The opinion
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
ANTHONY ARAGON WRIGHT,
Plaintiff,
v. Case No.: 2:23-cv-383-JLB-KCD
CROSSCOUNTRY MORTGAGE,
LLC,
Defendant.
/
REPORT & RECOMMENDATION
Before the Court is Plaintiff Anthony Wright’s Motion for Entry of
Default Judgment against CrossCountry Mortgage, LLC. (Doc. 79).1 A clerk’s
default was entered against CrossCountry (Doc. 28) because it did not answer
despite having been served (Doc. 10). CrossCountry also failed to respond to
the pending motion, and the time to do so has passed.
Having reviewed Wright’s motion and the complaint, the Court
recommends entering default judgment as to CrossCountry’s liability under
Florida Consumer Collection Practices Act (“FCCPA”). The Court further
recommends awarding Wright $1,000 in statutory damages while deferring
judgment on actual and punitive damages until an evidentiary hearing can be
1 Unless otherwise indicated, all internal quotation marks, citations, and alterations have
been omitted in this and later citations.
held. Additionally, Wright’s request for attorney’s fees and costs is premature
under Local Rule 7.01. Thus, the Court recommends directing him to move
separately for those fees. Finally, the Court recommends dismissing Wright’s
Fair Credit Reporting Act (“FCRA”) claim because it has been abandoned.
I. Background
The Court takes the facts below from the complaint, which are admitted
by CrossCountry’s default. Wright had the misfortune of buying a home just
before Hurricane Ian arrived and damaged it. (Doc. 1 ¶¶ 26-28.) The hurricane
also caused him to lose wages and incur emergency expenses, making it
difficult to afford his mortgage payments. (Id. ¶¶ 30-33.) Wright relayed these
concerns to his lender, CrossCountry, which recommended he seek relief
through its forbearance program. (Id. ¶ 34.) Wright applied and was granted a
forbearance, suspending his mortgage payments for three months. (Id. ¶¶ 34-
36, 38.) But CrossCountry never honored the forbearance. According to Wright,
CrossCountry wrongfully tried to collect the mortgage and reported him in
default. (Id. ¶¶ 170-84.) Wright’s credit score and standing were thereby
reduced. (Id. ¶ 75.)
This lawsuit under the FCRA and FCCPA followed. Despite having been
served, CrossCountry did not answer or otherwise appear, and the Clerk has
entered a default against it. (Docs. 10, 28.) That brings us to the current
motion. Wright now seeks a final judgment against CrossCountry. (Doc. 79.)
II. Legal Standard
“When a defendant has failed to plead or defend, a district court may
enter judgment by default.” Golembiewski v. Waters Pointe Apartments, LLC,
No. 823CV00081KKMAEP, 2023 WL 4931218, at *2 (M.D. Fla. June 27, 2023).
“The Federal Rules of Civil Procedure establish a two-step process for
obtaining default judgment.” Petition of Daytona Beach Aqua Safari, Inc. v.
Castle, No. 6:22-CV-740-CEM-DCI, 2023 WL 2329090, at *1 (M.D. Fla. Feb.
10, 2023). First, when a defendant “fails to plead or otherwise defend,” the
Clerk enters default. Id. By defaulting, the defendant admits the well-pleaded
factual allegations in the complaint. Eagle Hosp. Physicians, LLC v. SRG
Consulting, Inc., 561 F.3d 1298, 1307 (11th Cir. 2009). “Second, after obtaining
[a] clerk’s default, the plaintiff must move for default judgment.” Daytona
Beach Aqua Safari, Inc., 2023 WL 2329090, at *1.
“Before entering default judgment, the court must ensure that it has
jurisdiction over the claims and parties, and that the well-pled factual
allegations in the complaint, which are assumed to be true, adequately state a
claim for which relief may be granted.” Golembiewski, 2023 WL 4931218, at
*2. “The validity of an order of a federal court depends upon that court’s having
jurisdiction over both the subject matter and the parties.” Nu Image, Inc. v.
Does 1-3,932, No. 2:11-CV-545-FTM-29, 2012 WL 1890829, at *2 (M.D. Fla.
May 24, 2012).
III. Discussion
A. Subject Matter Jurisdiction
Wright claims CrossCountry violated the FCRA and the FCCPA. (Doc. 1
¶ 170-184.) The Court has original jurisdiction over Wright’s claim under the
FCRA because it presents a federal question. 28 U.S.C. § 1331. And the Court
has supplemental jurisdiction over his FCCPA claim because it “arise[s] out of
a common nucleus of operative fact” and “form[s] part of the same case or
controversy.” Williams v. Monroe Cnty. Dist. Att’y, 702 F. App’x 812, 815 (11th
Cir. 2017); Lucero v. Trosch, 121 F.3d 591, 597 (11th Cir. 1997). Thus, the
Court has subject matter jurisdiction over these proceedings.
B. Personal Jurisdiction
“The Due Process Clause . . . protects an individual’s liberty interest in
not being subject to the binding judgments of a forum with which he has
established no meaningful contacts, ties, or relations.” Thomas v. Brown, 504
F. App’x 845, 847 (11th Cir. 2013). Thus, before entering default judgment, the
Court must assure itself that service was proper, Florida’s long-arm statute
reaches CrossCountry, and maintenance of the suit would not offend due
process. Golembiewski, 2023 WL 4931218, at *3. If any of these requirements
are missing, the default judgment against CrossCountry would be void. Nu
Image, Inc., 2012 WL 1890829, at *2.
1. Wright Properly Served CrossCountry
Rule 4(h) governs service on a corporation. It provides Wright could serve
CrossCountry by delivering copies of the summons and complaint to its
registered agent. Fed. R. Civ. P. 4(h)(1)(B).
CrossCountry is a citizen of Delaware. According to the Delaware
Secretary of State’s website, its registered agent is The Corporation Trust
Company in Wilmington, Delaware. See Delaware Department of State,
Division of Corporations, File Number 7633475. Wright’s return of service
attests that a copy of the summons and complaint were served on Robin Hutt
Banks, an “intake manager” for the Corporation Trust Company. (Doc. 10 at
3.) This establishes a prima facie case of proper service. Udoinyion v. The
Guardian Sec., 440 F. App’x 731, 735 (11th Cir. 2011); see United States v.
Formoso, No. 6:22-CV-1639-RBD-EJK, 2022 WL 17738710, at *1 (M.D. Fla.
Dec. 16, 2022) (finding proper service on the defendant’s registered agent
under Rule 4(h)(1)(B) when the complaint was left with the agent’s intake
specialist).
2. This Court has Specific Personal Jurisdiction Over
CrossCountry Under Florida’s Long-Arm Statute
CrossCountry is a citizen of Delaware and Ohio. But that does not place
CrossCountry beyond this Court’s reach. Florida’s long-arm statute empowers
this Court to exercise jurisdiction over citizens of other states. Two sections
apply here.
First, “[t]he long-arm statute confers personal jurisdiction over non-
residents who [c]ommit[ ] a tortious act within [Florida].” Sean Dawkins v. Blue
Dart Ventures, LLC, Steven Craig Mitchem, & Joshua Lane Mitchem, No. 8:20-
CV-2353-MSS-TGW, 2021 WL 2823454, at *2 (M.D. Fla. Apr. 1, 2021).
“[F]irmly established precedent interprets this provision to apply to defendants
committing tortious acts outside the state that cause injury in Florida.” Id.
Second, citizens of other states who “own or hold a mortgage or lien on
real property within [Florida]” are subject to this Court’s jurisdiction if “the
plaintiff’s claim arose from” the defendant’s ownership of that mortgage or lien.
§ 48.193(1)(a)(3) Fla. Stat. (2023); Wells Fargo Equip. Fin., Inc. v. Bacjet, LLC,
221 So. 3d 671, 674 (Fla. Dist. Ct. App. 2017). “For a plaintiff’s claim to arise
from the defendant’s actions, there must be a direct affiliation, nexus, or
substantial connection between the basis for the plaintiff’s claim and the
defendant’s activity in the state.” Bacjet, LLC, 221 So. 3d at 674.
The long-arm statute empowers this Court to exercise jurisdiction over
CrossCountry under either section. Violations of the FCCPA are tortious acts.
Dawkins, 2021 WL 2823454, at *3. And Wright alleges CrossCountry violated
the FCCPA when it mismanaged the mortgage it held on his property in
Florida. (Doc. 1 ¶ 26). As a result, the complaint alleges enough facts to bring
CrossCountry within this Court’s orbit.
3. Exercising Jurisdiction over CrossCountry Would Not
Offend Due Process
Determining whether jurisdiction over CrossCountry offends due process
is a distinct analysis from defining the reach of Florida’s long-arm statute. CJS
Sols. Grp., LLC v. Tokarz, No. 3:20-CV-65-MMH-JRK, 2021 WL 848159, at *9
(M.D. Fla. Mar. 5, 2021). And “the Court must engage in the [Eleventh
Circuit’s] three-part due process analysis” before exercising jurisdiction over
CrossCountry. Id.
The test “examines: (1) whether [Wright]’s claims arise out of or relate
to at least one of [CrossCountry]’s contacts with the forum; (2) whether
[CrossCountry] purposefully availed [it]self of the privilege of conducting
activities within [Florida], thus invoking the benefit of [Florida]’s laws; and (3)
whether the exercise of personal jurisdiction comports with traditional notions
of fair play and substantial justice.” Louis Vuitton Malletier, S.A. v. Mosseri,
736 F.3d 1339, 1355 (11th Cir. 2013). Wright bore the burden of establishing
the first two factors. Id. CrossCountry was responsible for the third. Id.
The first factor is satisfied. Wright obtained a mortgage loan from
CrossCountry for his home in Florida. CrossCountry granted him forbearance
after Hurricane Ian but never honored it. Instead, CrossCountry sought to
collect payment through phone calls and letters, increasing Wright’s monthly
payments to cover the “principal, interest and late fees” from the three months
the loan was in forbearance, and threatening to “withhold the insurance
proceeds from the damage caused to Plaintiff’s home by Hurricane Ian.” (Doc.
1 ¶¶ 49-51, 126-31, 171.) These allegations form the foundation of Wright’s
FCCPA claim. And they form a direct causal relationship between
CrossCountry and Florida. Louis Vuitton Malletier, S.A., 736 F.3d at 1356.
The second factor is also met. To find CrossCountry has purposefully
availed itself of the privilege of doing business in Florida, the Court must find
CrossCountry’s contacts with this state result from “[it]s own choice and [are]
not random, isolated, or fortuitous.” Ford Motor Co. v. Montana Eighth Jud.
Dist. Ct., 592 U.S. 351, 359 (2021). Essentially, CrossCountry’s contacts with
Florida “must show that [it] deliberately reached out beyond its home [to
Florida]—by, for example . . . entering a contractual relationship centered
[here].” Id.
CrossCountry reached into Florida when it contracted to mortgage
Wright’s home. (Doc. 1 ¶ 26.) And Wright’s claims against CrossCountry stem
from its administration of his mortgage. (Doc. 1 ¶¶ 49-51, 126-31, 171.) Thus,
Wright’s injuries “arise out of or relate to” CrossCountry’s contacts with
Florida and CrossCountry had “fair warning” that it could be sued here. Ford
Motor Co., 592 U.S. at 362; Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472
(1985).
Finally, CrossCountry has not appeared or offered evidence to suggest
this Court’s jurisdiction would thwart traditional notions of fair play and
substantial justice. Louis Vuitton Malletier, S.A., 736 F.3d at 1355. Still, the
Court has considered “(1) the burden on [CrossCountry]; (2) the forum’s
interest in adjudicating the dispute; (3) [Wright’s] interest in obtaining
convenient and effective relief; and (4) the judicial system’s interest in
resolving the dispute.” Louis Vuitton Malletier, S.A., 736 F.3d at 1358. Having
independently weighed these factors, the Court finds exercising jurisdiction
over CrossCountry will not violate due process.
C. Wright Pleads Sufficient Facts to State Plausible Claims Under
the FCCPA
Entering a default judgment is warranted only when “the well-pleaded
allegations in the complaint actually state a substantive cause of action and
that a substantive, sufficient basis exists in the pleadings for the particular
relief sought.” Golembiewski, 2023 WL 4931218, at *2. A sufficient basis is
“akin to that necessary to survive a motion to dismiss for failure to state a
claim.” Id. Thus, the Court must evaluate whether the complaint contains
“sufficient factual matter, accepted as true, to state a claim to relief that is
plausible on its face.” Id.
The FCCPA states that “[i]n collecting consumer debts, no person shall .
. . [c]laim, attempt, or threaten to enforce a debt when [they] know[] that the
debt is not legitimate, or assert the existence of some other legal right when
such person knows that the right does not exist.” Fla. Stat. § 559.72(9). “Thus,
to state the claim under [the FCCPA], Plaintiff must allege: (1) an illegitimate
debt [or assertion of a right that does not exist]; (2) a threat or attempt to
enforce that debt; and (3) actual knowledge that the debt is illegitimate.”
Denning v. Mankin L. Grp., P.A., No. 8:21-CV-2822-MSS-MRM, 2022 WL
3365273, at *11 (M.D. Fla. Aug. 11, 2022); Perez-Guma v. Nissan Motor
Acceptance Corp., No. 17-14232-CV, 2017 WL 5179913, at *3 (S.D. Fla. Nov. 7,
2017).
CrossCountry granted Wright forbearance on his mortgage payments for
October, November, and December 2022. (Doc. 1 ¶¶ 36, 38.) Yet it never
honored the forbearance. Instead, CrossCountry tried to collect payment
through phone calls and letters, increasing Wright’s monthly payments, and
threatening to “withhold the insurance proceeds from the damage caused to
Plaintiff’s home by Hurricane Ian.” (Doc. 1 ¶¶ 49-51, 126-31.) Throughout this
process, Wright repeatedly reminded CrossCountry that his loan was in
forbearance. (Doc. 1 ¶¶ 42-45, 60-64.) CrossCountry was also informed that
Wright disputed consumer reports based on incorrect information provided by
the company. (Id. ¶¶ 69-71, 74-77, 81-82.) It made no difference. Taking these
facts as true, Wright has stated a plausible claim for relief under the FCCPA.
D. Damages
“Although a defaulted defendant admits well-pleaded allegations of
liability, allegations relating to the amount of damages are not admitted by
virtue of default.” Baumann v. Prober & Raphael, No. 615CV1951ORL40GJK,
2017 WL 10350673, at *2 (M.D. Fla. May 17, 2017). Instead, the Court must
ensure there is a legitimate basis for any damage award it enters. Anheuser
Busch, Inc. v. Philpot, 317 F.3d 1264, 1266 (11th Cir. 2003).
Generally, damages as part of a default judgment cannot be awarded
without a hearing, “unless the amount claimed is a liquidated sum or one
capable of mathematical calculation.” Organizacion Miss Am. Latina, Inc. v.
Urquidi, 712 F. App’x 945, 948 (11th Cir. 2017). Nor is a hearing needed if “the
record adequately reflects the basis for award . . . by detailed affidavits
establishing the necessary facts.” Adolph Coors Co. v. Movement Against
Racism & the Klan, 777 F.2d 1538, 1544 (11th Cir. 1985). But it is not enough
for a plaintiff seeking default judgment to “merely tell[] the Court in summary
fashion what [his] damages are[.]”Cabbil v. Res. Horizons Grp., LLC, No. 2:14-
CV-2017-JHH, 2015 WL 1840476, at *2 (N.D. Ala. Apr. 22, 2015). He must
“show the Court what those damages are, how they are calculated, and where
they come from.” Id. If he fails to do so, an evidentiary hearing is required.
Organizacion Miss Am. Latina, Inc., 712 F. App’x at 948.
Wright seeks “actual, statutory, and punitive damages” as well as his
attorneys’ fees and costs under Fla. Stat. § 559.77(2). (Doc. 1 ¶¶ 183-84.) These
components are addressed in turn.
1. Wright has Shown Entitlement to Statutory Damages
Statutory damages are awardable under the FCCPA when a defendant
commits one of the prohibited practices. Fla. Stat. § 559.72(2). But they are
capped at $1,000. William O’Driscoll, v. Arbor Grove Condo. Ass’n, Inc., &
Resource Property Management, Inc., No. 8:22-CV-1984-VMC-JSS, 2024 WL
493084, at *10 (M.D. Fla. Feb. 7, 2024) (collecting cases). To obtain statutory
damages, Wright need only show CrossCountry committed one of the
prohibited acts. Barardi v. Select Portfolio Servicing, Inc., 2017 U.S. Dist.
LEXIS 160951, *9 (S.D. Fla. April 4, 2017). It is irrelevant whether he was
actually injured. Golembiewski, 2023 WL 4931218, at *4. As outlined above,
Wright has pled facts showing CrossCountry violated § 559.72(9).
Statutory damages under the FCCPA are liquidated and may be
awarded without a hearing. Harris v. Beneficial Fin. Co. of Jacksonville, 338
So. 2d 196, 200 (Fla. 1976). Wright’s entitlement to the full $1,000 recoverable
under the Act, or something less, is left to the Court’s discretion. Baumann,
2017 WL 10350673, at *2.
The allegations in the complaint, admitted by CrossCountry, show it was
aware that Wright’s mortgage was in forbearance, not default, between
October and December 2022. (Doc. 1 ¶¶ 42-45, 60-64, 69-71, 74-77, 81-82.)
Despite this knowledge, CrossCountry made repeated efforts to collect
payment, to include threatening to withhold the insurance proceeds Wright
needs to repair damage caused to his home by Hurricane Ian. (Id. ¶¶ 49-51,
126-31.) More troubling still, CrossCountry continues to treat Wright’s
mortgage as if it were in default. (Id. ¶¶ 130-31.) The nature, frequency, and
persistence of its attempts to collect payment, coupled with the extent of its
misconduct, dictates that Wright should recover the full statutory damages
available under § 559.72(2).
2. Wright has not Shown Entitlement to Actual or Punitive
Damages
Actual and punitive damages are also awardable under the FCCPA. See
Fla. Stat. § 559.72(2), (9). Wright asks the Court to award him $10,000 in
actual damages and $10,000 in punitive damages. (Doc. 79, Doc. 79-2.) But
Wright never explains how he arrived at either figure. Instead, they are
presented in summary fashion. (Id.) The Court cannot award actual or punitive
damages on this record. Adolph Coors Co., 777 F.2d at 1543-44; Cabbil, 2015
WL 1840476, at *2. Thus, Wright must make his claim for actual and punitive
damages at an evidentiary hearing.
3. Plaintiff’s Request for Attorney’s Fees and Costs is Premature
Attorney’s fees and costs are also recoverable under the FCCPA. “But
Local Rule 7.01 and Fed. R. Civ. P. 54. require any demand for fees and costs
to be made after entry of judgment. Thus, these requests should be made by
separate motion.” Alexander Produce, Inc. v. DGR Sales, LLC, No. 2:21-CV-
495-JLB-KCD, 2022 WL 17370251, at *4 (M.D. Fla. Sept. 20, 2022) (emphasis
added).
E. Wright Abandoned the FCRA Claim
As mentioned, Wright’s complaint also seeks relief under the FDCPA.
His motion for default judgment, however, makes no mention of this claim. A
plaintiff abandons a cause of action by omitting it from their motion for default
judgment. E-Z-Dock, Inc. v. KonaDocks LLC, No. 6:21-CV-2155-ACC-EJK,
2022 WL 8221613, at *1 n. 1 (M.D. Fla. Aug. 5, 2022). Accordingly, Wright’s
FDCPA claim should be dismissed.
For these reasons, the Court RECOMMENDS that:
1. Wright’s Motion for Default Judgment be GRANTED as to
CrossCountry’s liability under the Florida Consumer Collection Practices Act;
2. Wright be awarded $1,000 in statutory liquidated damages;
3. Wright’s request for fees and costs be decided at the conclusion of
the case consistent with Local Rule 7.01;
4. The Court set an evidentiary hearing to determine Wright’s
economic and unliquidated damages;
5. Wright’s claim under the Fair Credit Reporting Act be dismissed;
and
6. The Clerk MAIL a copy of the Court’s Order and any notice of
hearing to CrossCounty at the following address:
C T CORPORATION SYSTEM
1200 SOUTH PINE ISLAND
PLANTATION, FL 33324
ENTERED in Fort Myers, Florida on February 21, 2024.
Lye wen
□□□ Bf
lef. ale
* Wale C. Dudek
United States Magistrate Judge
Copies: All Parties of Record
NOTICE TO PARTIES
A party has fourteen days from this date to file written objections to the Report
and Recommendation’s factual findings and legal conclusions. A party’s failure
to file written objections waives that party’s right to challenge on appeal any
unobjected-to factual finding or legal conclusion the district judge adopts from
the Report and Recommendation. See 11th Cir. R. 3-1. To expedite resolution,
parties may file a joint notice waiving the 14-day objection period.
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