The opinion of the court was delivered by: Falk, U.S.M.J.
REPORT AND RECOMMENDATION
Before the Court is the application of Plaintiff Miriam Cohen's attorney, Michael M. Cohen, Esq., for counsel fees pursuant to the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. ("FDCPA"). For the reasons stated below, it is respectfully recommended that Plaintiff be awarded $1,046.75 in attorney's fees and $453.00 in costs for a total award of $1,499.75.
This case is about a single message left on an answering machine attempting to collect a $150.00 debt. The sole violation of the FDCPA is purely technical-that the amount of the debt was not mentioned in the telephone message. However, there were three letters that previously identified the $150 amount of the debt. The merits of the case were resolved by Plaintiff's acceptance of an Offer of Judgment for $1,001.00, one dollar more than the maximum statutory damages recoverable under the FDCPA. The issue is now attorney's fees. Plaintiff's counsel, Michael M. Cohen, is married to Plaintiff Miriam Cohen. Mr. Cohen claims that he is entitled to collect $29,210.25 in attorney's fees. Defendant contends the fee award should be $348.75.
Background of Fair Debt Fee Disputes
In Weed-Schertzer v. Nudelman, Klemm & Golub, 2011 WL 4436553 (D.N.J. Sept. 23, 2011), adopted at, 2011 WL 4916309 (D.N.J. Oct. 13, 2011), this Court expressed certain concerns over the state of Fair Debt attorney's fee disputes and indicated that it would further explore the issue in appropriate circumstances. Specifically, Weed-Schertzer states:
Although the fees in dispute are relatively small, the integrity of the billing process in small Fair Debt cases is called into question. Often, the law firms involved on both sides are the same. This Court has observed that liability is commonly resolved immediately and the real dispute presented to the federal court is about legal fees. Deciding the fee issue can be time consuming, even though the sums in dispute are often similar to numbers handled by small claims courts. Drawing no conclusions here, the Undersigned believes it bears further observation. Specifically, whether the practice on the ground is consistent with the intent of the Fair Debt Act.
Id. at *8 (emphasis added).
The Court believes this scrutiny is justified by the increasing number of Fair Debt cases filed in this Court.*fn1 After Weed-Schertzer, fee requests in Fair Debt cases have also been commented on in a number of recent opinions in this district. See, e.g., Conklin v. Pressler & Pressler, 2012 WL 569384 (D.N.J. Feb. 21, 2012); Freid v. Nat'l Action Fin. Servs., 2011 WL 6934845 (D.N.J. Dec. 29, 2011); Cassagne v. Law Offices of Weltman, Weinberg & Reis, 2011 WL 5878379 (D.N.J. Nov. 23, 2011); Levy v. Global Credit & Coll. Grp., 2011 WL 5117855 (D.N.J. Oct. 27, 2011).
Although Fair Debt cases may be factually different, they are also similar. Usually, the real dispute for the federal court to decide is one of attorney's fees. Liability is nearly always resolved by settlement or offer of judgment. Most FDCPA cases never reach the merits. This is a function of the FDCPA $1,000 maximum statutory penalty per case and the fact that few cases involve actual damages. Thus, it is not economically sensible for the parties to battle about the merits. Defendants commonly resort to serving an offer of judgment (or settlement offer) for the maximum statutory damages available, $1,000.00. Plaintiffs have no practical choice but to accept the offer of judgment, since pressing the case would be meaningless.*fn2
While the $1,000 penalty usually resolves liability, there is a rub. The FDCPA also provides that a successful plaintiff may recover "reasonable" attorney's fees (see, infra, p. 14). This is regarded as part of the penalty enforced by a winning plaintiff acting as private attorney general. However, the attorneys do not often resolve the attorney's fees. Thus, most FDCPA cases really boil down to attorney's fee disputes.
The FDCPA was not passed in order to sprout a cottage industry for lawyers who self-interestedly battle over attorney's fees in federal court. See, e.g., Lee v. Thomas & Thomas, 109 F.3d 302, 306-07 (6th Cir. 1997) ("Counsel should not wish to reap financial rewards for prolonging litigation unnecessarily."). And, in this Court's view, judicial economy is an appropriate consideration in addressing these repetitive, relatively minor fee disputes, especially as FDCPA filings rise and resources shrink. It is against this backdrop that the current fee dispute is decided.*fn3
Fee Dispute In This Case In this unique case, Plaintiff's counsel, Michael M. Cohen, Esq., filed a complaint on behalf of his wife, Plaintiff Miriam Cohen. Mr. Cohen vaguely pleaded that Defendant, American Credit Bureau ("Defendant" or "ACB"), committed "at least fifteen  FDCPA violations" many of which occurred during the same telephone call. (Compl., ¶¶ 9, 16-17.) The 15 supposed violations are mentioned in the background section of the Complaint; however, Mr. Cohen then attempts to limit the pleading by seeking "statutory damages for just one" of the at least 15 violations-purporting to save the rest for later. (Compl., ¶ 10) (emphasis added).*fn4
Mr. Cohen's intention-expressed to the Court, his adversary, and in the papers submitted on this motion-was to use his wife's case to "make law." (Def.'s Ex. 3; CM/ECF No. 24-4.) Apparently the "law" he sought to make was to establish the right to bring 14 separate subsequent lawsuits-each one targeting a single one of the 14 alleged violations-even though many of the supposed violations were quite technical and apparently occurred during the same telephone message and all involved the same $150 debt.
The Court views Plaintiff's threat of successive lawsuits for technical violations of the FDCPA as improper. It is doubtful any Court would sanction such a blatant multiplication of litigation. According to Plaintiff's position, if a debt collector sent one letter that contained ten technical violations of the FDCPA, the victim could theoretically bring 10 separate federal cases to remedy the violation, each one permitting $1,000 in statutory penalties and mandatory attorney's fees. It is no wonder that there is no authority for this inefficient, extravagant position. Yet, Plaintiff's counsel persisted with this threat of successive lawsuits for at least six months, repeatedly rejecting settlement offers for the maximum statutory damages available-all while Mr. Cohen continued to accrue attorney's fees by this hollow, Damocles' sword threat.*fn5
Eventually, Plaintiff accepted an Offer of Judgment for $1,001.00 plus a "reasonable" attorney's fee. The equivalent of this Offer of Judgment was offered prior to the filing of the Complaint, but Plaintiff waited until her husband accrued nearly $25,000.00 in attorney's fees to accept it. Specifically, Defendant offered $1,500.00 to settle Plaintiff's claims pre-suit. (Def.'s Ex. 2; CM/ECF No. 24-3.) It was rejected based on Mr. Cohen's bluff of successive litigation.
The threatened separate lawsuits were never filed and the one-year statute of limitations under the FDCPA has expired. All that is left to show for those unasserted "claims" is nearly $29,000.00 in attorney's fees that Plaintiff wants to tax against Defendant.
For the reasons set forth below, this Court believes that Plaintiff's request for $29,210.25 in attorney's fees is unreasonable and contrary to the intent of the Fair Debt Act.
The Complaint was filed on October 5, 2010. Plaintiff Miriam Cohen is represented by her husband, Mr. Cohen. She alleges that she received a phone message on May 12, 2010, from Defendant attempting to collect a debt, and that during this initial communication, Defendant failed to disclose certain information required by the Act, including the amount of the alleged debt. (Compl., ¶¶ 16-17, 26.) Plaintiff also claims that Defendant subsequently left "numerous messages" on her answering machine that did not comply in various ways with the Act's technical disclosure requirements. (Compl., ¶ 18.) Finally, Plaintiff states that, in June 2010, Defendant placed a call to her home and impermissibly spoke with a "third-party," -her husband and counsel, Mr. Cohen -- about the debt. (Compl., ¶ 20.)
Plaintiff contends that each phone call and/or technical omission constitutes a separate and independent violation of the Act that can be filed as a stand alone federal lawsuit. She claims that there are "at least 15" FDCPA violations, but that this case has been brought to address just one. (Compl., ¶¶ 9-10.) Despite filing this lawsuit to recover for just one violation, Plaintiff identifies and includes in the pleading the "non-asserted claims," presumably making them an issue in the case. (Compl., ¶¶ 16-21.)
B. Procedural History & Settlement Discussions*fn7
A plaintiff may not recover more than $1,000.00 in statutory damages in a Fair Debt action. See,e.g., 15 U.S.C. § 1692k(a)(2)(A); Goodman v. People's Bank, 209 Fed. Appx. 111,114 (3d Cir. 2006). On August 25, 2010, prior to the filing of the Complaint, Defendant offered Plaintiff $1,500.00, to settle all of her FDCPA claims against Defendant. (Pl.'s Ex. F (8/25/10).) Plaintiff rejected the offer, despite it exceeding the statutory maximum available. She claimed that Defendant was liable for 10 separate FDCPA violations and, therefore, she was entitled to $1,000.00 in statutory damages for each violation, in other words $10,000.00 in statutory damages, as well as attorney's fees.*fn8 (Def.'s Ex. 1; CM/ECF No. 24-2.) This position was taken despite Plaintiff's confounding refusal to include all ten claims in her request for relief. (Compl., ¶¶ 9-10.) At the time the $1,500 settlement offer was received, Plaintiff's counsel had billed a total of 2.65 hours to the file, which equates to $1,046.75 in attorney's fees. (Declaration of Michael M. Cohen, Esq. ("Cohen Decl.") Ex. F at 1.)*fn9
In January 2011, prior to the scheduling conference and the service of any discovery, Defendant offered Plaintiff $4,500.00, inclusive of fees and costs, to settle her FDCPA claims. (Def.'s Ex. 2.) Plaintiff again refused the offer. (Def.'s Ex. 2.) Instead, Plaintiff said she would accept $4,500 for just the single claim specifically alleged in the Complaint, but would not settle "all her claims" for the value of "just one claim." (Def.'s Ex. 3 at 2.)
On February 2, 2011, the Undersigned held an initial scheduling conference with counsel by telephone. Despite no scheduling order or any discovery served, Plaintiff's demand to settle her FDCPA claims was $17,500.00 ($9,500.00 in attorney's fees; $8,000.00 in statutory damages). (Affidavit of Richard J. Perr ("Perr Aff.") ¶ 1.) On February 14, 2011, again before any discovery had been served in the case and before the case had really commenced, Defendant offered Plaintiff $5,500.00 to settle her FDCPA claims. (Def.'s Ex. 5; CM/ECF No. 24-6.) Plaintiff again rejected the offer, claiming somehow that $11,000.00 in attorney's fees had already been billed to the case. (Def.'s Ex. 6; CM/ECF No. 24-7.)
Shortly after the initial conference, the parties served discovery. On March 22, 2011, Plaintiff responded to Defendant's requests. However, she did not produce any documents and provided unsigned and unverified answers to interrogatories. (Def.'s Exhs. 9, 10; CM/ECF Nos. 24-10, 24-11.) Despite this, Mr. Cohen's timesheets reflect that he billed 9.45 hours and nearly $3,800.00, reviewing the discovery requests; meeting with his spouse about them in various "office conferences";*fn10 and preparing responses. (Cohen Decl., Ex. F.)*fn11
C. Plaintiff's Acceptance of Defendant's Offer of Judgment
On March 25, 2011, Defendant served an Offer of Judgment, which states:
1. Judgment shall be entered in the amount of $1,001.00, as against Defendant American Credit Bureau, Inc.
2. In addition, Plaintiff's reasonable costs and reasonable attorney fees in connection with the claims against Defendant in the above-referenced action are to be added to the judgment; said fees and costs are to be in an amount as agreed to between counsel for the parties, or if they are unable to agree, as determined by the Court upon motion;
3. The judgment entered in accordance with this Offer of Judgment is to be in total settlement of any and all claims by Plaintiff in the above captioned case against Defendant and its current and former employees, owners, and agents, and said judgment shall have no effect whatsoever except in settlement of those claims;
4. This Offer of Judgment is made solely for the purposes specified in Rule 68, and is not to be construed either as an admission that Defendant is liable in this action, or that Plaintiff ...