Opinion
1:01CV00643
December 12, 2002
MEMORANDUM OPINION
I. INTRODUCTION
This matter is currently before the Court on Defendant Sears Roebuck Co.'s ("Sears") Motion for Summary Judgment [Document #9]. Pursuant to its Motion, Defendant seeks summary judgment in its favor with respect to all of the claims asserted by Plaintiff Donald Steven Butler ("Plaintiff") Specifically, Plaintiff has alleged that Sears engaged in unfair and deceptive trade practices when it reported Plaintiff's non-payment of his credit card account to Equifax Credit Information Services) Inc. ("Equifax"). For the reasons detailed below, Defendant's Motion for Summary Judgment is GRANTED.
II. FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff filed a Complaint against Sears and Equifax (collectively, "Defendants"), in North Carolina state court on May 21, 2001, alleging that Sears intentionally, deliberately, and illegally reported the non-payment of his credit card account to Equifax, thereby engaging in unfair and deceptive trade practices, in violation of Chapter 75 of the General Statutes of North Carolina. Plaintiff also alleged that Equifax, based upon its own actions, violated the Federal Fair Credit Reporting Act. Subsequently, Defendants jointly removed this matter to this Court based upon 28 U.S.C. § 1331 original jurisdiction by the federal courts. On May 7, 2002, Sears filed a Motion for Summary Judgment. Plaintiff, however, never responded to Sears' Motion for Summary Judgment. Because Plaintiff did not file a response, on July 3, 2002, the Clerk of the Middle District of North Carolina advised Plaintiff's counsel by mail that, pursuant to Rule 7.3(k) of the Local Rules, the Court would consider Sears' Motion for Summary Judgment as being uncontested and that it could be granted without further notice. Plaintiff's counsel was further advised that if Plaintiff did oppose the motion and could demonstrate excusable neglect, then this information would be provided to the Court. Up to the date of this Memorandum Opinion and Order and Judgment, Plaintiff still has not responded to Defendant's Motion for Summary Judgment.
Later, on June 6, 2002, the Court issued an Order, pursuant to a stipulation entered into by the parties, dismissing all of Plaintiff's claims against Equifax with prejudice.
In considering Sears' Motion for Summary Judgment, the Court notes that the documents available to the Court indicate that in 1998, Plaintiff purchased a stackable washer/dryer unit from Sears, which was installed in his home. Due to mechanical problems, Sears replaced the unit in the middle of 1998. Like his previous one, Butler's second washer/dryer unit also malfunctioned and caused approximately $6000.00 worth of water damage to his home. Sears agreed to give Plaintiff credit for the purchase price of the malfunctioning unit which he had received. Plaintiff subsequently purchased a third washer/dryer unit from Sears and charged its cost to his Sears' Premium Credit Card Account. After corresponding with Sears' representatives about the damage to his home, Plaintiff took the position that he did not have to make any payments or pay his Sears' credit card for charges on the new unit until Sears settled and resolved his claim for the water damage to his home. There is no indication that anyone from Sears had advised Plaintiff to proceed in that manner. This perhaps became clear as Sears' Payment Center sent Plaintiff monthly statements on his credit card account and informed him that by not making payments on the account he was incurring both a late payment fee, and finance charges on his outstanding account balance.
At the time Plaintiff purchased the third washer/dryer unit on September 29, 1999, his Sears Premium Card Account balance was zero. Either when he purchased the washer/dryer unit or at some time thereafter, Plaintiff charged other items to his Sears Premium Card Account in the amount of $286.11. Plaintiff did remit $286.11 to Sears' Payment Center to satisfy that debt, but he refused to make payment of the remaining balance that related to the washer/dryer unit.
On December 23, 1999, Plaintiff sent the Sears' Payment Center another notice stating that he refused to make payments on his credit card account for the replacement washer/dryer unit until Sears reimbursed him for the damages caused by the faulty unit he had received earlier. The Court notes that the question of Plaintiff's concern about his credit status was presented to Sears, prior to a settlement being reached, in the form of a warning by Plaintiff to Sears that if it reported his non-payment to a credit bureau, then he would pursue litigation against Sears. Plaintiff in fact did file a lawsuit against Sears in Guilford County District Court, case number, 00 CVD 6200 ("Butler I"), on April 20, 2000. In that lawsuit, Plaintiff specifically sought to recover for the damages he suffered to his home from the water overflow of the faulty washer/dryer unit.
After the initial lawsuit was filed, but before a settlement was reached, Plaintiff became aware that Sears had in fact reported his delinquent account status to Equifax. Plaintiff alleged that this reporting by Sears caused his credit rating to decrease. On September 1, 2000, through his lawyer, Plaintiff sent a letter to the Sears' Payment Center demanding that it retract the erroneous credit information. Plaintiff also informed Sears of his contention that it violated the Federal Fair Credit Reporting Act by reporting his non-payment to Equifax. Plaintiff then received a letter in response, dated September 19, 2000, in which Sears confirmed that his balance was correctly reported and included a copy of his credit report. It is to be noted, however, that in a letter from Equifax dated October 10, 2000, Plaintiff was aware of the fact that Equifax had already complied with his request to retract the credit information reported by Sears.
A copy of the letter was also forwarded to Equifax.
Having been provided with notice of all the claims that Plaintiff was asserting against it, Sears, on March 8, 2001, reached an agreement with Plaintiff and paid him a total sum of $6400.00 to settle his civil action that arose as a result of the faulty washer/dryer unit Plaintiff had purchased from Sears. The settlement between the parties was entered into on March 12, 2001, whereupon Plaintiff signed a liability release which contained language discharging Sears from any causes of action or liability that had already arisen or that Plaintiff might attempt to assert in the future arising out of and relating to the incident which generated the litigation against Sears and Equifar, that is, the damage to Plaintiff's home from the faulty washer/dryer unit. On March 13, 2001, Plaintiff's civil action was voluntarily dismissed with prejudice.
Notwithstanding the disposition of Plaintiff's civil action in Guilford County District Court pursuant to the settlement and release, Plaintiff, on May 21, 2001, initiated the instant action ("Butler II") against Sears and Equifax in order to recover damages he suffered to his credit rating based upon Sears reporting to Equifax Plaintiff's failure to make any payments on his Sears' credit card balance. Although the parties agreed on May 24, 2002, by stipulation, to dismiss the action with prejudice as to Equifax, Plaintiff still contends that Sears improperly reported his credit status to Equifax, which caused Equifax to erroneously publish this information to the general public. On the basis of these allegations, Plaintiff asserted the present claim that Sears engaged in unfair and deceptive trade practices. Sears' motion before the Court asserts that it is entitled to summary judgment on the basis of the execution of the liability release by Plaintiff and because of the doctrine of res judicata. Sears also contends that Plaintiff's claim for unfair trade practices should fail as a matter of law. However, as previously noted, Plaintiff failed to respond to Sears' Motion for Summary Judgment in contravention of the Local Rules of this Court. Therefore, the Court finds that Sears would be entitled to summary judgment both procedurally and substantively as a matter of law.
III. DISCUSSION
A. Dismissal for Failure to Comply with Local Rules for Summary Judgment Motion Practice
Procedurally, Plaintiff's instant civil action is subject to dismissal for failure to comply with Rule 7.3(k) of the Local Rules for the Middle District of North Carolina. Rule 7.3(k) provides, in part that
The failure to file a brief or response within the time specified in this rule shall constitute a waiver of the right thereafter to file such brief or response, except upon a showing of excusable neglect. . . . If a respondent fails to file a response within the time required by this rule, the motion will be considered and decided as an uncontested motion, and ordinarily will be granted without further notice.
M.D.N.C. LR 7.3(k).
Furthermore, Local Rule 7.3(f), in conjunction with Local Rule 56.1(d), further provides that the respondent, if opposing a motion for summary judgment, shall file a response, including brief, within thirty (30) days after service of the motion. As previously noted Sears filed its Motion for Summary Judgment on May 7, 2002, Pursuant to the Local Rules, Plaintiff's response to Sears' Motion for Summary Judgment should have been filed on or about June 7, 2002. Although the record reveals that Plaintiff is represented by counsel in this matter, a response to Sears' summary judgment motion has never been filed. This is still the case despite the fact that on July 3, 2002, the Clerk of the Middle District of North Carolina advised Plaintiff's counsel by mail that, pursuant to Rule 7.3(k) of the Local Rules, the Court would consider Sears' Motion for Summary Judgment as being uncontested and that it could be granted without further notice. Plaintiff's counsel was further advised that if Plaintiff did oppose the motion and could demonstrate excusable neglect, then this information would be provided to the Court. Even up to the date of this Memorandum Opinion and Order and Judgment, Plaintiff still has not responded to Sears' Motion for Summary Judgment. Procedurally, the Court will therefore treat Sears' Motion for Summary Judgment as being uncontested and allow Sears' motion for the reasons stated therein. Even if the Court were not to proceed, pursuant to the Local Rules, to dismiss Plaintiff's claim on procedural grounds, Sears would nevertheless be entitled to summary judgment as a matter of law on the merits of its motion. The Court, therefore, for sake of completeness, will briefly address the merits of Sears' Motion for Summary Judgment.
Later, on June 6, 2002, the Court issued an Order, pursuant to a stipulation entered into by the parties, dismissing all of Plaintiff's claims against Equifax with prejudice.
B. Defendant's Motion for Summary Judgment
With respect to its Motion for Summary Judgment, Sears attacks the claim asserted by Plaintiff on three different grounds. Specifically, Sears claims that Plaintiff signed a valid release discharging it from any liability relating to the faulty washer/dryer unit, that the voluntary dismissal of Plaintiff's previous civil action has res judicata implications, and that Plaintiff cannot satisfy the elements of a claim for unfair or deceptive trade practices. The Court notes, in addressing the bases of Sears' motion on the merits, that because of Plaintiff's failure to file a Response to Sears' Motion for Summary Judgment, Plaintiff has not set forth any specific facts showing that there is a genuine issue for trial. Summary judgment is therefore appropriate when "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). A fact is considered "material" if it "might affect the outcome of the suit under the governing law . . . ." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). Under this standard, a genuine issue of material fact exists "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. As a result, the Court will only enter summary judgment in favor of the moving party when the record "`shows a right to judgment with such clarity as to leave no room for controversy'" and dearly demonstrates that the non-moving party "`cannot prevail under any circumstances.'" Campbell v. Hewitt, Coleman Assocs., Inc., 21 F.3d 52, 55 (4th Cir. 1994) (quoting Phoenix Sav. Loan, Inc. v. Aetna Cas. Sur. Co., 381 F.2d 245, 249 (4th Cir. 1967)). Plaintiff's failure to respond leaves the Court with the only position that can be taken, which is, that without any response or evidence to the contrary from Plaintiff, there can be no genuine issue of material fact as to the position taken by Sears as to the merits of Plaintiff's claims.
While it is the that a moving party such as Sears, in this instance, bears the initial burden of establishing that there is no genuine issue as to any material fact and that he is entitled to judgment as a matter of law, once the moving party has met this burden, the non-moving party, such as Plaintiff, in this instance, must set forth specific facts showing that there is a genuine issue for trial. Id. Catawba Indian Tribe of S.C. v. South Carolina, 978 F.2d 1334, 1339 (4th Cir. 1992), cert. denied, 507 U.S. 972, 113 S.Ct. 1415, 122 L.Ed.2d 785 (1993). In other words, the non-moving party must show "more than . . . some metaphysical doubt as to the material facts[,]" for the mere existence of a scintilla of evidence in support of his position is insufficient to survive summary judgment. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986); see Catawba Indian Tribe, 978 F.2d at 1339. In so doing, the adverse party may not rest on mere allegations, denials, or unsupported assertions, but must, through affidavits or otherwise, provide evidence of a genuine dispute.Anderson, 477 U.S. at 251-52, 106 S. Ct, at 2511-12. Plaintiff, by not responding at all, has failed to put forth any evidence of a genuine issue of material fact in dispute.
As previously stated, Sears asserted three different bases for its Motion for Summary Judgment to suggest that there is no genuine material issue in dispute as to Plaintiff's claim against Sears for unfair trade practices. These include the assertion that Plaintiff signed a valid release discharging Sears from any liability relating to the dispute that originated from the faulty washer/dryer unit Plaintiff purchased from Sears, the fact that the doctrine of res judicata applies based upon Plaintiff's voluntary dismissal of his case in Butler I, and more importantly, the assertion by Sears that Plaintiff cannot satisfy the elements of a claim for unfair or deceptive trade practices. The Courts in resolving this matter on the merits, to the extent necessary, needs to only look to one of the bases asserted by Sears as substantive grounds to support its Motion for Summary Judgment.
As previously noted, one of the reasons Sears contends that it is entitled to summary judgment as a matter of law is that Plaintiff failed to establish that Sears' actions amount to an unfair or deceptive trade practice. To establish a claim for unfair or deceptive trade practices under N.C. Gen. Stat. § 75-1.1 a plaintiff must show: (1) an unfair or deceptive act or practice, (2) in or affecting commerce, and, (3) which proximately caused injury to the plaintiff. Dalton v. Camp, 353 N.C. 647, 656, 548 S.E.2d 704, 711 (2001). Notably, in the instant case, the final two elements, whether Sears' actions were in or affected commerce and whether Plaintiff's purported injury was proximately caused by Sears reporting to Equifax the fact that Plaintiff failed to make any payments on his Sears' credit card account, are not in dispute. Therefore, the determination of Plaintiff's unfair or deceptive trade practices claim, for summary judgment purposes, would turn on whether Sears engaged in an unfair or deceptive act or practice. of course, the question of whether Sears engaged in certain behavior that Plaintiff complains of would be for a jury to decide. However, the ultimate determination of whether such behavior, if it occurred, amounts to an unfair or deceptive act or practice would be a question of law for the Court to decide. Gray v. North Carolina Ins. Underwriting Ass'n, 352 N.C. 61, 68, 529 S.E.2d 676, 681, reh'g denied, 352 N.C. 599, 544 S.E.2d 771 (2000).
A practice is unfair when it "offends public policy and when the practice is immoral, unethical, oppressive, unscrupulous, or substantially injurious to consumers." Miller v. Nationwide Mutual Ins. Co., 112 N.C. App. 295, 301, 435 S.E.2d 537, 542 (1993). Additionally, an act is deceptive if it has the capacity or tendency to mislead, or created the likelihood of deception. Chastain v. Wall, 78 N.C. App. 350, 356, 337 S.E.2d 150, 154 (1985). Plaintiff, in his Complaint, alleged that Sears' action of reporting the non-payment of his credit account to Equifax would amount to an unfair and deceptive act. However, Plaintiff, by not responding to the Motion for Summary Judgment, failed to demonstrate how any such conduct that he complained of would lead to a conclusion as a matter of law that Sears acted towards him in an unfair or deceptive manner.
Based upon the facts of this matter, at least as alleged in Plaintiff's Complaint, Plaintiff would have difficulty showing an unfair or deceptive act even if he had responded to the motion for summary judgment. At best, the allegations of the Complaint reveal that Sears reported Plaintiff's non-payment to Equifax after Sears' Payment Center sent Plaintiff monthly bills notifying him that he was incurring late payment and interest charges. In turn, Plaintiff notified Sears' Payment Center, in a letter dated December 23, 1999, that he would file additional litigation against Sears if it reported his delinquent account to a credit agency. In the only evidence that can possibly be attributed to Plaintiff in a potential response to the motion for summary judgment, that is, his deposition, Plaintiff asserted that he told Sears that he would not pay on his account until it resolved his claim for damages from the faulty washer/dryer unit. Plaintiff further indicated that he believed he had no obligation to pay on his credit card account balance until Sears compensated him for the damages to his home. But, Plaintiff also admitted that Sears never represented to him that it agreed with the position he had taken in this matter. Thus, Sears did not act unfairly towards Plaintiff since merely reporting his delinquent account due to non-payment would not constitute conduct that would be immoral, unethical, or otherwise inappropriate so as to constitute an unfair trade practice.
Moreover, Plaintiff, again by not responding to the motion for summary judgment failed to produce, and perhaps could not produce, any evidence demonstrating that Sears deceived or misled him in any manner. Simply put, Plaintiff chose not to pay Sears, which as a consequence, reported his non-payment to Equifax. Sears, therefore, did not engage in any unfair or deceptive act that injured Plaintiff. According to his own deposition, Plaintiff admitted that Sears never told him that he did not have to pay his account. Hence, Sears did not mislead him. Because Plaintiff failed to respond or produce any evidence which would be sufficient to show as a matter of law that Sears' action constituted an unfair or deceptive practice, dismissal of Plaintiff's action on this basis alone is proper. Walker v. Branch Banking Trust Co., 133 N.C. App. 580, 584, 515 S.E.2d 727, 730 (1999).
Sears' reliance on the existence of a valid release and its defense of res judicata would also present sufficient legal basis for the Court to grant Sears' Motion for Summary Judgment, even if Plaintiff had responded to the motion for summary judgment. The Court, however, as shown above, felt it more appropriate to address the substantive nature of the legal claim asserted by Plaintiff against Sears, that is, his claim for unfair trade practices.
IV. CONCLUSION
For the reasons explained above, the Court concludes that there is no genuine issue of material fact at dispute in this case, given Plaintiff's failure to respond to Sears' Motion for Summary Judgment. The Court further concludes that Sears is entitled to summary judgment as a matter of law, Therefore, Sears' Motion for Summary Judgment [Document #9] is hereby GRANTED.
An Order and Judgment consistent with this Memorandum Opinion shall be filed contemporaneously herewith.
ORDER AND JUDGMENT
For the reasons outlined in the Court's Memorandum Opinion, filed contemporaneously herewith,
IT IS HEREBY ORDERED THAT Defendant's Motion for Summary Judgment EDocument #9] is GRANTED.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED THAT Plaintiff's civil action is DISMISSED WITH PREJUDICE.