United States District Court, W.D. North Carolina, Charlotte Division
CASCADE CAPITAL, LLC and CASCADE CAPITAL, LLC - SERIES A, Plaintiffs,
DRS PROCESSING LLC d/b/a MILLER STARK KLEIN & ASSOCIATES, Defendant.
ORDER AND JUDGMENT
J. Conrad, Jr. United States District Judge
MATTER is before the Court on the plaintiffs Cascade
Capital, LLC's and Cascade Capital, LLC - Series A's
(“Plaintiffs”), Motion for Enforcement of
Contempt Order and Request for Additional Sanctions (Doc. No.
41) and Motion for Determination and Award of Damages and
Attorneys' Fees (Doc. No. 43), as well as the defendant
DRS Processing LLC's (“Defendant”) Motion for
Purging of Contempt (Doc No. 57).
underlying facts in this matter are set forth in this
Court's prior orders (Doc. Nos. 16 and 24) and are
incorporated by reference.
January 5, 2018, this Court granted Plaintiffs' Motion
for Default Judgment, finding that Plaintiffs'
well-pleaded complaint sufficiently alleged defendant's
liability for tortious interference of contract, unjust
enrichment and money had and received, and acts constituting
unfair and deceptive trade practices. (Doc. No. 16) (the
“Default Judgment Order”). Relevant to these
proceedings, the Court determined that in order to ascertain
the extent of Plaintiffs' damages, additional information
was necessary and a further evidentiary hearing would be
held. Accordingly, the Court ordered Defendant to produce
certain documents within thirty days. (Doc. No. 16). The
Court additionally permanently enjoined Defendant from
further communications with any consumer regarding accounts
within the Santander Portfolio and from collecting or
attempting to collect on accounts from the Santander
Portfolio. (Doc. No. 16).
Defendant failed to comply with the Court's Default
Judgment Order, contempt proceedings were commenced and
Defendant and its principal, Darryl Miller
(“Miller”), were ordered to appear and show cause
why they should not be held in contempt. Ultimately,
Defendant and Miller were held in civil contempt for their
failure to comply with the Default Judgment Order (Doc. No.
30). Defendant and Miller were provided an opportunity to
purge their contempt by, among other things, fully complying
with and obeying the Default Judgment Order (Doc. No. 16) and
disgorging any monies collected on the Santander Accounts or
received from selling Santander Accounts from January 5, 2018
forward (the “Contempt Order”). (Doc. No. 30).
The sanctions imposed by the Contempt Order were suspended
while Defendant and Miller were given time to purge their
upon the representations of Defendant and Miller that their
collection records regarding the Santander Accounts during
the relevant time period were stored in a cloud based
software, “Simplicity Collection Software, ” the
Court additionally ordered Simplicity Payment Solutions LLC,
a third party software provider, to produce access and
activity logs during the relevant time period, including any
deletions or modifications of the Santander Accounts or the
Santander Portfolio. (Doc. No. 32). On November 5, 2018, the
deadline for Defendant and Miller to purge their contempt was
extended through November 15, 2018 (Doc. No. 38).
December 14, 2018, Plaintiffs filed their Motion for
Enforcement of Contempt Order and Request for Additional
Sanctions (Doc. No. 41) and their Motion for Determination
and Award of Damages and Attorneys' Fees (Doc. No. 43).
On December 28, 2018, Defendant filed its Motion for Purging
of Contempt (Doc. No. 57).
September 22, 2019, the parties filed a Joint Stipulation of
Damages. (Doc. No. 73). On September 23, 2019, an evidentiary
hearing was held with regard to the pending motions. (Doc
Nos. 41, 43, and 57).
TESTIMONY AND EVIDENCE
parties presented their evidence through affidavits,
declarations and exhibits which were submitted with their
respective motions and through live testimony at the
September 23, 2019 hearing. Based upon the evidence
presented, the Court makes the following:
FINDINGS OF FACT
January 5, 2018, this Court entered an order establishing the
liability of Defendant but reserving the issue of damages.
The Default Judgment Order additionally permanently enjoined
Defendant from communicating with any consumer regarding
accounts within the Santander Portfolio and from collecting
or attempt to collect on accounts from the Santander
Portfolio. (Doc. 16).
Additionally, the Court ordered Defendant to produce the
following documentation within thirty (30) days to allow the
Court and Plaintiffs sufficient information to ascertain the
scope and appropriate amount of damages:
(a) Specific Santander Accounts. Defendants
must produce reports identifying all Santander accounts
Defendant has acquired or collected on in the past 24 months.
These reports should identify each consumer with the
following: (1) their last name; (2) the last four digits of
their social security number; and (3) their corresponding
Santander account number;
(b) Related Documents. Defendants must
produce all documents related to their purchase of the
Santander Accounts within the past 24 months. These documents
include, but are not limited to, correspondence, bills of
sale, and purchase documents;
(c) Collection Documents. Defendants must
produce all records of their collection activities in respect
to Santander Portfolio accounts. These records include, but
are not limited to, notes, correspondence, and recordings of
any calls with consumers;
(d) Third Party Referrals. Defendants must
produce the identity of any third party, if any, who referred