United States District Court, W.D. North Carolina, Charlotte Division
ORDER FOR PERMANENT INJUNCTION AND JUDGMENT
C. MULLEN UNITED STATES DISTRICT JUDGE.
Federal Trade Commission (“FTC”) filed a
complaint on June 22, 2017 seeking a permanent injunction and
other equitable relief, pursuant to Section 13(b) of the
Federal Trade Commission Act (“FTC Act”), 15
U.S.C. § 53(b) and Section 814(a) of the Fair Debt
Collection Practices Act (“FDCPA”), 15 U.S.C.
§ 1692l(a). Plaintiff has moved for summary
judgment pursuant to Federal Rule of Civil Procedure 56 on
all counts against Defendants ACDI Group, LLC
(“ACDI”), Solutions to Portfolios, LLC, d/b/a STP
Management Group (“STP”), and Anthony Swatsworth
(collectively, “Defendants”). On August 22, 2018,
the Court granted in part and denied in part the FTC's
motion for summary judgment, finding that Defendants violated
the FTC Act and that ACDI and STP violated the FDCPA. (ECF
No. 56.) On August 23, 2018, the Court heard argument from
the parties regarding injunctive relief, during which the
Court expressed concerns about the compliance and monitoring
provisions and other terms in the FTC's proposed order.
On August 24, 2018, the Court entered an order holding
Defendants jointly and severally liable for repayment of $31,
763.54 to injured consumers, directing Defendants to
reimburse consumers directly and bear the costs of such
reimbursement, and directing the parties to provide
supplemental briefing on the issue of injunctive relief. (ECF
No. 57.) The Court, having considered the parties'
submissions, enters this Order for Permanent Injunction and
Monetary Judgment (“Order”) to resolve all
remaining matters in dispute in this action.
purpose of this Order, the following definitions apply:
“Debt” means any obligation or alleged obligation
to pay money arising out of a transaction, whether or not
such obligation has been reduced to judgment.
“Debt collection activities” means any activities
of a debt collector to collect or attempt to collect,
directly or indirectly, a debt owed or due, or asserted to be
owed or due.
“Debt collector” means any person who uses any
instrumentality of interstate commerce or the mail in any
business the principal purpose of which is the collection of
any debts, or who regularly collects or attempts to collect,
directly or indirectly, debts owed or due or asserted to be
owed or due another. The term also includes any creditor who,
in the process of collecting its own debts, uses any name
other than its own that would indicate that a third person is
collecting or attempting to collect such debts. The term also
includes any person to the extent that such person collects
or attempts to collect any debt that was in default at the
time it was obtained by such person.
“Defendants” means the Individual Defendant and
the Corporate Defendants, individually, collectively, or in
any combination, and each of them by whatever names each
might be known.
1. “Corporate Defendants” means ACDI Group, LLC
and Solutions to Portfolios, LLC, d/b/a STP Management Group,
and their successors, assigns, affiliates, or subsidiaries,
and each of them by whatever names each might be known.
2. “Individual Defendant” means Anthony
“Investigation” includes objectively evaluating
the circumstances and considering information, including an
assessment of the relevance, reliability, accuracy,
integrity, and completeness of such information, to determine
whether a debtor owes a debt in the amount asserted by
Defendants while collecting on debt. The information
Defendants shall assess in an Investigation, where
applicable, shall include but not be limited to:
1. the information that Defendants received from the credit
originator or the creditor to whom the debt is owed, such as:
(a) the debtor's credit application, (b) the credit
contract between the debtor and the credit originator, (c)
documents with the current or former name, address, and
telephone phone number of the debtor, (d) documents with the
debtor's account number, in whole or in part, and account
statements, (e) documents with the date and amount of any
payments, (f) documents with the date and outstanding balance
at charge-off, and (g) collector's notes;
2. the information that Defendants received from data
aggregators, data brokers, consumer reporting agencies, skip
tracers, and other third-parties, such as: (a) documents with
the current or former name, address, and telephone number of
the debtor, (b) documents with consumer report information,
including credit scores and updates to the information in
credit reports, and (c) the scoring of the debt through the
use of a predictive model;
3. the information that Defendants created or maintained in
collecting on the debt, such as collectors' notes; and
4. the information Defendants received from the debtor
denying, disputing, or challenging the claim that the debtor
owes the debt or the amount of the debt, such as: (a)
documents with the debtor's current or former name,
address, and telephone number, (b) receipts or other evidence
of payment from the credit originator, the creditor to whom
the debt is owed, or a debt collector, (c) canceled checks,
bank account statements, credit card statements, and other
documents evidencing payment, and (d) a consumer report
relevant to the disputed item.
“Person” means a natural person, an organization
or other legal entity, including a corporation, partnership,
sole proprietorship, limited liability company, association,
cooperative, or any other group or combination acting as an
“Portfolio” means the portfolio of purported
past-due payday loan debt purchased by ACDI from SQ Capital,
LLC on or about July 24, 2014, containing 2335 records of
purported “500FastCash” debt.
terms “and” and “or” shall be
construed conjunctively or disjunctively as necessary to make
the applicable phrase or sentence inclusive rather than
Section 13(b) of the FTC Act, 15 U.S.C. § 53(b),
empowers this Court to issue injunctive and other relief
against violations of the FTC Act and, in the exercise of its
equitable jurisdiction, to award redress and restitution to
remedy the injury to consumers, to order disgorgement of
profits resulting from Defendants' unlawful acts or
practices, and issue other ancillary equitable relief.
Individual Defendant and the Corporate Defendants are likely
to continue to engage in the activities alleged in the
Complaint or otherwise violate the FTC Act and the FDCPA
unless they are prohibited from doing so by order of the
Court. Accordingly, it is proper in this case to issue a
permanent injunction that, inter alia: (a) prohibits
Defendants from engaging in any debt collection violations;
(b) requires Defendants reasonably investigate debts that are
disputed; (c) prohibits Defendants from disclosing, using, or
benefitting from previously obtained consumer information
that is unverified; and (d) provides for monitoring by
Plaintiff of Defendants' compliance with such a permanent
Defendants have caused consumer injury in the amount of at
least $31, 397.29.
is proper in this case to enter a monetary judgment in the
amount of $31, 397.29 against Defendant Swatsworth and the
Corporate Defendants, jointly and severally, as equitable
monetary relief in the form of restitution.
action and the relief awarded herein are in addition to, and
not in lieu of, other remedies that may be provided by law,
including both civil and criminal remedies.
Pursuant to Federal Rule of Civil Procedure 65(d), the
provisions of this Order are binding upon each Defendant,
their successors and assigns, and their officers, agents,
employees and attorneys, and upon those persons or entities
in active concert or participation with them who receive
actual notice of this Order by personal service or otherwise.
Entry of this Order is in the public interest.
AGAINST UNLAWFUL COLLECTION PRACTICES
IT IS THEREFORE ORDERED that Defendants,
Defendants' officers, agents, employees, and all other
persons in active concert or participation with any of them,
who receive actual notice of this Order, whether acting
directly or indirectly, in connection ...