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Ta v. Cannon

United States District Court, D. Arizona

November 21, 2019

Dung Thi Ta, Plaintiff,
Sean Cannon, et al., Defendants.


          Honorable John J. Tuchi United States District Judge

         At issue is Plaintiff Dung Thi Ta's Motion for Default Judgment (Doc. 15) against Defendant Sean Cannon and Defendant Cannon Law Firm, PLLC (collectively, “Defendants”), which is supported by the Declaration of Daniel Huynh (Doc. 15-1, at 7).

         I. Background

         In her First Amended Complaint (Doc. 9, FAC), Plaintiff alleges that Defendants, on behalf of the Cambridge Estates Homeowners Association (the “Association”), filed a foreclosure action against her in the Superior Court of Maricopa County (the “state court action”) seeking to recover $10, 996.00 that Plaintiff purportedly owed to the Association. (FAC ¶¶ 11, 13-14.) In the state court action, Defendants filed a motion for entry of judgment and a ledger in support, which purportedly itemized the amounts Plaintiff owed. (FAC ¶¶ 15-16.) The state court granted default judgment against Plaintiff in the amount of $12, 707.33, plus interest (the “State Court Judgment”).[1] (FAC, Ex. 3.) Defendants then obtained a Writ of Special Execution (the “Writ”) that included $2, 920.00 in costs in addition to the $12, 707.33 awarded in the State Court Judgment. (FAC ¶ 46.)

         In the current action, Plaintiff alleges that Defendants “falsely inflated the amount of the alleged debt owed to the Association” in the state court action. (FAC ¶ 45.) Plaintiff contends that Defendant Cannon authored the ledger he submitted to the state court, the ledger failed to include a $3, 335.00 payment made on Plaintiff's account, and the ledger included two fictitious entries for “special assessments” totaling $4, 275.00 (FAC ¶¶ 16, 18, 26, 32.) Plaintiff further argues that $2, 720.00 of the costs included in the Writ were unauthorized. (FAC ¶¶ 46-48.)

         Plaintiff filed this action alleging violations of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §§ 1692e and 1692f; tortious interference with contractual relations; and conversion. (FAC ¶¶ 57, 63, 69, 73.) Plaintiff properly served Defendants, (Docs. 10, 11), and Defendants have failed to appear or defend in this action. Pursuant to Plaintiff's Application, the Clerk of the Court entered default as to Defendants (Doc. 13) on July 10, 2019. Plaintiff then filed the present Motion for Default Judgment (Doc. 15).

         II. State Court Judgment

         Although the Court is sympathetic to Plaintiff's position, the Court lacks the authority to review or modify the State Court Judgment under the Rooker-Feldman doctrine. See D.C. Ct. App. v. Feldman, 460 U.S. 462 (1983); Rooker v. Fid. Tr. Co., 263 U.S. 413 (1923). In this action, Plaintiff seeks to recover $10, 530.00 in actual damages and $1, 000.00 in statutory damages. (Mot. at 9.) The actual damages are comprised of $4, 275.00 for fictitious special assessments and $3, 335.00 for payments that were made on Plaintiff's account but not reflected on the ledger Defendant filed in the state court action, as well as $2, 920.00 for the additional costs that Defendants included in the Writ. (Mot. At 4.) If the Court were to consider the allegedly fictitious special assessments or the payments Plaintiff allegedly made in the state court action, the Court would modify portions of the State Court Judgment-an action barred by the Rooker-Feldman doctrine. The Court therefore will only evaluate Plaintiff's claims as they relate to the $2, 920.00 in costs included in the Writ that are in excess of the State Court Judgment.

         The Court notes that a plaintiff seeking to reverse or nullify a state court judgment is not without remedy. For example, in instances when a party aims to challenge an Arizona state court judgment, Rules 59 and 60(b) of the Rules of Civil Procedure for the Superior Courts of Arizona provide a procedure to challenge a final judgment.

         III. Remaining Claims

         The Court now considers Plaintiff's claims to the extent they do not disrupt the State Court Judgment. Before a district court enters a judgment of default, it must consider seven factors: (1) the merits of the plaintiff's substantive claim; (2) the sufficiency of the complaint; (3) the sum of money at stake in the action; (4) the possibility of prejudice to the plaintiff; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure that favors a decision on the merits. See Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). Upon consideration and balancing of these factors, the Court finds that they weigh in favor of entering judgment of default in part against Defendants.

         Factors One and Two-the merits of the claim and the sufficiency of the complaint-favor entry of judgment with respect to Plaintiff's claim under 15 U.S.C. § 1692e. Under § 1692e, “[a] debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt.” 15 U.S.C. § 1692e. A debt collector violates this section if it falsely represents “the character, amount, or legal status of any debt.” 15 U.S.C. § 1692e(2)(A). Plaintiff alleges that Defendant Cannon falsely represented the amount Plaintiff owed to the Association by demanding payment of unauthorized costs. (FAC ¶ 57.) Plaintiff contends that $2, 720.00[2] of the costs included in the Writ would be paid directly to Cannon because no amount approaching $2, 720.00 was owed to the Association by Plaintiff post-judgment. (FAC ¶ 46.) Plaintiff further alleges that the state court never authorized the $2, 720.00 in costs that Defendant Cannon included in the Writ. (FAC ¶¶ 46-48.) The Court takes these well-pleaded factual allegations of the First Amended Complaint as true, as it must. Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977).

         Factors Four and Six-the possibility of prejudice and whether default was due to excusable neglect-also favor entry of judgment. Plaintiff has diligently prosecuted this matter, and Defendant Cannon, who received proper service and is trained in the law yet failed to participate in any way, is unlikely to be able to demonstrate excusable neglect. Factor Three-the amount of money at stake-further favors entry of judgment.

         In addition to the $2, 720.00 in actual damages addressed above, Plaintiff also requests $1, 000.00 in statutory damages pursuant to 15 U.S.C. § 1692k. (FAC ¶ 76; Mot. at 9.) Section 1692k provides that a debt collector who violates the FDCPA is liable for actual damages and “in the case of any action by an individual, such additional damages as the court may allow, but not exceeding $1, 000.” 15 U.S.C. § 1692k(a)(2)(A). In determining whether to award statutory damages, the Court considers “the frequency and persistence of noncompliance by the debt collector, the nature of such noncompliance, and the extent to which such noncompliance was intentional.” 15 U.S.C. § 1692k(b)(1). Plaintiff has set forth sufficient facts demonstrating Defendants' repeated violations of the FDCPA, and thus the Court awards $1, ...

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