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LAW OFFICES OF CLARK GAREN, CLARK GAREN, CALIF. BAR #50564 P. O. BOX 1790, PALM SPRINGS, CALIFORNIA 92263 STREET ADDRESS-NO MAIL: 17100 N. INDIAN, PALM SPRINGS, CA. 92258 TELEPHONE: (760) 323-4901 Fax: (760) 288-4080 ATTORNEYS FOR PLAINTIFFS IMPERIAL MERCHANT SERVICES, a California corporation, doing business as CHECK RECOVERY SYSTEMS UNITED STATES DISTRICT COURT

8 NORTHERN DISTRICT OF CALIFORNIA, SAN FRANCISCO DIVISION 9 10 11 12 13 14 15 16 17 18 19 TO PLAINTIFF BRANDY HUNT, on behalf of herself and others 20 similarly situated, and to IRVING L. BERG; THE BERG LAW GROUP; O. 21 RANDOLPH BRAGG; HORWITZ, HORWITZ & ASSOCIATES; PAUL ARONS; and 22 THE LAW OFFICES OF PAUL ARONS, her attorneys of record,: 23 PLEASE TAKE NOTICE THAT on October 24, 2006 at the hour of 24 9:30 A.M. in Courtroom 11 of the above-entitled Court, Defendant 25 will move the Court for entry of Summary Judgment in favor of 26 Defendant and against Plaintiff under F.R.C.P. 56(b) because: 27 1. Defendant is entitled to collect both interest and a 28 service charge on dishonored checks in the State of California; ________________________________________________________________
MOTION BY DEFENDANT FOR SUMMARY JUDGMENT UNDER FRCP 56 - Case No. C 05-4993 MJJ

BRANDY HUNT, on behalf of herself and others similarly situated,

) ) ) Plaintiff, ) ) ) -vs) ) ) CHECK RECOVERY SYSTEMS, INC., ) et. al., ) ) Defendants. ) ) ) ) ) ___________________________________)

Case No. C 05 4993 MJJ NOTICE OF MOTION BY DEFENDANT FOR SUMMARY JUDGMENT UNDER FRCP 56; NOTICE OF MOTION FOR ENTRY OF PARTIAL JUDGMENT UNDER FRCP 54b; NOTICE OF MOTION FOR CERTIFICATION OF IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b); MEMORANDUM OF POINTS AND AUTHORITIES Date: October 24, 2006 Time: 9:30 A.M. Place: Courtroom 11

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2. Defendant is entitled to collect both interest and a service charge on an oral contract and on a common count evidenced by a dishonored check; 3. Defendant is excused from any liability to Plaintiff pursuant to the provisions of 15 U.S.C. 1692k. PLEASE TAKE FURTHER NOTICE THAT Defendant will move the Court to enter a Partial Judgment under FRCP 54(b) that can be immediately appealed, or, alternatively, to certify its ruling on this motion for an immediate appeal in accordance with the provisions of 28 U.S.C. 1292(b). MEMORANDUM OF POINTS AND AUTHORITIES TABLE OF CONTENTS CHAPTER TITLE STATEMENT OF THE CASE STANDARD OF REVIEW ON MOTION FOR SUMMARY JUDGMENT CALIFORNIA CIVIL CODE SECTION 1719 7 CALIFORNIA LAWS ON INTEREST RULES FOR INTERPRETATION OF STATUTES IN CALIFORNIA THERE IS NO BINDING PRECEDENT DETERMINING WHETHER PRE-JUDGMENT INTEREST MAY BE RECOVERED IN ADDITION TO THE REMEDIES AVAILABLE UNDER CALIFORNIA CIVIL CODE SECTION 1719 9 THE LEGISLATIVE HISTORY OF CALIFORNIA CIVIL CODE SECTION 1719 SHOWS A LEGISLATIVE INTENT TO ALLOW THE RECIPIENT OF A DISHONORED CHECK TO RECOVER ALL DAMAGES SUSTAINED PRE-JUDGMENT INTEREST IS AN ELEMENT OF DAMAGES 7 8 PAGE 5 6

13 I 14 II 15 16 17 18 19 VI 20 21 22 VII 23 24 25 VIII 26 27 28 11 III IV V

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1 2 3 4 5 X 6 7 8 XII 9 XIII 10 11 12 13 14 15 16 17 18 XVI 19 20 21 22 23 XIX 24 25 26 27 28 XX XVIII XVII XIV XV XI CHAPTER IX

TABLE OF CONTENTS (Continued) TITLE THE CALIFORNIA SUPREME COURT ORDERED THAT PRE-JUDGMENT INTEREST IS TO BE AWARDED WHEN THE STATUTE IS SILENT ON INTEREST A STATUTE MUST BE ANALYZED IN THE CONTEXT OF ALL THE OTHER LAWS INTEREST IS AWARDED ON LIQUIDATED DAMAGE AWARDS ARGUMENT PLAINTIFF CREATED THREE THEORIES OF RECOVERY BY A SINGLE WRONG. THE FIRST THEORY OF RECOVERY WAS UNDER CALIFORNIA CIVIL CODE 1719 FOR ISSUING A DISHONORED CHECK; THE SECOND THEORY OF RECOVERY WAS FOR A BREACH OF THE CONTRACT EVIDENCED BY THE DISHONORED CHECK; A THIRD THEORY OF RECOVERY WAS FOR THE COMMON COUNT OF GOODS, WARES, AND MERCHANDISE HAD AND RECEIVED BY THE PLAINTIFF EFFECT OF ALTERNATIVE REMEDIES CIVIL CODE §1719 TREBLE DAMAGE PROVISION IS NOT RELEVANT TO THIS CASE DEFENDANT WOULD NOT RECEIVE A DOUBLE OR MULTIPLE RECOVERY CALIFORNIA CIVIL CODE SECTION 1719 IS NOT THE EXCLUSIVE REMEDY FOR A DISHONORED CHECK PLAINTIFF IS EXCUSED FROM LIABILITY UNDER 15 U.S.C. 1692k REQUEST FOR PARTIAL JUDGMENT UNDER FRCP 54(b) OR CERTIFICATION FOR IMMEDIATE APPEAL UNDER 18 U.S.C. 1291(b) CONCLUSION 13 13 14 PAGE

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15 17 18 19

19 21

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1 2 3 4 5 6 7 8 9 10 11 12 13 FEDERAL STATUTES: 14 15 U.S.C. 1692f(1) 15 15 U.S.C. 1692k 16 28 U.S.C. 1291(b) 17 STATE CASES: 18 19 20 21 22 23 24 25 26 STATE STATUTES: 27 28 FEDERAL CASES:

TABLE OF AUTHORITIES PAGE

Anderson vs. Liberty Lobby Inc., 477 U.S. 242, 248-252, 106 S. Ct. 1505, 2520-2522, 91 L. Ed. 2d 202 (1986) 7 Department of Commerce vs. U. S. House of Representatives, 525 U.S. 316, 327, 119 S. Ct. 765, 772, 142 L.Ed. 2d. 797 (1999) Irwin v. Mascott, (2000), 112 F. Supp. 2d 937, 956 Palmer vs. Stassinos, (2004), 348 F. Supp. 2d 1070, 12 6, 10, 18, 19, 20, 22 10,

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Ruby Joseph vs. J. J. Mac Intyre Companies, 238 F. Supp 2d. 1158, 1163-1164 Wichita Eagle and Beacon Publishing Company, Inc. v. Pacific National Bank of San Francisco, (1974), 493 F.2d 1285, 1287

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6, 17, 22, 23 23, 24

Curie vs. Workmen's Compensation Appeals Board, (2001), 24 Cal. 4th 1109, Dyna-Med, Inc. vs. Fair Employment and Housing Com., (1987), 43 Cal. 3d 1379, 8

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Kaufman & Broad vs. City & Surburban Mortgage Co., (1970), 10 Cal. App.3d 206, 215, 88 Cal.Rptr. 858, Lara vs. Board of Supervisors, (1976), 59 Cal. App. 3d 399, 408-409, Tripp vs. Swoap, (1976), 17 Cal. 3d 672, 679, 131 Cal. Rptr. 789,

16 9 13, 14

California Civil Code Section 1719 5, 6, 7, 9, 13, 14, 17, 18, 19, 20, 21, 22, 23

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1 2 3 4 5 6 7 8 9 10 11 12 STATE STATUTES:

TABLE OF AUTHORITIES (Continued) PAGE

California Civil Code Section 3302 8 California Civil Code Section 3287 8, 9, 13, 14, 19 FEDERAL RULES: F.R.C.P. Rule 54(b) F.R.C.P. Rule 56(b) OTHER AUTHORITIES: 4, Witkin, California Procedure, 4th Edition 618 16, 23, 24 7, 24

I STATEMENT OF THE CASE What did the legislature intend when it enacted Civil Code

13 §1719? Did the legislature intend that dishonored checks bear 14 interest in addition to the charges levied under the statute or 15 did the legislature intend to force the victim of a dishonored 16 check writer to give the check writer an interest free loan? 17 To determine the legislative intent, the problem legislature 18 wanted to solve must be identified. A person who pays for goods, 19 wares, and merchandise from a merchant with a dishonored check 20 is, in effect, committing a robbery. The only difference between 21 the robber and the dishonored check writer is that the robber 22 uses a gun, while the dishonored check writer uses a ball point 23 pen. Both steal goods, wares, and merchandise from the merchant 24 without paying for them. 25 Civil Code §1719 itself is silent on whether interest is 26 allowed. Plaintiff claims silence means the legislature intended 27 to reward the wrongful behavior of the dishonored check writer 28

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with an interest free loan at the expense of the victim (Palmer vs. Stassinos, (2004), 348 F. Supp. 2d 1070, 1078). Defendant claims the legislature intended to require the dishonored check writer to make full and complete restitution to the victim for the check writer's wrongful behavior, including the payment of interest on the debt. After all, interest is just rent for the use of someone else's money! The facts in this case are undisputed. Plaintiff purchased goods, wares, and merchandise from PACK `N Save for $137.15, and paid for them with a dishonored check. The dishonored check was returned to PACK `N SAVE by Plaintiff's bank marked "not sufficient funds". PACK `N SAVE added the $35.00 service charge permitted by Civil Code §1719 because this was the second NSF check it had received from Plaintiff. When Plaintiff failed to pay PACK `N SAVE anything, PACK `N SAVE assigned the claim against Plaintiff for goods, wares, and merchandise evidenced by the dishonored check to Defendant. Defendant sent Plaintiff two notices. Both notices sought to collect the amount of the N.S.F. check ($137.15), the $35.00 service fee, and interest on the check at the legal rate. There was no other contact whatsoever between Plaintiff and Defendant. Plaintiff claims the notice violates 15 U.S.C. 1692f(1) because she claims Defendant cannot impose both the service charge permitted by Civil Code §1719 and charge for interest. Plaintiff has filed for bankruptcy protection, having paid nothing to either Defendant or its assignor. Therefore, Plaintiff has no further obligation on this debt, and no risk of further collection activity.

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II STANDARD OF REVIEW ON MOTION FOR SUMMARY JUDGMENT "A party against whom a claim, counterclaim, or cross-claim is asserted or a declaratory judgment is sought may, at any time, move with or without supporting affidavits for a summary judgment in the party's favor as well as to all or any part thereof." F.R.C.P. Rule 56(b)

6 Summary Judgment is to be rendered forthwith when one party 7 is unable to show a genuine issue as to a material fact on which 8 that party will bear the burden of proof at trial. (Department of 9 Commerce vs. U.S. House of Representatives, 525 U.S. 316, 327, 10 119 S. Ct. 765, 772, 142 L. Ed. 2d. 797 (1999). A genuine issue 11 of fact exists when the evidence before the court is of such a 12 nature that a reasonable jury could return a verdict in favor of 13 the non-moving party. There must be evidence upon which a jury 14 could reasonably find in the non-moving party's favor. (Anderson 15 vs. Liberty Lobby Inc., 477 U. S. 242, 248-252, 106 S. Ct. 2505, 16 2520-2512, 91 L. Ed. 2d. 202 (1986). 17 18 19 20 21 22 23 24 25 26 27 28 III CALIFORNIA CIVIL CODE SECTION 1719 The relevant portions of Civil Code § 1719 read as follows: Dishonored checks; liability; demands for payment; stop payments; notice; penalties, damages and service charges; assignees (a)(1) Notwithstanding any penal sanctions that may apply, any person who passes a check on insufficient funds shall be liable to the payee for the amount of the check and a service charge payable to the payee for an amount not to exceed twenty-five dollars ($25) for the first check passed on insufficient funds and an amount not to exceed thirty-five dollars ($35) for each subsequent check to that payee passed on insufficient funds. California Civil Code Section § 1719

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IV CALIFORNIA LAWS ON INTEREST California law awards pre-judgment interest.

3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 In 1987, the California Supreme Court said: 22 23 24 25 26 27 In 1976, the California Supreme Court said: 28 "The words of the statute must be construed in context, keeping in mind the statutory purpose, and statutes or statutory sections relating to the same subject must be harmonized, both internally and with each other, to the extent possible (citing authority)." Dyna-Med, Inc. vs. Fair Employment and Housing Com., (1987), 43 Cal. 3d 1379, 1387 (a) Every person who is entitled to recover damages certain, or capable of being made certain by calculation, and the right to recover which is vested in him upon a particular day, is entitled also to recover interest thereon from that day, except during such time as the debtor is prevented by law, or by the act of the creditor from paying the debt. This section is applicable to recovery of damages and interest from any such debtor, including the state or any county, city, city and county, municipal corporation, public district, public agency, or any political subdivision of the state. (b) Every person who is entitled under any judgment to receive damages based upon a cause of action in contract where the claim was unliquidated, may also recover interest thereon from a date prior to the entry of judgment as the court may, in its discretion, fix, but in no event earlier than the date the action was filed. California Civil Code Section 3287 V RULES FOR INTERPRETATION OF STATUTES IN CALIFORNIA "BREACH OF CONTRACT TO PAY LIQUIDATED SUM. The detriment caused by the breach of an obligation to pay money only, is deemed to be the amount due by the terms of the obligation, with interest therein. California Civil Code Section 3302 Interest on damages; right to recover; time from which interest runs

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"the well-settled rules of statutory construction that, if possible, the codes are to be read together and blended into each other as though there was but a single statute, (citations omitted), and that the existence of a particular statute does not negate the effect of a general statute unless there is a conflict. (Citations omitted)." Lara vs. Board of Supervisors, (1976), 59 Cal. App. 3d 399, 408-409 The two statutes now at issue (Civil Code §1719 and Civil

7 Code §3287 "are to be read together and blended into each other 8 as though there was but a single statute." (Lara vs. Board of 9 Supervisors, (1976), 59 Cal. App. 3d 399, 408). Furthermore, "the 10 existence of a particular statute does not negate the effect of a 11 general statute unless there is a conflict." (Lara vs. Board of 12 Supervisors, (1976), 59 Cal. App. 3d 399, 408). 13 There is no conflict between Civil Code §1719 and Civil Code 14 §3287. The general statute (Civil Code §3287) authorizes interest 15 on a claim which is certain. The specific statute (Civil Code 16 §1719) allows the victims of dishonored check writers to recover 17 additional statutory damages to fully compensate the wrongdoing 18 of the dishonored check writer. 19 Unless clearly indicated otherwise, the general principle is 20 that words in a statute are to be given a sensible construction 21 according to their commonly understood meaning (Lara vs. Board of 22 Supervisors, (1976), 59 Cal. App. 3d 399, 407). The only sensible 23 construction according to the commonly understood meaning of the 24 words of these statutes is that the failure of the legislature to 25 address interest in Civil Code §1719 means that the legislature 26 intended that the right to interest be determined by its other 27 statutes that specifically 28

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address interest. This allows interest to be added to the balance owed by the dishonored check writer, and gives complete restitution to the victim. VI THERE IS NO BINDING PRECEDENT DETERMINING WHETHER PRE-JUDGMENT INTEREST MAY BE RECOVERED IN ADDITION TO THE REMEDIES AVAILABLE UNDER CALIFORNIA CIVIL CODE SECTION 1719 "The parties located, any availability with section have not cited, nor has this Court other case directly addressing the of prejudgment interest in conjunction 1719.

* * * Unfortunately, section 1719 is silent as to the availability of interest in light of the service charge and treble damages provisions...." Palmer vs. Stassinos, (2004) 348 F. Supp. 2d 1070, 1078 VII THE LEGISLATIVE HISTORY OF CALIFORNIA CIVIL CODE SECTION 1719 SHOWS A LEGISLATIVE INTENT TO ALLOW THE RECIPIENT OF A DISHONORED CHECK TO RECOVER ALL DAMAGES SUSTAINED "When the language of a statute is unambiguous, the plain meaning rule generally governs. (Citation omitted). In some situations, however, what would otherwise appear to be plain language is interpreted contrarily where there are compelling indications of legislative intent. (Citations omitted) Moreover, where particular language of a statute appears ambiguous, it is appropriate to look to other indicia of the Legislature's intent, including the textual context of the language, policy, and legislative history. " Ruby Joseph vs. J. J. Mac Intyre Companies, 238 F. Supp 2d. 1158, 1163-1164 The California Bill Analysis dated August 20, 1996

22 concurring in the Senate Amendments to Civil Code §1719 (Judicial 23 Notice Exhibit 1) reads as follows: 24 25 26 27 28 A recent federal case dealing with the issue of the imposition of bad check charges by merchants, (Newman ________________________________________________________________
MOTION BY DEFENDANT FOR SUMMARY JUDGMENT UNDER FRCP 56 - Case No. C 05-4993 MJJ

While California authorizes the assessment and collection of a "commercially reasonable" service charge and several California statutes relate to bad checks, none specifically authorize the imposition of a fee by the retailer or other payee who has a check returned.

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v. Checkrite California, Inc. (E.D.Cal. No. CIV. 8-931557 LKK, December 19, 1995) suggests that because state law only provides for a commercially reasonable charge, merchants must prove that their charges are indeed commercially reasonable. Merchants are concerned that this case may require some merchants to prove in each case that their charge is "commercially reasonable". California courts have recognized the legality of fees in other contexts and have not required that the merchant prove in each case that the charge be "commercially reasonable." Courts have held that requiring proof of the actual damages incurred by the company would be impractical, extremely difficult and expensive to determine. The charge should represent a reasonable endeavor to fix the probable loss resulting to the merchant and that charge should bear a reasonable relation to such loss and be reasonable in amount. (Emphasis added.) ARGUMENTS IN SUPPORT: According to the sponsor of this measure, the California Retailers Association (CRA), the Newman case has caused concern among merchants about te validity of bad check fees charged by merchants. This measure is intended to declare that the imposition of bad check fees by retailers and other payees is permissible under current law and to clarify that bad check fees of up to $35 are commercially reasonable. (Emphasis added) The figure of $%35.00 was arrived at based upon a survey of CRA members and because the United States Supreme Court imposes a $35 charge for anyone bouncing a check payable to it. American Stores Company which operates over 650 Lucky, Super Saver and Sav-On retail stores in California supports this measure. They point out that during 1995 they had over 300,000 checks returned unpaid by the bank. The costs associated with attempting to make collection on these checks is enormous. It is both reasonable and fair that those who write bad checks pay the cost of collection. To the extent that they are not paid by the writers of these checks, they would be passed on to all consumers." (Emphasis added)" California Bill Analysis dated August 20, 1996 concurring in the Senate Amendments to Civil Code § 1719 (Judicial Notice Exhibit 1) This legislative analysis shows the legislature intended

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that the dishonored check writer be required to "pay the cost of collection", and did not intend to have any part of the cost of collecting dishonored checks passed "on to all consumers". Denying a merchant who receives a dishonored check interest on the debt has the effect of transferring a large part of the cost of the dishonored check initially to the merchant and eventually to all consumers. This is the opposite of the result the legislature said it intended to achieve. VIII PRE-JUDGMENT INTEREST IS AN ELEMENT OF DAMAGES "Every person who is entitled to recover damages certain, or capable of being made certain by calculation and the right to recover which is vested in him on a particular day, is entitled also to recover interest thereon from that day, except during such time as the debtor is prevented by law, or by the act of the creditor from paying the debt... Damages is defined broadly to include any compensatory monetary recovery, as provided in California Civil Code Section 3287, which provides: "Every person who suffers detriment from the unlawful act or omission of another, may recovery from the person in fault a compensation therefor in money, which is called damages." California Civil Code §3287 has been consistently applied to require the award of prejudgment interest where the judgment is for money owed or to be refunded pursuant to a statutory obligation. (Tripp v. Swoap, 17 Cal 3d 671,681, 131 Cal.Rptr. 789, 552 P.2d 749 (1976). Irwin v. Mascott, (2000), 112 F. Supp 2d. 937, 956 IX THE CALIFORNIA SUPREME COURT ORDERED THAT PRE-JUDGMENT INTEREST IS TO BE AWARDED WHEN THE STATUTE IS SILENT ON INTEREST In 2001, the California Supreme Court issued an opinion directing California Courts that the general interest statutes governed interest awards when a statute was silent on the issue

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of interest. The pertinent portion of that opinion reads as follows: "In summary, although Labor Code Section 132a does not itself expressly authorize the addition of prejudgment interest to an award of backpay to a victim of discrimination, Civil Code section 3287 requires such interest on damages due on a particular date, including awards of backpay, when they are certain or capable of being made certain by calculation. Neither section 5800 nor any other provision of the Labor Code cited to us or discovered in our research precludes addition of interest to a backpay award, and addition of interest would serve the remedial purpose of section 132a. Harmonizing the provisions of the Labor and Civil Codes to further the overall legislative goals, therefore, we conclude the WCAB may and must, when the criteria of Civil Code section 3287 are met, add to its awards reimbursing employees for lost wages and work benefits interest from the dates such wages and benefits would have become due had the employer not acted in violation of section 132a. Because the WCAB denied petitioner interest in the belief such an award was unauthorized, it must reconsider its award in this case. Currie vs. Workers' Compensation Appeals Board (2001), 24 Cal. 4th 1109, 1119 According to the California Supreme Court, Civil Code §3287

16 applies to any award for unliquidated damages under a statute 17 unless the statute contains specific language to the contrary. 18 Civil Code §1719 does not contain any language to the contrary. 19 Therefore, according to the California Supreme Court, the 20 language of Civil Code §1719 requires that pre-judgment interest 21 be allowed under Civil Code §3287. 22 23 24 25 26 27 28 X A STATUTE MUST BE ANALYZED IN THE CONTEXT OF ALL THE OTHER LAWS In 1976, the California Supreme Court directed its trial Courts how to analyze two codes together. By coincidence, one of the code sections was the interest statute, Civil Code §3287. The directions of the California Supreme Court were:

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"Where as here two codes are to be construed, they must be regarded as blending into each other and forming a single statute. (Citation omitted) Accordingly, they must be read together and so construed as to give effect, when possible, to all the provisions thereof. (Citations omitted). *** *** * * * Interest, on the other hand, relates to the extent of recovery inasmuch as it constitutes an element of damages. Under this construction the fact that the Legislature did not mention interest specifically does not mean that a successful recipient is precluded from receiving it." Tripp vs. Swoap, (1976), 17 Cal. 3d 672, 679, 552 P.2d 749, 755, 131 Cal. Rptr. 789, 795 XI INTEREST IS AWARDED ON LIQUIDATED DAMAGE AWARDS Plaintiff claims the statutory penalty imposed by Civil Code §1719 precludes an award of interest to prevent a double recovery. In 1974, the Ninth Circuit Court of Appeal considered a similar argument in connection with a liquidated damage award under a contract provision. The contract at issue in the case had a valid liquidated damage provision, and the Court held "since the claim is for a liquidated amount, plaintiff is also entitled to an award of interest from the date of the bank's refusal to honor the draft." (Wichita Eagle and Beacon Publishing company, Inc. v. Pacific National Bank of San Francisco, (1974), 493 F.2d 1285, 1287). Therefore, the Ninth Circuit Court of Appeals believes California law awards interest under Civil Code §3287 on an award for a penalty. XII ARGUMENT When reading Civil Code §1719 and Civil Code §3287 together,

27 the only reasonable interpretation is the legislature 28

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enacted Civil Code §1719 to allow the victim of the dishonored check writer to receive all damages sustained from being given a dishonored check, including interest or rent for the money the dishonored check writer borrowed. It is not reasonable to believe the legislature intended to reward the dishonored check writer with an interest free loan at the expense of, and without the consent of, the victim. The utter unjust result of Plaintiffs argument is illustrated by the following example. Suppose Donald Trump issued a dishonored check for $1,000,000.00, and the creditor sought to impose the $25.00 service fee. Suppose Mr. Trump failed to make the check good, and suit had to be filed. The case comes to trial three years later. For the sum of $25.00, Mr. Trump has been rewarded with an interest free loan of $1,000,000.00 for three years, causing the victim to lose $300,000.00 in interest. Is this the result the legislature intended? NO! The identity of Mr. Trump and the amount of the check only exaggerate the unjust and unreasonable result sought by Plaintiff. The same result would ensue if the check writer was John Doe, and the amount of the check was $100.00. John Doe would obtain an interest free loan of $100.00 for three years. The $25.00 check fee would still be less than three years of interest at the legal rate in California of 10%, or $30.00. The legislative analysis shows the legislature intended to allow the recipients of dishonored checks to recover all the costs from the dishonored check writers instead of the public. The interpretation sought by Plaintiff creates the opposite

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result! Instead of passing the costs onto the dishonored check writer, Plaintiff wants to pass the costs onto the merchant and eventually to all consumers. XIII PLAINTIFF CREATED THREE THEORIES OF RECOVERY BY A SINGLE WRONG. THE FIRST THEORY OF RECOVERY WAS UNDER CIVIL CODE 1719 FOR ISSUING A DISHONORED CHECK; THE SECOND THEORY OF RECOVERY WAS FOR A BREACH OF THE CONTRACT EVIDENCED BY THE DISHONORED CHECK; A THIRD THEORY OF RECOVERY WAS FOR THE COMMON COUNT OF GOODS, WARES, AND MERCHANDISE HAD AND RECEIVED BY THE PLAINTIFF "The essence of a cause of action is the existence of a primary right and one violation of that right. (Citations omitted). The cause of action as it appears in the complaint will be the facts from which the plaintiff's primary right and the defendant's corresponding duty have arisen, together with the facts which constitute the defendant's delict or wrong. (Citations omitted) The seeking of two different kinds of relief does not establish different causes of action." Kaufman & Broad vs. City & Surburban Mortgage Co., (1970), 10 Cal. App.3d 206, 215, 88 Cal.Rptr. 858, 863 "The situation is different where the single cause of action (injury to plaintiff's primary right by defendant's wrong) gives rise to alternative remedies or legal theories of recovery. Thus, if defendant wrongfully takes plaintiff's goods, there is but one invasion of plaintiff's rights by one wrong, hence, only one cause of action. Plaintiff may, however, seek redress on alternative legal theories of conversion (tort) or quasi-contract (waiver of tort), and pray for alternative remedies of damages (for conversion), value of the goods (quasi-contract), or specific recovery of goods. (See 2 Cal. Proc. (4th), Actions, §160.) 4, Witkin, California Procedure, 4th Edition 618

23 Plaintiff purchased goods, wares, and merchandise in the sum 24 of $137.15 from Pack `N Save, and paid for them with a check. The 25 check was dishonored, and the Plaintiff never paid the debt owed 26 Pack `N Save. This is the wrong giving rise to the primary right. 27 28

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Plaintiff's purchase of the goods, wares, and merchandise created an oral contract between Plaintiff and Pack `N Save whereby Plaintiff was obligated to pay Pack `N Save the sum of $137.15 and a right of remedy for breach of an oral contract. Breach of an oral contract is the type of obligation for which prejudgment interest is awarded in California. Plaintiff's purchase of the goods, wares, and merchandise also created a common count obligation and a right of remedy for goods, wares, and merchandise in the sum of $276.36. A common count for goods, wares, and merchandise is also the type of obligation for which prejudgment interest is awarded in California. Plaintiff paid the oral contract and common count for goods, wares, and merchandise rights of remedy with a check in the sum of $276.36 that was subsequently dishonored. This then created an additional right of remedy under Civil Code §1719. Even if Civil Code §1719 precludes an award of interest on the right of remedy created by the statute (the award of a $25.00 or $35.00 service charge), Civil Code §1719 does not preclude an award of interest on either the right of remedy for breach of an oral contract or the right of remedy for the common count of goods, wares, and merchandise. XIV EFFECT OF ALTERNATIVE REMEDIES This action by Plaintiff is for violation of the Federal

25 Fair Debt Collection Practices Act. The specific violation 26 alleged is that Defendant demanded money (interest) that was not 27 due under California law in violation of 15 U.S.C. 1691f(1). 28

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In determining whether Defendant was entitled to charge Plaintiff interest, the Court must examine the primary right of the Defendants Assignor and the Plaintiff's violation of that right, as well as every alternative legal theory and every alternative remedy for damages available to Defendant. In this case, Plaintiff's violation of the primary right vested Pack `N Save with three alternative legal theories and remedies for: (1) Breach of an oral contract;

(2) a common count against the Plaintiff for goods, wares, and merchandise received by Plaintiff; and (3) a dishonored check under Civil Code §1719. Even if interest cannot be awarded for the dishonored check under Civil Code §1719, it can be awarded under the theories of: (1) recovery for Breach of an oral contract; and (2) the common count for goods, wares, and merchandise. Each of these alternative legal theories and remedies, as a matter of law, were included with the claim assigned to Defendant, and each of these alternative legal theories are the type of remedy which may be assigned under California law. Defendant, as the assignee of Pack `N Save, was able to charge Plaintiff interest under the alternative remedy of breach of an oral contract; the alternative remedy for a common count for goods, wares, and merchandise, together with the alternative remedy under Civil Code §1719 for the amount of the check and the $25.00 service charge. Therefore, Defendant has NOT sought to collect any charge from Plaintiff that is not permitted by

California law, and has not violated the Federal Fair Debt ________________________________________________________________
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Collection Practices Act. XV CIVIL CODE §1719 TREBLE DAMAGES PROVISION IS NOT RELEVANT TO THIS CASE Palmer vs. Stassinos, (2004), 348 F. Supp. 2d 1070, primarily analyzed whether interest was allowed when the victim of the dishonored check writer sought treble damages under Civil Code §1719. Judge Whyte believed that "permitting interest in addition to the statutory remedies would permit a double recovery. The law generally bars multiple recoveries for the same loss." Palmer vs. Stassinos, (2004), 348 F. Supp. 2d 1070, 1082). Since neither Defendant nor its assignor ever sought treble damages, whether interest may be awarded in addition to treble damages is not at issue in this case and is not now before this Court. XVI DEFENDANT WOULD NOT RECEIVE A DOUBLE OR MULTIPLE RECOVERY Defendant sought the service charge of $25.00 permitted by

17 Civil Code §1719, in addition to the amount of the check and 18 interest on the check. The $25.00 service charge was 9% of the 19 principal balance, and was intended by the legislature to 20 compensate the victim of the dishonored check writer for the 21 costs of processing the dishonored check, including the 22 substantial bank charges that Defendant's Assignor had to pay for 23 the dishonored check. Allowing the service charge along with 24 interest under Civil Code §3287 does not result in either a 25 double recovery or a multiple recovery for the same loss. 26 The rationale employed by Judge Whyte does not apply to the 27 28 facts of this case in which only a $35.00 service charge and ________________________________________________________________
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interest on the check were imposed on the dishonored check writer. Allowing the victims of the Plaintiff to recover $137.15, $35.00, and interest on the check does not even fully compensate the victim for damages, let alone result in a double or multiple recovery. The amounts sought by Defendant constitute less than full restitution of all the damages caused by the Plaintiff's wrongful act, not more! XVII CALIFORNIA CIVIL CODE SECTION 1719 IS NOT THE EXCLUSIVE REMEDY FOR A DISHONORED CHECK In Palmer vs. Stassinos, (2004), 348 F. Supp. 2d 1070, 1082), Judge Whyte found that "the California Legislature intends the present remedies under Civil Code §1719 to be exclusive." While this conclusion is easily applied to a case where a dishonored check writer presents one check to purchase goods, wares, and merchandise from a merchant, Civil Code §1719 applies to all dishonored checks in California. Accordingly, if Judge Whyte's opinion is adopted, Civil Code §1719 will be the exclusive remedy for all dishonored checks. The following hypothetical examples show how this leads to ridiculous results. Let's pretend that The Donald, aka Donald Trump, opens a trade account at a building supply store like Home Depot. He makes regular charges each month to the account, and pays the bill by check at the end of the month. Let's pretend he made ten (10) purchases of $1,000.00 each, for a total of $10,000.00. He gets his bill, which he pays by check. The check is returned unpaid because of not sufficient funds. Home Depot imposes the $25.00 service charge permitted by Civil Code §1719.

However, because he is The Donald, Home Depot continues to ________________________________________________________________
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permit him to charge. Next month, he makes twenty purchases of $1,000.00 each, and he owes $20,000.00 plus $10,000.00 for the preceding month that he paid for with an N.S.F. check and the $25.00 service charge. The Donald now owes $30,025.00 on an open book account, $30,000.00 for the common count of goods, wares, and merchandise, and $10,000.00 plus a $25.00 service charge under Civil Code §1719. However, if Civil Code §1719 is the exclusive remedy as Judge Whyte suggests, Home Depot has made The Donald an interest free loan on $10,000.00. Is there any possibility the legislature intended to grant The Donald a $10,000.00 interest free loan from Home Depot? NO! If the remedy is exclusive, the case can lead to even more unjust results. If the remedy of Home Depot is exclusively confined to Civil Code §1719, their action for the common counts of an open book account and an account stated are in question. Plaintiff argues that Civil Code §1719 is the exclusive remedy and precludes Home Depot from pursuing its common count action against The Donald. This raises the question whether the entire common count for $30,025.00 is precluded, or is only the $10,025.00 portion of the common count represented by the N.S.F. check precluded. Could the legislature have intended that Civil Code §1719 allow The Donald to receive $30,000.00 of merchandise from Home Depot but only be obligated to repay Home Depot $10,025.00 as a reward for being a dishonored check writer? Whether or not the legislature intended this result, Judge Whyte's opinion creates a dignified legal argument for attorneys

like those now representing Plaintiff to seek precisely this ________________________________________________________________
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result for The Donald. This hypothetical illustrates the multitude of problems that arise because of Judge Whyte's decision to add a provision prohibiting interest to Civil Code §1719. The legislative process allows approximately 200 state representatives and senators, along with the citizens of California, to carefully consider the effect of each word in a statute. The decision of Judge Whyte to insert a provision prohibiting interest into their work creates the opposite result of what the legislature said it intended to achieve. The statutory modifications of Judge Whyte only serve one constituent - the lawyers for the Plaintiff. XVIII PLAINTIFF IS EXCUSED FROM LIABILITY UNDER 15 U.S.C. 1692k "A debt collector may not be held liable in any action brought under this subchapter if the debt collector shows by a preponderance of evidence that the violation was not intentional and resulted from bona fide error not withstanding the maintenance of procedures reasonably adapted to avoid any such error 15 United States Code 1692k Defendant believed that it was entitled to charge interest because, as was judicially noted in Palmer vs. Stassinos, (2004), 348 F. Supp. 2d 1070, 1077, every Court in California allows interest on an claim that is certain and is evidenced by a check returned not sufficient funds with service charges imposed under California Civil Code Section 1719. Until binding legal precedent to the contrary is established in California, the charging of interest, if illegal, is a violation that was not intentional and resulted from a bona fide error

notwithstanding the maintenance of procedures reasonably adapted to avoid any such error. Defendant is therefore excused from any ________________________________________________________________
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liability to Plaintiff pursuant to the provisions of 15 U.S.C. 1692k. While advice of counsel and mistake of law usually does not constitute a defense under the provisions of 15 U.S.C. 1692k, the facts of this case are that interest is allowed under California law unless and until the Judicial Branch of the Federal Government inserts an additional provision into California Civil Code Section 1719 to the contrary. The failure to recognize that the Judicial Branch of the Federal Government would re-write a California state statute by inserting a new statutory provision in conflict with published precedents of the California Supreme Court constitutes a violation that is not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error. Therefore, Defendant must be excused from any liability to Plaintiff pursuant to the provisions of 15 U.S.C. 1692k. XIX REQUEST FOR PARTIAL JUDGMENT UNDER FRCP 54(b) OR CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1291(b) As Judge Whyte noted, there is no "other case directly addressing the availability of prejudgment interest in conjunction with section 1719." There needs to be finding precedent on this issue so that everyone will know what the law is and be able to comply with it. Until this issue is resolved by the issuance of binding precedent, creditors and dishonored check writers will be unsure

as to their rights and obligations. The only beneficiaries of a delay in the issuance of a binding precedent are the attorneys for the Plaintiff, who will continue to file lawsuits like the ________________________________________________________________
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one now before the Court to extort attorney fees from the credit and collection industry based on a published opinion that is not now binding precedent. FRCP 54(b) and 18 U.S.C. 1292(b) permit this Court to enter either a partial judgment or certify this issue for immediate appeal. Defendant urges this Court adopt one of these approaches so that the law on this issue can be settled by the issuance of binding precedent. Creating binding precedent will benefit both the consumers the attorneys for Plaintiff claim to represent as well as the credit and collection industry because the present uncertainty in the law created by the attorneys for the Plaintiff will be resolved. XX CONCLUSION Summary Judgment under F.R.C.P. 56(b) must be granted

16 because Plaintiff will be unable to provide any evidence of such 17 a nature that a reasonable jury could return a verdict in favor 18 of the Plaintiff because there is no evidence upon which a jury 19 could reasonably find that Defendant has any liability to 20 Plaintiff. 21 In addition, this Court should enter a partial judgment 22 under FRCP 54(b) or certify this case for an immediate appeal 23 under 28 U.S.C. 1291(b). 24 25 Dated: August 21, 2006 26 BY 27 28 CLARK GAREN, ATTORNEY FOR DEFENDANT ________________________________________________________________
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 STATE OF CALIFORNIA COUNTY OF RIVERSIDE

PROOF OF SERVICE BY MAIL (1013a, 2015.5 C.C.P.) ) ) S.S.

I am a citizen of the United States and a Resident of the County Aforesaid; I am over the age of eighteen years and not a party to the within entitled action; my business address is: 1801 CALIFORNIA AVENUE, CORONA, CALIFORNIA 92881 On AUGUST 21, 2006, I served the within MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b) on the interested parties herein in said action by placing a true copy thereof enclosed in a sealed envelope with postage thereon fully prepaid, in the United States mail at PALM SPRINGS, CALIFORNIA addressed as follows: IRVING L. BERG, THE BERG LAW GROUP, 433 TOWN CENTER, NO. 493, CORTE MADERA, CALIFORNIA 94925 PAUL ARONS, LAW OFFICES OF PAUL ARONS, 685 SPRINGS STREET, #104, FRIDAY HARBOR, WASHINGTON 98250 O. RANDOLPH BRAGG, HORWITZ, HORWITZ & ASSOCIATES, 25 EAST WASHINGTON, SUITE 900 CHICAGO, ILLINOIS 60602 I DECLARE UNDER PENALTY OF PERJURY THAT THE FOREGOING IS TRUE AND CORRECT. EXECUTED ON AUGUST 21, 2006 AT PALM SPRINGS, CALIFORNIA

CLARK GAREN, DECLARANT

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LAW OFFICES OF CLARK GAREN, CLARK GAREN, CALIF. BAR #50564 P. O. BOX 1790, PALM SPRINGS, CALIFORNIA 92263 STREET ADDRESS-NO MAIL: 17100 N. INDIAN, PALM SPRINGS, CA. 92258 TELEPHONE: (760) 323-4901 Fax: (760) 288-4080 ATTORNEYS FOR PLAINTIFFS IMPERIAL MERCHANT SERVICES, a California corporation, doing business as CHECK RECOVERY SYSTEMS UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA, SAN FRANCISCO DIVISION BRANDY HUNT, on behalf of herself and others similarly situated, ) ) ) ) ) Plaintiff, ) ) -vs) ) CHECK RECOVERY SYSTEMS, INC., ) et. al., ) ) Defendants. ) ) ) ) ) ___________________________________) EXHIBIT NUMBER 1 2 DESCRIPTION OF EXHIBIT Declaration of Todd Shields Check from Plaintiff dated July 5, 2004 and returned marked "Not Sufficient Funds" Defendant's Account Summary December 6, 2004 notice Electronic Assignment of Claim Case No. C 05 4993 MJJ

INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b) Date: October 24, 2006 Time: 9:30 A.M. Place: Courtroom 11

PAGE NO.

3 4 5

________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b) 1

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Dated: June 7, 2006

LAW OFFICES OF CLARK GAREN BY CLARK GAREN, ATTORNEY FOR DEFENDANT

________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b) 2

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 EXHIBIT 1 ________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b) 3

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LAW OFFICES OF CLARK GAREN, CLARK GAREN, CALIF. BAR #50564 P. O. BOX 1790, PALM SPRINGS, CALIFORNIA 92263 STREET ADDRESS-NO MAIL: 17100 N. INDIAN, PALM SPRINGS, CA. 92258 TELEPHONE: (760) 323-4901 Fax: (760) 288-4080 ATTORNEYS FOR PLAINTIFFS IMPERIAL MERCHANT SERVICES, a California corporation, doing business as CHECK RECOVERY SYSTEMS UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA, SAN FRANCISCO DIVISION ) ) ) ) ) Plaintiff, ) ) -vs) ) CHECK RECOVERY SYSTEMS, INC., ) et. al., ) ) Defendants. ) ) ) ) ) ) ) ___________________________________) BRANDY HUNT, on behalf of herself and others similarly situated, Case No. C 05 4993 MJJ

DECLARATION OF TODD SHIELDS IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b) IN CONNECTION WITH THE CASE OF BRANDY HUNT Date: October 24, 2006 Time: 9:30 A.M. Place: Courtroom 11

________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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I, TODD SHIELDS, STATE AND DECLARE 1. If duly called as a witness and sworn to give testimony, my testimony would be as hereinafter stated. 2. All of the facts stated herein are within my own, personal knowledge. 3. I am the Executive Vice-President of IMPERIAL MERCHANT SERVICE, INC., a California corporation, doing business as CHECK RECOVERY SYSTEMS. By virtue of my position, I am the custodian of the business records of my employer that are maintained in connection with the transaction that with Plaintiff BRANDY HUNT. 4. On October 21, 2004, IMPERIAL MERCHANT SERVICE, INC., a California corporation, doing business as CHECK RECOVERY SYSTEMS received an assignment from Safeway, Inc. of all its right, title, and interest to a claim against Plaintiff BRANDY HUNT for the common count of goods, wares, and merchandise that was evidenced by a check that had been returned marked "NSF, which I interpreted to mean "Not Sufficient Funds". The assignment was without reservation of any right by Safeway, Inc. The assignment was transmitted electronically, and included as evidence of the claim a check that was dated on July 5, 2004 on Plaintiff BRANDY HUNT's Bank of America account in the sum of $137.15 payable to Pack `N Save and indicating it was issued for food. The check indicated that it was subsequently returned unpaid to Safeway, Inc. because there were "not sufficient funds" in the Plaintiff BRANDY HUNT's bank account to pay the check. A copy of the check that was included with the assignment of the claim by Safeway, Inc. is attached to the Index of Evidence as Exhibit 1, and incorporated herein by reference. ________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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5. Prior to assignment, Safeway, Inc. added a $35.00 service charge to the balance assigned to IMPERIAL MERCHANT SERVICE, INC., a California corporation, doing business as CHECK RECOVERY SYSTEMS. 6. IMPERIAL MERCHANT SERVICE, INC., a California corporation, doing business as CHECK RECOVERY SYSTEMS maintained a data processing record of all communications it had with Plaintiff BRANDY HUNT. A copy of the data processing record is attached hereto, marked Exhibit 2, and incorporated herein by reference. The data processing record shows that Defendant had no verbal contact with Plaintiff BRANDY HUNT. The data processing record shows that Defendant IMPERIAL MERCHANT SERVICE, INC., a California corporation, doing business as CHECK RECOVERY SYSTEMS sent two written notices to Plaintiff BRADY HUNT. One notice was sent on October 22, 2004, and this notice was the validation notice providing Plaintiff BRANDY HUNT with the information required by the Federal Fair Debt Collection Practices Act. While the notice sent on October 22, 2004 requested interest, the notice was sent more than one year before the Complaint in this action was filed, and any action on this notice is therefore barred by the Statute of Limitations. The second notice was sent on December 6, 2004, and a copy of the second notice sent on December 6, 2004 is attached to the Index of Evidence as Exhibit 3 and incorporated herein by reference.

7. IMPERIAL MERCHANT SERVICE, INC., a California corporation, doing business as CHECK RECOVERY SYSTEMS added interest on the claim of $137.15 at the lawful rate of interest ________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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from July 5, 2004 because, on that date, the amount that was owed by Plaintiff BRANDY HUNT on the claim became certain. 8. IMPERIAL MERCHANT SERVICE, INC., a California corporation, doing business as CHECK RECOVERY SYSTEMS believes that it was entitled to charge interest because, as was judicially noted in Palmer vs. Stassinos, (2004), 348 F. Supp. 2d 1070, 1077, every Court in California allows interest on an claim that is certain and is evidenced by a check returned not sufficient funds with service charges imposed under California Civil Code Section 1719. Until binding legal precedent to the contrary is established in California, the charging of interest, if illegal, is a violation that was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error, and Defendant is excused from any liability to Plaintiff BRANDY HUNT pursuant to the provisions of 15 U.S.C. 1692k. While advice of counsel usually does not constitute a defense under the provisions of 15 U.S.C. 1692k, the facts of this case are that interest is allowed under California law unless and until the Judicial Branch of the Federal Government inserts an additional provision into California Civil Code Section 1719 that provides otherwise. The failure to recognize that the Judicial Branch of the Federal Government would re-write a California state statute by inserting a new statutory provision in conflict with published precedents of the California Supreme Court constitutes a violation that is not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error, and Defendant should be excused ________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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from any liability to Plaintiff pursuant to the provisions of 15 U.S.C. 1692k. 9. Plaintiff BRANDY HUNT has made no payments whatsoever on this account. I DECLARE PENALTY OF PERJURY UNDER THE LAWS OF THE STATE OF CALIFORNIA THAT THE FOREGOING IS TRUE AND CORRECT. EXECUTED ON AUGUST 18, 2006 AT CULVER CITY, CALIFORNIA

________________________________________ TODD SHIELDS

________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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EXHIBIT 2
________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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EXHIBIT 3
________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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EXHIBIT 4
________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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EXHIBIT 5
________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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PROOF OF SERVICE BY MAIL (1013a, 2015.5 C.C.P.) STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) S.S. I am a citizen of the United States and a Resident of the County Aforesaid; I am over the age of eighteen years and not a party to the within entitled action; my business address is: 1801 CALIFORNIA AVENUE, CORONA, CALIFORNIA 92881 On AUGUST 21, 2006, I served the within INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b) on the interested parties herein in said action by placing a true copy thereof enclosed in a sealed envelope with postage thereon fully prepaid, in the United States mail at PALM SPRINGS, CALIFORNIA addressed as follows: IRVING L. BERG, THE BERG LAW GROUP, 433 TOWN CENTER, NO. 493, CORTE MADERA, CALIFORNIA 94925 PAUL ARONS, LAW OFFICES OF PAUL ARONS, 685 SPRINGS STREET, #104, FRIDAY HARBOR, WASHINGTON 98250 O. RANDOLPH BRAGG, HORWITZ, HORWITZ & ASSOCIATES, 25 EAST WASHINGTON, SUITE 900 CHICAGO, ILLINOIS 60602 I DECLARE UNDER PENALTY OF PERJURY THAT THE FOREGOING IS TRUE AND CORRECT. EXECUTED ON AUGUST 21, 2006 AT PALM SPRINGS, CALIFORNIA

CLARK GAREN, DECLARANT

LAW OFFICES OF CLARK GAREN, ________________________________________________________________ INDEX OF EVIDENCE IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56; PARTIAL SUMMARY JUDGMENT UNDER FRCP 54b; AND CERTIFICATION FOR IMMEDIATE APPEAL UNDER 28 U.S.C. 1292(b)

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CLARK GAREN, CALIF. BAR #50564 P. O. BOX 1790, PALM SPRINGS, CALIFORNIA 92263 STREET ADDRESS-NO MAIL: 17100 N. INDIAN, PALM SPRINGS, CA. 92258 TELEPHONE: (760) 323-4901 Fax: (760) 288-4080 E-MAIL: [email protected] ATTORNEYS FOR PLAINTIFFS IMPERIAL MERCHANT SERVICES, a California corporation, doing business as CHECK RECOVERY SYSTEMS UNITED STATES DISTRICT COURT

8 NORTHERN DISTRICT OF CALIFORNIA, SAN FRANCISCO DIVISION 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 The motion for Summary Judgment filed by Defendant IMPERIAL MERCHANT SERVICES D.B.A. CHECK RECOVERY SYSTEMS, INC., came regularly for hearing on October 24, 2006 at 9:30 A.M. in Courtroom 11 before the Honorable Martin J. Jenkins, United States District Judge. After due consideration of the moving, responding, and reply papers, and after consideration of oral argument, the Court finds that the Plaintiff will be unable to provide any evidence of such a nature that a reasonable jury could return a verdict in favor of the Plaintiff because there is no evidence upon which a jury could reasonably find that Defendant has any liability to ________________________________________________________________ ORDER GRANTING DEFENDANTS MOTION FOR SUMMARY JUDGMENT CASE NO. 05 4993 MJJ ) ) ) ) ) Plaintiff, ) ) -vs) ) CHECK RECOVERY SYSTEMS, INC., ) et. al., ) ) Defendants. ) ___________________________________) BRANDY HUNT, on behalf of herself and others similarly situated, Case No. C 05 4993 MJJ ORDER GRANTING MOTION BY DEFENDANT FOR SUMMARY JUDGMENT UNDER FRCP 56; (Proposed)

Date: October 24, 2006 Time: 9:30 A.M. Place: Department 11

Case 4:05-cv-04993-SBA

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Plaintiff. Based on the finding of the Court, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED THAT Summary Judgment is granted in favor of Defendant IMPERIAL MERCHANT SERVICES D.B.A. CHECK RECOVERY SYSTEMS, INC., and against Plaintiff BRIAN CASTILLO, on behalf of himself and all others similarly situated.

Dated:

______________________________________ MARTIN J. JENKINS, UNITED STATES DISTRICT JUDGE

________________________________________________________________ ORDER GRANTING DEFENDANTS MOTION FOR SUMMARY JUDGMENT CASE NO. 05 4993 MJJ

Case 4:05-cv-04993-SBA

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PROOF OF SERVICE BY MAIL (1013a, 2015.5 C.C.P.) STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) S.S. I am a citizen of the United States and a Resident of the County Aforesaid; I am over the age of eighteen years and not a party to the within entitled action; my business address is: 1801 CALIFORNIA AVENUE, CORONA, CALIFORNIA 92881 On AUGUST 21, 2006 I served the within ORDER GRANTING DEFENDANTS MOTION FOR SUMMARY JUDGMENT UNDER FRCP 56 (Proposed) on the interested parties herein in said action by placing a true copy thereof enclosed in a sealed envelope with postage thereon fully prepaid, in the United States mail at PALM SPRINGS, CALIFORNIA addressed as follows: IRVING L. BERG, THE BERG LAW GROUP, 433 TOWN CENTER, NO. 493, CORTE MADERA, CALIFORNIA 94925 PAUL ARONS, LAW OFFICES OF PAUL ARONS, 685 SPRINGS STREET, #104, FRIDAY HARBOR, WASHINGTON 98250 O. RANDOLPH BRAGG, HORWITZ, HORWITZ & ASSOCIATES, 25 EAST WASHINGTON, SUITE 900 CHICAGO, ILLINOIS 60602 I DECLARE UNDER PENALTY OF PERJURY THAT THE FOREGOING IS TRUE AND CORRECT. EXECUTED ON AUGUST 21, 2006 AT PALM SPRINGS, CALIFORNIA

CLARK GAREN, DECLARANT 22 23 24 25 26 27 28 ________________________________________________________________ ORDER GRANTING DEFENDANTS MOTION FOR SUMMARY JUDGMENT CASE NO. 05 4993 MJJ