With Malice Toward None

The North Dakota Supreme Court affirmed dismissal of a lawyer’s claims 

The Rodenburg Law Firm appeals from a judgment dismissing its action against Kathy Sira, Mikhail Usher, and the Usher Law Group, P.C., for malicious prosecution, abuse of process, and exemplary damages. We conclude the district court did not clearly err in dismissing Rodenburg’s claims for abuse of process and malicious prosecution. We affirm the judgment.

Sira initiated a Fair Debt Collection Practices Act (“FDCPA”) action against Rodenburg in New Jersey federal court, alleging Rodenburg, a North Dakota law firm, engaged in harassment and abusive debt collection tactics and violated 15 U.S.C. § 1692 et. seq. Sira’s action was ultimately dismissed by agreement of the parties. After the dismissal of Sira’s action, Rodenburg sued Sira and her attorney, Usher and the Usher Law Group, in this action, alleging malicious prosecution. Rodenburg subsequently amended its complaint to include claims for abuse of process and exemplary damages.

 After a bench trial, the district court dismissed Rodenburg’s claims. The court found Sira lived in New Jersey, her allegations in the federal FDCPA action stated a claim for relief, and her allegations were based on reasonable trustworthy information made after a reasonable inquiry under the circumstances. The court found Sira’s lawsuit was not for an improper purpose and was not an abuse of process. The court also found her lawsuit was not a malicious prosecution because there was probable cause for the action and there was no malice.

On appeal

The district court made specific factual findings regarding whether Sira’s FDCPA federal court action in New Jersey was initiated for an ulterior purpose, one of the essential elements of Rodenburg’s claim for abuse of process. The court found Rodenburg had previously secured a judgment in collection proceedings against Sira, collection efforts were initiated and Sira agreed to a payment plan. The court found Sira subsequently contacted Rodenburg regarding payment of the debt and was informed Rodenburg had closed its file and instructed Sira to contact the creditor directly. Rodenburg also obtained Sira’s New Jersey address. Sira contacted the creditor and was directed to a second law firm, the Eltmann firm, regarding the debt. At the same time she was in contact with the Eltmann firm regarding the original debt, Sira began to receive phone calls regarding a second debt from Portfolio Recovery Associates, LLC. Sira testified she told Usher that Eltmann and Portfolio always identified themselves in phone calls to her. The court found that while living in New Jersey, Sira began to receive collection calls from an unidentified source regarding collection of a “judgment.” According to Sira, the calls were rude and sarcastic, and the caller refused to give her information about the caller’s identity. Sira contacted Usher and informed him that Rodenburg had previously secured a judgment against her when she lived in Montana. Sira also told Usher that Rodenburg had obtained her address in New Jersey, where she had lived for six months and planned to continue to reside. Sira communicated to Usher that someone had attempted to withdraw funds from her bank account and that she could not recall having received a validation notice as required under the FDCPA. She informed Usher she suspected Rodenburg made the calls to her because she did not believe anyone else was aware of the judgment. Usher then sued Rodenburg on behalf of Sira in New Jersey federal court, alleging violations of the FDCPA.

…The district court’s finding of fact that the federal court action in New Jersey was not brought for an ulterior purpose was not clearly erroneous, and dismissal of Rodenburg’s claim for abuse of process was appropriate. The court’s factual finding Rodenburg failed to prove malice was not clearly erroneous, and dismissal of the malicious prosecution claim was appropriate. We affirm the district court judgment.

(Mike Frisch)