Consumer Bankruptcy Journal Winter 2018 - Page 19

$119,000 Sanctions for Discharge Injunction Violations The panel next addressed the bankruptcy court’s treatment of the telephone call evidence. Although the motion for contempt cited only the letters, the bankruptcy court found, and the BAP agreed, that the motion put Ocwen on notice that any violation of the discharge injunction was fair game at trial. In fact, an Ocwen representative testified at trial that he reviewed telephone logs, though he did not offer any specifics at that time as to the number of calls. It was only in its motion for reconsideration that Ocwen produced telephone logs indicating that there were only thirty five calls as opposed to the approximately one hundred Ms. Marino testified to. The panel agreed with the court below that the logs were available to Ocwen at the original trial and did not provide a basis for reconsideration. The fact that Ocwen failed to produce on appeal the transcript of the reconsideration hearing further supported affirmance. Concluding that “Ocwen’s repeated dunning deprived the Marinos of a fresh start ‘unhampered by the pressure and discouragement of pre-existing debt,’” the panel found that the amount of the sanctions was appropriate. The panel considered the significant harm suffered by the Marinos and the evidence that the harm was caused by Ocwen’s conduct. The panel found, however, that the bankruptcy erred in concluding it lacked the power to award punitive damages. While Ninth Circuit law does constrain a bankruptcy court’s power to award substantial punitive damages, it permits an award of “relatively minor noncompensatory fines.” The panel reasoned that punitive damages are equivalent to “noncompensatory fines,” and found that the bankruptcy court had three choices: it could have 1) awarded relatively minor punitive damages, 2) issued a recommendation to the district court for an award of punitive damages, or 3) referred the matter to the district court for criminal contempt proceedings. The BAP, therefore, affirmed the sanctions against Ocwen but reversed and remanded on the Marinos’ cross- appeal on the punitive damages issue. Marino BAP 9th Cir. opinion Dec 2017 Rediscover the lost art of human interaction. Solo and small firm clients don’t want to talk to a machine. Which is why firms like yours rely on Ruby, the highly tra ined team of offsite receptionists who handle all your calls with the perfect mix of friendliness and professionalism. 866-611-RUBY (7829) or visit National Association of Consumer Bankruptcy Attorneys Winter 2018 CONSUMER BANKRUPTCY JOURNAL 19