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Brownstejn v. Shelton

United States District Court, D. Connecticut

September 17, 2016

RONNIE BROWNSTEJN, Plaintiff,
v.
ADAM J. SHELTON, EQUITY RECOVERY SERVICE, LLC, and NEW ENGLAND ADJUSTMENT SERVICES INC., Defendants.

          OPINION AND ORDER (DOCS. 26, 35, 44, 68, 96, 108, 114, 116, 118)

          Geoffrey W. Crawford, Judge.

         This is an action by a judgment debtor against a debt buyer, its debt collection company, audits attorney raising claims of violations of state and federal consumer protection laws and claims of unjust enrichment and conversion under state law. The court has subject matter jurisdiction through Plaintiffs claim under the federal Fair Debt Collection Practices Act, 15U.S.C. § 1692 et seq.

         Facts

         The basic facts of the case are not in dispute. All facts appear in court filings, docket statements, demand letters from collection counsel, and account records. The authenticity of some records is disputed, but this does not impact resolution of the pending motions.

         In May 1996 Plaintiff Ronnie Brownstein entered into a VISA revolving credit agreement with Capital One Bank for a credit card with a $200 limit. (Doc. 68-4 at 8.) She soon maxed out the credit card. (Doc. 68-6 at 9.) By June 1997 she was behind in payments with 19% interest and $40 in past-due and over limit fees accruing monthly. Capital One Bank sent her a final statement in December 1997, showing a balance of $504.12. (Doc. 68-6 at 14.)

         Three years later, in June 2000, Capital One sold Plaintiffs account as part of a block of delinquent accounts to Collins Financial Services, Inc. ("Collins"). (Doc. 68-6 at 48.) In November 2000, Collins assigned Plaintiffs account to Equity Recovery Service, LLC ("Equity"). (Id. at 50.) Documents listed the balance due at the time of both sales as $544.12. (Plaintiff disputes the admissibility of these documents. (Doc. 76-1 at 2-3.))

         Adam Shelton, Equity's attorney, filed a collections action in Connecticut small claims court in July 2002. (Doc. 68-6 at 2.) Plaintiff filed an answer with the court in which she stated that she expected the credit protection clause in her VISA agreement to have covered her missed payments during a period of unemployment which resulted in the arrears.

         The statement of account filed by Shelton with the small claims court sought damages in the amount of the jurisdictional limit of $3, 500. (Doc. 68-6 at 4-5.) To the original principal balance of $504.12, Defendants added interest ($726.92), past-due fees ($1, 080), and over limit fees ($1, 080) that had accrued from December 1997 to June 2002, along with attorney's fees ($508.66). Defendants waived any claim in excess of $3, 500. (Doc. 68-3 at ¶ 9.)

         The small claims court issued a default judgment on September 18, 2002 in the amount of $3, 535 (including the filing fee of $35.00). The judgment includes an order for weekly payments of $35.00 commencing October 3, 2002. (Doc. 68-6 at 54.)

         The history of payments by Plaintiff appears in a statement maintained by Shelton's office. (Doc. 68-6 at 57-58.) It shows the original judgment amount of $3, 500, plus the filing fee, for an opening balance of $3, 535. In November 2003, Shelton added service costs ($80.01), which brought the balance to $3, 946.41.

         Commencing in December 2003, Plaintiff made monthly payments to Shelton. These started at $50.00, increased over time to $200, and included three payments of $250. By October 2012, Plaintiff had paid a total of $5, 350 which Shelton attributed to costs ($150.01), principal ($3, 145.97), and interest ($2, 054.02).

         On April 3, 2013, Shelton sent Plaintiff a collection letter stating: "YOU HAVE VIOLATED A COURT ORDER TO MAKE PAYMENTS." (Doc. 68-6 at 60.) The letter stated that Plaintiff owed a balance of $366.97, "including the remaining judgment principal, court costs, and interest that is accruing thereon at 8% per year in accordance with Connecticut General Statute §37-1." (Id.)

         Plaintiff filed suit on April 10, 2013.

         I. Defendants' Motion to Dismiss (Docs. 26, 35)

         Shelton has filed a motion to dismiss the state-law claim that he violated the Connecticut Unfair Trade Practices Act ("CUTPA"), Conn. Gen. Stat. § 42-110a et seq. He contends that as it applies to attorneys, CUTPA claims are limited to billing disputes and other disputes arising from the business end of a law practice, hi contrast to the FDCPA, CUTPA does not apply to ...


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