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Singleton v. Hospital of Morristown

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

December 14, 2016

JASON SINGLETON and SCHERRY SINGLETON, 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 the complaints. 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. 25].[1] The plaintiffs have responded, [Doc. 28], and the defendants have replied, [Doc. 29]. Defendant Michael Mossman (“Mossman”) filed a motion for judgment on the pleadings, [2] [Doc. 36]. The plaintiffs have responded to the motion for judgment on the pleadings, [Doc. 44], and Mossman has replied, [Doc. 46]. The matters are ripe for review.

         I. FACTS

         The plaintiffs filed two suits in state court against the defendants related to the defendants' attempts to collect debts.[3] The plaintiffs have alleged FDCPA violations and various state law claims. The complaints allege that the plaintiffs incurred debts to Lakeway for medical services provided to the plaintiffs. [Complaint, Doc. 1-1 ¶ 8]. 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. [Amended Complaint. ¶ 12][4]. A debt collection suit was filed in state court against the plaintiffs using a state court civil summons and sworn affidavit of account. The plaintiffs allege on information and belief that “an employee of Mossman prepared the civil summonses” and “an employee or agent of PASI” signed the sworn affidavit. [Id. ¶¶ 15, 15].

         The sworn affidavit of account submitted with the civil summons states that the plaintiffs “owe the sum of $6701.68” on five accounts listed. [Exhibit 6-1]. The civil summons and filed in state court against both plaintiffs stated that “the balance due and owing on a Sworn Account hereto the Court shown in the amount of $6, 701.68, 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. ¶ 18, Exhibit 6-1]. A default judgment was entered in the amount of $6, 364.48, “plus interest at the rate of 5.25% and cost of suit.” [Id. ¶ 21, Exhibit 6-1].

         Following entry of the default judgment, a wage garnishment was issued against Mr. Singleton by the Hamblen County Court Clerk on January 15, 2015. [Doc. 1-1, ¶ 19, Exhibit 6-2]. On September 3, 2015, Mr. Singleton talked with the Clerk's office to stay the garnishment and proposed a payment plan. [Id. ¶ 20]. While Mr. Singleton was in the office, the Clerk called Mossman's office and spoke with a Jane Doe about the proposed payment plan. [Id. ¶ 22]. The plaintiffs allege that Jane Doe informed the Clerk's office that the “Plaintiffs had two other debts with Defendant Mossman's office they were attempting to collect and that Plaintiffs needed to contact Defendant Mossman's office about those debts, and the deputy clerk relayed this communication to Plaintiffs.” [Id. ¶ 22]. The plaintiffs allege that Doe did not have the required consent to communicate with the clerk, a third party, in regard to the collection of debts. [Id. ¶ 32].

         The plaintiffs filed these lawsuits alleging FDCPA violations and state law claims for improper entry of default judgments, unjust enrichment, and invasion of privacy. The complaint alleges that by communicating with the clerk about collection of a debt without consent the defendants committed FDCPA violations and a state law claim of invasion of privacy. [Id. ¶¶ 33-34]. The amended complaint alleges the default judgments entered against the plaintiffs are void because the defendants were not properly served and asks the Court to set aside the default judgments. [Amended Complaint ¶ 34]. The plaintiffs also allege that the defendants have been unjustly enriched by the payments made on the void judgments and ask the Court to order restitution to the plaintiffs in the amount of the payments and pre-judgment interest. [Id. ¶¶ 37-40]. Finally, the plaintiffs allege violations of the FDCPA occurred by “attempting to collect debts the plaintiffs do not owe, ” [Id. ¶ 46]; failing “to include § 1692e(11) language in subsequent communications, ” [Id. ¶ 52]; failing “to send a written notice containing amount of the debt and required notices within five days after the initial communication, ” [Id. ¶ 54]; and “requesting different amounts” on the civil summons and sworn affidavit, [Id. ¶ 56].

         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)).

         Rule 12(c) states that “after the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings.” Fed.R.Civ.P. 12(c). A motion for judgment on the pleadings is subject to the same standard of review as a motion for dismissal under Rule 12(b)(6). Penny/Ohlmann/Nieman, Inc. v. Miami Valley Pension Corp., 399 F.3d 692, 697 (6th Cir. 2005). 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). The 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).

         III. ANALYSIS

         1. Rooker-Feldman Doctrine

         The defendants argue that the Court lacks subject matter jurisdiction over the plaintiffs' state law and FDCPA claims in the Amended Complaint 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 doctrine's scope, “the source of the injury must be from the state court judgment itself; a claim alleging another source of injury is an independent claim.” Id. at 394.

         a. State Court Claims to Set Aside Default Judgment, Unjust Enrichment, Actual Damages, and Punitive Damages

         The plaintiffs allege that the default judgment entered against them should be set aside as “void” because the plaintiffs were not properly served. [Amended Complaint ¶ 24-32]. Further, the plaintiffs allege the defendants were unjustly enriched by the payments made on the allegedly void judgments, including the wage garnishment. [Id. ¶ 36-44]. The Court is hard-pressed to find an instance where the Rooker-Feldman doctrine would more clearly apply. The plaintiffs in these suits are clearly “state-court losers complaining of injuries caused by state-court judgments” that were entered before these proceedings were commenced. The first claim specifically requests this Court to “set aside” and declare the state court default judgments “void”; thereby specifically asking this Court to review and reject the state court judgments. In the second claim requesting restitution for payments made pursuant to the judgments, the “source of the injury” is clearly the default judgments in state court. For the Court to find the plaintiffs' claims of improper service actionable would require the Court to specifically review the state court's determination that service was proper before it entered the default judgment.

         In their response, the plaintiffs argue that the Court has jurisdiction to hear these state law claims and to grant the relief requested, setting aside the state court default judgments and restitution of monies paid on the judgments. The plaintiffs cite a Sixth Circuit case holding that an exception to the general rule prohibiting district court review of a state court judgment exists and a district court “may entertain a collateral attack on a state court judgment which is alleged to have been procured through fraud, deception, accident, or mistake.” Sun Valley Foods Co. v. Detroit Marine Terminals, Inc., 801 F.2d 186, 189 (6th Cir. 1986) (quoting Resolute Insurance Co. v. North Carolina, 397 F.2d 586, 589 (4th Cir. 1968)). However, nowhere in the plaintiffs' amended complaint do they allege that the default judgments resulted from any mistake of the state court or fraud by the defendants. The plaintiffs fail to account for the fact that the exception stated in Sun Valley Foods “focuses on situations involving the improper procurement of the judgment, i.e., where the state court winner deceived the Court into a wrong decree.” International Christian Music Ministry Inc. v. Ocwen Federal Bank, FSB, 289 Fed. App'x 63, 65 (6th Cir. 2008) (internal citations omitted). The exception does not extend to mere judicial errors committed by the state court. Id. (citing Resolute Insurance ...


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