FTC v. Am. Future Sys., Inc.
FTC v. Am. Future Sys., Inc.
2021 WL 10263706 (E.D. Pa. 2021)
December 16, 2021
Rohn, James J., Special Master
Summary
The court has determined that the collection cards, which are ESI in the form of ICR's hand-written notes from debt collectors, are important evidence. The court has recommended that ICR produce a sampling of the cards to the Plaintiffs and that ICR not provide AFS with collection cards other than those provided in the sampling, those that have already been produced to Plaintiffs, or those that will be produced in response to a Plaintiff's request for collection cards for a specific entity.
Additional Decisions
FEDERAL TRADE COMMISSION, et al., Plaintiffs,
v.
AMERICAN FUTURE SYSTEMS, INC., et al., Defendants
v.
AMERICAN FUTURE SYSTEMS, INC., et al., Defendants
CIVIL ACTION No. 2:20-cv-02266
United States District Court, E.D. Pennsylvania
Signed December 16, 2021
Counsel
Christian M. Capece, Conor P. Duffy, Derek E. Diaz, Harris A. Senturia, Maris Snell, Amy C. Hocevar, Fil Maria Debanate, U.S. Federal Trade Commission, Cleveland, OH, for Plaintiff Federal Trade Commission.Heather Z. Kelly, Commonwealth of Pennsylvania, Harrisburg, PA, John Abel, PA Office of Attorney General Bureau of Consumer Protection, Harrisburg, PA, Jonathan R. Burns, Pennsylvania Office of Attorney General Pennsylvania Office of Attorney General, Harrisburg, PA, Sarah Anne Ellis Frasch, PA Office of Attorny General, Philadelphia, PA, Amy C. Hocevar, Derek E. Diaz, Federal Trade Commission, Cleveland, OH, for Plaintiff Commonwealth of Pennsylvania.
Ilana H. Eisenstein, DLA Piper LLP, Philadelphia, PA, David H. Marion, Morgan S. Birch, White and Williams LLP, Philadelphia, PA, Paul H. Saint-Antoine, Faegre Drinker Biddle & Reath LLP, Philadelphia, PA, Casey Alan Coyle, Babst, Calland, Clements and Zomnir, P.C., Pittsburgh, PA, Mark Scott Stewart, Eckert Seamans Cherrin & Mellott LLC, Harrisburg, PA, for Defendants American Future Systems, Inc., Progressive Business Publications of New Jersey, Inc., Edward M. Satell.
Stephen M. Hladik, Eric J. Phillips, Pamela L. Cunningham, Hladik Onorato & Federman, LLP, North Wales, PA, for Defendants International Credit Recovery, Inc., Richard Diorio, Jr., Cynthia Powell.
Rohn, James J., Special Master
REPORT AND RECOMMENDATION OF SPECIAL MASTER JAMES J. ROHN, ESQ.
*1 The FTC filed a letter motion to compel ICR to respond to its first set of discovery requests. (Doc. # 111.) Through letters between counsel, the parties narrowed their disputes and set forth proposed agreements to resolve the disputes. (See e.g., Oct. 21, 2021, ICR's ltr. to Pls; Nov. 3, 2021, Pls.’ ltr. to ICR.) On December 8, 2021, the Special Master entered a Report and Recommendation recommending resolutions for the disputes which remained outstanding from the FTC's motion to compel. (Doc. # 133; Doc. # 111.)
In the context of the FTC's motion to compel (Doc. # 111), through a letter ICR proposed that in “order to alleviate Plaintiff's concerns over any cards that are not included in the sampling being utilized by ICR at trial, ICR proposes that it will only utilize cards that were included in the sampling at trial.” (Oct. 21, 2021, ICR's ltr. to Pls.) In response to ICR, Plaintiffs argued that the “evidentiary limitation you mention (‘ICR proposes that it will only utilize cards that were included in the sampling at trial’) does not bind AFS. Plaintiffs cannot agree to an evidentiary limitation that does not apply to AFS.” (Nov. 3, 2021, Pls.’ ltr. to ICR). The Special Master, in his December 8, 2021 Report & Recommendation, requested additional letter briefing on this issue from “any party (this includes the FTC, the Commonwealth, ICR, and AFS) that wishes to address this issue [.]” (Doc. # 133 at L. 193-197) (emphasis in original). The Special Master received a letter brief from Plaintiffs on December 10, 2021. Neither ICR nor AFS submitted a letter brief.
Plaintiffs are seeking discovery from ICR in the form of its collection cards. These collection cards contain, according to Plaintiffs, “hand-written notes from ICR's debt collectors describing how consumers frequently reported that AFS's telemarketers had deceived them.” (Dec. 10, 2021, Pls.’ ltr. to Special Master.) Plaintiffs state that the “prevalence of these reports directly rebuts claims from ICR and AFS about a supposed paucity of angry consumers.” (Id.) The Special Master recommended in his December 8, 2021 Report that ICR produce a sampling of collection cards from July 1, 2015 to present to Plaintiffs. However, Plaintiffs disagree with ICR providing a sampling. (Id. “A sampling severely prejudices Plaintiffs because it leaves ICR and AFS with unfettered access to all the remaining, unproduced cards.”) Plaintiffs argue that “if the Court orders a sampling,” as the Special Master recommended, the Court should also “direct that ICR must not provide AFS with collection cards other than those provided in the sampling, those that have already been produced to Plaintiffs, or those that will be produced in response to a Plaintiff's request for collection cards for a specific entity.” (Id.)
In the Special Master's view, Plaintiffs’ seek an anticipatory motion in limine either to block ICR from providing collection cards to AFS and/or block ICR or AFS from using collection cards at trial that were not previously produced to Plaintiffs. It is a request that has been framed in the context of a discovery motion against only ICR, meanwhile, it implicates both ICR and AFS. The Special Master construes this request as a motion in limine and will recommend that the Court deny it without prejudice.
*2 For these reasons, the Special Master recommends that the Court deny without prejudice the request of Plaintiffs (derived from the motion to compel (Doc. # 111)) to prohibit ICR from providing collection cards to AFS for use at trial that were not previously provided to Plaintiffs.