The opinion
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION
CRYSTAL CRUZ,
Plaintiff,
v. Case No: 6:24-cv-1008-RBD-NWH
CREDITMAX EXPERTS, LLC,
Defendant.
REPORT AND RECOMMENDATION
This cause comes before the Court on Plaintiff Crystal Cruz’s (“Plaintiff”)
Motion for Default Judgment Against Defendant Creditmax Experts, LLC
(“Defendant”) on a Sum Certain (the “Motion”), filed October 10, 2024. (Doc. 14).
For the reasons set forth below, the undersigned respectfully recommends that the
Motion be granted in part and denied in part.
BACKGROUND1
This case arises under the Credit Repair Organizations Act (“CROA”), 15
U.S.C. §§ 1679b and 1679g. (See Doc. 1). In early 2023, Plaintiff contacted Defendant
regarding its credit repair services. (Id., ¶¶ 7-8). Defendant informed Plaintiff that it
“would be able to get certain information removed from Plaintiff’s credit report” by
disputing that information in exchange for payment. (Id., ¶¶ 9-10). Plaintiff specifically
1 On default, a defendant admits the well-pleaded allegations of fact in the complaint. Eagle Hosp.
Physicians, LLC v. SRG Consulting, Inc., 561 F.3d 1298, 1307 (11th Cir. 2009).
asked Defendant to remove “a mortgage-related debt,” and Defendant promised to
have that debt “removed from all of Plaintiff’s credit reports through its services.” (Id.,
¶ 11). Defendant represented that Plaintiff “would be entitled to a full refund on her
payments” if she “did not have the account removed entirely from her credit reports
within 3 months of signing up.” (Id., ¶ 12).
Based on that conversation, Plaintiff entered into a contract with Defendant,
which required her to pay “approximately $7,500.00 for Defendant’s services ‘at
signup.’ ” (Id., ¶¶ 13-14). Plaintiff ultimately paid the $7,500.00 sign-up fee in two
payments. (Id., ¶ 15).2
After three months, Plaintiff requested the refund that Defendant promised
because the mortgage-related debt remained on her credit reports. (Id., ¶¶ 19-20).
Despite her attempts to contact Defendant and Defendant’s various requests for
extensions of time, Plaintiff has not received a refund. (Id., ¶¶ 20-23).
Plaintiff filed this lawsuit on May 31, 2024, asserting that Defendant violated
§ 1679b of the CROA. (Id.). Although Defendant was served, Defendant has neither
filed an answer nor otherwise appeared. (See Docs. 11-13). Consequently, Plaintiff
filed the instant Motion, seeking $7,500.00 in damages under 15 U.S.C.
§ 1679g(a)(1)(B) and $2,362.50 in attorneys’ fees and costs pursuant to § 1679g(a)(3).3
2 Plaintiff was also subjected to an undisclosed monthly fee “totaling approximately $20 just to have
access to her account with Defendant.” (Doc. 1, ¶ 17).
3 While Plaintiff’s Complaint includes a request for punitive damages under § 1679g(a)(2)(A), Plaintiff
does not seek punitive damages in the instant Motion. (Compare Doc. 1 with Doc. 14).
LEGAL STANDARD
A district court may enter a default judgment against a properly served
defendant who fails to defend or otherwise appear. Fed. R. Civ. P. 55(b)(2). The mere
entry of a default by the Clerk does not warrant entering a default judgment without
more. See Tyco Fire & Sec., LLC v. Alcocer, 218 F. App’x 860, 863 (11th Cir. 2007).
Rather, a defaulted defendant is deemed to admit only the plaintiff’s well-pleaded
allegations of fact. Id. “Thus, before entering a default judgment for damages, the
district court must ensure that the well-pleaded allegations in the complaint, which are
taken as true due to the default, actually state a substantive cause of action and that
there is a substantive, sufficient basis in the pleadings for the particular relief sought.”
Id.
“Once liability is established, the court turns to the issue of relief.” Enpat, Inc. v.
Budnic, 773 F. Supp. 2d 1311, 1313 (M.D. Fla. 2011). Under Federal Rule of Civil
Procedure 54(c), a default judgment “must not differ in kind from, or exceed in
amount, what is demanded in the pleadings.” Fed. R. Civ. P. 54(c). However, a “court
may conduct hearings when it needs to determine the amount of damages, establish
the truth of any allegation by evidence, or investigate any other matter.” Enpat, Inc.,
773 F. Supp. 2d at 1313 (citing Fed. R. Civ. P. 55(b)(2)). That said, an evidentiary
hearing is not required “where all essential evidence is already of record.” SEC v.
Smyth, 420 F.3d 1225, 1232 n.13 (11th Cir. 2005).
DISCUSSION
I. Service of Process
The Court previously determined that Defendant was properly served on
June 26, 2024, through service on an employee of its registered agent, pursuant to
Federal Rule of Civil Procedure 4(h)(1)(B). (Docs. 10, 12).
II. Jurisdiction
The Court has subject matter jurisdiction under 28 U.S.C. § 1331 because a
federal question is presented on the face of Plaintiff’s properly pleaded complaint. See
Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987); (Doc. 1). The Court has personal
jurisdiction over Defendant because Defendant operates and conducts business in
Orlando, Florida, which is the location of its principal place of business. See Fla. Stat.
§ 48.193(1)(a)(1) (“A person . . . submits himself or herself . . . to the jurisdiction of the
courts of this state for any causation of action arising from . . . [o]perating, conducting,
engaging in, or carrying on a business or business venture in this state or having an
office or agency in this state.”); (Doc. 1, ¶ 5; Doc. 12). This Court is the appropriate
venue because a substantial portion of the events giving rise to Plaintiff’s claim
occurred in the Middle District of Florida. See 28 U.S.C. § 1391(b)(2); (Doc. 1, ¶ 3).
III. Liability
Plaintiff moves for default judgment on her CROA claim.4 “The CROA
4 Although Plaintiff separates Defendant’s “[v]iolations of the Credit Repair Organizations Act” into
three counts in her Complaint, the undersigned refers to a singular “claim” under the CROA. (See
Doc. 1).
prohibits unfair or deceptive advertising and business practices by credit repair
organizations.” FTC v. Lalonde, 545 F. App’x 825, 837 (11th Cir. 2013) (citing 15
U.S.C. § 1679(b)(2)). That Act defines a “credit repair organization” as:
[A]ny person who uses any instrumentality of interstate commerce or the
mails to sell, provide, or perform (or represent that such person can or
will sell, provide, or perform) any service, in return for the payment of
money or other valuable consideration, for the express or implied
purpose of . . . improving any consumer’s credit record, credit history, or
credit rating[.]
§ 1679a(3)(A)(i).
The CROA prohibits credit repair organizations from: (1) making or using “any
untrue or misleading representation of the services of the credit repair organization”;
(2) engaging “in any act, practice, or course of business that constitutes or results in
the commission of, or an attempt to commit, a fraud or deception on any person in
connection with the offer or sale of the services of the credit repair organization”; and
(3) charging or receiving “any money or other valuable consideration for the
performance of any service which the credit repair organization has agreed to perform
for any consumer before such service is fully performed.” §§ 1679b(a)(3)–(4), (b).
Plaintiff (a resident of Brooklyn, New York) has sufficiently pleaded that
Defendant is a credit repair organization because she alleges Defendant (a Florida
LLC) contracted with her for the purported purpose of improving her credit score in
exchange for $7,500.00. (Doc. 1, ¶¶ 4-5, 7-15). See Dauval v. Preferred Collection & Mgmt.
Servs., Inc., No. 8:11-cv-2269-T-27TGW, 2012 WL 5928622, at *4 (M.D. Fla. Nov. 26,
2012). Additionally, Plaintiff has properly alleged that Defendant violated
§§ 1679(b)(a)(3)–(4) and (b), considering that Defendant promised to remove
Plaintiff’s mortgage-related debt from all of her credit reports, charged Plaintiff for that
service before Defendant performed any work, and offered her a money-back
guarantee—but ultimately failed to fulfill any of its promises.5 (Doc. 1, ¶¶ 9-22, 30, 35,
40). Taking these facts as true, the undersigned respectfully recommends that the Court
find Plaintiff has pleaded a plausible claim for relief under the CROA,
§§ 1679(b)(a)(3)–(4) and (b).
IV. Damages
“Although a defaulted defendant admits well-pleaded allegations of liability,
allegations related to damages are not deemed admitted and the Court must determine
the amount and character of damages to be awarded.” Glanzrock v. Patriot Roofing
Indus., Inc., No. 8:07-cv-535-T-33MAP, 2009 WL 179634, at *2 (M.D. Fla. Jan. 26,
2009) (citing Miller v. Paradise of Port Richey, Inc., 75 F. Supp. 2d 1342, 1346 (M.D. Fla.
1999)). “Damages may be awarded only if the record adequately reflects the basis for
award via a hearing or a demonstration by detailed affidavits establishing the necessary
facts.” Adolph Coors Co. v. Movement Against Racism & the Klan, 777 F.2d 1538, 1543–44
(11th Cir. 1985)
Pursuant to § 1679(g), Plaintiff may recover actual damages and attorneys’ fees
for Defendant’s violations of the CROA. That provision states, in relevant part:
5 In other words, Plaintiff has pleaded a claim under the CROA because she has alleged that Defendant
issued untrue and misleading representations regarding its services, engaged in a course of business
that resulted in deception in connection with the sale of its services, and charged Plaintiff for its
services before it actually performed said services. See §§ 1679(b)(a)(3)–(4) and (b).
Any person who fails to comply with any provision of this subchapter
with respect to any other person shall be liable to such person in an
amount equal to the sum of the amounts determined under each of the
following paragraphs:
(1) Actual damages
The greater of—
(A) the amount of any actual damage sustained by such
person as a result of such failure; or
(B) any amount paid by the person to the credit repair
organization. . . .
(3) Attorneys’ fees
In the case of any successful action to enforce any liability under
paragraph (1) or (2), the costs of the action, together with
reasonable attorneys’ fees.
Id. §§ 1679g(a)(1), (3).
In her Motion, Plaintiff seeks $7,500.00 in actual damages under
§ 1679g(a)(1)(B) and $2,362.50 in attorneys’ fees and costs pursuant to § 1679g(a)(3).
(Doc. 14; see Docs. 14-1, 14-2).
A. Actual Damages
The undersigned concludes that Plaintiff is entitled to $7,500.00 in actual
damages under § 1679g(a)(1)(B), as that is the amount that she alleges she paid to
Defendant. (Doc. 1, ¶¶ 14-15).
B. Attorneys’ Fees
Plaintiff is also entitled to attorneys’ fees under § 1679g(a)(3).6 In her
Itemization of Attorneys’ Fees and Costs, Plaintiff requests a total of $1,862.50 in
attorneys’ fees, on the basis that counsel spent a total of 8.5 hours of time on this case,
split between work by attorney Alexander J. Taylor (3.2 hours at $375.00 per hour)
and a paralegal (5.3 hours at a rate of $125.00 per hour). (Doc. 14-1). Attorney Taylor
asserts that this billing is “reasonable for an attorney with similar experience.”
(Doc. 14-2).
Based on counsel’s averment and the undersigned’s own experience, the
undersigned will recommend that the Court (1) approve counsel’s request for rates of
$375.00 per hour for Attorney Taylor and $125.00 per hour for his paralegal as
reasonable and (2) find the number of hours spent on this case (8.5, primarily billed by
counsel’s paralegal) reasonable. See Bean v. Step 1 Credit, LLC, No. 1:23-CV-01504-DII,
2024 WL 3510303, at *4 (W.D. Tex. July 22, 2024), report and recommendation adopted,
2024 WL 3730277 (W.D. Tex. Aug. 7, 2024) (finding the same requested rates and 8.1
hours of work reasonable in a case involving a CROA claim).
6 Middle District of Florida Local Rule 7.01 provides for a bifurcated process to determine attorneys’
fees and expenses. However, in the interest of judicial efficiency, and given the fact that Defendant is
in default, the undersigned addresses the merits of Plaintiff’s requested fees and costs, and respectfully
recommends that the Court forego the procedural mechanisms set forth in Local Rule 7.01 and rule
on the issues of both entitlement and quantification without additional motion practice. See Local
Rule 1.01(b).
C. Costs
Additionally, Plaintiff is entitled to costs pursuant to § 1679g(a)(3). She seeks a
total of $500.00 in costs: $405.00 for the filing fee and $95.00 for service fees.
(Doc. 14-1 at 2). Plaintiff is entitled to recover the filing fee, which the docket reflects
that she paid. See 28 U.S.C. § 1920(1); see also Fam. Oriented Cmty. United Strong, Inc. v.
Lockheed Martin Corp., No. 8:11-cv-217-T-30AEP, 2012 WL 6575348, at *1 (M.D. Fla.
Dec. 17, 2012) (“Fees of the clerk and marshal include filing fees and are clearly
taxable.”).
Although the recovery of private process server fees is authorized under 28
U.S.C. § 1920(1), the rate must not exceed the costs charged by the United States
Marshal’s Service to effectuate service. See EEOC v. W&O, Inc., 213 F.3d 600, 624 (11th
Cir. 2000). The current statutory rate for service by the United States Marshal is $65.00
per hour, plus travel costs and other out of pocket expenses. See 28 C.F.R.
§ 0.114(a)(3); Cadle v. GEICO Gen. Ins., No. 6:13-cv-1591-Orl-31GJK, 2015 WL
4352048, at *2 (M.D. Fla. July 14, 2015).
Plaintiff provides no invoice, documentation, or other information in support
of the $95.00 she requests. As a result (and absent any argument or evidence in support
of a higher amount), the undersigned will recommend that the recoverable costs for
service of process be limited to $65.00. See Joe Hand Promotions, Inc. v. Johnny G’s LLC,
No. 8:19-cv-652-T-60CPT, 2020 WL 7029302, at *6 (M.D. Fla. Nov. 13, 2020), report
and recommendation adopted, 2020 WL 7024873 (M.D. Fla. Nov. 30, 2020).
D. Post-Judgment Interest
Finally, Plaintiff seeks an award of post-judgment interest on her damages. (See
Doc. 14 at 4). By federal statute, “Interest shall be allowed on any money judgment in
a civil case recovered in a district court.” 28 U.S.C. § 1961(a). “Interest shall be
computed daily to the date of payment . . . and shall be compounded annually.” Id.
§ 1961(b). Interest is calculated “from the date of the entry of the judgment, at a rate
equal to the weekly average 1-year constant maturity Treasury yield, as published by
the Board of Governors of the Federal Reserve System, for the calendar week
preceding the date of the judgment.” Id. § 1961(a). Under this statute, post-judgment
interest is mandatory. BankAtlantic v. Blythe Eastman Paine Webber, Inc., 12 F.3d 1045,
1053 (11th Cir. 1994). Therefore, the undersigned recommends that the Court award
Plaintiff post-judgment interest, which will accrue at the statutory rate as set forth in
28 U.S.C. § 1961.
CONCLUSION
Accordingly, the undersigned RESPECTFULLY RECOMMENDS that the
Court GRANT in part and DENY in part Plaintiff’s Motion for Default Judgment
Against Creditmax Experts, LLC on a Sum Certain (Doc. 14), as follows:
1. ENTER a final default judgment in favor of Plaintiff and against Defendant in
the total amount of $9,832.50, allocated to:
$7,500.00 in actual damages;
$1,862.50 in attorneys’ fees; and
e $470.00 in costs;
2. AWARD Plaintiff post-judgment interest, which will accrue at the statutory
rate as set forth in 28 U.S.C. § 1961;
3. DENY the Motion (Doc. 14) in all other respects; and
4, DIRECT the Clerk of Court to issue a judgment consistent with the Court’s
ruling on this Report and Recommendation and, thereafter, to close the file.
NOTICE TO PARTIES
The party has fourteen days from the date the party is served a copy of this
report to file written objections to this report’s proposed findings and
recommendations or to seek an extension of the fourteen-day deadline to file written
objections. 28 U.S.C. § 636(b)(1)(C). 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; 28 U.S.C. § 636(b)(1).
Recommended in Orlando, Florida on July 29, 2025.
Ae ul
NATHAN W. HILL
UNITED STATES MAGISTRATE JUDGE
11