Janet Beasley v. Red Rock Financial Services , 583 F. App'x 138 ( 2014 )


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  •                               UNPUBLISHED
    UNITED STATES COURT OF APPEALS
    FOR THE FOURTH CIRCUIT
    No. 13-2113
    JANET BEASLEY; GORDON BEASLEY,
    Plaintiffs - Appellants,
    v.
    RED ROCK FINANCIAL SERVICES, LLC,
    Defendant - Appellee.
    Appeal from the United States District Court for the Eastern
    District of Virginia, at Alexandria.        Anthony J. Trenga,
    District Judge. (1:12-cv-01312-AJT-TRJ; 1:13-cv-00206-AJT-TRJ)
    Submitted:   July 18, 2014                Decided:     September 9, 2014
    Before MOTZ and    WYNN,     Circuit   Judges,   and   HAMILTON,   Senior
    Circuit Judge.
    Affirmed by unpublished per curiam opinion.
    Ernest P. Francis, ERNEST P. FRANCIS, LTD., Arlington, Virginia,
    for Appellants. Virginia M. Sadler, JORDAN COYNE LLP, Fairfax,
    Virginia, for Appellee.
    Unpublished opinions are not binding precedent in this circuit.
    PER CURIAM:
    In this case under the Fair Debt Collections Practices Act
    (the FDCPA), 
    15 U.S.C. §§ 1692
    -1692p, the plaintiffs-appellants
    raise numerous allegations of error that they contend should be
    resolved in their favor.            Having carefully reviewed the briefs,
    the   record,     and    the    relevant    law,       we    conclude    that    each    is
    without merit.      Accordingly, we affirm.
    I.
    At   all    times    relevant    to       this    case,    husband       and   wife,
    Gordon and Janet Beasley (the Beasleys), owned a home in the
    Princeton     Woods      Addition    neighborhood,            located    in     Dumfries,
    Virginia.        The home is subject to a declaration of covenants,
    conditions, and restrictions administered by the Princeton Woods
    Addition Homeowners Association, Inc. (the HOA).                              In October
    2008, the HOA, through its collection agent Reese Broome, PC,
    notified the Beasleys by letter that they owed the HOA a total
    of $685.00 in unpaid assessments, late fees, and legal fees.
    Additionally,       the    letter     stated         that     unless     the    Beasleys
    disputed the debt or made payment in full within thirty days
    after   receipt     of    the    letter,       the     HOA    would     accelerate      the
    Beasleys’ account through the end of the year and record a lien
    on their home.          The Beasleys periodically continued to receive
    similar letters from Reese Broome, PC, on behalf of the HOA,
    2
    with the last letter from Reese Broome, PC, dated March 17,
    2011.
    The Beasleys claim they brought their HOA account current
    in 2008 and dispute any and all alleged delinquencies in their
    HOA account after that time.                      In 2009, the HOA revoked the
    Beasleys’ HOA privileges, such as use of the neighborhood pool,
    for failure to keep their HOA account current.
    In January 2012, the HOA switched collection agents from
    Reese    Broome,     PC,     to    Red    Rock     Financial       Services,       LLC    (Red
    Rock).     Red Rock’s first letter to the Beasleys on behalf of the
    HOA is dated January 23, 2012, stating the Beasleys’ current HOA
    account balance as $1,373.36.                     The letter also stated that if
    the   Beasleys      chose    not     to     pay    their    account       in     full   within
    thirty days from the date of the letter, “the [HOA] will refer
    the matter to counsel for appropriate legal action, including
    filing a Memorandum of Assessment Lien on behalf of [the HOA] in
    the     Prince     William        Circuit     Clerk’s       Office    without           further
    notice.”      (J.A. 445).           In a letter dated March 12, 2012, from
    Red   Rock    to    the     Beasleys’       attorney,        Red   Rock        reported    the
    Beasleys’ HOA account balance as $1,458.90.
    On May, 25, 2012, the HOA filed a “Memorandum of Assessment
    Lien”    in   Prince       William        County,    Virginia        on    the     Beasleys’
    Princeton     Woods    home,       asserting       the     Beasleys       owed    the    HOA   a
    total of $1,902.82, consisting of $307.36 in unpaid assessments,
    3
    $23.46 in late fees and interest, and $1,572.00 in “Collection
    and Attorney Fees and Costs.”                      (J.A. 459).          Of relevance in the
    present      appeal,       in    a    letter        dated    May    30,    2012,    Red     Rock
    informed Janet Beasley that “Red Rock Financial Services may
    proceed with foreclosure no sooner than the 61st day from the
    mailing of the Memorandum of Assessment Lien if [the] debt is
    not satisfied.”            (J.A. 450).             Red Rock contemporaneously sent a
    separate, but identical letter to Gordon Beasley.
    The Beasleys subsequently brought the present action solely
    against      Red    Rock,       alleging      Red       Rock’s     collection      efforts    on
    behalf of the HOA violated numerous provisions of the FDCPA. 1
    The   Beasleys       sought       a    total       of   $98,000.00        in   damages,     plus
    reasonable         attorney’s         fees,    prejudgment         interest,     and   costs.
    Following discovery, Red Rock stipulated to violating the FDCPA
    in an unspecified manner and to the Beasleys’ entitlement to
    $1,000.00 each in statutory damages.                             Shortly thereafter, the
    case went to trial, with the district court granting judgment as
    a   matter    of     law    in    favor       of    Red     Rock   at    the   close   of    all
    evidence on ten out of the eleven counts alleged.                               According to
    the district court, the Beasleys had either failed to produce
    1
    The Beasleys actually filed separate, but identical
    complaints, which were consolidated for discovery and trial
    purposes. For ease of understanding, we treat them as being in
    one action in this opinion.
    4
    sufficient evidence of any FDCPA violation in counts I through X
    or   had   failed    to   produce   sufficient     evidence    that    they   had
    suffered    any     actual   damages    as   a   result   of   any    violations
    claimed in those counts.
    In the lone remaining count, the Beasleys alleged that each
    of them was entitled to recover for actual damages which each of
    them had sustained as a result of Red Rock violating 15 U.S.C.
    § 1692e(5), which statutory section provides:
    [a] debt collector may not use any false, deceptive or
    misleading representation or means in connection with
    the collection of any debt.       Without limiting the
    general application of the foregoing, the following
    conduct is a violation of this section:
    *   *    *
    (5) The threat to take any action that cannot legally
    be taken or that is not intended to be taken.
    15 U.S.C. § 1692e(5).        The district court instructed the jury as
    follows with respect to the Beasleys’ legal theory regarding
    this claim:
    The Plaintiffs claim that Defendant violated this
    section of the Act when it stated in its letter dated
    May 30, 2012, . . . that “Red Rock Financial may
    proceed with foreclosure no sooner than the 61st day
    from the mailing of the Memorandum of Assessment Lien
    if debt is not satisfied.”    The basis for this claim
    is that the Memorandum of Lien did not comply with all
    the legal requirements necessary to perfect and
    enforce a lien and for that reason there was not filed
    a valid lien.   The defendant denies that it violated
    this particular section of the Act.
    In order to recover on his or her claim, each
    plaintiff must prove the following:
    5
    (1) that the defendant violated this section of
    the Act;
    (2) that he or she sustained actual damages as a
    result of defendant’s violation of this section
    of the Act; and
    (3) the amount of damage he or she sustained as a
    result of defendant’s violation of the Act.
    (J.A. 569-70).         Additionally, the district court instructed the
    jury that none of the following conduct, by itself, violated the
    FDCPA:       (1)     the   fact    that     Red         Rock    sent   the   Beasleys      the
    collections letters dated January 23, 2012, and March 12, 2012;
    (2) the fact that Red Rock attempted to collect a disputed debt;
    and    (3)     the    filing       itself          of    the     Memorandum      of    Lien.
    Accordingly, the district court instructed the jury that the
    Beasleys     are     not    entitled      to       recover      damages      based    on   any
    emotional distress or other injuries caused by such conduct.
    In a verdict form containing special interrogatories, the
    jury   found       that    the    Beasleys         had    not    sustained     any    actual
    damages as a result of Red Rock’s violation of the FDCPA over
    and above the statutory damages to which Red Rock had already
    stipulated.        The district court entered judgment in favor of the
    Beasleys in the amount of $1,000.00 each in statutory damages,
    pursuant to 15 U.S.C. § 1692k(a)(2)(A), and otherwise in favor
    of Red Rock as to all eleven counts.                       The Beasleys subsequently
    filed a motion, pursuant to 15 U.S.C. § 1692k(a)(3), requesting
    a total of $52,120.00 in attorney’s fees and $220.00 in costs.
    6
    After considering the motion, the district court awarded the
    Beasleys a total of $5,000.00 in attorney’s fees and $252.00 as
    taxable      costs,   representing     the     fees   of    the   Clerk     of   Court.
    This    timely    appeal     followed     in    which       the   Beasleys       allege
    numerous errors by the district court below.                      We have reviewed
    them all and find all to be without merit.                    Several are worthy
    of our expressly addressing.
    II.
    The    Beasleys   first      contend    the    district      court    erred      by
    granting Red Rock’s motion for judgment as a matter of law with
    respect to Counts III, IV, V, and VII, all of which allege Red
    Rock violated 15 U.S.C. § 1692e(2) by making false statements as
    to the amount of debt the Beasleys owed the HOA.                            Count III
    pertained to the January 23, 2012 letter, Count IV pertained to
    the March 12, 2012 letter, Count V pertained to the May 30, 2012
    letter, and Count VII pertained to the May 25, 2012 Memorandum
    of Lien.
    We review the district court’s grant of Red Rock’s motion
    for judgment as a matter of law de novo.                    Anderson v. Russell,
    
    247 F.3d 125
    , 125 (4th Cir. 2001).               Judgment as a matter of law
    is appropriate on a claim “[i]f a party has been fully heard on
    an   issue     during    a   jury    trial    and     the   court    finds       that    a
    reasonable jury would not have a legally sufficient evidentiary
    7
    basis to find for the party on that issue[.]”                            Fed. R. Civ. P.
    50(a)(1).             Having reviewed the record, the relevant law, and
    the parties’ briefs, we hold the district court did not err in
    granting Red Rock’s motion for judgment as a matter of law with
    respect to Counts III, IV, V, and VII.                         The crux of the matter
    is   that    the      Beasleys    failed    to      present      sufficient            evidence,
    viewed      in   the    light     most   favorable        to    them,       to    remove       the
    existence        of     damages     proximately           caused    by           the     alleged
    violations         at    issue     beyond          the    realm     of       impermissible
    speculation and conjecture.                 Myrick v. Prime Ins. Syndicate,
    Inc., 
    395 F.3d 485
    , 489 (4th Cir. 2005) (“[I]f the verdict in
    favor of the non-moving party would necessarily be based upon
    speculation and conjecture, judgment as a matter of law must be
    entered.”).           The evidence presented at trial established that,
    since October 2008, the Beasleys had suffered extreme emotional
    distress because of (1) the HOA’s repeated claims that their HOA
    account was delinquent; (2) the steady efforts by Reese Broome,
    PC to collect on such alleged delinquencies; and (3) the filing
    of the Memorandum of Lien on their home.                         The Beasleys offered
    insufficient          evidence    for    the       jury   to    find     what,         if   any,
    additional         emotional       distress         the     Beasleys         suffered           as
    proximately        caused   by    Red    Rock’s      violations        of    the       FDCPA    as
    alleged in Counts III, IV, V, and VII, i.e., by allegedly making
    8
    false statements as to the amount of debt the Beasleys owed the
    HOA.
    III.
    Next, the Beasleys contend that Red Rock’s stipulation that
    it   violated       the    FDCPA     precluded         Red     Rock    from    disputing      all
    allegations         in     the     complaint          pertaining       to     liability,      and
    therefore,      the       district        court       erred    in     admitting,       over   its
    objections      at         trial,     evidence           regarding          their      allegedly
    delinquent      HOA        account.          Such       evidence        consisted       of    the
    testimony      of        Cynthia    Weiss,        the       person     in     charge    of    the
    Beasleys’ HOA account at the management company the HOA employed
    to maintain its books, and such management company’s “resident
    transaction report,” (J.A. 352), pertaining to the Beasleys.
    We review the “trial court’s rulings on the admissibility
    of evidence for abuse of discretion, and we will only overturn
    an evidentiary ruling that is arbitrary and irrational.                                 To that
    end, we look at the evidence in a light most favorable to its
    proponent,      maximizing          its    probative          value    and    minimizing      its
    prejudicial effect.”               United States v. Cole, 
    631 F.3d 146
    , 153
    (4th Cir. 2011) (internal quotation marks and citation omitted).
    Here,    the        district       court       did     not     act     arbitrarily      or
    irrationally in admitting the challenged evidence.                                  Regardless
    of     Red   Rock’s        stipulation        to       violating        the    FDCPA     in    an
    9
    unspecified manner, the challenged evidence was probative on the
    issue of damages.      Specifically, the challenged evidence was
    probative to dispute testimony by the Beasleys to the effect
    that they were shocked and in disbelief that Red Rock would send
    them letters seeking to collect on the debt the HOA claimed the
    Beasleys owed.
    The Beasleys also specifically challenge on hearsay grounds
    the district court’s admission of their “resident transaction
    report,” (J.A. 352), listing all the assessments, late fees, and
    payments associated with the Beasleys’ HOA account.           Below, the
    Beasleys specifically objected to admission of this document,
    identified as Defendant’s Exhibit 1, as inadmissible hearsay.
    Fed. R. Evid. 802.     We review the district court’s admission of
    this report for abuse of discretion.        Cole, 631 F.3d at 153.
    The    district   court   did    not   abuse   its   discretion   in
    admitting   the   challenged   resident     transaction   report   because
    such document was admissible for the purpose of proving the HOA
    had a long running dispute with the Beasleys over their HOA
    account, which is not for the purpose of proving the truth of
    the matter asserted, e.g., not for the purpose of proving the
    Beasleys owed the HOA the amounts listed as delinquent in the
    resident transaction report.         Because the report was admissible
    for a purpose other than the truth of the matter asserted, it
    falls outside the definition of hearsay set forth in Federal
    10
    Rule of Evidence 801(c).               The fact that the Beasleys had a long
    running     dispute      with    the       HOA        over   varying        amounts         the   HOA
    claimed     the    Beasleys      owed       on    their      HOA    account         (since       2008)
    undercut the magnitude of the emotional distress the Beasleys
    claimed     they     suffered         as    proximately            caused      by     Red    Rock’s
    statement in its letter dated May 30, 2012, that it “may proceed
    with foreclosure no sooner than the 61st day from the mailing of
    the   Memorandum         of    Assessment             Lien    if     [the]       debt       is    not
    satisfied.” (J.A. 450).
    IV.
    The    Beasleys         also    challenge         as    inadequate            the    district
    court’s     $5,000.00         award    of       attorney’s         fees     in      their    favor.
    Their challenge is without merit.
    “[I]n    the    case      of    any    successful         action         to     enforce      the
    [FDCPA],”     the    FDCPA      authorizes             district      courts         to    award    “a
    reasonable        attorney’s     fee       as     determined        by    the       court.”         15
    U.S.C. § 1692k(a)(3).                Under the applicable abuse of discretion
    standard,     we     have     the     duty       to    affirm       the     district        court’s
    $5,000.00 attorney’s fees award if such award “falls within the
    district      court’s       broad      discretion.”             Carroll          v.      Wolpoff    &
    Abramson, 
    53 F.3d 626
    , 628 (4th Cir. 1995) (internal quotation
    marks omitted).          Here, the district court undertook a thorough
    analysis     of    the   record        and       applicable        law    in     calculating        a
    11
    reasonable attorney’s fees award in the present case, setting
    forth such analysis in a lengthy written order.              To summarize,
    the district court awarded the Beasleys far less in attorney’s
    fees than they had sought because “[t]heir recovery was limited
    to the amount of statutory damages that [Red Rock] had offered
    shortly after suit was filed, and no reasonable assessment of
    the case justified the expense to pursue actual damages.”               (J.A.
    727).       Given that the degree of success obtained is the most
    critical      factor   in    determining     the   reasonableness      of   an
    attorney’s fees award, Carroll, 
    53 F.3d at 630
    , the Beasleys
    have offered no persuasive argument on appeal which convinces us
    that the district court abused its discretion in limiting the
    Beasleys’ attorney’s fees award to $5,000.00.
    V.
    For     the   reasons   stated,    we   affirm   the   judgment    below
    entered upon the jury’s verdict and affirm the judgment below
    awarding the Beasleys $5,000.00 in attorney’s fees and costs of
    252.00. 2
    2
    We have also reviewed and find to be without merit the
    Beasleys’ remaining assignments of reversible error pertaining
    to the district court’s jury instructions regarding Red Rock’s
    right to foreclose on the lien at issue and the bonafide error
    defense as well as the district court’s refusal to instruct the
    jury that it could award prejudgment interest on all of the
    Beasleys’ damages.
    12
    We dispense with oral argument because the facts and legal
    contentions are adequately presented in the materials before the
    court and argument would not aid the decisional process.
    AFFIRMED
    13
    

Document Info

Docket Number: 13-2113

Citation Numbers: 583 F. App'x 138

Filed Date: 9/9/2014

Precedential Status: Non-Precedential

Modified Date: 1/13/2023