Ricky Henson v. Santander Consumer USA, Inc.Ricky Henson v. Santander Consumer USA, Inc.
A nonmoving party seeking to prevent summary judgment must show a genuine dispute of fact using admissible evidence, not merely conclusory or speculative statements. See Fed.R.Civ.P. 56(c). Raynor’s own interpretation of his x-ray reports, and his speculation regarding the causes of his back pain and his falls after the attack, constitute conclusory and inadmissible lay opinion on issues requiring “scientific, technical, or other specialized knowledge.” Fed.R.Evid. 701(c). A layperson could not determine whether the “multilevel spondylosis” and the “facet arthropathy” described in a post-attack report differs from the “multilevel lower lumbar facet arthrosis” and the “spondylosis” described in pre-attack reports. Thus, without expert testimony, a lay juror would be unable to determine whether any change in Raynor’s spinal condition was attributable to Mullins’ attack.
Although, in many cases, an inference of causation may be drawn based on temporal proximity between violent contact and a particular injury, such an inference is unavailable here. Raynor’s medical history is sufficiently complex that a lay juror could not rationally infer the cause of his existing back problems. Unlike an injury that appears immediately following a violent impact, Raynor’s degenerative spinal condition existed before the attack and worsened after multiple falls during the seven months following the attack. Nothing in the record indicates that this type of spinal condition can be caused by acute physical trauma. Nevertheless, evidence revealed during future discovery may yet establish material facts supporting Raynor’s claim of causation. Therefore, I respectfully concur in the judgment in this appeal.
Ricky HENSON; Ian Matthew Glover; Karen Pacouloute, f/k/a Karen Welcome Kuteyi; Paulette House, Plaintiffs-Appellants,
v.
SANTANDER CONSUMER USA, INC., Defendant-Appellee,
and
Commercial Recovery Systems, Inc.; NCB Management Services, Incorporated, Defendants.
AARP; National Consumer Law Center; National Association of Consumer Advocates; Civil Justice, Inc.; Public Justice Center, Inc.; Maryland Consumer Rights Coalition, Inc.; Attorney General of Maryland, Amici Supporting, Appellants.
No. 15-1187.
United States Court of Appeals, Fourth Circuit.
Argued: Dec. 9, 2015.
Decided: March 23, 2016.
Before NIEMEYER, DUNCAN, and AGEE, Circuit Judges.
Affirmed by published opinion. Judge NIEMEYER wrote the opinion, in which Judge DUNCAN and Judge AGEE joined.
ARGUED: Cory Lev Zajdel, Z Law, LLC, Reisterstown, Maryland, for Appellants. Kim M. Watterson, Reed Smith LLP, Pittsburgh, Pennsylvania, for Appellee. ON BRIEF: Travis Sabalewski, Robert Luck Jr., Richmond, Virginia, Richard L. Heppner, Reed Smith LLP, Pittsburgh, Pennsylvania, for Appellee. Julie Nepveu, AARP Foundation Litigation, Washington, D.C., for Amicus AARP. Joseph S. Mack, Catherine Gonzalez, Civil Justice, Inc., Baltimore, Maryland; Brian E. Frosh, Attorney General, Office of the Attorney General of Maryland, Baltimore, Maryland, for Amici Attorney General of Maryland, Civil Justice, Inc., Maryland Consumer Rights Coalition, Inc., National Association of Consumer Advocates, National Consumer Law Center and Public Justice Center, Inc.
NIEMEYER, Circuit Judge:
Four Maryland consumers commenced this action against Santander Consumer USA, Inc., and its agents, alleging that the defendants violated the Fair Debt Collection Practices Act (“FDCPA”),
The district court granted Santander’s motion to dismiss the claims against it under
I
Ricky Henson, Ian Glover, Karen Pacouloute, and Paulette House, Maryland consumers who are the plaintiffs in this action, each signed a retail installment sales contract with CitiFinancial Auto Credit, Inc., CitiFinancial Auto Corp., or CitiFinancial Auto, LTD (collectively, “CitiFinancial Auto”) to finance the purchase of an automobile. When the plaintiffs were unable to make the payments required by the contracts and thereby defaulted, CitiFinancial Auto repossessed and sold their vehicles and subsequently informed each plaintiff that he or she owed a deficiency balance.
On December 1, 2011, CitiFinancial Auto sold $3.55 billion in loan receivables, including the plaintiffs’ defaulted loans, to Santander, a consumer finance company. The plaintiffs allege that, as part of its business, Santander “acquires defaulted consumer debt ... for a few cents on the dollar.”
Thereafter, Santander and its agents, presumably in an effort to collect more than the few cents on the dollar that it paid for defaulted loans, “began communicating with [the plaintiffs] ... in an attempt to collect on the alleged debts.” And during the course of those communications, Santander and its agents allegedly misrepresented the amount of the debt and their entitlement to collect it.
The plaintiffs commenced this action in November 2012 against Santander and its agents, alleging that they violated the FDCPA in pursuing the debts and in the manner they pursued them. In their complaint, they proposed to represent a class of certain debtors “who were subjected to debt collection efforts by Santander Consumer USA, Inc. on or after December 1, 2011,” the date on which Santander purchased the receivables from CitiFinancial Auto.
Santander filed a motion to dismiss the complaint against it under
The plaintiffs filed this appeal, presenting the single issue of whether, as necessary to state an FDCPA claim, their complaint adequately alleged that Santander was acting as a “debt collector,” as that term is defined in
II
In their brief on appeal, the plaintiffs state their position that Santander was a “debt collector,” subject to regula
The terms “debt collector” and “creditor” are mutually exclusive under the FDCPA. An entity can be either a “debt collector” or a “creditor” in any particular transaction. The determining factor of whether an entity is a “debt collector” or “creditor” in any particular transaction when the entity in question is not the originating lender is whether the debt was acquired prior to default or after default. Since Santander acquired [the plaintiffs’] debts from the original lender well after each [plaintiff] defaulted on their debt, Santander’s collection activities on these defaulted debts make[ ] it a “debt collector.”
(Emphasis added). To make their argument, the plaintiffs rely on their interpretations of
The plaintiffs’ argument, however, contains several interpretational and logical flaws, such that their interpretation of the FDCPA ultimately stands in tension with its plain language. When arguing from the definition of creditor, they overlook the fact that the exclusion applies only to a person who receives defaulted debt “solely for the purpose of facilitating collection ... for another.”
We conclude that the default status of a debt has no bearing on whether a person qualifies as a debt collector under the threshold definition set forth in
We begin our explanation by noting at a general level that the FDCPA purports to regulate only the conduct of debt collectors, not creditors, generally distinguishing between the two based on whether the person acts in an agency relationship with the person to whom the borrower is indebted. With limited exceptions, a debt collector thus collects debt on behalf of a creditor. A creditor, on the other hand, is a person to whom the debt is owed, and when a creditor collects its
The FDCPA’s definitions of debt collector and creditor bear out this distinction.
The definition of debt collector, which is contained in
The term “debt collector” means any person [1] who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or [2] who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another. Notwithstanding the exclusion provided by clause (F) of the last sentence of this paragraph, the term includes any creditor [3] who, in the process of collecting his own debts, uses any name other than his own which would indicate that a third person is collecting or attempting to collect such debts.
The second part of
Thus, the overall structure of
The material distinction between a debt collector and a creditor—at least with re
With this interpretation of
But the very next paragraph of the complaint alleges that on December 1, 2011, CitiFinancial Auto sold the plaintiffs’ loans to Santander. Only thereafter, when Santander began collecting from the plaintiffs on the loans that it had purchased, did Santander engage in the conduct that the plaintiffs allege was in violation of the FDCPA. Specifically, the complaint alleges that after December 1, 2011, Santander improperly contacted the borrowers directly, misrepresented the amounts owed, and misrepresented the fact that Santander was entitled to collect on the loans. Importantly, however, the complaint does not allege that, when Santander engaged in the allegedly illegal collection practices, it was collecting the debts on behalf of CitiFinancial Auto. Rather, it alleges that CitiFinancial Auto had sold the loans to Santander, presumably “for a few cents on the dollar,” thus leaving Santander to collect on the debts for its own account. And this allegation is consistent with public SEC filings, which reveal that Santander purchased $3.55 billion in loan receivables from CitiFinancial Auto on December 1, 2011, following which Santander presumably attempted to obtain a return by collecting more than a few cents on the dollar through its collection efforts.
Applying these allegations to the definition of debt collector in
Because the complaint does not satisfy any definition of debt collector, the analysis ends, and the exclusions from the definition of debt collector, on which the plaintiffs rely, have no significance.
Nonetheless, the plaintiffs argue that the default status of a debt is determinative of whether a person who purchased the debt is a debt collector, pointing to exclusion (F)(iii), which excludes from the class of persons defined as a debt collector “any person collecting or attempting to collect any debt owed or due ... another to the extent such activity ... concerns a debt which was not in default at the time it was obtained by such person.”
In a similar vein, the plaintiffs argue that the definition of creditor supports their position that the default status of a debt defines whether a person attempting to collect that debt is a debt collector. In making this argument, they rely on the exclusion to the definition of creditor but, in doing so, the plaintiffs again apply the same kind of upside-down logic that relies on an inaccurate premise and a negative pregnant that does not follow.
The term “creditor” is defined by the FDCPA as “any person who offers or extends credit creating a debt or to whom a debt is owed.”
The logic does not follow, mainly because debt collector is defined separately and that definition, rather than some implied definition, is determinative. But the logic is flawed even more fundamentally because the premise that Santander satisfies the exclusion is incorrect. In arguing that Santander satisfies the exclusion, the plaintiffs recharacterize the facts they alleged in the complaint, stating in their brief that, “although Santander currently owns [the plaintiffs’] debts, those debts were assigned to Santander after default
Apart from their argument based on the default status of debt, the plaintiffs also seek to avoid the interpretation of “debt collector” that we make, arguing that the second definition of debt collector in
In another attempt to avoid our interpretation, the plaintiffs argue that “debts owed or due another” could refer to debts that were due another either when they were first incurred or at the time of the collection activity. Thus, according to the plaintiffs, when Santander collected on the debts that it had purchased, it could be seen as having acted to collect the debts of another because the loans were originally due to CitiFinancial Auto. This argument, however, is no more persuasive. Insofar as Congress was regulating debt-collector conduct, defining the term “debt collector” to include a person who regularly collects debts owed to another, it had to be referring to debts as they existed at the time of the conduct that is subject to regulation. See Davidson, 797 F.3d at 1318 (“[O]ur inquiry under
Finally, the plaintiffs argue that because Santander had, before December 1, 2011, been a debt collector with respect to their loans, it remained a debt collector after it purchased their loans and thereafter collected on them. They suggest that Santander’s status as a debt collector, generally, made it subject to regulation. As they summarize:
In order for this Court to hold that Santander is not a “debt collector” with respect to [plaintiffs’] defaulted debts, this Court would have to create a loophole in the FDCPA that allows an entity acting as a “debt collector” while servicing ... defaulted debts to become a “creditor” simply by purchasing the defaulted debt it was collecting for another.
Again, we reject this argument. Under the plaintiffs’ interpretation, a company such as Santander—which, as a consumer finance company, lends money, services loans, collects debt for itself, collects debt for others, and otherwise engages in borrowing and investing its capital—would be subject to the FDCPA for all of its collection activities simply because one of its several activities involves the collection of debts for others. Congress did not intend this. Rather, it aimed at abusive conduct by persons who were acting as debt collectors. See
At bottom, a valid claim under the FDCPA inherently requires the coming together of all the statutory elements at the time of and in connection with the prohibited conduct. Thus, for example, when a plaintiff claims that a defendant violated
* * *
Because the complaint failed to allege facts demonstrating that Santander was acting as a “debt collector,” as defined by
AFFIRMED