(6)], the motion must be treated as one for summary judgment under Rule 56." Fed.R.Civ.P. 12(d). The Court has discretion to accept or reject documents attached to a motion to dismiss pursuant to Rule 12(b)(6). Lybrook v. Members of Farmington Mun. Sch. Bd. of Educ., 232 F.3d 1334, 1341 (10th Cir. 2000) (citations omitted). Here, the Court rejects Butell's affidavit and considers defendant's arguments in the ...


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