United States District Court, N.D. California
JOSHUA M. FRAZIER, Plaintiff,
AMERICAN CREDIT RESOLUTION, INC., Defendant.
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT Re: Dkt.
S. Hixson United States Magistrate Judge.
Joshua M. Frazier brings this complaint against Defendant
American Credit Resolution (“ACR”) alleging that
it violated both the Fair Debt Collection Practices Act
(“FDCPA”) and the Rosenthal Fair Debt Collection
Practices Act (“Rosenthal Act”) through its debt
collection activities. After the parties initially reached a
settlement, ACR stopped participating, its counsel withdrew,
and the Clerk entered its default. Frazier now moves for
default judgment pursuant to Federal Rule of Civil Procedure
55(b)(2). ECF No 45. No opposition has been filed. The Court
finds this matter suitable for disposition without oral
argument and VACATES the November 7, 2019
hearing. Fed.R.Civ.P. 78(b); Civ. L.R. 7-(1)(b). After
carefully reviewing Frazier's motion and controlling
authorities, the undersigned GRANTS the
motion for the following reasons.
November 2017, Frazier obtained a payday loan from Check
n' Go. Compl. ¶ 9, ECF No. 1. Due to financial
hardship, he fell behind on his scheduled payments.
Id. ¶ 10. On December 14, 2018, Frazier
received a text message from ACR attempting to collect upon
the debt. Id. ¶ 11. He received a second
identical text message from ACR on December 17, 2018.
Id. ¶ 12. ACR's entire text messages
contained the following language: “YOUR ACCOUNT REMAINS
DELINQUENT IN OUR OFFICE. PLEASE CALL 844-864-3236 TODAY.
THIS IS FROM ACR, A DEBT COLLECTION AGENCY.”
Id. ¶ 13. ACR failed to disclose that any
information obtained would be used for the purpose of debt
collection. Id. ¶ 14. Concerned, Frazier
contacted ACR on December 17, 2018 and learned that it was
attempting to collect upon the debt. Id.
¶¶ 15-16. ACR represented that Frazier agreed to a
payment plan but never fully executed the agreement.
Id. ¶ 17. Frazier was confused by ACR's
representation because he had not previously communicated
with ACR and did not agree to a payment plan with ACR or
Check n' Go. Id. ¶ 18. When he demanded ACR
stop contacting him, ACR stated it could continue to contact
him regardless of his demands. Id. ¶¶
filed this case on December 26, 2018, alleging he “has
suffered concrete harm due to [ACR's] conduct, including
but not limited to, aggravation, invasion of privacy, and
emotional distress.” Id. ¶
On April 8, 2019, Frazier filed a Notice of Settlement
indication the parties were “in the process of
completing the final closing documents and filing the
dismissal” and that the process would take no more than
60 days. ECF No. 21. However, on June 25, 2019, ACR's
counsel filed a motion to withdraw as counsel on the grounds
that ACR breached its contractual obligations and otherwise
made it unreasonably difficult for counsel to carry out its
representation effectively. ECF No. 26. ACR did not oppose
the motion. On August 5, 2019, the Court granted the motion
on the condition that counsel continue to serve all papers
from the Court and Frazier on ACR for forwarding purposes.
ECF No. 35.
filed the present motion on September 30, 2019. He seeks
statutory damages of $1, 000 under the FDCPA, statutory
damages of $1, 000 under the Rosenthal Act, and
attorney's fees and costs $6, 560.95. Mot. at 11.
Rule of Civil Procedure 55(b)(2) permits a court, following
default by a defendant, to enter default judgment in a case.
“The district court's decision whether to enter
default judgment is a discretionary one.” Aldabe v.
Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980).
default judgment stage, the factual allegations of the
complaint, except those concerning damages, “together
with other competent evidence submitted” are deemed
admitted by the non-responding parties. Shanghai
Automation Instrument Co. v. Kuei, 194 F.Supp.2d 995,
1000 (N.D. Cal. 2001); see also Fair Hous. of Marin v.
Combs, 285 F.3d 899, 906 (9th Cir. 2002) (“With
respect to the determination of liability and the default
judgment itself, the general rule is that well-pled
allegations in the complaint regarding liability are deemed
true.”). “However, a defendant is not held to
admit facts that are not well-pleaded or to admit conclusions
of law.” DIRECTV, Inc. v. Hoa Huynh, 503 F.3d
847, 854 (9th Cir. 2007) (citation and quotation omitted)).
Therefore, “necessary facts not contained in the
pleadings, and claims which are legally insufficient, are not
established by default.” Cripps v. Life Ins. Co. of
N. Am., 980 F.2d 1261, 1267 (9th Cir. 1992) (citing
Danning v. Lavine, 572 F.2d 1386, 1388 (9th Cir.
1978)); accord DIRECTV, 503 F.3d at 854. Further,
the scope of relief is limited by Federal Rule of Civil
Procedure 54(c), which states that a “default judgment
must not differ in kind from, or exceed in amount, what is
demanded in the pleadings.”
determining whether default judgment is appropriate, the
Ninth Circuit has enumerated the following factors for courts
(1) the possibility of prejudice to the plaintiff, (2) the
merits of plaintiff's substantive claim, (3) the
sufficiency of the complaint, (4) the sum of money at stake
in the action; (5) the possibility of a dispute concerning
material facts; (6) whether the default was due to excusable
neglect, and (7) the strong policy underlying the Federal
Rules of Civil Procedure favoring decisions on the merits.
Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir.
Jurisdiction and Service of Process
considering whether to enter default judgment, a district
court must first determine whether it has jurisdiction over
the subject matter and the parties to the case. In re
Tuli, 172 F.3d 707, 712 (9th Cir. 1999). “[T]he
district court is not restricted to the face of the
pleadings, but may review any evidence, such as affidavits
and testimony, to resolve factual disputes concerning the
existence of jurisdiction.” McCarthy v. United
States, 850 F.2d 558, 560 (9th Cir. 1988) (considering
subject matter jurisdiction on a 12(b)(1) motion).
Subject Matter Jurisdiction
courts are courts of limited jurisdiction and are
presumptively without jurisdiction. Kokkonen v. Guardian
Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). A
federal court may dismiss an action on its own motion if it
finds that it lacks subject matter jurisdiction. Fiedler
v. Clark, 714 F.2d 77, 78-79 (9th Cir. 1983); see
also Fed. R. Civ. P. 12(h)(3) (“If the court
determines at any time that it lacks subject-matter
jurisdiction, the court must dismiss the action.”).
in this case arises pursuant to § 1692k(d) of the FDCPA,
which states that such actions may be brought and heard
before “any appropriate United States district court
without regard to the amount of controversy.”
Additionally, 28 U.S.C. § 1387 grants the Court
supplemental jurisdiction over Frazier's Rosenthal Act
Basis for Personal Jurisdiction
enter default judgment, the Court must have a basis for the
exercise of personal jurisdiction over the defendants in
default. In re Tuli, 172 F.3d at 712. “Without
a proper basis for [personal] jurisdiction, or in the absence
of proper service of process, the district court has no power
to render any judgment against the defendant's person or
property unless the defendant has consented to jurisdiction
or waived the lack of process.” S.E.C. v.
Ross, 504 F.3d 1130, 1138-39 (9th Cir. 2007).
Traditional bases for conferring a court with personal
jurisdiction include a defendant's consent to
jurisdiction, personal service of the defendant within the
forum state, or a defendant's citizenship or domicile in
the forum state. J. McIntyre Mach., Ltd. v.
Nicastro, 564 U.S. 873, 880 (2011). Absent one of the
traditional bases for jurisdiction, the Due Process Clause
requires that the defendant have “certain minimum
contacts with the forum ‘such that the maintenance of
the suit does not offend traditional notions of fair play and
substantial justice.'” Int'l Shoe Co. v.
State of Wash., Office of Unemployment Comp. &
Placement, 326 U.S. 310, 316 (1945) (citations and
quotation marks omitted). The party seeking to invoke
jurisdiction has the burden of establishing that jurisdiction
is proper. Flynt Distrib. Co. v. Harvey, 734 F.2d
1389, 1392 (9th Cir. 1984). “[M]ere ‘bare
bones' assertions of minimum contacts with the forum or
legal conclusions unsupported by specific factual allegations
will not satisfy a plaintiff's pleading burden.”
Swartz v. KPMG LLP, 476 F.3d 756, 766 (9th Cir.
to Frazier's complaint, ACR is a corporation organized
under the laws of the state of Georgia with its principal
place of business at 270 Carpenter Drive, Suite 575, Sandy
Springs, Georgia 30328. Compl. ¶ 6. ACR regularly
collects upon consumers located in the state of California.
Id. “Personal jurisdiction over a nonresident
defendant is tested by a two-part analysis. First, the
exercise of jurisdiction must satisfy the requirements of the
applicable long-arm statute. Second, the exercise of
jurisdiction must comport with federal due process.”
Dow Chem. Co. v. Calderon, 422 F.3d 827, 830 (9th
Cir. 2005). Where there is no applicable federal statute
governing personal jurisdiction, courts apply the law of the
state in which the court sits. Fed.R.Civ.P. 4(k)(1)(A);
Panavision Int'l, L.P. v. Toeppen, 141 F.3d
1316, 1320 (9th Cir. 1998). In California, a court “may
exercise jurisdiction on any basis not inconsistent with the
Constitution of this state or of the United States.”
Cal. Civ. Proc. Code § 410.10; Daimler AG v.
Bauman, 571 U.S. 117, 125 (2014)
(“California's long-arm statute allows the exercise
of personal jurisdiction to the full extent permissible under
the U.S. Constitution.”). As such, “the
jurisdictional analyses under state law and federal due
process are the same.” Schwarzenegger v. Fred
Martin Motor Co., 374 F.3d 797, 801 (9th Cir. 2004).
Fourteenth Amendment Due Process Clause requires that an
out-of-state defendant have “minimum contacts”
with the forum state such that the exercise of jurisdiction
“does not offend traditional notions of fair play and
substantial justice.” Int'l Shoe, 326 U.S.
at 316 (quotation marks omitted). “In judging minimum
contacts, a court properly focuses on ‘the relationship
among the defendant, the forum, and the
litigation.'” Calder v. Jones, 465 U.S.
783, 788 (1984) (quoting Shaffer v. Heitner, 433
U.S. 186, 204 (1977)).
may exercise either general or specific jurisdiction over a
nonresident defendant. Helicopteros Nacionales de
Colombia, S.A. v. Hall, 466 U.S. 408, 414 (1984).
General jurisdiction exists where a defendant has
“substantial” or “continuous and
systematic” contacts with the forum. Id. at
415. If general jurisdiction exists, the forum has
jurisdiction over the defendant regardless of where the
events giving rise to the litigation occurred. Id.
Here, there is no indication ...