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Millard v. Northland Group, Inc.

United States District Court, District of Nevada

November 17, 2014

LINDA MILLARD, Plaintiff,
v.
NORTHLAND GROUP, INC., Defendant.

ORDER DENYING MOTION FOR ATTORNEY FEES

JENNIFER A. DORSEY, UNITED STATES DISTRICT JUDGE

Plaintiff Linda Millard alleges that defendant Northland Group, Inc., engaged in harassing and abusive practices in violation of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et. seq., by attempting to collect a debt from her after her husband filed for bankruptcy and received a discharge of the debt. Doc. 1 at ¶ 8–14. Millard also alleges that Northland’s attempts to collect the debt invaded her privacy. Id. at ¶ 31–38. On May 27, 2014, the court dismissed Millard’s complaint for failure to state a claim and granted leave to amend by June 11, 2014. Millard did not amend, and Northland moved to dismiss. Doc. 24. On July 8, 2014, Millard filed a notice of voluntary dismissal with prejudice under Fed.R.Civ.P. 41. Doc. 25.

Northland now moves for attorney fees under 15 U.S.C. § 1692k(a)(3), which permits the award of fees and costs against a plaintiff who has brought an FDCPA action “in bad faith and for the purpose of harassment.” Doc. 26. Finding that Northland has not demonstrated Millard’s action was brought in bad faith and for the purpose of harassment, I deny Northland’s motion.

Legal Standard

Section 1692k(a)(3) of the FDCPA provides that “[o]n a finding by the court that an action under this section was brought in bad faith and for the purpose of harassment, the court may award to the defendant attorney’s fees reasonable in relation to the work expended and costs.”[1] It is therefore the defendant’s burden to establish, through something more than “conclusory assertions, ” that the plaintiff brought her FDCPA action both in bad faith and for the purpose of harassment.[2]Section 1692k(a)(3) does not permit the award of attorney fees against a plaintiff’s attorneys; rather, it “authorizes attorney’s fees and costs only against the offending plaintiff or plaintiffs.”[3] Therefore, “there must be evidence that [the plaintiff] both knew that [his or her] claim was meritless and pursued it with the purpose of harassing the defendant.”[4]

Discussion

A. Northland Has Not Made a Sufficient Showing of Bad Faith

To establish that Millard brought her action in bad faith, Northland essentially asserts that: (1) the complaint did not state a valid cause of action under the FDCPA; (2) Millard requested leave to amend and then failed to amend her complaint before the deadline set by the court; and (3) Millard voluntarily dismissed her complaint, which “reflects that [she] knew that there was no legal basis to file” it.[5] Without citing any legal authority, Northland relies on these assertions alone to support its conclusion that Millard acted in bad faith and for the purpose of harassment.[6]

Northland falls short of carrying its burden. That a claim is “meritless and properly dismissed on the pleadings" does not necessarily mean it was argued in bad faith.[7] Northland must offer evidence that Millard herself knew her claims lacked merit and pursued them anyway. With respect to Millard's knowledge, Northland asserts only that her choice to voluntarily dismiss the case indicates she knew she lacked a legal basis to file her complaint. But, a voluntary dismissal, which saves the parties and the court considerable time and expense, is generally not evidence of bad faith. On the contrary, when a plaintiff discovers in the early stages of litigation that her complaint lacks merit, a "subsequent voluntary dismissal is indicative of. . . good faith."[8]Accordingly, Northland has not offered evidence sufficient to support a finding of bad faith.

B. Northland Has Not Made a Sufficient Showing of Harassment

Even assuming that Northland had established that Millard acted in bad faith, its motion is devoid of any facts that might permit the court to infer a purpose of harassment.[9] A defendant's "conclusory assertion that [p]laintiff s purpose was to harass does not entitle it to attorney's fees under the Federal Debt Collection Practices Act."[10] Therefore, I find that Northland has not satisfied its burden of establishing that Millard brought her FDCPA action for the purpose of harassment.

Conclusion

Accordingly, and based on the foregoing reasons, IT IS HEREBY ORDERED that Northland's Motion for Attorney Fees [Doc. 26] is DENIED.


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