Court Opinion

ID: 4572138
Source: CourtListenerOpinion
Date Created: 2020-10-01 20:00:49.75216+00
Date Added: 2024-06-11T08:47:07.565390
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        OCT 1 2020
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                             FOR THE NINTH CIRCUIT

JOSEPH FANGSRUD VON ESCH;                       No.    19-35825
RENNY FANGSRUD VON ESCH,
                                                D.C. No. 3:16-cv-05842-RBL
                Plaintiffs-Appellants,

 v.                                             MEMORANDUM*

ASSET SYSTEMS, INC., DBA Asset
Systems, pursuant to Washington UBI No.
601474356, an Oregon corporation,

                Defendant-Appellee,

and

LEGACY SALMON CREEK HOSPITAL,
a Washington company,

                Defendant.

                   Appeal from the United States District Court
                     for the Western District of Washington
                   Ronald B. Leighton, District Judge, Presiding

                       Argued and Submitted June 22, 2020
                              Seattle, Washington

Before: McKEOWN, W. FLETCHER, and GOULD, Circuit Judges.

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      In July 2013, Joseph and Renny Fangsrud von Esch (“Appellants”) had their

baby at Legacy Salmon Creek Hospital. After receiving payment from Appellants’

insurer, Kaiser, Legacy submitted a medical bill to Appellants erroneously

charging them $5,000 more than they owed. The billing error arose because of

how Legacy and Kaiser handled billing and payments, resulting in “out-of-balance

remittances.” Appellants’ account was sent to Asset for collections, where it

accrued interest at the 12% statutory rate. Appellants received an explanation of

benefits from Kaiser, dated December 16, 2013, which was not provided to Asset

until July 28, 2016. Legacy ultimately determined that Appellants’ bill was sent in

error, refunded the amount Appellants had paid and wrote off the $400 copayment.

      Appellants brought claims against Legacy and Asset for violations of the

Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. (“FDCPA”) and

Washington’s Consumer Protection Act, RCW 19.86 et seq. (“WCPA”). In a prior

appeal, we affirmed the district court’s grant of summary judgment in favor of

Legacy but we reversed the district court’s grant of summary judgment in favor of

Asset. On remand, the district court denied Appellants’ motion for partial

summary judgment as to Asset’s FDCPA liability and held a three-day jury trial.

Before closing arguments, the district court granted judgment as a matter of law for

Asset. Appellants appeal the district court’s dismissal of their claims against Asset

under the FDCPA and the WCPA, and the denial of their motion for partial

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summary judgment on the FDCPA claims. We review the district court’s decisions

de novo. Balvage v. Ryderwood Improvement and Serv. Ass’n, Inc., 642 F.3d 765,

775 (9th Cir. 2011) (de novo standard applies on partial summary judgment);

Spencer v. Peters, 857 F.3d 789, 797 (9th Cir. 2017) (de novo standard applies on

judgment as a matter of law). We affirm.

      Appellants first argue that they are entitled to partial summary judgment on

the FDCPA claim. Summary judgment is not proper if, viewing the evidence in

the light most favorable to the non-moving party, material factual issues exist for

trial. Simo v. Union of Needletrades, Indus. & Textile Emps., 322 F.3d 602, 609–

10 (9th Cir. 2003). Appellants rely on our prior memorandum disposition in this

case to argue that we had already decided—and cannot reconsider—whether Asset

proved its bona fide error defense. We disagree. At that time, we held that “[o]ne

could reasonably determine that Asset violated 15 U.S.C. § 1692e,” but not that

one must do that or that genuine disputes of material fact did not exist (emphasis

added). The district court did not err in finding a triable issue as to whether the

procedures Asset maintained were reasonable.

      Appellants next argue that the district court erred in granting judgment as a

matter of law and dismissing their FDCPA and WCPA claims. To grant a motion

for judgment as a matter of law, the court must find “that a reasonable jury would

not have a legally sufficient evidentiary basis to find for the party on that issue.”

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Fed. R. Civ. P. 50(a). In so doing, the court must view the evidence in the light

most favorable to the non-moving party and draw all reasonable inferences in that

party’s favor. Torres v. City of L.A., 548 F.3d 1197, 1205–06 (9th Cir. 2008).

      Under the FDCPA, “a debt collector may not be held liable . . . if the debt

collector shows by a preponderance of the evidence that the violation was not

intentional and resulted from a bona fide error notwithstanding the maintenance of

procedures reasonably adapted to avoid any such error.” 15 U.S.C. § 1692k(c). In

the prior appeal, we held that Asset could not establish the bona fide error defense

as a matter of law on the then-current record. But after reviewing the

supplemented trial record, we hold that Asset presented sufficient evidence—

which remains unrebutted—to prove its procedures were “reasonably adapted” to

avoid demanding the wrong principal sum. See McCollough v. Johnson,

Rodenburg & Lauinger, LLC, 637 F.3d 939, 948 (9th Cir. 2011).

      To succeed under the WCPA, as a matter of applicable state law, Appellants

must have shown that Asset committed an unfair or deceptive act or practice and

that Appellants suffered an injury caused by that act or practice, among other

elements. See RCW 19.86.090; Hangman Ridge Training Stables, Inc. v. Safeco

Title Ins. Co., 719 P.2d 531, 533 (Wash. 1986) (en banc). On the trial record, the

district court properly found as a matter of law that Asset did not: (1) represent or

imply to Appellants that their existing obligation had been increased by improper

                                          4
fees, (2) threaten legal action, or (3) impermissibly collect or attempt to collect a

balance in excess of the principal amount in violation of the WCPA. See RCW

19.16.250(15), (16), (21).

      AFFIRMED.

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