Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-4_10-cv-00549/USCOURTS-azd-4_10-cv-00549-0/pdf.json

Nature of Suit Code: 152
Nature of Suit: Recovery of Defaulted Student Loans
Cause of Action: 28:1345 Default of Student Loan

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

United States of America, 

Plaintiff, 

vs.

Scott R. Macy, 

Defendant. 

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No. CV 10-549-TUC-HCE

ORDER

The Magistrate Judge has jurisdiction over this matter pursuant to the parties’

consent. See 28 U.S.C. § 636(c). (Doc. 13). Pending before the Court is Plaintiff’s Motion

for Summary Judgment (Doc. 16). For the following reasons, Plaintiff’s Motion is granted.

I. FACTUAL & PROCEDURAL BACKGROUND

Plaintiff, the United States of America, filed the instant action pursuant to 28 U.S.C.

§1345 to recover amounts due on a defaulted student loan allegedly made to Defendant.

Plaintiff alleges that “[a]ll due credits and set-offs have been applied to the debt and there

now remains due and owing to the plaintiff $54,063.59 principal, plus $6,608.40 interest

through August 17, 2010, with interest continuing to accrue at 8.25% per annum from August

18, 2010, which debt, despite demand, has not been paid.” (Complaint, ¶3). Defendant,

through counsel, filed an Answer. (Doc. 10). Defendant did not assert any affirmative

defenses in his Answer.

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On October 3, 2011, Plaintiff filed a Motion for Summary Judgment (Doc. 16)

(hereinafter “MSJ) and a Separate Statement of Facts (Doc. 17) (hereinafter “SOF”).

Pursuant to LRCiv. 56.1(d), Rules of Practice of the U.S. District Court for the District of

Arizona (hereinafter “Local Rules”), the opposing party to a motion for summary judgment

shall have 30 days after service within which to serve and file a responsive memoranda. The

response time has expired and Defendant has not filed a response. 

II. DISCUSSION

Under LRCiv 7.2(i) of the Local Rules, if the opposing party to a motion, such as a

motion for summary judgment “does not serve and file the required answering memoranda

...such non-compliance may be deemed a consent to the denial or granting of the motion and

the Court may dispose of the motion summarily.” The Ninth Circuit has held that it is an

abuse of discretion to grant a motion pursuant to a local rule such as LRCiv 7.2(i) where the

movant’s papers are insufficient to support the motion or on their face reveal a genuine issue

of material fact. Henry v. Gill Indus., Inc., 983 F.2d 943, 950 (9th Cir. 1993). To recover on

a promissory note in a student loan case, the government must establish that: (1) the

defendant signed the note; (2) the government is the current owner or holder of the note; and

(3) the note is in default. United States v. Petroff-Kline, 557 F.3d 285, 290 (6th Cir. 2009);

United States v. Lawrence, 276 F.3d 193, 197 (5th Cir. 2001). To establish this prima facie

showing, “the government may introduce evidence of the note and a sworn transcript of the

account or certificate of indebtedness.” Petroff-Kline, 557 F.3d at 290. Once a prima facie

case is established, the defendant has the burden of proving the nonexistence, extinguishment

or variance in payment of the obligation. Id.

In its moving papers, Plaintiff contends that it is entitled to judgment as a matter of

law “in the total amount of $60,671[.]99, consisting of [$]54,063.59 principal, plus $6,608.40

interest computed through August 17, 2010, with interest continuing to accrue from August

17, 2010, plus interest from the date of judgment as provided by law and all costs in this

action.” (MSJ, p. 5).

To support its Motion for Summary Judgment, Plaintiff submits an affidavit from

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1

This amount repaid Defendant’s then outstanding FFEL Stafford Subsidized Loans

held and serviced by Sallie Mae. (SOF, Exh. A, ¶¶6-7).

2

This amount repaid Defendant’s then outstanding Supplemental Loans held and

serviced by Sallie May. (SOF, Exh. A, ¶¶6-7). 

3

Under the William D. Ford Federal Direct Loan Program, the Secretary of Education

extends loans to enable a student or parent to pay the costs of the student’s attendance at a

post-secondary school. 20 U.S.C. §1087a; 34 C.F.R. §685.100. A component of this Program

is the Federal Direct Consolidation Loan Program which provides loans to borrowers to

consolidate certain Federal educational loans. 34 C.F.R. §685.100(a)(4). 

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Lynda Faatalale, a Loan Analyst with the U.S. Department of Education. (SOF, Exh. A) as

well as a Certificate of Indebtedness certified pursuant to 28 U.S.C. §1746(2) under the

penalty of perjury by Loan Analyst Peter LaRoche, also with the U.S. Department of

Education (SOF, Exh. B). Plaintiff’s evidence establishes that on or about August 20, 2007,

Defendant executed a promissory note to secure a Direct Consolidation loan from the U.S.

Department of Education. (SOF Exh. A,¶6 att. 1; see also SOF Exh. B). Under the

promissory note executed by Defendant, Defendant “promise[d] to pay the U.S. Department

of Education...all sums disbursed under the terms of this Promissory Note...”, including

interest and fees as well as collection costs if Defendant failed to make payment on the note

when due. (SOF, Exh. A, att. 1, p.3). On or about September 17, 2007, the loan was

disbursed in the amounts of $18,043.211

 and $31,548.112. (SOF, Exh. A ¶7 & att. 2; SOF,

Exh. B). The loan was approved and made under the William D. Ford Federal Direct Loan

Program3

 under Title IV, Part D of the Higher Education Act of 1965, as amended, 20 U.S.C.

§1087a et seq. and 34 C.F.R. Part 685. (SOF, ¶3 & Exh. B). The Department of Education

“has credited a total of $1,440.00 in payments from all sources, including Treasury

Department offsets, if any, to the balance. After application of these payments, the borrower

now owes the United States...” a total debt of $60,671.99. (Id.). Additionally, “interest

accrues on the principal...[of $54,063.59] at the rate of $12.21 per day.” (Id.). 

On or about November 18, 2009, Defendant defaulted on the obligation. (SOF, ¶9 &

Exh. B). Pursuant to 35 C.F.R. §685.202(b), a total of $4,472.27 in unpaid interest was

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capitalized and added to the principal balance. (Id.).

III. CONCLUSION

The time to respond to Plaintiff’s Motion for Summary Judgment has expired and

Defendant has not filed a response. Review of the record indicates that Plaintiff’s Motion

is facially meritorious and, thus, supports the granting of Plaintiff’s Motion pursuant to

LRCiv. 7.2(i).

Accordingly, 

IT IS ORDERED that Plaintiff’s Motion for Summary Judgment (Doc. 16) is

GRANTED.

IT IS FURTHER ORDERED that the Clerk of Court is directed to enter judgement

against Defendant for $54,063.59 principal, and $6,608.40 interest through August 17, 2010,

plus interest from August 18, 2010 through the date of Judgment in the amount of $6,251.52,

plus interest from the date of Judgment at 0.12%, compounded annually until the Judgment

is satisfied. Plaintiff is also entitled to costs incurred herein.

The Clerk of Court is further directed to close this action.

DATED this 11th day of January, 2012.

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