United States District Court, D. Nevada
RICHARD F. BOULWARE, II UNITED STATES DISTRICT JUDGE
the Court is Plaintiff John Zaby's Motion for Default
Judgment against Defendant Perfection Collection, LLC (ECF
No. 16). For the reasons stated below, the Court grants the
sued Defendants on April 1, 2019, asserting causes of action
for violations of the Fair Credit Reporting Act (15 U.S.C.
§ 1681 et seq), and the Fair Debt Collection
Practices Act (15 U.S.C. §1692 et seq). ECF No.
1. Defendant Perfection Collection, LLC
(“Perfection”) was served on April 5, 2019. ECF
No. 10. On May 10, 2019, the Clerk of the Court entered
default against Perfection. ECF No. 11.
alleges as follows in his complaint and motion for default
judgment: Perfection seeks to collect a debt originally owned
by Vivint, Inc against Plaintiff. On August 9, 2018,
Plaintiff sent a dispute letter to Perfection regarding the
debt. In the dispute letter Plaintiff informed Perfection
that the debt does not belong to him, requested verification
of the debt, and demanded that Perfection cease and desist
contact. In August 2018, Plaintiff reviewed his consumer
reports and discovered that Perfection was reporting the debt
without a dispute notation. Perfection also served a
collection notice to Plaintiff on August 16, 2018 offering to
resolve the alleged debt for $2, 081 and threatened to
garnish Plaintiff's wages despite not having a judgment
for the debt. Plaintiff now alleges violations of section
1681s-2(b) of the FCRA, and of various provisions of section
1692 of the FDCPA.
granting of a default judgment is a two-step process directed
by Federal Rule of Civil Procedure (“Rule”) 55.
Eitel v. McCool, 782 F.2d 1470, 1471 (9th Cir.
1986). The first step is an entry of clerk's default
based on a showing, by affidavit or otherwise, that the party
against whom the judgment is sought “has failed to
plead or otherwise defend.” Fed.R.Civ.P. 55(a). The
second step is default judgment under Rule 55(b), a decision
which lies within the discretion of the Court. Aldabe v.
Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980).
which a court, in its discretion, may consider in deciding
whether to grant a default judgment include: (1) the
possibility of prejudice to the plaintiff, (2) the merits of
the substantive claims, (3) the sufficiency of the complaint,
(4) the amount of money at stake, (5) the possibility of a
dispute of material fact, (6) whether the default was due to
excusable neglect, and (7) the Federal Rules' strong
policy in favor of deciding cases on the merits.
Eitel, 782 F.2d at 1471-72.
entry of default is made, the Court accepts all well-pleaded
factual allegations in the complaint as true; however,
conclusions of law and allegations of fact that are not
well-pleaded will not be deemed admitted by the defaulted
party. DirecTV, Inc. v. Hoa Huynh, 503 F.3d 847, 854
(9th Cir. 2007). Additionally, the Court does not accept
factual allegations relating to the amount of damages as
true. Geddes v. United Financial Group, 559 F.2d
557, 560 (9th Cir. 1977). Default establishes a party's
liability, but not the amount of damages claimed in the
Court finds that the Eitel factors warrant the
granting of default judgment. Plaintiff will be prejudiced
because he continues to suffer from a loan denial due to the
inaccurate tradeline remaining on his credit reports. The
Court also finds that Plaintiff's substantive claims have
merit. The Court assumes as it must that Plaintiff's
well-pleaded factual allegations are true. These allegations
include that Perfection threatened garnishment of
Plaintiff's wages despite not having a judgment on which
it could collect, continued to contact Plaintiff despite his
written instructions to cease collection efforts, and
reported the debt as not disputed to consumer reporting
agencies. The Court finds that such conduct violates §
1681s-2 of the FCRA, which proscribes a furnisher from
reporting inaccurate information to credit reporting
agencies. 15 U.S.C. § 1681s-2. Such behavior also
violates 15 U.S.C. §1692e(8) and § 1692e(10), which
proscribe debt collectors from communicating credit
information that they know to be false, including the failure
to communicate that a debt is disputed, and using false
representations or deceptive means to collect or attempt to
collect a debt. 15 U.S.C. §§ 1692e(8), 1692e(10).
Finally, such conduct could also constitute unfair or
unconscionable means of collecting a debt in violation of 15
U.S.C. §1692f. 15 U.S.C. § 1692f (proscribing debt
collectors from using unfair or unconscionable means to
collect or attempt to collect any debt). The Court finds that
the complaint is factually sufficient. The Court also finds
it unlikely that there will be a dispute as to material
facts, and no facts or evidence is presented before the Court
to suggest that Perfection's default was due to excusable
the FCRA and the FDCPA allow for damages and attorneys'
fees for statutory violations. 15 U.S.C. § 1681n
(providing for maximum statutory damages of $1000 and
attorneys' fees for willful noncompliance of the FCRA);
15 U.S.C. § 1681o (providing for actual damages and
attorneys' fees for negligent noncompliance of the
FCRA);15 U.S.C. § 1692k (allowing for ...