FILED
NOT FOR PUBLICATION
DEC 24 2019
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
THOMAS WEINSTEIN, No. 19-35130
Plaintiff-Appellee, D.C. No. 2:17-cv-01897-RSM
v.
MEMORANDUM*
MANDARICH LAW GROUP, LLP,
Defendant-Appellant.
Appeal from the United States District Court
for the Western District of Washington
Ricardo S. Martinez, District Judge, Presiding
Argued and submitted on December 10, 2019
Seattle, Washington
Before: McKEOWN and CHRISTEN, Circuit Judges, and HARPOOL,** District
Judge.
Mandarich Law Group appeals the district court’s order granting
Weinstein’s motion for partial summary judgment, and subsequent verdict in
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable M. Douglas Harpool, United States District Judge for
the Western District of Missouri, sitting by designation.
Weinstein’s favor, on his claims brought pursuant to the Fair Debt Collection
Practices Act (“FDCPA”) and the Washington Collection Agency Act (“WCAA”).
Mandarich also appeals the district court’s denial of Mandarich’s motion to deem
three requests for admission (“RFA”) admitted. We have jurisdiction pursuant to
28 U.S.C. § 1291, and we affirm in part, reverse in part, and remand.1
We review de novo an order granting summary judgment. Herrera v.
Command Sec. Corp., 837 F.3d 979, 984 (9th Cir. 2016). We may affirm the
decision on any basis supported in the record. San Jose Christian Coll. v. City of
Morgan Hill, 360 F.3d 1024, 1030 (9th Cir. 2004). Where, as here, the parties
have both filed summary judgment motions, this court considers each party’s
evidence to evaluate whether summary judgment was appropriate. Herrera, 837
F.3d at 985.
1. Mandarich argues the district court abused its discretion by denying its
motion to deem certain RFAs admitted. We review this ruling for abuse of
discretion. See Asea, Inc. v. S. Pac. Transp. Co., 669 F.2d 1242, 1247 (9th Cir.
1981). Assuming without deciding that the district court abused its discretion in
1
Because the parties are familiar with the facts, we recite only those facts
necessary to resolve this appeal.
2
denying the motion, Mandarich failed to show how it was prejudiced. Any error
was harmless. See 28 U.S.C. § 2111.
2. Mandarich contends that the statute of limitations barred Weinstein’s
FDCPA claims. The FDCPA’s statute of limitations requires claims to be made
“within one year from the date on which the violation occurs.” 15 U.S.C. §
1692k(d). If the facts are not in dispute, we review statute of limitations decisions
de novo. Herrera, 837 F.3d at 985.
Mandarich argues that Rotkiske v. Klemm, No. 18-328, 2019 WL 6703563
(U.S. Dec. 10, 2019), controls because the district court relied in part on the
discovery rule to determine that Weinstein’s FDCPA claims were timely. But the
district court also concluded that Weinstein’s FDCPA claims were timely because
he filed this action within one year of his wages being garnished.
Weinstein’s complaint alleged that Mandarich violated the prohibition
against “unfair or unconscionable means to collect or attempt to collect any debt.”
15 U.S.C. § 1692f. The district court did not err by concluding that Mandarich
violated § 1692f when it garnished Weinstein’s wages pursuant to a default
judgment that Mandarich admits it secured while Weinstein was in the process of
making payments according to the parties’ oral agreement. The default judgment
did not credit Weinstein’s prior payments or provide the required notice under
3
Washington Civil Rules 55(a)(3) and 55(f)(1), (2). See generally Fox v. Citicorp
Credit Servs., Inc., 15 F.3d 1507, 1517 (9th Cir. 1994) (noting that the FDCPA
provisions “include[] a non-exhaustive list of examples of proscribed conduct”).2
Mandarich also violated § 1692f when it initiated a second garnishment of
Weinstein’s wages. Because the wage garnishments constituted FDCPA violations
that occurred within one year after the complaint was filed, the FDCPA’s statute of
limitations did not bar Weinstein’s claims.
3. Mandarich also contends that Weinstein’s claims are barred by res
judicata. The district court did not abuse its discretion by concluding that
Mandarich waived this affirmative defense by failing to include it in its answer.
See Fed. R. Civ. P. 8(c)(1), 12(b). On the merits, Mandarich cites no authority
supporting its argument that res judicata applies where a debt collector fails to
provide notice to the debtor of an ongoing state court action.3 The case law
Mandarich does cite is distinguishable.
2
Mandarich argues that Weinstein waived his FDCPA claim based on the
wage garnishments because he did not raise this issue before the district court. But
Weinstein’s complaint asserted that the garnishments violated the FDCPA, as did
his response to Mandarich’s motion for summary judgment.
3
Mandarich has been admonished by Washington state courts for its
“pattern of . . . failing to comply with the local rules regarding motions for
default.” Cach, LLC v. Kasahara, No. 15-2-16887-8 (Wash. Supp. Ct., Feb. 8,
2016).
4
4. Mandarich argues the district court erred by rejecting its bona fide error
defense. The bona fide error defense is a “narrow exception” to strict liability
under the FDCPA. Reichert v. Nat’l Credit Sys., Inc., 531 F.3d 1002, 1005 (9th
Cir. 2008) (quoting Clark v. Capital Credit & Collection Servs., Inc., 460 F.3d
1162, 1177 (9th Cir. 2006)). To establish a bona fide error defense, the debt
collector must prove that: “(1) it violated the FDCPA unintentionally; (2) the
violation resulted from a bona fide error; and (3) it maintained procedures
reasonably adapted to avoid the violation.” McCollough v. Johnson, Rodenburg &
Lauinger, LLC, 637 F.3d 939, 948 (9th Cir. 2011); see also 15 U.S.C. § 1692k(c).
The district court did not err by concluding that Mandarich did not
adequately support its bona fide error defense. Mandarich contends that its
computer system, which “automatically populate[s]” payments that have been
made, is a procedure adapted to avoid errors in default judgments, but failed to
explain how this procedure was “adapted to avoid the error.” Reichert, 531 F.3d at
1007.
5. Mandarich argues that Weinstein failed to satisfy the economic injury
element of his state law claim brought pursuant to RCW § 19.16.250(21). A
WCAA violation is enforced through Washington’s Consumer Protection Act
(“WCPA”) (RCW 19.86 et seq.), and violations of the WCAA are per se violations
5
of the state consumer protection law. Panag v. Farmers Ins. Co. of Wash., 204
P.3d 885, 897 (Wash. 2009) (en banc).
The district court concluded that Weinstein was entitled to the amount
Mandarich garnished ($1,468.94) as actual damages. But from the record
available, it appears Weinstein still owed $1,070.63 on the principal at the time of
the first garnishment. The district court did not make a finding regarding whether
Mandarich was entitled to interest or expenses in addition to the principal, but the
record does not support the district court’s finding that the entire garnishment
constituted actual damages.
We vacate the damages awarded on the WCAA claim, including the district
court’s award of trebled damages ($4,935.63), and remand for recalculation of
damages.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
6