Court Opinion

ID: 2731296
Source: CourtListenerOpinion
Date Created: 2014-09-09 19:00:34.196956+00
Date Added: 2024-06-11T10:01:20.036243
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                              No. 13-2113

JANET BEASLEY; GORDON BEASLEY,

                Plaintiffs - Appellants,

          v.

RED ROCK FINANCIAL SERVICES, LLC,

                Defendant - Appellee.

Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria.        Anthony J. Trenga,
District Judge. (1:12-cv-01312-AJT-TRJ; 1:13-cv-00206-AJT-TRJ)

Submitted:   July 18, 2014                Decided:     September 9, 2014

Before MOTZ and    WYNN,     Circuit   Judges,   and   HAMILTON,   Senior
Circuit Judge.

Affirmed by unpublished per curiam opinion.

Ernest P. Francis, ERNEST P. FRANCIS, LTD., Arlington, Virginia,
for Appellants. Virginia M. Sadler, JORDAN COYNE LLP, Fairfax,
Virginia, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

      In this case under the Fair Debt Collections Practices Act

(the FDCPA), 15 U.S.C. §§ 1692-1692p, the plaintiffs-appellants

raise numerous allegations of error that they contend should be

resolved in their favor.            Having carefully reviewed the briefs,

the   record,     and    the    relevant    law,       we    conclude    that    each    is

without merit.      Accordingly, we affirm.

                                           I.

      At   all    times    relevant    to       this    case,    husband       and   wife,

Gordon and Janet Beasley (the Beasleys), owned a home in the

Princeton     Woods      Addition    neighborhood,            located    in     Dumfries,

Virginia.        The home is subject to a declaration of covenants,

conditions, and restrictions administered by the Princeton Woods

Addition Homeowners Association, Inc. (the HOA).                              In October

2008, the HOA, through its collection agent Reese Broome, PC,

notified the Beasleys by letter that they owed the HOA a total

of $685.00 in unpaid assessments, late fees, and legal fees.

Additionally,       the    letter     stated         that     unless     the    Beasleys

disputed the debt or made payment in full within thirty days

after   receipt     of    the    letter,       the     HOA    would     accelerate      the

Beasleys’ account through the end of the year and record a lien

on their home.          The Beasleys periodically continued to receive

similar letters from Reese Broome, PC, on behalf of the HOA,

                                           2
with the last letter from Reese Broome, PC, dated March 17,

2011.

        The Beasleys claim they brought their HOA account current

in 2008 and dispute any and all alleged delinquencies in their

HOA account after that time.                      In 2009, the HOA revoked the

Beasleys’ HOA privileges, such as use of the neighborhood pool,

for failure to keep their HOA account current.

      In January 2012, the HOA switched collection agents from

Reese    Broome,     PC,     to    Red    Rock     Financial       Services,       LLC    (Red

Rock).     Red Rock’s first letter to the Beasleys on behalf of the

HOA is dated January 23, 2012, stating the Beasleys’ current HOA

account balance as $1,373.36.                     The letter also stated that if

the   Beasleys      chose    not     to     pay    their    account       in     full   within

thirty days from the date of the letter, “the [HOA] will refer

the matter to counsel for appropriate legal action, including

filing a Memorandum of Assessment Lien on behalf of [the HOA] in

the     Prince     William        Circuit     Clerk’s       Office    without           further

notice.”      (J.A. 445).           In a letter dated March 12, 2012, from

Red   Rock    to    the     Beasleys’       attorney,        Red   Rock        reported    the

Beasleys’ HOA account balance as $1,458.90.

        On May, 25, 2012, the HOA filed a “Memorandum of Assessment

Lien”    in   Prince       William        County,    Virginia        on    the     Beasleys’

Princeton     Woods    home,       asserting       the     Beasleys       owed    the    HOA   a

total of $1,902.82, consisting of $307.36 in unpaid assessments,

                                              3
$23.46 in late fees and interest, and $1,572.00 in “Collection

and Attorney Fees and Costs.”                      (J.A. 459).          Of relevance in the

present      appeal,       in    a    letter        dated    May    30,    2012,    Red     Rock

informed Janet Beasley that “Red Rock Financial Services may

proceed with foreclosure no sooner than the 61st day from the

mailing of the Memorandum of Assessment Lien if [the] debt is

not satisfied.”            (J.A. 450).             Red Rock contemporaneously sent a

separate, but identical letter to Gordon Beasley.

      The Beasleys subsequently brought the present action solely

against      Red    Rock,       alleging      Red       Rock’s     collection      efforts    on

behalf of the HOA violated numerous provisions of the FDCPA. 1

The   Beasleys       sought       a    total       of   $98,000.00        in   damages,     plus

reasonable         attorney’s         fees,    prejudgment         interest,     and   costs.

Following discovery, Red Rock stipulated to violating the FDCPA

in an unspecified manner and to the Beasleys’ entitlement to

$1,000.00 each in statutory damages.                             Shortly thereafter, the

case went to trial, with the district court granting judgment as

a   matter    of     law    in    favor       of    Red     Rock   at    the   close   of    all

evidence on ten out of the eleven counts alleged.                               According to

the district court, the Beasleys had either failed to produce

      1
        The Beasleys actually filed separate, but identical
complaints, which were consolidated for discovery and trial
purposes. For ease of understanding, we treat them as being in
one action in this opinion.

                                                   4
sufficient evidence of any FDCPA violation in counts I through X

or   had   failed    to   produce   sufficient     evidence    that    they   had

suffered    any     actual   damages    as   a   result   of   any    violations

claimed in those counts.

      In the lone remaining count, the Beasleys alleged that each

of them was entitled to recover for actual damages which each of

them had sustained as a result of Red Rock violating 15 U.S.C.

§ 1692e(5), which statutory section provides:

      [a] debt collector may not use any false, deceptive or
      misleading representation or means in connection with
      the collection of any debt.       Without limiting the
      general application of the foregoing, the following
      conduct is a violation of this section:

                                    *   *    *

      (5) The threat to take any action that cannot legally
      be taken or that is not intended to be taken.

15 U.S.C. § 1692e(5).        The district court instructed the jury as

follows with respect to the Beasleys’ legal theory regarding

this claim:

      The Plaintiffs claim that Defendant violated this
      section of the Act when it stated in its letter dated
      May 30, 2012, . . . that “Red Rock Financial may
      proceed with foreclosure no sooner than the 61st day
      from the mailing of the Memorandum of Assessment Lien
      if debt is not satisfied.”    The basis for this claim
      is that the Memorandum of Lien did not comply with all
      the legal requirements necessary to perfect and
      enforce a lien and for that reason there was not filed
      a valid lien.   The defendant denies that it violated
      this particular section of the Act.

           In order to recover on his or her claim, each
      plaintiff must prove the following:

                                        5
             (1) that the defendant violated this section of
             the Act;

             (2) that he or she sustained actual damages as a
             result of defendant’s violation of this section
             of the Act; and

             (3) the amount of damage he or she sustained as a
             result of defendant’s violation of the Act.

(J.A. 569-70).         Additionally, the district court instructed the

jury that none of the following conduct, by itself, violated the

FDCPA:       (1)     the   fact    that     Red         Rock    sent   the   Beasleys      the

collections letters dated January 23, 2012, and March 12, 2012;

(2) the fact that Red Rock attempted to collect a disputed debt;

and    (3)     the    filing       itself          of    the     Memorandum      of    Lien.

Accordingly, the district court instructed the jury that the

Beasleys     are     not    entitled      to       recover      damages      based    on   any

emotional distress or other injuries caused by such conduct.

       In a verdict form containing special interrogatories, the

jury   found       that    the    Beasleys         had    not    sustained     any    actual

damages as a result of Red Rock’s violation of the FDCPA over

and above the statutory damages to which Red Rock had already

stipulated.        The district court entered judgment in favor of the

Beasleys in the amount of $1,000.00 each in statutory damages,

pursuant to 15 U.S.C. § 1692k(a)(2)(A), and otherwise in favor

of Red Rock as to all eleven counts.                       The Beasleys subsequently

filed a motion, pursuant to 15 U.S.C. § 1692k(a)(3), requesting

a total of $52,120.00 in attorney’s fees and $220.00 in costs.

                                               6
After considering the motion, the district court awarded the

Beasleys a total of $5,000.00 in attorney’s fees and $252.00 as

taxable      costs,   representing     the     fees   of    the   Clerk     of   Court.

This    timely    appeal     followed     in    which       the   Beasleys       allege

numerous errors by the district court below.                      We have reviewed

them all and find all to be without merit.                    Several are worthy

of our expressly addressing.

                                        II.

       The    Beasleys   first      contend    the    district      court    erred      by

granting Red Rock’s motion for judgment as a matter of law with

respect to Counts III, IV, V, and VII, all of which allege Red

Rock violated 15 U.S.C. § 1692e(2) by making false statements as

to the amount of debt the Beasleys owed the HOA.                            Count III

pertained to the January 23, 2012 letter, Count IV pertained to

the March 12, 2012 letter, Count V pertained to the May 30, 2012

letter, and Count VII pertained to the May 25, 2012 Memorandum

of Lien.

       We review the district court’s grant of Red Rock’s motion

for judgment as a matter of law de novo.                    Anderson v. Russell,

247 F.3d 125, 125 (4th Cir. 2001).               Judgment as a matter of law

is appropriate on a claim “[i]f a party has been fully heard on

an   issue     during    a   jury    trial    and     the   court    finds       that    a

reasonable jury would not have a legally sufficient evidentiary

                                         7
basis to find for the party on that issue[.]”                            Fed. R. Civ. P.

50(a)(1).             Having reviewed the record, the relevant law, and

the parties’ briefs, we hold the district court did not err in

granting Red Rock’s motion for judgment as a matter of law with

respect to Counts III, IV, V, and VII.                         The crux of the matter

is   that    the      Beasleys    failed    to      present      sufficient            evidence,

viewed      in   the    light     most   favorable        to    them,       to    remove       the

existence        of     damages     proximately           caused    by           the     alleged

violations         at    issue     beyond          the    realm     of       impermissible

speculation and conjecture.                 Myrick v. Prime Ins. Syndicate,

Inc., 395 F.3d 485, 489 (4th Cir. 2005) (“[I]f the verdict in

favor of the non-moving party would necessarily be based upon

speculation and conjecture, judgment as a matter of law must be

entered.”).           The evidence presented at trial established that,

since October 2008, the Beasleys had suffered extreme emotional

distress because of (1) the HOA’s repeated claims that their HOA

account was delinquent; (2) the steady efforts by Reese Broome,

PC to collect on such alleged delinquencies; and (3) the filing

of the Memorandum of Lien on their home.                         The Beasleys offered

insufficient          evidence    for    the       jury   to    find     what,         if   any,

additional         emotional       distress         the     Beasleys         suffered           as

proximately        caused   by    Red    Rock’s      violations        of    the       FDCPA    as

alleged in Counts III, IV, V, and VII, i.e., by allegedly making

                                               8
false statements as to the amount of debt the Beasleys owed the

HOA.

                                             III.

       Next, the Beasleys contend that Red Rock’s stipulation that

it   violated       the    FDCPA     precluded         Red     Rock    from    disputing      all

allegations         in     the     complaint          pertaining       to     liability,      and

therefore,      the       district        court       erred    in     admitting,       over   its

objections      at         trial,     evidence           regarding          their      allegedly

delinquent      HOA        account.          Such       evidence        consisted       of    the

testimony      of        Cynthia    Weiss,        the       person     in     charge    of    the

Beasleys’ HOA account at the management company the HOA employed

to maintain its books, and such management company’s “resident

transaction report,” (J.A. 352), pertaining to the Beasleys.

       We review the “trial court’s rulings on the admissibility

of evidence for abuse of discretion, and we will only overturn

an evidentiary ruling that is arbitrary and irrational.                                 To that

end, we look at the evidence in a light most favorable to its

proponent,      maximizing          its    probative          value    and    minimizing      its

prejudicial effect.”               United States v. Cole, 631 F.3d 146, 153

(4th Cir. 2011) (internal quotation marks and citation omitted).

       Here,    the        district       court       did     not     act     arbitrarily      or

irrationally in admitting the challenged evidence.                                  Regardless

of     Red   Rock’s        stipulation        to       violating        the    FDCPA     in    an

                                                  9
unspecified manner, the challenged evidence was probative on the

issue of damages.      Specifically, the challenged evidence was

probative to dispute testimony by the Beasleys to the effect

that they were shocked and in disbelief that Red Rock would send

them letters seeking to collect on the debt the HOA claimed the

Beasleys owed.

     The Beasleys also specifically challenge on hearsay grounds

the district court’s admission of their “resident transaction

report,” (J.A. 352), listing all the assessments, late fees, and

payments associated with the Beasleys’ HOA account.           Below, the

Beasleys specifically objected to admission of this document,

identified as Defendant’s Exhibit 1, as inadmissible hearsay.

Fed. R. Evid. 802.     We review the district court’s admission of

this report for abuse of discretion.        Cole, 631 F.3d at 153.

     The    district   court   did    not   abuse   its   discretion   in

admitting   the   challenged   resident     transaction   report   because

such document was admissible for the purpose of proving the HOA

had a long running dispute with the Beasleys over their HOA

account, which is not for the purpose of proving the truth of

the matter asserted, e.g., not for the purpose of proving the

Beasleys owed the HOA the amounts listed as delinquent in the

resident transaction report.         Because the report was admissible

for a purpose other than the truth of the matter asserted, it

falls outside the definition of hearsay set forth in Federal

                                     10
Rule of Evidence 801(c).               The fact that the Beasleys had a long

running     dispute      with    the       HOA        over   varying        amounts         the   HOA

claimed     the    Beasleys      owed       on    their      HOA    account         (since       2008)

undercut the magnitude of the emotional distress the Beasleys

claimed     they     suffered         as    proximately            caused      by     Red    Rock’s

statement in its letter dated May 30, 2012, that it “may proceed

with foreclosure no sooner than the 61st day from the mailing of

the   Memorandum         of    Assessment             Lien    if     [the]       debt       is    not

satisfied.” (J.A. 450).

                                                 IV.

      The    Beasleys         also    challenge         as    inadequate            the    district

court’s     $5,000.00         award    of       attorney’s         fees     in      their    favor.

Their challenge is without merit.

      “[I]n    the    case      of    any    successful         action         to     enforce      the

[FDCPA],”     the    FDCPA      authorizes             district      courts         to    award    “a

reasonable        attorney’s     fee       as     determined        by    the       court.”         15

U.S.C. § 1692k(a)(3).                Under the applicable abuse of discretion

standard,     we     have     the     duty       to    affirm       the     district        court’s

$5,000.00 attorney’s fees award if such award “falls within the

district      court’s       broad      discretion.”             Carroll          v.      Wolpoff    &

Abramson, 53 F.3d 626, 628 (4th Cir. 1995) (internal quotation

marks omitted).          Here, the district court undertook a thorough

analysis     of    the   record        and       applicable        law    in     calculating        a

                                                 11
reasonable attorney’s fees award in the present case, setting

forth such analysis in a lengthy written order.              To summarize,

the district court awarded the Beasleys far less in attorney’s

fees than they had sought because “[t]heir recovery was limited

to the amount of statutory damages that [Red Rock] had offered

shortly after suit was filed, and no reasonable assessment of

the case justified the expense to pursue actual damages.”               (J.A.

727).       Given that the degree of success obtained is the most

critical      factor   in    determining     the   reasonableness      of   an

attorney’s fees award, Carroll, 53 F.3d at 630, the Beasleys

have offered no persuasive argument on appeal which convinces us

that the district court abused its discretion in limiting the

Beasleys’ attorney’s fees award to $5,000.00.

                                       V.

     For     the   reasons   stated,    we   affirm   the   judgment    below

entered upon the jury’s verdict and affirm the judgment below

awarding the Beasleys $5,000.00 in attorney’s fees and costs of

252.00. 2

     2
       We have also reviewed and find to be without merit the
Beasleys’ remaining assignments of reversible error pertaining
to the district court’s jury instructions regarding Red Rock’s
right to foreclose on the lien at issue and the bonafide error
defense as well as the district court’s refusal to instruct the
jury that it could award prejudgment interest on all of the
Beasleys’ damages.

                                       12
     We dispense with oral argument because the facts and legal

contentions are adequately presented in the materials before the

court and argument would not aid the decisional process.

                                                           AFFIRMED

                               13