United States District Court, D. Maryland
JESSICA GARNER, Individually and on behalf of all others similarly situated, Plaintiff,
CLAIMASSIST, LLC, et al. Defendants.
LIPTON HOLLANDER UNITED STATES DISTRICT JUDGE
Jessica Garner, individually and on behalf of all others
similarly situated, initiated suit against defendants
ClaimAssist, LLC (“ClaimAssist”); Credit Control
Services, Inc. (“CCS”); and CCS Financial
Services, Inc. (“CCS Financial”), alleging
violations of the Fair Debt Collection Practices Act
(“FDCPA” or the “Act”), codified, as
amended, at 15 U.S.C. §§ 1692 et seq. ECF
1 (“Complaint”). Garner alleges that ClaimAssist
is a debt collector that violated the FDCPA by making false
representations and using deceptive or misleading means in an
attempt to collect a debt from plaintiff. Id.
According to plaintiff, ClaimAssist, CCS, and CCS Financial
operate, in effect, as a single entity. See id.
have moved for summary judgment (ECF 57), supported by a
memorandum of law (ECF 57-1) (collectively, the
“Summary Judgment Motion”) and exhibits
(see ECF 57-2 through ECF 57-10). The Summary
Judgment Motion also seeks “sanctions”, in the
form of costs and attorneys' fees, under 15 U.S.C. §
1692k(a)(3) and 28 U.S.C. § 1927. See ECF 57-1
at 5. Plaintiff opposes the Summary Judgment Motion (ECF 65),
supported by a memorandum of law (ECF 65-1) and exhibits.
See ECF 65-2 through ECF 65-18. Defendants have
replied. See ECF 66.
plaintiff has filed a “Motion To Certify A Class,
Appoint Named Plaintiff As Class Representative, And Appoint
Class Counsel” (ECF 62), supported by a memorandum of
law (ECF 62-1) (collectively, the “Motion to
Certify”) and exhibits. See ECF 62-2 and ECF
62-3. Defendants oppose the Motion to Certify as to CCS and
CCS Financial, but not as to ClaimAssist. See ECF
64. Plaintiff has replied (ECF 67) and provided additional
exhibits. See ECF 67-1 through ECF 67-6.
defendants have filed a “Motion for Rule 11
Sanctions” (ECF 63), supported by a memorandum of law
(ECF 63-1) (collectively, the “Motion for
Sanctions”) and exhibits. See ECF 63-3 through
ECF 63-12. The Court did not request a response (see
Local Rule 105.8(b)), and plaintiff has not filed
For the purpose of judicial economy, I shall consider the
sanctions requested in the Summary Judgment Motion (ECF 57)
together with the Motion for Sanctions (ECF 63).
motions are fully briefed, and no hearing is necessary to
resolve them. See Local Rule 105.6. For the reasons
that follow, I shall grant defendants' Summary Judgment
Motion as to the FDCPA claims, but deny the request for
sanctions. Because I shall grant the Summary Judgment Motion
as to the FDCPA claims, plaintiff's Motion to Certify
shall be denied, as moot. Further, I shall deny
defendants' Motion for Sanctions.
16, 2014, Garner was injured during a motor vehicle accident
in Baltimore (the “Accident”). See ECF
57-2 (the Complaint), ¶ 9. On that day, she received
medical treatment at Northwest Hospital (“NWH” or
the “Hospital”) for injuries arising from the
Accident. ECF 57-3 (Deposition of William Rew, Director of
Patient Financial Services for LifeBridge Health, Inc.) at
30. As a result, Garner incurred a bill from the Hospital.
ECF 57-2 at 23-24.
connection with the Accident, Garner retained a lawyer,
Michael Greene, to represent her in a tort case. Greene now
represents Garner in this FDCPA action.
is a limited liability company, formed under the laws of
Delaware, with its principal office in Newton, Massachusetts.
ECF 1, ¶ 5; see also ECF 57-2, ¶ 5. CCS
and CSS Financial are also Delaware corporations that
maintain their principal offices in Newton, Massachusetts.
ECF 1, ¶¶ 6-7. According to plaintiff, defendants
“improperly disregard corporate formalities” and,
in effect, operate as a single entity. Id.; see
also ECF 65-1 at 13.
to the Affidavit of William Rew (ECF 57-4), the Director of
Patient Financial Services for LifeBridge Health, Inc.
(“LifeBridge”), LifeBridge is the “sole
member (the corporate ‘parent') of Northwest
Hospital Center, Inc.” Id. ¶ 2. Rew avers
that, as the Director of Patient Financial Services for
LifeBridge, he is both “familiar with Northwest
Hospital's billing procedures” (id.) and
“responsible for them.” ECF 57-3 at 30.
January 2010, LifeBridge hired ClaimAssist “to assist
in the collection of auto liability accounts.” ECF 57-3
at 23-24; see also ECF 65-2 (“Claim Processing
Service Agreement”, dated January 1, 2010)
(hereinafter, the “ClaimAssist Agreement”).
Notably, ClaimAssist was hired “exclusively . . . to
collect recovery from third-party sources[.]” ECF 57-3
explained that an auto liability account at the Hospital is
typically paid by a third-party, such as an insurer or a tort
litigant. ECF 57-3 at 24. Pursuant to the ClaimAssist
Agreement, the Hospital transferred auto liability accounts
to ClaimAssist, allowing ClaimAssist to “identify the
payer responsible and to pursue recovery from that
[third-party] payer.” Id. at 24. Upon transfer
of an account, ClaimAssist would “contact the patient
on the hospital's behalf to gather the information to
seek reimbursement” from the proper third-party payer.
ECF 57-3 at 25.
transfer of accounts to ClaimAssist occurred once per week.
Id. at 36. Notably, when auto liability accounts
were transferred to ClaimAssist, they were
“pre-collection”, meaning they were not yet in
default. Id. at 68-69.
24, 2014, eight days after Garner received medical treatment
at the Hospital, her account was transferred to ClaimAssist,
pursuant to the ClaimAssist Agreement, because Garner's
medical treatment related to an automobile accident. ECF 57-3
at 23-24, 31-32, 35; see also ECF 65-2; ECF 57-3 at
36-37. Of import here, when Garner's account was
transferred to ClaimAssist, it was not in default. ECF 57-4,
¶ 3; ECF 57-3 at 66-68.
to Rew, ClaimAssist was not hired to collect any debt
directly from Garner. ECF 57-3 at 38; see also ECF
57-4, ¶ 4. Rather, ClaimAssist was hired to identify the
proper third-party payer in regard to Garner's account.
ECF 57-3 at 46.
April 28, 2015, ClaimAssist sent a letter to Greene,
Garner's tort lawyer. ECF 57-2 at 23-34 (the
“Letter”). The Letter stated that a lien had been
lodged against plaintiff on behalf of Northwest Hospital.
Id; see ECF 1, ¶¶ 11, 12, 27, 28.
Page one of the Letter provided, id. at 23:
Dear MR GREEN [sic],
The attached is a copy of the lien in which [sic] NORTHWEST
HOSPITAL has filed with BALTIMORE CITY CIRCUIT COURT.
This is to inform you that we statutorily attach a hospital
lien to any funds that an injured patient may receive as
reimbursement as a result of an accident or injury.
Title 16 S16-601 is the Maryland Statute providing the legal
means of insuring payment of the injured person's
hospital bill. The lien is filed when the possibility exists
that other persons, firms or corporations may be liable for
damages caused to the patient.
An example would be if a person was injured in an automobile
accident and an insurance company was expected to cover the
related hospital expenses, the hospital would file a lien to
insure that they would be paid out of any recovered funds.
The patient and/or person or company who appear on the lien
is provided a copy of said lien by certified mail.
Please let me know if you have any questions about this
two of the Letter is titled “NOTICE AND CLAIM OF
HOSPITAL LIEN.” ECF 57-2 at 24. A facsimile of page two
of the Letter appears below. However, I have deleted the
references to plaintiff's address.
two of the Letter reflects, inter alia, Garner's
name and address; provides that Garner was admitted to the
Hospital on May 16, 2014; and indicates that she was
discharged from the Hospital on the same date. ECF 57-2 at
24. Further, the Letter indicates: “Amount due [to NWH]
for care of $801.16.” Id.
Letter identified NWH as the “Claimant Hospital”
and Raja Khoury, who signed page one of the Letter on behalf
of ClaimAssist, as the “Executive Officer or Agent of
Hospital.” Id. at 23-24. The Letter also
included the following statement, id. at 24:
The above named hospital pursuant to laws of the State of
Maryland in such cases made and provided, does hereby claim a
lien upon any and all causes of action, suits, claims,
counter-claims, or demands for damages accruing to the
patient named herein, or to the legal representative of such
patient, on account of injuries giving rise to such causes of
action and which necessitated his or her hospitalization, for
its customary charges for hospital care and treatment of the
above named injured patient in the sum hereinabove claimed to
In addition, the Letter provided, id.: “No
other responsible parties identified at this time.”
to the Complaint, the Letter inaccurately stated that
plaintiff owed $801.16 to NWH. See ECF 1, ¶ 12.
Garner does not dispute that a debt was owed to the Hospital.
See ECF 65. But, she claims that she had
“health insurance (and/or other contractual / legal
relationship) with Aetna insurance . . . and U.S. Medicare .
. .” and the Hospital and ClaimAssist were legally
required to process the bill for Hospital services consistent
with NWH's agreements with Aetna and Medicare. ECF 1,
¶ 12. According to Garner, the bill had not been
processed as of April 28, 2015. Id. Therefore,
“the alleged debt amount of $801.16 was plainly false,
inaccurate, deceptive, and/or misleading (including by being
not certain, and known to be so).” Id.
31, 2011, LifeBridge formed a separate agreement with CCS
(the “CCS Agreement”). See ECF 57-3 at
23; see also ECF 65-6 (“CCS Collection
Agreement”, dated May 31, 2011). Pursuant to the CCS
Agreement, CCS provided debt collection services as to
accounts that were initially transferred from LifeBridge to
ClaimAssist but later fell into default. See ECF
57-3 at 41; ECF 57-3 at 55-56. Rew averred that ClaimAssist
attempted to exhaust “insurance opportunities” to
satisfy a medical bill before transferring an account to CCS.
ECF 57-3 at 55. If ClaimAssist was unable to recover funds
from a third-party, “at some point ClaimAssist
transfer[ed] that account or refer[ed] that account to CCS .
. . [f]or collection.” Id. at 55-56. According
to Rew, an account was only transferred from ClaimAssist to
CCS if the account was “in default or in
collections.” Id. at 56-57.
stated at his deposition that “[a]t some point”
during an unspecified month or year, ClaimAssist transferred
Garner's account to CCS. ECF 57-3 at 41-42. Counsel for
plaintiff did not inquire further as to the transfer of the