United States District Court, D. Nebraska
MELISSA L. CETAK, Plaintiff,
NATIONAL CREDIT ADJUSTERS, LLC, Defendant.
MEMORANDUM AND ORDER
M. GERRARD UNITED STATES DISTRICT JUDGE.
matter is before the Court on the plaintiff's motion for
default judgment (filing 8). The Court finds that the
plaintiff has stated a claim for relief under the Electronic
Fund Transfer Act, 15 U.S.C. § 1693 et seq. (EFTA), but
not under the Fair Debt Collection Practices Act, 15 U.S.C.
§ 1692 et seq. (FDCPA). The Court will give the
plaintiff an opportunity to support her FDCPA claim.
plaintiff, Melissa Cetak, defaulted on a debt that was
transferred to defendant National Credit Adjusters for
collection. Filing 1 at 2. The defendant contacted the
plaintiff and obtained her personal financial account
information in order to initiate a series of electronic fund
transfers aimed at satisfying the debt. Filing 1 at 3. But
the defendant failed to obtain written authorization from the
plaintiff for electronic fund transfers, and therefore could
not provide her with a written copy of such an authorization.
Filing 1 at 3. Nonetheless, the defendant made several
electronic fund transfers from the plaintiff's bank
account between May 1 and August 31, 2015. Filing 1 at 3.
plaintiff sued the defendant for violation of the EFTA and
FDCPA. Filing 1. Service was had on the defendant's
registered agent. Filing 5. On the plaintiff's motion,
the Clerk of the Court entered the defendant's default.
The present motion for default judgment followed. Filing 8.
default judgment is entered, facts alleged in the complaint-
except as to damages-may not be later contested. Marshall v.
Baggett, 616 F.3d 849, 852 (8th Cir. 2010); Murray v.
Lene, 595 F.3d 868, 871 (8th Cir.2010). It remains for
the Court to consider whether the unchallenged facts
constitute a legitimate cause of action, since a party in
default does not admit mere conclusions of law. Id.
Therefore, it is incumbent upon the Court to ensure that the
unchallenged facts constitute a legitimate cause of action
before entering final judgment. Marshall, 616 F.3d at 852-53.
And then, even though the allegations of the plaintiff's
complaint are admitted, see id., it is still necessary for
the Court to determine the plaintiff's damages based upon
the evidence. See, Fed.R.Civ.P. 55(b)(2)(B); Brown v. Kenron
Aluminum & Glass Corp., 477 F.2d 526, 531 (8th Cir.
task for the Court is, first, to consider the allegations of
the complaint to ensure that the plaintiff has stated a
legitimate cause of action with respect to each of her claims
for relief. Then, the Court must consider whether the
plaintiff's damages can be determined based on the
evidence that has been presented in support of its motion.
Fund Transfer Act
EFTA provides that "[a] preauthorized electronic fund
transfer from a consumer's account may be authorized by
the consumer only in writing, and a copy of such
authorization shall be provided to the consumer when
made." § 1693e. An electronic fund transfer is
any transfer of funds, other than a transaction originated by
check, draft, or similar paper instrument, which is initiated
through an electronic terminal, telephonic instrument, or
computer or magnetic tape so as to order, instruct, or
authorize a financial institution to debit or credit an
account. Such term includes, but is not limited to,
point-of-sale transfers, automated teller machine
transactions, direct deposits or withdrawals of funds, and
transfers initiated by telephone.
§ 1693a(7). And a "preauthorized electronic fund
transfer" is an electronic fund transfer
"authorized in advance to recur at substantially regular
intervals[.]" § 1693a(10). Any person who fails to
comply with the EFTA's requirements with respect to any
consumer is liable for the consumer's actual damage and
statutory damages of $100 to $1000, in addition to costs and
attorney's fees. § 1693m(a).
Court finds the plaintiff's allegations sufficient to
state a claim for relief under the EFTA. She specifically
alleged the defendant's failure to obtain her written
authorization, or to provide her with a copy of her written
authorization, for preauthorized electronic fund transfers.
See filing 1 at 2-3. The Court has given some consideration
to whether the plaintiff sufficiently alleged a preauthorized
electronic fund transfer, which requires a recurring payment
schedule. See, e.g., In re DirecTV Early Cancellation
Litigation, 738 F.Supp.2d 1062, 1091 (C.D. Cal. 2010);
see also Gillette v. Gaming Entm't, No. 1:15-CV-1040,
2016 WL 4919992, at *4 (S.D. Ind. Sept. 14, 2016). But the
plaintiff alleged that the purpose of obtaining her account
information was to "initiate a series of electronic
funds transfers" and that multiple transfers were made.
Filing 1 at 3. This, the Court concludes, was sufficient. See
Coover v. Immediate Credit Recovery, Inc., No.
2:14-CV-395, 2014 WL 5823166, at *5 (M.D. Fla. Nov. 10,
noted above, the EFTA authorizes statutory damages, and costs
and attorney's fees, to a successful plaintiff. §
1693m(a). The Court finds, in the absence of any mitigating
evidence or argument from the defendant, that the
plaintiff's request for statutory damages of $1, 000 is
appropriate. The Court has also reviewed the plaintiff's
evidence of costs and attorney's fees, and finds that the
amounts sought are fair and reasonable. See, Blum v.
Stenson,465 U.S. 886, 889 (1984); Shrader v. OMC