United States District Court, E.D. Virginia, Norfolk Division
THOMAS W. LOVEGROVE, Plaintiff,
BROCK & SCOTT, PLLC, Defendant.
OPINION & ORDER
COKE MORGAN, JR. SENIOR UNITED STATES DISTRICT JUDGE.
matter is before the Court on Defendant Brock & Scott,
PLLC's ("Defendant") three (3) pending motions:
a Motion to Dismiss the Class Action Complaint, Doc. 13, a
Motion to Strike the Complaint's demand for punitive
damages, Doc. 11, and a Motion to Stay Discovery, Doc. 22,
pending the resolution of the Motion to Dismiss. Plaintiff
Thomas W. Lovegrove ("Plaintiff') opposes each.
Docs. 16, 17, 24. For the reasons set forth herein, the Court
GRANTS the Motion to Dismiss, DENIES the Motion to Strike as
MOOT, and DENIES the Motion to Stay Discovery as MOOT.
a Virginia citizen, is the owner of the property at 70
Homeplace Circle, Moneta, Virginia. Compl., Ex. B. Defendant
is a law firm organized under the laws of North Carolina and
maintains an office at 484 Viking Drive, Suite 203, Virginia
Beach, Virginia. Id. ¶ 4. "The principal
purpose of [Defendant's business is the collection of
debts for its clients, creditors to whom debts are allegedly
owed by consumers." Id. ¶ 5. Defendant
also owns and operates Trustee Services of Virginia, L.L.C.,
which performs foreclosures in Virginia. Id. ¶
10, 2016, Defendant sent Plaintiff a referral for foreclosure
letter ("Foreclosure Letter"). Id. ¶
14 & Ex. A. Defendant alleged that Plaintiff owed $1,
798, 636.56 to Bank of America, N.A for the Moneta property.
Id. Ex. A. The letter provided Plaintiff with steps
to dispute the debt. Id. Defendant stated that if
Plaintiff notified Defendant that he disputed the debt in
writing within thirty (30) days of receipt of the letter,
Defendant's "office will obtain a verification of
the debt or a copy of a judgment against you and mail it to
you." Id. At the bottom of each page of the
letter, Defendant included this paragraph in bold italicized
***THIS COMMUNICATION IS FROM A DEBT COLLECTOR. THIS
IS AN ATTEMPT TO COLLECT A DEBT, AND ANY INFORMATION OBTAINED
WILL BE USED FOR THAT PURPOSE. IF YOU HAVE RECEIVED A
DISCHARGE IN A CHAPTER 7 BANKRUPTCY, WE ARE AWARE YOU ARE NOT
PERSONALLY OBLIGATED FOR THIS DEBT. PLEASE BE ADVISED THAT
THIS NOTICE IS REQUIRED FOR FORECLOSURE IN THIS STA TE.
Id. The letter also contained a paragraph stating,
"If your personal liability for this debt has been
discharged in a bankruptcy proceeding and you have not
reaffirmed the debt, this communication is for notice
purposes only in connection with the foreclosure of the
referenced property, and we are not attempting to collect the
debt from you personally." Id.
alleges that he "had a reasonable basis for disputing
that he owed the debt" and through counsel sent
Defendant letters on May 17, 2016 and May 20, 2016 disputing
the validity of the debt and requesting verification of it.
Id. ¶¶ 15-16 & Ex. B. Plaintiff wrote
that Bank of America transferred or sold the Note to
"CIG-RESI HFI 1ST LIEN MORT, " and Bank of America
notified Equifax, a credit reporting agency, that it no
longer held the Note. id., Ex. B.
3, 2016, Defendant replied with a copy of the Foreclosure
Letter and a statement that no foreclosure sale was scheduled
at that time. id., Ex. C. On June 21, 2016,
Defendant sent Plaintiff a letter stating its understanding
that Plaintiff had "an interest in the [Moneta]
property, " enclosing copies of a Notice of
Trustee's Sale and a Substitution of Trustee, and
informing Plaintiff that the property would be sold at public
auction on July 5, 2016. Id., Ex. D. Plaintiff
alleges that Defendant failed to verify the alleged debt and
continued to collect it by scheduling the foreclosure sale.
Id. ¶ 19.
27, 2016, Plaintiff filed an action in the Franklin County
Circuit Court for an injunction enjoining Trustee Services of
Virginia from foreclosing on Plaintiffs property.
Id. ¶ 22. On June 30, 2016, a Franklin County
Circuit Court judge "orally indicated that he would
grant the motion for a temporary injunction."
Id. ¶ 25. Plaintiff alleges that at the
hearing, Defendant's counsel assured him that the July 5,
2016 foreclosure sale would be canceled. WL As of the filing
of the Complaint in this case, a foreclosure sale was
scheduled for July 27, 2016. Id. ¶28.
7, 2016, Plaintiff filed the three-count Class Action
Complaint. See generally Id. The Complaint
alleges violation of Sections 1692g(b) and 1692e(10) of the
Fair Debt Collection Practices Act ("FDCPA")
(Counts One and Two) and fraud (Count Three), ]d Plaintiff
included the description of three (3) classes in the
Complaint: (1) the "Main Class" eligible for relief
under Count Three consisting of all persons nationwide who
received foreclosure letters with identical debt dispute
language from Defendant, attempted to dispute the debt, but
did not receive mailed verification of the debt from
Defendant; (2) the "First Subclass" eligible for
relief under Count Two consisting of members of the Main
Class to whom Defendant sent the same Foreclosure Letter in
the year preceding the filing of the Complaint; and (3) the
"Second Subclass" eligible for relief under Count
One consisting of members of the Main Class to whom Defendant
sent the same Foreclosure Letter in the year preceding the
filing of the Complaint and against whom Defendant pursued
collection prior to verifying the debt. Id. ¶
alleges upon his "experience, information, and belief
that Defendant "regularly and systematically fails to
provide meaningful verification of debts required by the
FDCPA... even after Brock & Scott has received written
request[s] from consumers." Id. ¶ 12.
Plaintiff also alleges that Defendant regularly continues to
collect debts despite receiving debtors' timely written
dispute notices. Id. ¶ 13. Plaintiff requests
judgment in favor of the class members, an injunction
permanently enjoining Defendant from violating the FDCPA,
actual damages, statutory damages of $1, 000 per class
member, reasonable attorney fees and costs, and $350, 000 in
punitive damages. Id. ¶¶ 40, 43, 51.