Alexander v. Convergent Outsourcing, Inc., 4:16-cv-03318

Background

Plaintiff Tamara Alexander alleges Convergent Outsourcing sent debt-collection letters after the statute of limitations on the underlying debt had expired, without disclosing that she was not required to pay or that a partial payment would revive the limitations period.
The letters listed a total balance and a substantially lower "settlement offer" amount but omitted limitations-related disclosures.
The Fifth Circuit in Daugherty v. Convergent Outsourcing, Inc., issued an opinion holding that materially identical language violates the FDCPA.
Alexander moved to certify a Texas class of recipients of similar letters; Convergent moved to stay pending resolution of a nearly identical, earlier-filed Colorado case (Ross) that is moving toward a nationwide class settlement.
The Ross action expanded to seek nationwide certification and a proposed settlement covering overlap in time periods; Convergent produced the proposed settlement showing it would subsume Alexander’s proposed class if approved.
The court found no undue prejudice from a short stay, rejected speculation about defendant insolvency, and concluded judicial efficiency favors a limited stay rather than immediate parallel proceedings.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether to stay the Texas action pending resolution of the similar Colorado (Ross) action	Alexander initially agreed Ross would subsume her case if nationwide certification occurred; later argued differences in class periods mean stay could prejudice some class members	Convergent argued Ross is nearly identical, its proposed nationwide settlement would subsume Alexander’s class, and duplicative litigation is inefficient	Court granted a limited stay (60 days) to allow Ross to proceed toward disposition before duplicative litigation continues
Whether Alexander would be prejudiced by a short stay	Alexander contended many putative Texas class members would retain claims and that the Ross settlement could be unfair or deplete defendant’s assets	Convergent asserted overlap in class membership and produced the proposed nationwide settlement; disputed speculative insolvency concerns	Court found no clear prejudice from a short stay; plaintiffs could opt out or pursue individual claims if needed
Appropriateness of an indefinite or lengthy stay	Alexander opposed lengthy stay as improper	Convergent sought stay pending Ross resolution but did not seek an indefinite stay	Court declined an indefinite stay and limited the stay to 60 days as reasonable
Whether judicial efficiency favors staying this case	Alexander argued settlement in Ross may not resolve Texas claims and litigation should proceed	Convergent argued settlement would simplify or resolve overlapping issues and avoid duplicative proceedings	Court held judicial efficiency favored a short stay pending Ross rulings

Key Cases Cited

Daugherty v. Convergent Outsourcing, Inc., 836 F.3d 507 (5th Cir. 2016) (FDCPA violation finding for materially identical collection letter language)
Ambraco, Inc. v. Bossclip B.V., 570 F.3d 233 (5th Cir. 2009) (district courts have inherent power to stay cases to manage docket and promote efficiency)
Landis v. North American Co., 299 U.S. 248 (1936) (stay authority and factors for weighing competing interests)
Wedgeworth v. Fibreboard Corp., 706 F.2d 541 (5th Cir. 1983) (stay should be reasonably time-limited; indefinite stays disfavored)
McKnight v. Blanchard, 667 F.2d 477 (5th Cir. 1982) (caution against immoderate or indefinite stay orders)