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Jones v. Hospital of Morristown

United States District Court, E.D. Tennessee, Greeneville

November 7, 2016

WILMA JONES, et al., Plaintiffs,
v.
HOSPITAL OF MORRISTOWN, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          J. RONNIE GREER UNITED STATES DISTRICT JUDGE

         This Fair Debt Collection Practices Act, (“FDCPA”) 15 U.S.C. § 1692 et seq., case is before the court to address two motions to dismiss filed by the defendants. The defendants, Hospital of Morristown, Inc., d/b/a Lakeway Regional Hospital (“Lakeway”) and Professional Account Services, Inc. (“PASI”) filed a motion to dismiss the plaintiffs' complaint, [Doc. 15], and a motion to dismiss the plaintiffs' first amended complaint, [Doc. 22]. The plaintiffs have responded to the motion to dismiss the amended complaint, [Doc. 26], and the defendants have replied, [Doc. 28]. The matters are ripe for review.

         I. FACTS

         The plaintiffs filed this class action complaint alleging state law claims and FDCPA violations related to the defendants' attempts to collect debts. The complaint alleges that the plaintiffs incurred debts to Lakeway for medical services provided to the plaintiffs. [Complaint ¶¶ 15, 18]. After the plaintiffs defaulted on the debts, Lakeway “assigned the debts to PASI” for collection, and PASI hired defendant Michael Mossman (“Mossman”) to attempt to collect the debts from plaintiffs. [Id. ¶ 18]. Debt collection suits were filed in state court against the plaintiffs using a state court civil summons and sworn affidavit. The plaintiffs allege that “an employee of Mossman prepared the civil summonses” and “employees or agents of PASI” signed the sworn affidavits. [Id. ¶¶ 23, 26].

         The civil summons and sworn affidavit filed in state court against plaintiff Jones (“Jones”) stated that “the balance due and owing on a Sworn Account hereto the Court shown in the amount of $588.51, together with a reasonable Attorney Fee, plus post judgment interest at the legal rate, civil process fees in the amount of $35.00, less any payments credited and the costs of this cause.” [Id. ¶¶ 20, 24, Exhibit 18-1]. The plaintiffs allege that the sworn affidavit stated Jones owed $588.51 on two separate accounts but “makes no mention of attorney fees.” [Id. ¶ 29]. A default judgment was entered in the amount of $688.51, “plus interest at the rate of 5.25% and cost of suit.” [Id. ¶ 31, Exhibit 18-1]. Following entry of the default judgment, a wage garnishment was issued against Jones to collect the default judgment plus court costs, fees, and interest for a total of $840.46. [Exhibit 18-3].

         The civil summons and sworn affidavit in state court was filed against plaintiffs Barbara Long and Thomas Long (“Long”) and stated that “the balance due and owing on a Sworn Account hereto the Court shown in the amount of $696.72, together with a reasonable Attorney Fee, plus post judgment interest at the legal rate, civil process fees in the amount of $35.00, less any payments credited and the costs of this cause.” [Id. ¶¶ 21, 25, Exhibit 18-2]. The plaintiffs allege that the sworn affidavit stated Long owed $696.72 on a single account but “makes no mention of attorney fees.” [Id. ¶ 29]. A default judgment was entered in the amount of $796.72, “plus interest at the rate of 5.25% and cost of suit.” [Id. ¶ 32, Exhibit 18-2].

         The plaintiffs filed this class action lawsuit alleging FDCPA violation and state law claims for improper entry of default judgments “that exceed the amount demanded” and unjust enrichment. The amended complaint filed on June 13, 2016, alleges the default judgments entered against the plaintiffs are void because they are in excess of the amount requested in the pleadings and asks the Court to set aside the default judgments. [Id. ¶ 33-34]. The plaintiffs also allege that the defendants have unjustly benefited from the payments made by the plaintiffs on the void judgments and ask the Court to provide restitution to the plaintiffs in the amount of the payments made and pre-judgment interest. Finally, the plaintiffs allege that “requesting the entry of default judgments in the amounts of $688.51 against Jones or $796.72 against the Longs, when it is apparent from the face of the civil summons that Defendants had only demanded $588.51 and $696.72, respectively, without providing Plaintiffs an opportunity to dispute a specific amount for attorney fees, are false, deceptive, and misleading representations” and violations of the FDCPA. [Id. ¶ 46].

         II. STANDARD OF REVIEW

         Dismissal pursuant to Federal Rule of Civil Procedure 12(b)(6) eliminates a pleading or portion thereof that fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). Moreover, Federal Rule of Civil Procedure 8(a)(2) requires the complaint to contain a “short plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). A motion to dismiss under Rule 12(b)(6) requires the Court to construe the allegations in the complaint in the light most favorable to the plaintiff and accept all the complaint's factual allegations as true. Meador v. Cabinet for Human Res., 902 F.2d 474, 475 (6th Cir. 1990). The Court may not grant a motion to dismiss based upon a disbelief of a complaint's factual allegations. Lawler v. Marshall, 898 F.2d 1196, 1199 (6th Cir. 1990). The Court must liberally construe the complaint in favor of the party opposing the motion. Miller v. Currie, 50 F.3d 373, 377 (6th Cir. 1995). However, the plaintiff must allege facts that, if accepted as true, are sufficient “to raise a right to relief above the speculative level, ” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007), and to “state a claim to relief that is plausible on its face.” Id. at 570; see also Ashcroft v. Iqbal, ___ U.S. ___, 129 S.Ct. 1937, 1949-50 (2009). “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.” Ashcroft, 129 S.Ct. at 1949. Moreover, this Court need not “‘accept as true a legal conclusion couched as a factual allegation.'” Twombly, 550 U.S. at 555 (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986)); see also Ashcroft, 129 S.Ct. at 1949. Lastly, this Court may consider documents central to the plaintiff's claims to which the complaint refers and incorporates as exhibits. Amini v. Oberlin College, 259 F.3d 493, 502 (6th Cir. 2001).

         A motion to dismiss pursuant to Rule 12(b)(1) for lack of jurisdiction may be either an attack on the face of the complaint or on the factual basis of jurisdiction. Golden v. Gorno Bros., Inc., 410 F.3d 879, 881 (6th Cir. 2005). A factual attack challenges the existence of jurisdiction, apart from the pleadings. RMI Titanium Co. v. Westinghouse Elec. Corp., 78 F.3d 1125, 1334 (citing Mortensen v. First Federal Savings and Loan Ass'n, 549 F.2d 884, 890 (3d Cir. 1977)). When a factual issue exists in a Rule 12(b)(1) motion, the district court is “free to weigh the evidence and satisfy itself as the existence of its power to hear the case.” Id. (citing Mortensen, 549 F.2d at 890-91). The court is “empowered to resolve factual disputes” arising out of a Rule 12(b)(1) challenge to subject matter jurisdiction. Id. (citing Rogers v. Stratton Industries, Inc., 798 F.2d 913, 915 (6th Cir. 1986)).

         III. ANALYSIS

         1. State Law Violations

         The defendants argue that the Court lacks subject matter jurisdiction over the plaintiffs' state law claims under the Rooker-Feldman doctrine. The Rooker-Feldman doctrine arises out of two Supreme Court cases, Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923) and District of Columbia Court of Appeals v. Feldman, 460 U.S. 462 (1983). The Supreme Court clarified the Rooker-Feldman doctrine stating that application of the doctrine is “confined to cases of the kind from which the doctrine acquired its name: cases brought by state-court losers complaining of injuries caused by state-court judgments rendered before the district court proceedings commenced and inviting district court review and rejection of those judgments.” Exxon Mobile Corp. v. Saudi Basic Industries Corp., 544 U.S. 280, 284 (2005). Both plaintiffs in Rooker and Feldman requested the district court to “overturn an injurious state-court judgment” but only the Supreme Court has jurisdiction to review a state court's judgment. Id. at 292.

         The court must look at the source of the plaintiff's injury alleged in the federal complaint to determine whether a claim is one that attacks a state court judgment, and thus is within the Rooker-Feldman scope, or an independent claim over which a district court may assert jurisdiction. McCormick v. Braverman, 451 F.3d 382, 393 (6th Cir. 2006). “If the source of the injury is the state court decision, then the Rooker-Feldman doctrine would prevent the district court from asserting jurisdiction. If there is some other source of injury, such as a third party's actions, then the plaintiff asserts an independent claim.” Id. For a claim to fall within the Rooker-Feldman ...


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