UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 13-2113
JANET BEASLEY; GORDON BEASLEY,
Plaintiffs - Appellants,
v.
RED ROCK FINANCIAL SERVICES, LLC,
Defendant - Appellee.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. Anthony J. Trenga,
District Judge. (1:12-cv-01312-AJT-TRJ; 1:13-cv-00206-AJT-TRJ)
Submitted: July 18, 2014 Decided: September 9, 2014
Before MOTZ and WYNN, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Affirmed by unpublished per curiam opinion.
Ernest P. Francis, ERNEST P. FRANCIS, LTD., Arlington, Virginia,
for Appellants. Virginia M. Sadler, JORDAN COYNE LLP, Fairfax,
Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
In this case under the Fair Debt Collections Practices Act
(the FDCPA), 15 U.S.C. §§ 1692-1692p, the plaintiffs-appellants
raise numerous allegations of error that they contend should be
resolved in their favor. Having carefully reviewed the briefs,
the record, and the relevant law, we conclude that each is
without merit. Accordingly, we affirm.
I.
At all times relevant to this case, husband and wife,
Gordon and Janet Beasley (the Beasleys), owned a home in the
Princeton Woods Addition neighborhood, located in Dumfries,
Virginia. The home is subject to a declaration of covenants,
conditions, and restrictions administered by the Princeton Woods
Addition Homeowners Association, Inc. (the HOA). In October
2008, the HOA, through its collection agent Reese Broome, PC,
notified the Beasleys by letter that they owed the HOA a total
of $685.00 in unpaid assessments, late fees, and legal fees.
Additionally, the letter stated that unless the Beasleys
disputed the debt or made payment in full within thirty days
after receipt of the letter, the HOA would accelerate the
Beasleys’ account through the end of the year and record a lien
on their home. The Beasleys periodically continued to receive
similar letters from Reese Broome, PC, on behalf of the HOA,
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with the last letter from Reese Broome, PC, dated March 17,
2011.
The Beasleys claim they brought their HOA account current
in 2008 and dispute any and all alleged delinquencies in their
HOA account after that time. In 2009, the HOA revoked the
Beasleys’ HOA privileges, such as use of the neighborhood pool,
for failure to keep their HOA account current.
In January 2012, the HOA switched collection agents from
Reese Broome, PC, to Red Rock Financial Services, LLC (Red
Rock). Red Rock’s first letter to the Beasleys on behalf of the
HOA is dated January 23, 2012, stating the Beasleys’ current HOA
account balance as $1,373.36. The letter also stated that if
the Beasleys chose not to pay their account in full within
thirty days from the date of the letter, “the [HOA] will refer
the matter to counsel for appropriate legal action, including
filing a Memorandum of Assessment Lien on behalf of [the HOA] in
the Prince William Circuit Clerk’s Office without further
notice.” (J.A. 445). In a letter dated March 12, 2012, from
Red Rock to the Beasleys’ attorney, Red Rock reported the
Beasleys’ HOA account balance as $1,458.90.
On May, 25, 2012, the HOA filed a “Memorandum of Assessment
Lien” in Prince William County, Virginia on the Beasleys’
Princeton Woods home, asserting the Beasleys owed the HOA a
total of $1,902.82, consisting of $307.36 in unpaid assessments,
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$23.46 in late fees and interest, and $1,572.00 in “Collection
and Attorney Fees and Costs.” (J.A. 459). Of relevance in the
present appeal, in a letter dated May 30, 2012, Red Rock
informed Janet Beasley that “Red Rock Financial Services may
proceed with foreclosure no sooner than the 61st day from the
mailing of the Memorandum of Assessment Lien if [the] debt is
not satisfied.” (J.A. 450). Red Rock contemporaneously sent a
separate, but identical letter to Gordon Beasley.
The Beasleys subsequently brought the present action solely
against Red Rock, alleging Red Rock’s collection efforts on
behalf of the HOA violated numerous provisions of the FDCPA. 1
The Beasleys sought a total of $98,000.00 in damages, plus
reasonable attorney’s fees, prejudgment interest, and costs.
Following discovery, Red Rock stipulated to violating the FDCPA
in an unspecified manner and to the Beasleys’ entitlement to
$1,000.00 each in statutory damages. Shortly thereafter, the
case went to trial, with the district court granting judgment as
a matter of law in favor of Red Rock at the close of all
evidence on ten out of the eleven counts alleged. According to
the district court, the Beasleys had either failed to produce
1
The Beasleys actually filed separate, but identical
complaints, which were consolidated for discovery and trial
purposes. For ease of understanding, we treat them as being in
one action in this opinion.
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sufficient evidence of any FDCPA violation in counts I through X
or had failed to produce sufficient evidence that they had
suffered any actual damages as a result of any violations
claimed in those counts.
In the lone remaining count, the Beasleys alleged that each
of them was entitled to recover for actual damages which each of
them had sustained as a result of Red Rock violating 15 U.S.C.
§ 1692e(5), which statutory section provides:
[a] debt collector may not use any false, deceptive or
misleading representation or means in connection with
the collection of any debt. Without limiting the
general application of the foregoing, the following
conduct is a violation of this section:
* * *
(5) The threat to take any action that cannot legally
be taken or that is not intended to be taken.
15 U.S.C. § 1692e(5). The district court instructed the jury as
follows with respect to the Beasleys’ legal theory regarding
this claim:
The Plaintiffs claim that Defendant violated this
section of the Act when it stated in its letter dated
May 30, 2012, . . . that “Red Rock Financial may
proceed with foreclosure no sooner than the 61st day
from the mailing of the Memorandum of Assessment Lien
if debt is not satisfied.” The basis for this claim
is that the Memorandum of Lien did not comply with all
the legal requirements necessary to perfect and
enforce a lien and for that reason there was not filed
a valid lien. The defendant denies that it violated
this particular section of the Act.
In order to recover on his or her claim, each
plaintiff must prove the following:
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(1) that the defendant violated this section of
the Act;
(2) that he or she sustained actual damages as a
result of defendant’s violation of this section
of the Act; and
(3) the amount of damage he or she sustained as a
result of defendant’s violation of the Act.
(J.A. 569-70). Additionally, the district court instructed the
jury that none of the following conduct, by itself, violated the
FDCPA: (1) the fact that Red Rock sent the Beasleys the
collections letters dated January 23, 2012, and March 12, 2012;
(2) the fact that Red Rock attempted to collect a disputed debt;
and (3) the filing itself of the Memorandum of Lien.
Accordingly, the district court instructed the jury that the
Beasleys are not entitled to recover damages based on any
emotional distress or other injuries caused by such conduct.
In a verdict form containing special interrogatories, the
jury found that the Beasleys had not sustained any actual
damages as a result of Red Rock’s violation of the FDCPA over
and above the statutory damages to which Red Rock had already
stipulated. The district court entered judgment in favor of the
Beasleys in the amount of $1,000.00 each in statutory damages,
pursuant to 15 U.S.C. § 1692k(a)(2)(A), and otherwise in favor
of Red Rock as to all eleven counts. The Beasleys subsequently
filed a motion, pursuant to 15 U.S.C. § 1692k(a)(3), requesting
a total of $52,120.00 in attorney’s fees and $220.00 in costs.
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After considering the motion, the district court awarded the
Beasleys a total of $5,000.00 in attorney’s fees and $252.00 as
taxable costs, representing the fees of the Clerk of Court.
This timely appeal followed in which the Beasleys allege
numerous errors by the district court below. We have reviewed
them all and find all to be without merit. Several are worthy
of our expressly addressing.
II.
The Beasleys first contend the district court erred by
granting Red Rock’s motion for judgment as a matter of law with
respect to Counts III, IV, V, and VII, all of which allege Red
Rock violated 15 U.S.C. § 1692e(2) by making false statements as
to the amount of debt the Beasleys owed the HOA. Count III
pertained to the January 23, 2012 letter, Count IV pertained to
the March 12, 2012 letter, Count V pertained to the May 30, 2012
letter, and Count VII pertained to the May 25, 2012 Memorandum
of Lien.
We review the district court’s grant of Red Rock’s motion
for judgment as a matter of law de novo. Anderson v. Russell,
247 F.3d 125, 125 (4th Cir. 2001). Judgment as a matter of law
is appropriate on a claim “[i]f a party has been fully heard on
an issue during a jury trial and the court finds that a
reasonable jury would not have a legally sufficient evidentiary
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basis to find for the party on that issue[.]” Fed. R. Civ. P.
50(a)(1). Having reviewed the record, the relevant law, and
the parties’ briefs, we hold the district court did not err in
granting Red Rock’s motion for judgment as a matter of law with
respect to Counts III, IV, V, and VII. The crux of the matter
is that the Beasleys failed to present sufficient evidence,
viewed in the light most favorable to them, to remove the
existence of damages proximately caused by the alleged
violations at issue beyond the realm of impermissible
speculation and conjecture. Myrick v. Prime Ins. Syndicate,
Inc., 395 F.3d 485, 489 (4th Cir. 2005) (“[I]f the verdict in
favor of the non-moving party would necessarily be based upon
speculation and conjecture, judgment as a matter of law must be
entered.”). The evidence presented at trial established that,
since October 2008, the Beasleys had suffered extreme emotional
distress because of (1) the HOA’s repeated claims that their HOA
account was delinquent; (2) the steady efforts by Reese Broome,
PC to collect on such alleged delinquencies; and (3) the filing
of the Memorandum of Lien on their home. The Beasleys offered
insufficient evidence for the jury to find what, if any,
additional emotional distress the Beasleys suffered as
proximately caused by Red Rock’s violations of the FDCPA as
alleged in Counts III, IV, V, and VII, i.e., by allegedly making
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false statements as to the amount of debt the Beasleys owed the
HOA.
III.
Next, the Beasleys contend that Red Rock’s stipulation that
it violated the FDCPA precluded Red Rock from disputing all
allegations in the complaint pertaining to liability, and
therefore, the district court erred in admitting, over its
objections at trial, evidence regarding their allegedly
delinquent HOA account. Such evidence consisted of the
testimony of Cynthia Weiss, the person in charge of the
Beasleys’ HOA account at the management company the HOA employed
to maintain its books, and such management company’s “resident
transaction report,” (J.A. 352), pertaining to the Beasleys.
We review the “trial court’s rulings on the admissibility
of evidence for abuse of discretion, and we will only overturn
an evidentiary ruling that is arbitrary and irrational. To that
end, we look at the evidence in a light most favorable to its
proponent, maximizing its probative value and minimizing its
prejudicial effect.” United States v. Cole, 631 F.3d 146, 153
(4th Cir. 2011) (internal quotation marks and citation omitted).
Here, the district court did not act arbitrarily or
irrationally in admitting the challenged evidence. Regardless
of Red Rock’s stipulation to violating the FDCPA in an
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unspecified manner, the challenged evidence was probative on the
issue of damages. Specifically, the challenged evidence was
probative to dispute testimony by the Beasleys to the effect
that they were shocked and in disbelief that Red Rock would send
them letters seeking to collect on the debt the HOA claimed the
Beasleys owed.
The Beasleys also specifically challenge on hearsay grounds
the district court’s admission of their “resident transaction
report,” (J.A. 352), listing all the assessments, late fees, and
payments associated with the Beasleys’ HOA account. Below, the
Beasleys specifically objected to admission of this document,
identified as Defendant’s Exhibit 1, as inadmissible hearsay.
Fed. R. Evid. 802. We review the district court’s admission of
this report for abuse of discretion. Cole, 631 F.3d at 153.
The district court did not abuse its discretion in
admitting the challenged resident transaction report because
such document was admissible for the purpose of proving the HOA
had a long running dispute with the Beasleys over their HOA
account, which is not for the purpose of proving the truth of
the matter asserted, e.g., not for the purpose of proving the
Beasleys owed the HOA the amounts listed as delinquent in the
resident transaction report. Because the report was admissible
for a purpose other than the truth of the matter asserted, it
falls outside the definition of hearsay set forth in Federal
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Rule of Evidence 801(c). The fact that the Beasleys had a long
running dispute with the HOA over varying amounts the HOA
claimed the Beasleys owed on their HOA account (since 2008)
undercut the magnitude of the emotional distress the Beasleys
claimed they suffered as proximately caused by Red Rock’s
statement in its letter dated May 30, 2012, that it “may proceed
with foreclosure no sooner than the 61st day from the mailing of
the Memorandum of Assessment Lien if [the] debt is not
satisfied.” (J.A. 450).
IV.
The Beasleys also challenge as inadequate the district
court’s $5,000.00 award of attorney’s fees in their favor.
Their challenge is without merit.
“[I]n the case of any successful action to enforce the
[FDCPA],” the FDCPA authorizes district courts to award “a
reasonable attorney’s fee as determined by the court.” 15
U.S.C. § 1692k(a)(3). Under the applicable abuse of discretion
standard, we have the duty to affirm the district court’s
$5,000.00 attorney’s fees award if such award “falls within the
district court’s broad discretion.” Carroll v. Wolpoff &
Abramson, 53 F.3d 626, 628 (4th Cir. 1995) (internal quotation
marks omitted). Here, the district court undertook a thorough
analysis of the record and applicable law in calculating a
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reasonable attorney’s fees award in the present case, setting
forth such analysis in a lengthy written order. To summarize,
the district court awarded the Beasleys far less in attorney’s
fees than they had sought because “[t]heir recovery was limited
to the amount of statutory damages that [Red Rock] had offered
shortly after suit was filed, and no reasonable assessment of
the case justified the expense to pursue actual damages.” (J.A.
727). Given that the degree of success obtained is the most
critical factor in determining the reasonableness of an
attorney’s fees award, Carroll, 53 F.3d at 630, the Beasleys
have offered no persuasive argument on appeal which convinces us
that the district court abused its discretion in limiting the
Beasleys’ attorney’s fees award to $5,000.00.
V.
For the reasons stated, we affirm the judgment below
entered upon the jury’s verdict and affirm the judgment below
awarding the Beasleys $5,000.00 in attorney’s fees and costs of
252.00. 2
2
We have also reviewed and find to be without merit the
Beasleys’ remaining assignments of reversible error pertaining
to the district court’s jury instructions regarding Red Rock’s
right to foreclose on the lien at issue and the bonafide error
defense as well as the district court’s refusal to instruct the
jury that it could award prejudgment interest on all of the
Beasleys’ damages.
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We dispense with oral argument because the facts and legal
contentions are adequately presented in the materials before the
court and argument would not aid the decisional process.
AFFIRMED
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