The opinion of the court was delivered by: Richard W. Roberts United States District Judge
Plaintiff Rona Foote LaPrade has brought claims against May Department Stores Company ("May Co.") for defamation and for violations of the Truth in Lending Act ("TILA"), 15 U.S.C. §§ 1637(a)(7), 1666(a), 1666a(a) (2000), and against the law firm Wolpoff & Abramson ("Wolpoff firm") and one of its members, Ronald M. Abramson, for violation of the TILA and for using unfair means to attempt to collect a debt in violation of D.C. Code § 28-3814(g)(5).
LaPrade has filed three motions. First, LaPrade has moved for leave to file a fourth amended complaint. Because LaPrade's motion was unduly delayed and she failed to cure the deficiencies in her complaint in amendments previously allowed, and because granting LaPrade's motion would prejudice Abramson and the Wolpoff firm, LaPrade's motion has been denied. Second, LaPrade has moved to reinstate Count Sixteen of her first amended complaint ---- a claim of defamation against Abramson and the Wolpoff firm. Because Laprade's motion in part rehashes legal arguments already rejected and in part impermissibly attempts to bring an old claim under a new legal theory, her motion has been denied. Third, LaPrade has filed a motion styled as a motion for partial summary judgment, seeking a ruling on the issue of whether she owed a valid debt to May Co. Because May Co. has demonstrated that a genuine issue of material fact exists as to the existence of a valid debt, LaPrade is entitled to no relief under Rule 56 of the Federal Rules of Civil Procedure.
May Co. has filed a motion for summary judgment as to Counts I, II, III, IV, V and VIII of LaPrade's third amended complaint. Because May Co. did not extend to LaPrade an "open end credit plan" within the meaning of the TILA, there is no genuine issue of fact material to a claim under 15 U.S.C. § 1637(a)(7), and May Co.'s motion has been granted as to Count I. Because 15 U.S.C. § 1666(a) offers protection only to a consumer who has been extended consumer credit, and LaPrade was not extended consumer credit by May Co., May Co.'s motion has been granted as to Counts II, III, and IV. Because 15 U.S.C. § 1666a(a) offers protection only to a consumer entitled to invoke the protections of § 1666(a) and LaPrade is not entitled to invoke the protections of § 1666(a), May Co.'s motion has been granted as to Count V. Finally, May Co.'s motion has been denied as to Count VIII because if May Co. acted with malice or willful intent to injure LaPrade ---- a material fact in genuine dispute ---- then LaPrade's claim is not barred by 15 U.S.C. § 1681h(e).
LaPrade maintained a credit card account with the department store Woodward and Lothrop ("Woodies"). It is not clear when she opened her account, but the account was in existence by late 1989. LaPrade asserts that her Woodies account was paid in full as of October 1990. LaPrade contends that when Woodies ceased doing business in 1994, her Woodies account ceased to exist. May Co., which purchased Woodies' accounts receivable in 1995, counters that four documents from Woodies (the "Woodies documents") indicate that LaPrade owed $371.67 and that the account was in Woodies' collections department. May Co. relies on the Woodies documents and two affidavits submitted on its behalf ---- one by Richard Russell, former Recoveries and Bankruptcy Manager for Woodies (see May Co.'s Mot. Summ. J., Russell Aff. ¶ 3, Dec. 12, 1997), and another by Richard J. Jansing, regional vice-president of Credit Support for May Co. (See May Co.'s Mot. Summ. J., Jansing Aff. ¶ 2, Dec. 11, 1997.) Two "internal document[s] from Woodies" indicate that as of December 15, 1989 and December 15, 1990, the LaPrade account was in Woodies' collections department and had been assigned to a collection agency. (Russell Aff. ¶¶ 4, 6.) The documents show that in November 1989 and again in December 1990, a purchase charge was processed for LaPrade through Woodies Distribution Center, the Woodies warehouse. The charges totaled $371.67. The Woodies Distribution Center did not have a connection to the Woodies Credit Center, so the Distribution Center would not have been aware that the account was delinquent. In each instance, as soon as the charge was sent to the Credit Center, it was placed in Woodies' collections department. (Id. ¶¶ 5, 7.) May Co. claims that on November 27, 1991, Woodies removed the balance due from its collections department and placed it on LaPrade's account. (Id. ¶ 8.) Yet, LaPrade cites a letter from Woodies' Credit Division stating that LaPrade's account was paid in full as of November 1991. May Co. also claims that on January 9, 1992, the delinquent amount was removed from LaPrade's account and reassigned to Woodies' collections department as "uncollectable." (Id. ¶ 9-10.) LaPrade, though, cites a facsimile of a note dated January 9, 1992 from Woodies' Corporate Credit Department stating that LaPrade's account had a zero balance and that all derogatory information connected to that account was being purged.
In January 1996, Woodies' collections accounts receivable were transferred to May Co. (Jansing Aff. ¶ 16.) Each such account was assigned an internal May Co. number for administering the account during the collection process. (Id. ¶ 13.) Customers were not billed for these accounts. Customers with these accounts did not have the ability to use the new May Co. number to make purchases. (Id.) May Co. asserts that no new accounts were opened in this process. (Id. ¶ 15.) LaPrade, though, alleges that May Co. intentionally opened a new open end credit plan in her name without her consent and then in March 1996, placed a false charge of $371.67 on that account.
LaPrade's old Woodies account with its new May Co. number was placed in May Co.'s accounts receivable computer database system in January 1996 or soon thereafter and it was removed from that system by September of the same year. (Id. ¶¶ 16, 22.) May Co. made reports to credit bureaus on a monthly basis based on its computer account receivables database. (Id. ¶ 21.) May Co. reported LaPrade's account as delinquent. LaPrade claims that as a direct result of May Co.'s reports to credit bureaus, she lost a credit line of more than $4,000 and was unable to refinance existing debts at a lower rate.
After receiving the Woodies collections accounts receivable and assigning them new numbers, May Co. submitted them to outside collections agencies. (Id. ¶ 18.) LaPrade's account was assigned to the Wolpoff law firm for collection. (Id. ¶ 19.) On April 15, 1996, the Wolpoff firm sent LaPrade a letter requesting payment in the amount of $377.17, representing the original amount owed plus $5.50 interest. The letter stated:
Please be advised that your above account has been referred to our office for audit and review. After you have read the important notice on the reverse side of this letter, if appropriate please call our office to arrange for payment. If the balance indicated above [$377.17] is incorrect, please contact us as soon as possible so that we may adjust our records accordingly. (Compl. Ex. 1.) The "important notice" on the back of the letter stated, in part, that "this is an attempt to collect a debt and any information obtained will be used for that purpose." (Id.) LaPrade characterizes this letter as a "collection letter." Abramson and the Wolpoff firm deny that characterization. May Co. does not characterize the letter, but notes that the reference to debt collection appeared not in the text of the letter but only on the back of the letter in the standard disclosures required by the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692 et seq., part of the TILA.
In late August and early September 1996, LaPrade's attorney, Steven Teppler, directly telephoned and sent facsimiles to May Co. regarding the alleged debt, conduct that Abramson and the Wolpoff firm viewed as a violation of Rule 4.2 of the D.C. Bar's Rules of Professional Conduct governing attorneys. In September 1996, May Co. removed LaPrade's alleged debt from its database because one of its employees, Elizabeth Bess, decided not to pursue collection because of the small amount of money involved compared to the effort it would take to locate supporting documentation.
LaPrade filed her first complaint in January 1997 against Abramson and the Wolpoff firm and a month later amended it to add May Co. as a defendant. She served discovery requests in March 1997 seeking documentation of the alleged debt, to which May Co. responded in April 1997 by producing the Woodies documents. The April 9, 1997 scheduling order allowed all parties 90 days ---- until July 9, 1997 ---- to file any amendments to pleadings.
On April 28, 1997, the Legal Times published an article about a bar complaint against Teppler alleging a violation of Rule 4.2 of the D.C. Rules of Professional Conduct. The article noted that LaPrade's account had been referred to the Wolpoff firm for collection and that Teppler had been successful in clearing LaPrade's credit rating. LaPrade argues that the article portrayed her as a delinquent debtor and that the information was provided by and through defendants. Defendants deny conveying any information to the Legal Times. Further, May Co. argues that the article portrayed LaPrade in a positive light because it reported that the disputed account information had been removed.
Many of LaPrade's claims, including Count Sixteen against Abramson and the Wolpoff firm for defamation under D.C. Code 28-3814, were dismissed by order dated June 27, 1997. In July and September 1997, LaPrade filed her second and third amended complaints. LaPrade has now moved for leave to file a fourth amended complaint, to reinstate Count Sixteen, and for partial summary judgment, and May Co. has moved for summary judgment on all claims pending against it.
I. MOTION FOR LEAVE TO FILE A FOURTH AMENDED COMPLAINT
LaPrade seeks leave to file a fourth amended complaint.
Motions to amend are governed by Rule 15(a), which provides that
[a] party may amend the party's pleading once as a matter of course at any time before a responsive pleading is served . . . . Otherwise, a party may amend the party's pleading only by leave of the court or by written consent of the adverse party; and leave shall be freely granted when justice so requires.
Fed. R. Civ. P. 15(a). Because defendants have filed answers, LaPrade's motion to amend requires leave of court. While the term "freely" in Rule 15(a) does not mean "automatically," Foman v. Davis, 371 U.S. 178, 182 (1962), defendants bear the burden of demonstrating why leave should not be granted. See 3 James Wm. Moore et al., Moore's Fed. Prac. § 15.15 (3d ed. 1999) (noting that the party opposing amendment bears the burden of producing reasons or evidence to deny leave to amend). Factors that might lead a court properly to deny leave to amend include, among other things, a plaintiff's "undue delay, bad faith or dilatory motive . . . , repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party . . . , futility of the amendment, etc." Foman, 371 U.S. at 182; see also Atchinson v. District of Columbia, 73 F.2d 418, 425 (D.C. Cir. 1996) (citing the Foman factors); Williamsburg Wax Museum v. Historic Figures, Inc., 810 F.2d 243, 247 (D.C. Cir. 1987); cf. Harrison v. Rubin, 174 F.3d 249, 253 (D.C. Cir. 1999) (deciding that where a plaintiff does not seek to allege new facts, but only to "do no more than clarify legal theories or make technical corrections," amendment should be denied for undue delay only if defendant would be prejudiced by amendment).
A motion to amend may be denied as dilatory or unduly delayed where a plaintiff was aware of the facts giving rise to the cause of action before filing the complaint that she now wishes to amend. Yager v. Carey, 910 F. Supp. 704, 731-32 (D.D.C. 1995) (denying leave to amend because plaintiff had not been unaware of the cause of action at the time the original complaint was filed). Defendants argue that LaPrade's motion for leave to amend her complaint is unduly delayed and filed in bad faith.*fn1 They note that the basis for the proposed claims ---- the legal theory that no debt existed ---- was alleged in LaPrade's first amended complaint, that she had material facts by at least April 1997 in the form of the Woodies documents regarding the existence of the debt, and that her motion was filed beyond the 90 days for amendments allowed by the April 9, 1997 scheduling order.
LaPrade responds that she had not previously asserted her proposed claims under the FDCPA because she was relying on May Co. to produce proof of a credit purchase giving rise to the alleged debt, and that the Russell affidavit executed December 12, 1997 contains new factual allegations about when the alleged debt occurred. She argues that justice requires leave to amend, despite the 90-day limit imposed by the April 9, 1997 scheduling order.
Here, it is clear that LaPrade had sufficient information available to her by July 9, 1997, the scheduling order's deadline for amendments, to file her additional claims. LaPrade proposes to add a FDCPA claim under 15 U.S.C. § 1692e(2)(A), which prohibits "false representation of the character, amount, or legal status of any debt[.]" LaPrade argues that since the Wolpoff firm's April 15, 1996 letter stated that her debt was $371.67 plus $5.50 in interest while the Woodies documents she received in April 1999 showed it to be only $371.67, Abramson and the Wolpoff firm made a false representation of the amount of her debt. The letter and documents on which LaPrade bases her proposed claim were available to her before the amendment deadline in July 1997.
LaPrade also proposes to add a claim under 15 U.S.C. § 1692e(10), which prohibits the "use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer." LaPrade argues that the Wolpoff firm's April 15, 1996 letter contained a threat of court proceedings which is impermissible under sections 1692e(10) and 1692e(5). Similarly, LaPrade argues that this same letter establishes a violation of D.C. Code § 28-3814(f)(5), which prohibits a debt collector from making "any false representation or implication of the character, extent, or amount of a claim against a consumer, or of its status in any legal proceeding[,]" by containing a misrepresentation of court proceedings. The letter on which LaPrade bases her proposed claims was available to her before the amendment deadline in July 1997.
LaPrade also wants to add a claim under 15 U.S.C. § 1692f, which states that a "debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt." LaPrade argues that instituting a collection action on a debt that appears to be time-barred is a violation of § 1692f, that the Wolpoff firm's April 15, 1996 letter instituted a collection action against her, and that defendants knew or should have known that either the debt did not exist or that action on it was barred by D.C.'s three-year statute of limitations. LaPrade also argues that the Russell affidavit, first available in December 1997, presented new evidence to the effect that the debt at issue accrued in May 1991. Even assuming that the Russell affidavit presented new evidence of a debt incurred in May 1991, the Woodies documents attributed debt to LaPrade as of December 1989, December 1990, December 1991, and December 1992. These documents, available to LaPrade before the amendment ...