United States District Court, D. Kansas
STEPHANIE J. MAXWELL, Plaintiff,
ST. FRANCIS HEALTH CENTER, et al., Defendants.
MEMORANDUM AND ORDER
Crow, U.S. District Senior Judge.
Stephanie J. Maxwell, is a military servicemember. She has
brought this action against H. Kent Hollins and his law firm,
H. Kent Hollins PA (“the Hollins defendants”).
Plaintiff is also suing St. Francis Health Center and the
City of Topeka who were represented by the Hollins defendants
in two debt collection actions against plaintiff which were
filed in 2009 when plaintiff's name was Palmisano.
Plaintiff alleges defendants violated federal and state law
in the debt collection efforts. This case is before the court
upon defendants' motions to dismiss pursuant to
Rule 12(b)(6) standards
Rule 12(b)(6) motion, the court accepts plaintiff's
well-pleaded factual allegations as true and determines
whether plaintiff has provided enough facts to state a claim
to relief that is plausible on its face. George v. Urban
Settlement Services, 833 F.3d 1242, 1247
(10th Cir. 2016)(interior quotation omitted).
“[A] claim is facially plausible if the plaintiff has
pled ‘factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.'” Id. (quoting
Hogan v. Winder, 762 F.3d 1096, 1104 (10th Cir.
2014)). The court may consider: documents incorporated by
reference in the complaint; documents referred to in and
central to the complaint, when there is no dispute as to
authenticity; and matters of which a court may take judicial
notice. Gee v. Pacheco, 627 F.3d 1178, 1186 (10th
Cir. 2010). The court's function is not to weigh
potential evidence that the parties might present at trial.
See Proctor & Gamble Co. v. Haugen, 222
F.3d 1262, 1278-79 (10th Cir. 2000).
Allegations in the complaint and documents referenced in
following allegations are taken primarily from the first
amended complaint and almost identical affidavits filed by
defendant H. Kent Hollins in the state court debt collection
cases. The court treats the affidavits as documents central
to the complaint as to which there is no dispute as to
alleges that she enlisted in the United States Air Force on
April 9, 2009, reported to active duty on April 14, 2009, and
has been on active duty continuously from that date through
the date this action was filed. On April 24, 2009, St.
Francis and the City of Topeka, through the Hollins
defendants, each filed a debt collection lawsuit against
plaintiff in Shawnee County District Court.
December 28, 2009 through April 21, 2015, the Hollins
defendants ran several searches on the Defense Manpower Data
Center (DMDC) website to determine whether plaintiff was on
active military duty. The searches were conducted under the
name “Stephanie Palmisano” (plaintiff's
maiden name) and her social security number. Through
2011, the searches showed that plaintiff was on active
military duty. This caused the Hollins defendants to ask the
court to stay the debt collection cases against plaintiff.
According to the Hollins affidavits, which are supported by
exhibits showing the search results, in 2012 and 2013 some
searches showed that plaintiff was on active duty and some
showed that plaintiff was not on active duty.
16, 2014, a DMDC search showed that Stephanie Palmisano was
not on active duty. The Hollins defendants then requested and
received an alias summons. On January 13, 2015, plaintiff
called the Hollins law firm and left a message. A law firm
representative returned her call. During the conversation,
plaintiff did not indicate that her name had changed. She
stated that she was employed by the military.
Hollins defendants attempted to serve plaintiff by certified
mail on January 15, 2015 at an address in Oklahoma. The
return indicated that it was “signed by other”
and the green card showed that it was signed by the addressee
“Stephanie Maxwell.” The Hollins defendants
conducted two other DMDC searches on February 16, 2015 and
March 6, 2015. These showed that Stephanie Palmisano was not
on active duty. The Hollins defendants did not search under
the name Stephanie Maxwell until after default judgment was
entered and they received a letter from plaintiff's
Shawnee County District Court entered default judgment
against plaintiff on February 24, 2015 in favor of defendant
City of Topeka and on March 6, 2015 in favor of defendant St.
The applications for default judgment alleged that proper
service had been effected and, through an affidavit signed by
defendant Hollins, that plaintiff was not on active military
duty. The affidavit read in part as follows:
I, H. Kent Hollins, of lawful age, and being first duly
sworn, on oath state that I am the plaintiff or petitioner,
in the above entitled case, and I make this affidavit
pursuant to the provisions of the Service members Civil
Relief Act of 2003; that I have caused a careful
investigation to be made to ascertain whether or not the
above named defendant or respondent is in the active service
of the Army of the United States, the United States Navy, the
United States Marine Corps, the United States Coast Guard,
the United States Air Force, the National Guard or of any
Public Health Service detailed by proper authority for duty
with the military; and, that as a result of said
investigation, I hereby state that the defendant or
respondent is not in any of the above-named branches of the
military service nor has the defendant or respondent received
notice of induction or notice to report for active service.
Doc. No. 27-1, p. 5 and Doc. No. 27-2, p. 5. Plaintiff alleges
that it was false to represent in the affidavit that there
had been a careful investigation and that it was false to
represent that plaintiff was not in active military service.
Hollins defendants received a demand letter referencing
“Stephanie J. Maxwell (Palmisano)” from
plaintiff's counsel in April 2015. The letter asked to
set aside the default judgments. The Hollins defendants
conducted another DMDC search using the name Stephanie
Palmisano and her social security number. This search showed
that plaintiff was not on active duty. The same day
defendants did a DMDC search for Stephanie Maxwell and her
social security number which showed that plaintiff
was on active duty.
9, 2015, plaintiff moved to set aside the default judgments.
On May 10, 2016, the Shawnee County District Court granted
the motion to set aside the default judgments on the grounds
that defendants had not obtained proper service on plaintiff.
does not allege that the Hollins defendants were the
employees of defendants St. Francis or the City of Topeka.
Plaintiff does allege that the Hollins defendants were the
agents of St. Francis and the City of Topeka.
The Hollins defendants' motion to dismiss shall be
granted in part and denied in part.
Count One - the Servicemembers Civil Relief Act
(“SCRA”), 50 U.S.C. § 3901 et seq.
alleges that defendants are liable for damages under that
part of the SCRA which penalizes the filing of a false
affidavit regarding whether a defendant is in active military
service prior to entering judgment. The SCRA at 50 U.S.C.
§ 3931(a)&(b) requires that in any civil action or
proceeding in which the defendant does not make an
appearance, the court, before entering judgment for the
plaintiff shall require the plaintiff to file with the court
(A) stating whether or not the defendant is in military
service and showing necessary facts to support the affidavit;
or (B) if the plaintiff is unable to determine whether or not
the defendant is in military service, stating that the
plaintiff is unable to determine whether or not the defendant
is in military service.
(c) further provides a possible criminal penalty for making
or using an affidavit “knowing it to be
false.” (emphasis added). A civil cause of action is
authorized under 50 U.S.C. § 4042 for appropriate
relief, including monetary damages, to any person aggrieved
by a violation the SCRA.
assert that plaintiff has not alleged facts describing a
plausible claim that the Hollins defendants filed affidavits
which were knowingly false. The SCRA does not define
“knowing.” The court is guided by its ordinary
meaning. See U.S. v. Dobbs, 629 F.3d 1199, 1203-04
(10th Cir. 2011). So, the court asks here whether
plaintiff's allegations state a plausible claim that
defendants submitted an affidavit in possession of knowledge,
intelligence or understanding that it was, or may be, false.
See Oxford English Dictionary (online ed. 2017). In addition,
the court follows the approach other courts have taken in
construing a comparable statute, 18 U.S.C. §
1001. Courts have determined that reckless
disregard of the truth is sufficient to sustain a criminal
conviction for the violation of § 1001. U.S. v.
London, 66 F.3d 1227, 1241-42 (1stCir. 1995);
U.S. v. Puente, 982 F.2d 156, 159 (5th
Cir. 1993); U.S. v. Gottlieb, 493 F.2d 987, 994
(2nd Cir. 1974)(person may be convicted for
recklessly stating he was in the National Guard, when he
didn't know whether or not he was in the National Guard);
see also, U.S. v. Strandlof, 667 F.3d 1146, 1165
(10thCir. 2012)(one can be prosecuted under §
1001 without intentionally lying) abrograted on other
grounds, U.S. v. Alvarez, 567 U.S. 709 (2012).
to the complaint and other documents referenced in the
complaint, the Hollins defendants had knowledge that
Stephanie Palmisano was on active military duty for about
three years starting in April 2009. There were indications
that the DMDC searches may be producing inconsistent results.
The Hollins defendants also knew that she telephoned in
January 2015 and told them she was employed by the military.
A couple of days later a “Stephanie Maxwell”
signed for a piece of certified mail sent to Stephanie
Palmisano. This did not cause defendants to do a DMDC search
for the name Stephanie Maxwell. The Hollins defendants were
also aware that the DMDC website cautioned that further steps
should be taken to check on the military status of persons if
they had evidence that the person was on active duty for the
active duty status date. Given these alleged facts the court
believes plaintiff has stated a plausible claim that the
Hollins defendants submitted a knowing false affidavit
stating that plaintiff was not on active duty and that they
had conducted a careful investigation as to her active duty
Count Two - the Kansas Consumer Protection Act
(“KCPA”), K.S.A. 50-623 et seq.
Count Two of the first amended complaint, plaintiff alleges
that defendants violated the KCPA because they committed
deceptive or unconscionable acts. There is no dispute that
the KCPA applies to debt collection activities engaged in by
a creditor or his agent, including independent debt
collection agencies. See State ex rel. Miller v. Midwest
Service Bureau of Topeka, Inc., 623 P.2d 1343,
1345 (Kan. 1981). The court's analysis here is guided in
part by the KCPA provision stating that it is to be construed
liberally in order to protect consumers from suppliers who
commit deceptive and unconscionable practices. K.S.A. 60-623.
KCPA claims are not clearly stated in the first amended
complaint. The court relies upon the argumentation
made in regard to the motions to dismiss to help delineate
the claims. It appears to the court that plaintiff intends to
claim that defendants violated K.S.A. 50-626(b)(2) and (3)
which prohibit defendants from the following practices
“in connection with a consumer transaction: . . . (2)
the willful use, in any oral or written representation, of
exaggeration, falsehood, innuendo or ambiguity as to a
material fact; [and] (3) the willful failure to state a
material fact, or the willful concealment, suppression or
omission of a material fact.” Although, in ¶ 108
of the first amended complaint, plaintiff asserts that
defendants also filed inadequate service returns and engaged
in “sewer serving” individual consumers, it
appears that plaintiff is relying upon the alleged filing of
false affidavits as the actual basis of her KCPA
Hollins defendants' motion to dismiss, they claim that
the first amended complaint does not allege any deceptive
acts or practices that violate those sections of the KCPA in
spite of the obligation to plead the claim with
particularity. Defendants also claim that plaintiff alleges
no facts showing that the Hollins ...