United States v. Flynn

          RULING GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT

          JANET BOND ARTERTON, U.S.D.J.

         Plaintiff United States of America moves for summary judgment against Defendant Suzanne Flynn, arguing that Defendant has "failed to assert any viable defenses to the United States' claims or present any genuine issue of material fact." (PL's Mot. for Summ. J. [Doc. # 8] at 1.) For the reasons that follow, Plaintiffs motion is granted.

         I. Background

         Plaintiff alleges that "the Defendant is indebted to the Plaintiff for a combined principal amount of $58,438.11, plus combined interest of $10,834.40, plus additional interest thereafter. (Compl. [Doc. # 1] H 3-4.) Plaintiff alleges that "[d]emand has been made upon the Defendant by the Plaintiff for the sum due, but the amount due remains unpaid." (Id. at p. 2.) Plaintiff therefore seeks "judgment against the Defendant for the combined total of $69,272.51, plus costs, plus interest that accrues from January 8, 2018 to the date of judgment." (Id.) Plaintiff attached to its Complaint two Certificates of Indebtedness which state that Defendant executed several promissory notes to secure loans from the U.S. Department of Education in 1996, 1997, and 1998. (Exs. A and B to Compl. [Doc. ##1-1, 1-2].)

         Defendant contends^[1] that she "submitted timely loan payments to the [Department of Education] each and every month for a period often (10) consecutive years, commencing in February, 2000, and ending in April, 2010, at which time, Defendant fell on extreme hardship." (Def.'s Opp. at 1-2.) She alleges that the "total payments made by Defendant at the time payments ceased amounted to $73,745.26." (Id. at 2.) The Borrower History and Activity Report attached by Defendant to her opposition shows payments of varying amounts, beginning in February 2000 and ending in April 2010, and ultimately lists "$73,745.26" under the column "TOT PAID." (Ex. A to Def.'s Opp. (Borrower History and Activity Report.) [Doc. # 9] at 2.) Defendant contends that this payment history "directly contradicts" the Plaintiffs claim, via the Certificates of Indebtedness, that Defendant defaulted on December 1, 2012. (Def.'s Opp. at 2.)

         In her Answer, Defendant, who is proceeding pro se in this matter, represented that she "presently lacks sufficient knowledge or information to determine the truth of the allegations" in paragraphs 3 and 4 of the Complaint. (Answer [Doc. # 7] at f¶ 3-4.) She further asserted several affirmative defenses, including "laches"; "prevention, frustration, and impossibility of performance"; "contrary to public policy"; "failure to act in a commercially reasonable manner"; and "unenforceability of the Promissory notes submitted to Defendant by the U.S. Department of Education." (Id. at ¶J 6-10.)

         Plaintiff thereafter moved for summary judgment, arguing that Defendant has "failed to assert any viable defenses to the United States' claims or present any genuine issue of material fact." (PL's Mot. for Summ. J. at 1.) Defendant opposed that motion, (Def.'s Mem. Opp. Mot. for Summ. J. [Doc. # 9]), the Plaintiff replied, (PL's Reply [Doc. # 10), and Defendant was granted leave to file a sur-reply but did not do so, (Order Granting Def.'s Mot. for Leave to File Sur-Reply [Doc. # 12]).

         II. Discussion

         Summary judgment is appropriate where, "resolv[ing] all ambiguities and draw[ing] all permissible factual inferences in favor of the party against whom summary judgment is sought," Holcomb v. lona Coll., 521 F.3d 130,137 (2d Cir. 2008), "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law," Fed. R. Civ. P. 56(a). "A dispute regarding a material fact is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Williams v. Utica Coll. of Syracuse Univ., 453 F.3d 112, 116 (2d Cir. 2006) (quotation marks omitted). "The substantive law governing the case will identify those facts that are material, and '[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.'" Bouboulis v. Transp. Workers Union of Am., 442 F.3d 55, 59 (2d Cir. 2006) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). When considering a motion for summary judgment, the Court may consider depositions, documents, affidavits, interrogatory answers, and other exhibits in the record. Fed. R. Civ. P. 56(c).

         "'The Government is entitled to summary judgment if its evidence establishes that [defendant] signed promissory notes, received loans pursuant to these notes, and defaulted on [her] payment obligations,' . . . 'and if its evidence supports the amount it alleges is due."' United States v. Cohen, 111 F. Supp. 3d 166,172 (D. Conn. 2015) (quoting UnitedStates v. Mullaney, 2010 WL 4681251, at *1 (D. Conn. 2010) and citing Chem. Bank v. Geller, 727 F.2d 61, 64 (2d Cir.) decision clarified on denial ofreh'g, 734 F.2d 132 (2d Cir. 1984), United States v. Whittlesey, 2010 WL 1882283, at *2 (D. Conn. May 11, 2010)). Presentation by Plaintiff of "a certificate of indebtedness and the promissory note sued upon" may satisfy the government's prima facie case. Id. (citing Whittlesey, 2010 WL 1882283, at *2).

         Defendant argues that, because Plaintiff only "presented the certificates of indebtedness but not the original, signed promissory notes," it has not established its prima facie case. (Def.'s Opp. at 1.) Plaintiff did subsequently place in the record those promissory notes as attachments to its Reply to Defendant's Opposition. (Exs. 1-6 (Promissory Notes) to PL's Reply [Doc. ## 10-1 - 10-16].) Plaintiff has met its burden to demonstrate the debt owed by Defendant, shifting the burden to Defendant to prove any defenses to repayment. See Mullaney, 2010 WL 4681251, at *2 (citing Proctor v. U.S. Dept. of Ed., 196 Fed. App'x 345, 348 (6th Cir. 2006) (once a prima facie case is established, "the burden of proof of a defense to repayment is on the debtor")).

         Defendant pled a variety of affirmative defenses: (1) laches; (2) frustration and impossibility of performance; (3) contrariness to public policy; (4) failure to act in a commercially reasonable matter; and (5) unenforceability of the promissory notes. (Answer ¶¶ 6-10.) Plaintiff argues that each defense lacks merit. (Mem. Supp. Mot. for Summ. J. [Doc. # 8-1] at 4-6.)

         First, Defendant argues that the "equitable defense of laches is applicable, as according to the ED payment schedule, Defendant ceased making payments in April, 2010 [and] ... Defendant has, as a result of the egregious delay, suffered irreparable lifetime damage via creditworthiness, finances, reputation, stigma, employment prospects, a ballooning loan balance, deprivation of due process, and the despair of being trapped in a loan servicing system so broken, from which there was no available remedy." (Def.'s Opp. at 2.) Defendant contends that this delay is in violation of 28 U.S.C. § 2415, which states that

every action for money damages brought by the United States or an officer or agency thereof which is founded upon any contract express or implied in law or fact, shall be barred unless the complaint is filed within six years after the right of action accrues or within one year after final decisions have been rendered in ...