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Fuqua v. Associated Credit Service Inc.

United States District Court, E.D. Washington

May 24, 2018

JESSICA FUQUA, Plaintiff,
v.
ASSOCIATED CREDIT SERVICE, INC., a Washington corporation, and PAUL J WASSON and JANE DOE WASSON, Defendants.

          ORDER RULING ON DEFENDANT'S MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM OR ALTERNATIVELY MOTION FOR SUMMARY JUDGMENT

          SALVADOR MENDOZA, JR. UNITED STATES DISTRICT JUDGE

         Before the Court, without oral argument, is Defendants' Motion and Memorandum to Dismiss for Failure to State a Claim, or, Alternatively Motion for Summary Judgment, ECF No. 24. Fuqua's First Amended Complaint, ECF No. 3, alleges that Defendants Paul J. Wasson, Jane Doe Wasson, and Associated Credit Services (“Associated”) (collectively, “Defendants”) committed “unfair and deceptive” acts in violation of state and federal consumer protection laws in connection with its Associated's attempts to collect on debt owed by Fuqua.[1]

         Fuqua first alleges that Defendants executed an application for a writ of garnishment that falsely stated Associated had “reason to believe” Fuqua's account contained nonexempt funds. Fuqua also asserts that Associated unlawfully attempted to collect a $5 notary fee its application for reimbursement of court costs in connection with its motion for default judgment in the Spokane County District Court. Fuqua alleges that Associated's actions under both claims violated the Fair Debt Collection Practices Act (FDCPA), 18 U.S.C. § 1692 et seq., and the Washington Consumer Protection Act (CPA), Wash. Rev. Code (RCW) § 19.86 et seq.

         Defendants move for an order dismissing the claims or, alternatively, for summary judgment on both claims. Because Defendants submitted evidence beyond that contained in the pleadings, the Court considers the motion as one for summary judgment. Under this standard, taking all facts and inferences in the light most favorable to Fuqua's claims, Fuqua cannot establish facts sufficient to support her claims for violation of the FDCPA. Accordingly, the Court grants Defendants' motion for summary judgment on Fuqua's FDCPA claims. The Court also declines to exercise continued supplemental jurisdiction over Fuqua's remaining state law claims.

         LEGAL STANDARD

         In support of their motion, Defendants have asked the Court to consider documents and declarations not attached to Fuqua's complaint. In deciding a Rule 12(b)(6) motion, the court generally looks only to the face of the complaint and the documents attached thereto. Van Buskirk v. Cable News Network, Inc., 284 F.3d 97, 980 (9th Cir. 2002); Hal Roach Studios, Inc. v. Richard Feiner & Co., Inc., 896 F.2d 1542, 1555 n.19 (9th Cir. 1990). A court must normally convert a Rule 12(b)(6) motion into a Rule 56 motion for summary judgment if it “considers evidence outside the pleadings.” United States v. Ritchie, 342 F.3d 903, 907-08 (9th Cir. 2003); see also Fed. R. Civ. P. 12(d) (“If, on a motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56.”). The Court therefore considers Defendants' motion as a motion for summary judgment.

         When a court converts a motion to dismiss to a motion for summary judgment, it must give “[a]ll parties . . . a reasonable opportunity to present all the material that is pertinent to the motion.” Fed R. Civ. P. 12(d). In the Ninth Circuit generally the “non-moving party must be allowed to conduct discovery to oppose [the] motion.” Inlandboatmens Union of Pacific v. Dutra Group, 279 F.3d 1075, 1083 (9th Cir. 2002). Here, however, it appears from the face of the complaint and Fuqua's responsive memoranda that all information to oppose the motion is within Fuqua's knowledge. Despite the fact that Defendants styled their motion as a Motion and Memorandum to Dismiss for Failure to State a Claim, or, Alternatively Motion for Summary Judgment, Fuqua did not object to the motion or request more time to conduct discovery under Fed.R.Civ.P. 56(d). Instead, Fuqua responded to the motion on the merits, included an opposing statement of facts, and included her own declaration in support of her opposition to Defendants' motion. Accordingly, the Court will consider the matter on the materials submitted.

         Summary judgment is appropriate if the “movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Once a party has moved for summary judgment, the opposing party must point to specific facts establishing that there is a genuine dispute for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). If the nonmoving party fails to make such a showing for any of the elements essential to its case for which it bears the burden of proof, the trial court should grant the summary judgment motion. Id. at 322. “When the moving party has carried its burden under Rule [56(a)], its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. . . . [T]he nonmoving party must come forward with ‘specific facts showing that there is a genuine issue for trial.'” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986) (internal citation omitted).

         BACKGROUND

         Associated Credit Services is a Washington debt collection company in Spokane Valley Washington. Associated is owned and operated by brothers David and Jon Solberg. Attorney Paul Wasson represents Associated in various debt collection matters.

         On April 20, 2015, Associated filed a debt collection action in the Spokane County District Court. ECF No. 26 at 4. Associated hired Alpine Legal Process, Inc., (“Alpine”) to effect service. Id. Alpine is a legal service process company owned by Chad Solberg. The owners of Associated, Jon and David Solberg, are Chad Solberg's uncle and father, respectively, but neither has an ownership interest in Alpine. Id. at 6. Alpine charges Associated a flat rate of $45 per hour for process service. ECF No. 26 at 5. Alpine effected service on Fuqua and billed Associated $45. Id.

         While Washington law does not require a service of process declaration to be notarized, Associated prefers process servers to use a notarized declaration of service. Associated's attorney, Paul Wasson, works in the same building as Associated. ECF No. 28 at 2. His secretary, Cynthia Henderson, is a notary. Id. Wasson has a practice of allowing Associated to send process servers to Henderson for affidavit notarizations. Id. Henderson does not charge a fee for these notary services. Id. In Fuqua's case, Henderson notarized the declaration of service, which was signed by Alpine process server Jason Wilson. ECF No. 26 at 6.

         When Fuqua failed to defend against the suit, Associated filed a motion for default and default judgment in Spokane County District Court, which the court granted on July 16, 2015. ECF No. 26 at 7. The motion contained a request for reimbursement of the $45 process service cost. Id. In its affidavit supporting its motion for order of default judgment, Associated indicated that the service fee consisted on $30 for service, $10 for return, and $5 for “Notary.” Id. at 5. This was false. David Solberg believed that the Spokane County District Court would not approve the $45 process service flat fee, so he falsely allocated portions of the flat fee to service, return, and notary. Id. In fact, the $45 requested represents the $45 flat fee charged by Alpine. Id. at 5-6.

         After obtaining the judgment, Associated sought to collect on the outstanding debt by garnishing funds in Fuqua's bank accounts. Before applying for a writ of garnishment, Associated conducted a credit inquiry on Fuqua. Id. at 7-8. The inquiry showed that Fuqua had several open accounts, including three accounts with Spokane Teacher's Credit Union. Id. at 12-14. Because Fuqua had a checking account, a credit card, and a loan through Spokane Teacher's Credit Union, Associated concluded Fuqua was likely employed and that the bank account would likely contain nonexempt funds. Id. at 8. In reality, Fuqua was not employed at that time. ECF No. 34 at 3. In fact, she had been receiving government assistance for nearly the entire year of 2016. ECF No. 34 at 3.

         Acting as Associated's attorney, Wasson executed a writ of garnishment for funds held in Fuqua's account at Spokane Teacher's Credit Union on September 13, 2016. ECF No. 29 at 3. Associated served Fuqua's bank with the writ of garnishment on October 5, 2016. Following service of the writ, Spokane Teachers Credit Union froze the funds in Fuqua's account. The balance in Fuqua's account was $165.12. ECF No. 34 at 3. The money in Fuqua's ...


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