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Napolitano v. Ragan

United States District Court, D. New Jersey

August 17, 2017

JESSICA NAPOLITANO, on behalf of herself and all others similarly situated, Plaintiffs,
RAGAN & RAGAN, A Professional Corporation and JOHN DOES 1-25, Defendants.


          WOLFSON, United States District Judge:

         Defendant Ragan & Ragan (“Defendant”), pursuant to Fed.R.Civ.P. 12(c), moves for Judgment on the Pleadings with respect to Plaintiff Jessica Napolitano's (“Plaintiff”) Complaint, which accuses Defendant of violating the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §§1692 et seq. Plaintiff alleges that Defendant violated the FDCPA when it mailed four collection letters on its law firm letter head with electronically produced, facsimile attorney signatures that were in fact not “from” an attorney in any meaningful sense. In the instant matter, Defendant seeks dismissal, arguing, inter alia, that Plaintiff has not established Article III standing or stated a claim under the FDCPA. Plaintiff opposes Defendant's Motion, and cross-moves to amend her Complaint. For the reasons set forth below, the Court GRANTS Defendant's Motion for Judgment on the Pleadings, and DENIES Plaintiff's Cross-Motion to Amend the Complaint. However, in lieu of dismissal, Plaintiff may file, before the Magistrate Judge, a second motion for leave to amend her Complaint.


         At some point prior to July 8, 2014, an obligation was incurred by Plaintiff, owed to “various medical facilities, i.e., Kimball Medical Center and Community Medical Center.” Compl., ¶ 14. Also prior to that date, the debt incurred by Plaintiff was assigned, or sold, to Senex Services Corp. (“Senex”). Id. at ¶ 15. As alleged, Defendant, a law firm, was in the business of collecting debts incurred for personal, family, or household purposes on behalf of creditors. Id. at ¶ 20.

         Defendant mailed Plaintiff four substantially similar collection letters, generic in form, dated July 8, 2014.[2] Id. at ¶¶ 21-22, 25. Each of the collection letters were printed on Defendant's law firm letterhead stating: “This is to advise you that we have been retained by a creditor for the collection of this debt.” Id. at ¶ 21; see Montoya Decl. Ex. A. Furthermore, all four letters informed Plaintiff that she has “received a previous letter from this office. Be advised that there was an error in the previous letter and it should be ignored. This letter contains the correct information.” Id. at ¶ 24. The letters also stated the amount due to Defendant on behalf of a particular creditor, as well as the creditor account number and Defendant's file numbers. Id. at ¶ 25. Lastly, and most importantly, the collection letters all bore a mechanically reproduced, facsimile signature of W. Peter Ragan, Jr., an attorney at Defendant's law firm. Id. at ¶ 26; see Montoya Decl. Ex. A.

         On April 17, 2015, Plaintiff filed this putative class action, one-count Complaint, individually and on behalf of a class of all others similarly situated, id. at ¶¶ 4, 11, alleging that Defendant violated §§ 1692e, 1692e(3), and 1692e(9) of the FDCPA by mailing collection letters on its firm letterhead, containing an attorney signature without it being “from” an attorney in any meaningful sense. Id. at ¶¶ 27, 30-35. To that end, Plaintiff alleges that, “[t]he collection letters created the false and misleading impression that the communications were from an attorney when, in fact, they were not really ‘from' an attorney in any meaningful sense of the word.” Id. at ¶ 27. Stated differently, Plaintiff's sole theory of the case is that the form letters, containing the electronically reproduced attorney signature, give the semblance that the attorney who signed the letter personally reviewed Plaintiff's file, when in reality he did not conduct any meaningful review before signing the letters. Based on that conduct, Plaintiff alleges that Defendant's debt collection efforts violated 15 U.S.C. §§ 1692e, 1692e(3), and 1692e(9) of the FDCPA. Id. at ¶ 31.

         Defendant filed its Answer on June 12, 2015, denying the allegations in Plaintiff's Complaint. As an affirmative defense, Defendant claims that Plaintiff lacked standing to bring suit because neither she nor the putative class had suffered an injury-in-fact. Def.'s Answer, p. 6. The Magistrate Judge, on September 10, 2015, entered a Scheduling Order, which set a deadline of November 13, 2015, to file a motion to amend the pleadings. The Scheduling Order also initially set discovery to close by February 26, 2016.

         Without engaging in dispositive motion practice, discovery commenced. While some issues with respect to discovery arose, the Magistrate Judge scheduled a settlement conference on March 28, 2016, and intended to extend discovery deadlines if the matter did not settle. Ultimately, the parties were unable to settle. Thereafter, the Magistrate Judge permitted Defendant to file its Motion for Judgment on the Pleadings on May 27, 2016, and stayed discovery pending a decision on this motion. Plaintiff then sought consent from this Court to file an amended complaint. I denied that request, and directed Plaintiff to file a motion for leave to amend the complaint.

         In the instant matter, Defendant move for judgment on the pleadings, arguing that Plaintiff lacks standing to bring suit, and that Plaintiff failed to state a claim under the FDCPA. In response, Plaintiff opposed Defendant's motion, and at the same time, cross-moved to amend the Complaint under Rule 15(a).[3] I will first address Plaintiff's cross-motion to amend, before discussing standing and the merits of Plaintiff's claims.


         I. Motion to Amend

         Plaintiff cross-moves for leave to amend the Complaint to include additional facts to bolster standing allegations and her claims under the FDCPA. With regard to standing, because I find that Plaintiff has standing to bring suit, see infra, no additional allegations are necessary in that regard. As to Plaintiff's request to amend her FDCPA claims, the decision to grant or deny leave to amend a complaint lies within the discretion of the district court. Coventry v. U.S. Steel Corp., 856 F.2d 514, 518 (3d Cir. 1988). This discretion is broad pursuant to Fed R. Civ. P. 15(a).[4] See Phillips v. Greben, No. 04-5590, 2006 U.S. Dist. LEXIS 78419, at *15 (D.N.J. Oct. 27, 2006); Posey v. NJR Clean Energy Ventures Corp., No. 14-6833, 2015 U.S. Dist. LEXIS 146688, *5-6 (D.N.J. Oct. 29, 2015).

         When considering a motion to amend, “[t]he Supreme Court has instructed that although 'the grant or denial of an opportunity to amend is within the discretion of the District Court, . . . outright refusal to grant the leave without any justifying reason appearing for the denial is not an exercise of discretion; it is merely an abuse of that discretion and inconsistent with the spirit of the Federal Rules.'” Shane v. Fauver, 213 F.3d 113, 115 (3d. Cir. 2000) (quoting Foman v. Davis, 371 U.S. 178, 182 (1962)). Nonetheless, a court may deny a plaintiff leave to amend for a variety of reasons, including undue delay, bad faith, dilatory motive, prejudice and futility. In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1434 (3d Cir. 1997); Alston v. Parker, 363 F.3d 229, 235 (3d Cir. 2004). Under Third Circuit precedent, a “futile” amendment is one that fails to state a claim upon which relief could be granted. In re Burlington, 114 F.3d at 1434; Grayson v. Mayview State Hospital, 293 F.3d 103, 113 (3d Cir. 2002). Thus, in determining whether a complaint, as amended, is futile, the district court must apply the sufficiency standard set forth under Rule 12(b)(6). Shane, 213 F.3d at 115. “Accordingly, if a claim is vulnerable to dismissal under Rule 12(b)(6), but the plaintiff moves to amend, leave to amend generally must be granted unless the amendment would not cure the deficiency.” Id; Marrin v. Capital Health Sys., No. 14-2558, 2015 U.S. Dist. LEXIS 10243, at *10 (D.N.J. Jan. 29, 2015).

         Here, on Plaintiff's motion to amend, Defendant does not argue, and the Court does not find, that any undue delay, dilatory motive or prejudice exists. Instead, Defendant argues that Plaintiff's proposed amendments as to standing under Article III are futile. Because I find that Plaintiff has standing based on Plaintiff's original Complaint, see infra, I need not discuss Defendant's arguments in this regard. However, the Court must still consider whether Plaintiff's proposed amendments as to her substantive FDCPA claims meet the futility standard. I will address that question later in this Opinion. Next, I turn to the issue of standing.

         II. Rule 12(c) - Standard of Review

         Rule 12(c) of the Federal Rules of Civil Procedure allows a party to move for judgment on the pleadings “after the pleadings are closed but within such time as not to delay trial.” Fed.R.Civ.P. 12(c). The standard that a court applies on such a motion is the same standard that a court applies in deciding a motion to dismiss pursuant to Rule 12(b)(6). Turbe v. Government of Virgin Islands, 938 F.2d 427 (3d Cir. 1991); see also Spruill v. Gillis,372 F.3d 218, 223 n. 2 (3d Cir. 2004) (“There is no material difference in the applicable legal standards”). When reviewing a motion to dismiss on the pleadings, courts “accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief.” Phillips v. County of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008) (internal citation and quotations omitted); see also McTernan v. City of ...

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