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Keller v. Hospital of Morristown

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

November 28, 2016

SCOTT KELLER, et al., Plaintiffs,
v.
HOSPITAL OF MORRISTOWN, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          J. RONNIE GREER UNITED STATES DISTRICT JUDGE.

         This case is before the court to address a motion to dismiss filed by defendants, Hospital of Morristown, Inc., d/b/a Lakeway Regional Hospital (“Lakeway”) and Professional Account Services, Inc. (“PASI”), [Doc. 18]. The plaintiffs have responded to the motion to dismiss, [Doc. 22], and defendants Lakeway and PASI have replied, [Doc. 23]. The matter is ripe for review.

         I. FACTS

         The plaintiffs filed this class action complaint alleging violations of the Fair Debt Collection Practices Act, (“FDCPA”), 15 U.S.C. §§ 1692 et seq., violations of the Electronic Fund Transfer Act (“EFTA”), 15 U.S.C. §§ 1693 et seq., 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 ¶¶ 21, 24]. After the plaintiffs defaulted on the debts, Lakeway “assigned the debts to PASI” for collection, and PASI hired Michael Mossman (“Mossman”) to attempt to collect the debts from plaintiffs. [Id. ¶ 24]. Debt collection suits were filed in state court against the plaintiffs using a state court summons and sworn affidavit. The plaintiff alleges that “on information and belief, an employee of Mossman prepared the civil summonses” and “on information and belief” employees or agents of PASI signed the sworn affidavits. [Id. ¶¶ 31, 36].

         The civil summons and sworn affidavit were filed in Hamblen County state court against each plaintiff. On the pre-printed civil summons used in each of the plaintiffs' state court cases in the section titled “Notices to Defendant(s)” the following statement is printed:

If Plaintiff says his suit is based on a SWORN ACCOUNT, and if you deny owing the amount claimed, you will not be permitted to contest Plaintiff's claim unless you deny the correctness of the amount in writing, under oath. Your SWORN DENIAL should state what amount you think you do owe. It must be filed with the Clerk. A copy must be sent to and received by Plaintiff (or his attorney) before trial date. Failure to comply with this procedure may result the entry of a judgment against you, unless you show good cause for more time to comply.

[Id. ¶ 43].

         The civil summons filed against plaintiff Keller stated that “the balance due and owing on a Sworn Account hereto the Court shown in the amount of $1, 508.77, 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. ¶ 32, Exhibit 3-1]. The sworn affidavit filed with the civil summons stated Keller owed $1, 583.77 but “makes no mention of attorney fees.” [Id. ¶ 38]. A judgment by agreement was entered against Keller in the amount of $1458.27, “plus interest at the rate of 5.25% and cost of suit.” [Exhibit 3-1].

         The civil summons filed against plaintiff Griffin stated that “the balance due and owing on a Sworn Account hereto the Court shown in the amount of $245.76, 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. ¶ 33, Exhibit 3-2]. The sworn affidavit filed with the civil summons stated Griffin owed $245.76 but “makes no mention of attorney fees.” [Id. ¶ 39]. The civil summons was dismissed without prejudice against Griffin. [Exhibit 3-2].

         The civil summons filed against plaintiff Fincher stated that “the balance due and owing on a Sworn Account hereto the Court shown in the amount of $247.00, 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. ¶ 34, Exhibit 3-3]. The sworn affidavit filed with the civil summons stated Fincher owed $247.00 but “makes no mention of attorney fees.” [Id. ¶ 40]. A judgment by agreement was entered against Fincher in the amount of $346.50, “plus interest at the rate of 5.25% and cost of suit.” [Exhibit 3-3].

         The civil summons filed against plaintiff Robinson stated that “the balance due and owing on a Sworn Account hereto the Court shown in the amount of $547.80, 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. ¶ 35, Exhibit 3-4]. The sworn affidavit filed with the civil summons stated Robinson owed $547.80 but “makes no mention of attorney fees.” [Id. ¶ 41]. A judgment by agreement was entered against Keller in the amount of $647.80, “plus interest at the rate of 5.25% and cost of suit.” [Exhibit 3-4].

         The plaintiffs filed this class action lawsuit alleging FDCPA and EFTA violations. The plaintiffs allege the defendants violated the FDCPA by misrepresenting plaintiffs' rights under state law, through an alleged misrepresentation of Tennessee state law printed on the second page of each civil summons form. [Complaint ¶ 47]. The plaintiffs also allege that the defendants violated FDCPA by “requesting different amounts” in the civil summons and sworn affidavit. [Id. ¶ 48]. The plaintiffs further allege that the defendants violated EFTA by failing to comply with EFTA's requirement to provide notice and obtain verbal authorization for electronic fund transfers in violation of Regulation E of the Code of Federal Regulations, 112 C.F.R. §§ 1005.3(b)(2)(ii) and (iii).

         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, 556 U.S. 662, 678-79 (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, 556 U.S. at 678. 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, 556 U.S. at 678. 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. ...


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