Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_15-cv-02458/USCOURTS-caed-2_15-cv-02458-0/pdf.json

Nature of Suit Code: 480
Nature of Suit: Consumer Credit
Cause of Action: 15:1692 Fair Debt Collection Act

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UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF CALIFORNIA 

JENNIFER SOSA, 

Plaintiff, 

v. 

CROWNING POINT SOLUTIONS, LLC, 

 

 Defendant. 

No. 2:15-cv-2458-JAM-EFB 

FINDINGS AND RECOMMENDATIONS 

This matter came before the court on June 8, 2016, for hearing for hearing on plaintiff’s 

motion for default judgment against defendant Crowning Point Solutions, LLC.1

 ECF No. 9. 

Attorney Cory Teed appeared on behalf of plaintiff;2 no appearance was made by defendant. For 

the reasons stated below, it is recommended that plaintiff’s application for default judgment be 

granted. 

I. Background 

 Plaintiff filed this action against defendant, alleging violation of the Fair Debt Collection 

Practices Act, 15 U.S.C. §§ 1692, et seq. (“FDCPA”); the California Rosenthal Act, California 

Civil Code §§ 1788 et. seq. (“Rosenthal Act”); and a claim for invasion of privacy. ECF No. 1. 

 1

 This case was referred to the undersigned pursuant to Eastern District of California 

Local Rule 302(c)(19). See 28 U.S.C. § 636(b)(1). 

2

 Mr. Reed appeared telephonically. 

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On March 2, 2016, plaintiff filed a proof of service, indicating that Jose Toledo, “Operations 

Manager-Person authorized to accept service of process,” was personally served a copy of the 

summons and complaint at 7014 13th Avenue, Suite 202, Brooklyn, NY on December 4, 2015.3 

ECF No. 4. Defendant did not file an answer to the complaint or otherwise appear in this action. 

Plaintiff requested the clerk enter defendant’s default (ECF No. 6), which was entered on March 

7, 2016 (ECF No. 8). Plaintiff then filed the instant motion, seeking default judgment on her 

FDCPA and Rosenthal Act claims.4 ECF No. 9. 

II. Legal Standard 

 Pursuant to Federal Rule of Civil Procedure 55, default may be entered against a party 

against whom a judgment for affirmative relief is sought who fails to plead or otherwise defend 

against the action. See Fed. R. Civ. P. 55(a). However, “[a] defendant’s default does not 

automatically entitle the plaintiff to a court-ordered judgment.” PepsiCo, Inc. v. Cal. Sec. Cans, 

238 F. Supp. 2d 1172, 1174 (C.D. Cal. 2002) (citing Draper v. Coombs, 792 F.2d 915, 924-25 

(9th Cir. 1986)). Instead, the decision to grant or deny an application for default judgment lies 

within the district court’s sound discretion. Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 

1980). In making this determination, the court considers the following factors: 

 (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 the 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. 1986). “In applying this discretionary 

standard, default judgments are more often granted than denied.” Philip Morris USA, Inc. v. 

 3

 According to the New York Department of State’s website, defendant’s agent for 

service of process is United States Corporation Agents, Inc., located at 7014 13th Avenue, Suite 

202, Brooklyn, New York, 11228. 

4

 Plaintiff’s motion does not seek judgement on her invasion of privacy claim. See 

generally ECF No. 9-1. At the June 8 hearing, plaintiff’s counsel represented that he would 

voluntarily dismiss the invasion of privacy claim should the motion for default judgment be 

granted. In light of the recommendation made herein, the court also recommends that plaintiff’s 

invasion of privacy claim be dismissed without prejudice. 

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Castworld Products, Inc., 219 F.R.D. 494, 498 (C.D. Cal. 2003) (quoting PepsiCo, Inc. v. 

Triunfo-Mex, Inc., 189 F.R.D. 431, 432 (C.D. Cal. 1999)). 

 As a general rule, once default is entered, the factual allegations of the complaint are taken 

as true, except for those allegations relating to damages. TeleVideo Systems, Inc. v. Heidenthal, 

826 F.2d 915, 917-18 (9th Cir. 1987) (citations omitted). However, although well-pleaded 

allegations in the complaint are admitted by defendant’s failure to respond, “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). A party’s 

default conclusively establishes that party’s liability, although it does not establish the amount of 

damages. Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977) (stating that although 

a default established liability, it did not establish the extent of the damages). 

III. Discussion 

 A. Appropriateness of the Entry of Default Judgment Under the Eitel Factors 

 1. Factor 1: Possibility of Prejudice to Plaintiff 

 The first Eitel factor considers whether the plaintiff would suffer prejudice if default 

judgment is not entered, and such potential prejudice to the plaintiff militates in favor of granting 

a default judgment. See PepsiCo, Inc., 238 F. Supp. 2d at 1177. Here, plaintiff would potentially 

face prejudice if the court did not enter a default judgment. Absent entry of a default judgment, 

plaintiff would be unable to obtain remedies for defendant’s alleged misconduct. 

2. Factors Two and Three: The Merits of Plaintiff’s Substantive Claims and the 

Sufficient of the Complaint 

 The merits of plaintiff’s substantive claims and the sufficiency of the complaint are 

discussed together because of the relatedness of the two inquires. The court must consider 

whether the allegations in the complaint are sufficient to state a claim that supports the relief 

sought. See Danning, 572 F.2d at 1388; PepsiCo, Inc., 238 F. Supp. 2d at 1175. 

 Here, plaintiff seeks default judgment on her claims for violation of the FDCPA and 

California’s Rosenthal Act. ECF No. 9. The purpose of the FDCPA is to “eliminate abusive debt 

collection practices by debt collectors, to insure that those debt collectors who refrain from using 

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abusive debt collection practices are not competitively disadvantaged, and to promote consistent 

State action to protect consumers against debt collection abuses.” 15 U.S.C. § 1692(e). To 

recover under the FDCPA (1) the plaintiff must be a “consumer,” (2) the defendant must be a 

“debt collector,” and (3) the defendant must have committed some act or omission that violated a 

provision of the FDCPA. See 15 U.S.C. § 1692a(3)-(6); Alonso v. Blackstone Financial Group 

LLC, 962 F. Supp. 2d 1188, 1193-94 (E.D. Cal. 2013). 

 California’s Rosenthal Act incorporates by reference provisions of the FDCPA, and a 

violation of the FDCPA constitutes a violation of the Rosenthal Act. See Cal. Civ. Code 

§ 1788.17; Riggs v. Prober & Raphael, 681 F.3d 1097, 1100 (9th Cir. 2012) (“The Rosenthal Act 

mimics or incorporates by reference the FDCPA’s requirements . . . and makes available the 

FDCPA’s remedies for violations.”). 

 The complaint alleges that plaintiff is a “consumer” and defendant is a debt collector 

under the FDCPA. ECF No. 1 ¶¶ 5, 7. At an unknown time, defendant acquired information 

regarding an alleged debt that plaintiff had incurred. Id. ¶ 12. Defendant called plaintiff and her 

family members in an attempt to collect the debt, and disclosed details regarding the debt to 

members of plaintiff’s family. Id. ¶¶ 13-16. The complaint also alleges that defendant’s 

representative falsely stated that there had been “fraudulent activity” associated with plaintiff’s 

account, and that if plaintiff did not pay the amount owed defendant would file suit. Id. ¶¶ 17-21. 

 These allegations are sufficient to demonstrate violations of the FDCPA. See 15 U.S.C. 

§ 1692b(1) (prohibiting a debt collector from contacting a third-party for any purpose other than 

to confirm or correct the location of the alleged debtor); 15 U.S.C. § 1692b(2) (prohibiting 

disclosure to person other than the alleged debtor that the debtor owes any debt); 15 U.S.C. 

§ 1692e(2)(A) (prohibiting false representations about the legal status of any debt); 15 U.S.C. 

§ 1692e(10) (prohibiting the use of false representations or deceptive means to collect a debt). 

Moreover, because plaintiff states a claim for violation of the FDCPA, she also adequate alleges 

violations of California’s Rosenthal Act. See Riggs, 681 F.3d at 1100. 

 Accordingly, these factors weigh in favor of entry of default judgment. 

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 3. Factor Four: The Sum of Money at Stake in the Action 

 Under the fourth factor cited in Eitel, “the court must consider the amount of money at 

stake in relation to the seriousness of Defendant’s conduct.” PepsiCo, Inc., 238 F. Supp. 2d at 

1177; see also Philip Morris USA, Inc. v. Castworld Prods., Inc., 219 F.R.D. 494, 500 (C.D. Cal. 

2003). Plaintiff seeks $50,000 in damages. Although this is not a small amount of money, this 

amount is not enough to outweigh the other Eitel factors, which generally weigh in factor of 

default judgment. 

 4. Factor Five: The Possibility of a Dispute Concerning Material Facts 

 The court may assume the truth of well-pleaded facts in the complaint (except as to 

damages) following the clerk’s entry of default. See, e.g., Elektra Entm’t Group Inc. v. Crawford, 

226 F.R.D. 388, 393 (C.D. Cal. 2005) (“Because all allegations in a well-pleaded complaint are 

taken as true after the court clerk enters default judgment, there is no likelihood that any genuine 

issue of material fact exists.”); accord Philip Morris USA, Inc., 219 F.R.D. at 500; PepsiCo, Inc., 

238 F. Supp. 2d at 1177. Accepting as true the allegations in the complaint, which are supported 

by the evidence submitted by plaintiff, the likelihood of a dispute is minimal. Accordingly, this 

factor weighs in favor of granting plaintiff’s motion. 

 5. Factor Six: Whether the Default Was Due to Excusable Neglect 

 The record reflects that defendant’s default was not due to excusable neglect. Defendant’s 

agent for service of process was personally served with a copy of the summons and complaint. 

See ECF No. 4. Despite being properly served, defendant has failed to appear in this action. 

Accordingly, the court finds that defendant’s default is not due to excusable neglect. 

 6. Factor Seven: The Strong Policy Favoring Decisions on the Merits 

 “Cases should be decided upon their merits whenever reasonably possible.” Eitel, 782 

F.2d at 1472. However, district courts have concluded with regularity that this policy, standing 

alone, is not dispositive, especially where a defendant fails to appear or defend itself in an action. 

PepsiCo, Inc., 238 F. Supp. 2d at 1177; see also Craigslist, Inc. v. Naturemarket, Inc., 694 F. 

Supp. 2d 1039, 1061 (N.D. Cal. 2010); ACS Recovery Servs., Inc. v. Kaplan, 2010 WL 144816, 

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at *7 (N.D. Cal. Jan. 11, 2010); Hartung v. J.D. Byrider, Inc., 2009 WL 1876690, at *5 (E.D. Cal. 

June 26, 2009). Accordingly, this factor should not preclude entry of default judgment. 

 Upon weighing the factors articulated in Eitel, the court finds that plaintiff is entitled to 

default judgment on her claims under the FDCPA and Rosenthal Act. The only remaining issue 

is plaintiff’s entitlement to damages. 

 B. Damages 

 Plaintiff’s motion seeks statutory damages, actual damages, costs and attorney’s fees. 

ECF No. 9-1 at 4-6. Each request is addressed in turn. 

 1. Statutory Damages 

 Plaintiff seeks $2,000 in statutory damages for violations of the FDCPA and the Rosenthal 

Act. ECF No. 9-1 at 4. In addition to actual damages, a prevailing plaintiff may recover up 

$1,000 in statutory damages. 15 U.S.C. § 1692k(a)(2)(A). The Rosenthal Act also permits a 

successful plaintiff to recover up to $1,000 in statutory damages in addition to any actual 

damages. Cal. Civ. Code § 1788.30(b). “The Rosenthal Act’s remedies are cumulative, and 

available even when the FDCPA affords relief.” Gonzalez v. Arrow Financial Services, LLC, 660 

F.3d 1055, 1069 (9th Cir. 2011). Thus, plaintiff may recover statutory damages under both acts. 

 As indicated above, the allegations in plaintiff’s complaint, which must be taken as true, 

demonstrate several violations of the FDCPA and Rosenthal Act. Furthermore, plaintiff’s 

declaration evidences many improper communications by defendant. Plaintiff asserts that 

defendant called and left voicemails with her mother, brother, and ex-husband. ECF No. 9-3 

¶¶ 9-13. In these messages, a defendant’s representative indicated that there was “fraudulent 

activity” regarding plaintiff’s social security number and that plaintiff needed to contact 

defendant. Id. These messages also disclosed details regarding the alleged debt. Id. ¶ 10. These 

multiple calls to third-parties, which included false representations and details concerning the 

alleged debt, suggest a complete disregard of the FDCPA’s requirements. See 15 U.S.C. 

§§ 1692b(2), 1692e(2)(A), 1692e(10). Therefore, the court finds that the maximum penalty under 

the FDCPA and Rosenthal Act are appropriate. Accordingly, plaintiff is entitled to statutory 

damages in the amount of $2,000. 

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 2. Actual Damages 

 The FDCPA also entitles a prevailing plaintiff to actual damages. 15 U.S.C. 

§ 1692k(a)(1). Actual damages include damages for emotional distress caused by the defendant’s 

unlawful practices. See Baker v. G.C. Services Corp., 677 F.2d 775, 780 (9th Cir. 1982) (“The 

only actual damages that a plaintiff would be likely to incur [under the FDCPA] would be for 

emotional distress caused by abusive debt collection practices . . . .”); Johnson v. Hale, 13 F.3d 

1351, 1352 (9th Cir. 1994) (holding that emotional damages may be awarded based only on 

testimony or appropriate inference from circumstances). 

 In regards to her emotional distress, plaintiff’s declaration provides that the “phone calls 

and threats made by Defendant caused a great deal of stress and worry for me. Defendant had put 

a lot of pressure on me. All the worrying caused me anxiety and great stress. The phone calls 

and threats hung over my head and ultimately led me to pay the amount Defendant’s were [sic] 

asking for.” ECF No. 9-3 at 3. Based on this statement, plaintiff seeks $48,000 in actual 

damages. Plaintiff cites two cases to support her contention that the requested amount is 

appropriate. 

 In Nelson v. Equifax Information Services, LLC, 522 F. Supp. 2d 1222 (C.D. Cal. 2007), 

the district court found that the jury did not err in awarding $85,000 in actual damages based on 

the plaintiff’s emotional distress. In that case the plaintiff testified that as the result of the debt 

collection agency’s violations of the FDCPA, which occurred over a period of several months, 

“she feels stigmatized, has fights with her partner, difficulty sleeping, recurring fear, vomiting, 

and sick stomach.” Id. at 1235. Here, all the calls from defendant occurred on a single day and 

resulted in “anxiety and great stress.” ECF No. 9-3 at 2-3. Further, at the hearing plaintiff’s 

counsel confirmed that plaintiff’s emotional distress did not necessitate medical treatment. 

Defendant’s conduct in this case is not as egregious as the defendant’s conduct in Nelson, nor 

does plaintiff’s emotional distress rise to the same level as that experienced by the plaintiff in 

Nelson. Accordingly, Nelson does not support plaintiff’s request for $48,000 in actual damages. 

 Plaintiff also notes that “[i]n a recent case in the United States District Court for the 

Northern District of California, [Fausto v. Credigy Services Corporation, 5:07-cv-5658-JW], a 

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jury awarded $500,000 against a debt collector who called a debtor 90 times and made false 

claims. The verdict consisted of $100,000 in actual damages and $400,000 in punitive damages.” 

ECF No. 9-1 at 4. Although plaintiff cites generally to Fausto, plaintiff fails to direct the court to 

any opinion detailing the specific facts underlying the damages award. Thus, there is nothing in 

the record to compare the facts of this case to those giving rise to the award in Fausto. 

Accordingly, plaintiff has not demonstrated that the emotional distress suffered by the plaintiff in 

Fausto was similar to her distress. Furthermore, plaintiff’s evidence indicates that the defendant 

in this case made only four calls, one to plaintiff and three to third-parties. This limited evidence 

shows that the instant case is factually distinguishable from Fausto, where the defendant 

purportedly called the plaintiff 90 times. 

 The court’s independent review of cases addressing actual damages under the FDCPA 

demonstrates that plaintiff’s request for $48,000 is on the high end of the damages spectrum. See 

Hartung v. J.D. Byrider, Inc., 2009 WL 1876690, at * 10 (E.D. Cal. June 26, 2009) (finding that 

defendant’s actions were egregious but recommending that plaintiff’s request for $50,000 in 

damages be reduced to $25,000 because plaintiff was exposed to defendant’s actions for a limited 

period of time); Esget v. TCM Financial Services, LLC, 2014 WL 258837, at * 7-8 (E.D. Cal. Jan. 

23, 2014) (awarding $5,000 for emotional distress where plaintiff sustained stress-related illness 

requiring treatment by a psychiatrist and neurologist); Gervais v. O’Connell, Harris & Assoc., 

Inc., 297 F.Supp.2d 435 (D. Conn. 2003) (reducing plaintiff’s request for $4,000 in actual 

damages to $1,500 where the events in question were brief in time, defendant never threatened 

plaintiff, and plaintiff acknowledged that he did not need the care of a physician as a results of 

defendant’s conduct); Valero v. Bryant, LaFayette and Associates, LLC, 2011 WL 1438436, at *6 

(E.D. Cal Apr. 11, 2011) (awarding $5,000, instead of the requested $15,000, where plaintiff 

suffered from stress, sleeplessness, anxiety, and disruption in her personal relationship); Perkons 

v. American Acceptance, LLC., 2010 WL 4922916 (D. Ariz. Nov. 29, 2010) (awarding $5,000 in 

emotional distress damages when the plaintiff suffered stress, anxiety, sleeplessness, depression, 

and weight gain resulting in a heart condition and migraines). 

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 Given that the conduct at issue transpired on a single day and merely caused “anxiety and 

great stress,” the court finds that $6,000 is sufficient to compensate plaintiff for her emotional 

distress. 

 3. Attorney’s Fees 

 Plaintiff seeks a total of $2,855 in attorney’s fees. This figure is based on 3.3 hours of 

work by attorney Jeremy Golden at a rate of $350 per hour and 8.5 hours of work performed by 

attorney Cory Teed at $200 per hour. ECF No. 9-2 at 2. Both the FDCPA and the Rosenthal Act 

authorizes an award of attorney’s fees to a prevailing plaintiff. 15 U.S.C. § 1692k(a)(3); Cal. Civ. 

Code § 1788.30(c). The court’s local rules require a party seeking an award of attorney’s fees to 

submit an affidavit addressing certain criteria that the court will consider in determining whether 

an award of attorney’s fees is appropriate. See E.D. Cal. L. R. 293(b) and (c). The local rules 

also provide that “[w]ithin fourteen (14) days after entry of judgment or order under which costs 

may be claimed, the prevailing party may serve on all other parties and file a bill of costs 

conforming to 28 U.S.C. § 1924. E.D. Cal. L. R. 292. Pursuant to 28 U.S.C. § 1924, a party 

claiming any item of cost must submit a bill of costs and attach thereto an affidavit demonstrating 

that the “item is correct and has been necessarily incurred in the case . . . .” 

 Although plaintiff’s counsel submitted a declaration in support of the request for 

attorney’s fees, it fails to comply with the court’s local rules. Specifically, it fails to address the 

criteria set forth in Local Rule 293(c). Counsel also failed to submit an affidavit addressing all 

information required by Local Rule 292. Accordingly, plaintiff’s request for fees and costs shall 

be addressed in a motion filed in conformance with Local Rules 292 and 293 and shall contain 

information sufficient to make a lodestar calculation of a reasonable attorney fee award. 

IV. Conclusion 

 Accordingly, it is hereby RECOMMENDED that: 

 1. Plaintiff’s application for default judgment (ECF No. 9) be granted; 

 2. Plaintiff’s invasion of privacy claim be dismissed without prejudice; 

3. The court enter judgment against defendant in the amount of $8,000 in total damages; 

and 

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4. Plaintiff’s request for costs and attorney’s fees be denied without prejudice to a motion 

brought under Local Rules 292 and 293. 

These findings and recommendations are submitted to the United States District Judge 

assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(l). Within fourteen days 

after being served with these findings and recommendations, any party may file written 

objections with the court and serve a copy on all parties. Such a document should be captioned 

“Objections to Magistrate Judge’s Findings and Recommendations.” Failure to file objections 

within the specified time may waive the right to appeal the District Court’s order. Turner v. 

Duncan, 158 F.3d 449, 455 (9th Cir. 1998); Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991). 

DATED: June 9, 2016. 

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