Please E-mail suggested additions, comments and/or corrections to Kent@MoreLaw.Com.
Help support the publication of case reports on MoreLaw
Alexander A. Benzemann v. Houslanger & Associates, P.L.L.C., Todd E. Houslanger, New Century Financial Services
Case Number: 18-1162-CV
Judge: JOSÉ A. CABRANES
Court: United States Court of Appeals for the Second Circuit on appeal from the Southern District of New York (New York County)
Plaintiff's Attorney: Andrew J. Tiajoloff
Defendant's Attorney: Robert J. Bergson
In a final attempt to salvage his Fair Debt Collection Practices
Act (“FDCPA”) claim against Defendants‐Appellees Houslanger &
Associates, PLLC and Todd E. Houslanger (jointly, “Houslanger”),
Plaintiff‐Appellant Alexander A. Benzemann (“Plaintiff”) asks us to
endorse a novel—and potentially far‐reaching—construction of the
FDCPA’s statute of limitations. We decline the invitation.
An FDCPA claim must be filed “within one year from the date
on which the violation occurs.”1 Relying on certain language in our
decision in Benzemann v. Citibank N.A. (“Benzemann I”)2, Plaintiff
contends that an FDCPA “violation” does not “occur[ ]”—and the
statute of limitations does not begin to run—until an individual is
injured and receives “notice of the FDCPA violation.”3 The United
States District Court for the Southern District of New York (Naomi
Reice Buchwald, Judge) rejected Plaintiff’s reading of Benzemann I,
concluded that his FDCPA claim is time‐barred, and granted summary
judgment in Houslanger’s favor. We agree and therefore AFFIRM the
District Court’s March 23, 2018 judgment.
We draw the facts, which are undisputed or presented in the
light most favorable to Plaintiff, from the summary judgment record.4
1 15 U.S.C. § 1692k(d).
2 806 F.3d 98 (2d Cir. 2015) (“Benzemann I”).
3 Pl.’s Br. 9; see also Benzemann I, 806 F.3d at 103.
4 In re DeRogatis, 904 F.3d 174, 180 (2d Cir. 2018) (“Because the appeals
challenge orders granting summary judgment to defendants, we present here the
A. The Restraining Notices
On April 21, 2008, Houslanger sent a restraining notice
referencing a 2003 judgment against an individual named Andrew
Benzemann (“Andrew”) to Citibank, N.A. (“Citibank”), where
Plaintiff held an account.5 The notice named Andrew as the judgment
debtor, but it listed Plaintiff’s social security number and address. On
April 30, 2008, Citibank “froze” Plaintiff’s account. After Plaintiff’s
attorney notified Houslanger of the error, Houslanger withdrew the
restraining notice, and Citibank lifted the freeze.
More than three years later, on December 6, 2011, Houslanger
(somewhat inexplicably) sent Citibank a second restraining notice
containing similar information—i.e., naming Andrew as the judgment
debtor but listing Plaintiff’s social security number and address.
Perhaps not surprisingly, Citibank froze Plaintiff’s accounts. On
December 13, 2011 Plaintiff became aware that he could not gain access
to his Citibank accounts. He called Citibank, but the representative
with whom he spoke gave him little information about why his
accounts were unavailable. Distressed, Plaintiff contacted his attorney
that same evening. The next day, Plaintiff learned that his accounts
had been frozen pursuant to a restraining notice. By the evening of
version of the facts most favorable to [plaintiff]’s claims, and we draw all reasonable
inferences in [his] favor.”).
5 Under New York state law, a “restraining notice serves as a type of
injunction prohibiting the transfer of [a] judgment debtor’s property.” Aspen Indus.
v. Marine Midland Bank, 52 N.Y.2d 575, 579 (1981).
December 15, 2011, the freeze had been lifted, and Plaintiff had
regained access to his funds.
About one year later, on December 14, 2012, Plaintiff
commenced this action, asserting, among others, the FDCPA claim at
the center of this appeal.
B. Benzemann I
On June 27, 2014, the District Court dismissed Plaintiff’s FDCPA
claim as untimely.6 The District Court concluded that the alleged
FDCPA violation occurred, triggering the one‐year statute of
limitations, when Houslanger mailed the restraining notice on
December 6, 2011. Because Plaintiff commenced this action one year
and eight days later, the District Court held that his FDCPA claim is
In Benzemann I, we concluded that the District Court “erred in
finding that the FDCPA violation ‘occurred’ when Houslanger sent the
restraining notice.”7 Instead, we held that “where a debt collector
sends an allegedly unlawful restraining notice to a bank, the FDCPA
6 See Benzemann v. Citibank N.A., No. 12 Civ. 9145 (NRB), 2014 WL 2933140,
at *5–*8 (S.D.N.Y. June 27, 2014).
7 Benzemann I, 806 F.3d at 103.
violation does not ‘occur’ for purposes of [the statute of limitations]
until the bank freezes the debtor’s account.”8
Because the record was at that time unclear as to whether
Citibank froze Plaintiff’s accounts on December 13 or December 14,
2011, we remanded for further proceedings.9 We also directed the
District Court to consider, in the event it found that the freeze occurred
on December 13, 2011, whether the FDCPA’s statute of limitations is
subject to the common‐law “discovery rule.”10
C. Additional Factual Development After Remand
After limited discovery, it became clear that Citibank froze
Plaintiff’s accounts on December 13, 2011.
Citibank’s records, produced pursuant to a subpoena, show that
Citibank “blocked” Plaintiff’s accounts and an associated debit card at
6:14 p.m. on the evening of December 13, 2011. A Citibank employee
9 Though seemingly trivial on its face, as is frequently true in cases of
competing claims regarding statutes of limitation, the one‐day difference was
potentially significant. If Citibank froze Plaintiff’s accounts on December 14, 2011,
then his FDCPA claim, commenced exactly one year later, is necessarily timely. If
the freeze occurred even one day earlier, however, then the statute of limitations
might preclude recovery.
10 As we explain below, under the discovery rule, “a plaintiff’s cause of
action accrues when he discovers, or with due diligence should have discovered,
the injury that is the basis of the litigation.” Guilbert v. Gardner, 480 F.3d 140, 149
(2d Cir. 2007) (internal quotation marks omitted).
testified that after that time, Plaintiff could not withdraw funds, had
only limited ability to deposit funds, and did not have access to the
Plaintiff’s sworn declaration and deposition testimony
corroborate this account. Plaintiff averred that, on December 13, 2011,
in the evening, his wife informed him that “she had a problem using
[his] Citibank debit card at an [automated teller machine].”11 Plaintiff
attempted to gain access to his accounts electronically but was unable
to do so because they “were not visible on‐line.”12 At that point, he
“concluded that [his] accounts had been frozen because the same thing
had occurred . . . in 2008.”13 This realization was “extremely
distressing,”14 and by approximately 8:00 p.m. that evening, Plaintiff
“thought [he] was going to have a heart attack.”15
Notwithstanding his distress, Plaintiff acted immediately. He
contacted Citibank by telephone to learn “what happened to [his]
accounts.”16 A Citibank employee informed Plaintiff that his accounts
had been blocked and instructed him to call the next day for more
11 J.A. 176.
12 Id. at 177.
13 Id. at 176.
15 Id. at 299.
16 Id. at 176.
information. Plaintiff also contacted his attorney, who represented
him when Citibank erroneously froze his account in 2008, because that
experience led him to believe that he “might [have] a legal problem.”17
The next day, December 14, 2011, Plaintiff learned that Citibank
had frozen his accounts pursuant to the second erroneous restraining
notice sent by Houslanger on December 6, 2011.
D. The District Court’s Memorandum and Order
After discovery, Houslanger moved for summary judgment,
contending once again that Plaintiff’s FDCPA claim is time‐barred.
The District Court agreed and granted summary judgment in
First, the District Court found that Citibank froze Plaintiff’s
accounts—i.e., that the alleged FDCPA violation occurred, triggering
the statute of limitations—on December 13, 2011. Because Plaintiff
filed suit on December 14, 2012, one year and one day later, the District
Court held that Plaintiff’s FDCPA claim is untimely.
Second, the District Court concluded that it did not need to
determine whether the discovery rule applies to FDCPA claims as a
general matter because the outcome in this case would be the same in
any event. The evidence established that Plaintiff learned that Citibank
17 Id. at 302.
18 See Benzemann v. Citibank N.A., No. 12 Civ. 9145 (NRB), 2018 WL 1665253,
at *5–*7 (S.D.N.Y. Mar. 22, 2018).
froze his accounts on December 13, 2011, so that the date of injury and
the date of discovery were the same. Accordingly, Plaintiff’s claim
would be time‐barred even under the discovery rule.
This appeal followed.
A. Standard of Review
We review an award of summary judgment, including on the
basis of “an affirmative defense such as the statute of limitations,”19 de
novo, “construing the evidence in the light most favorable to the
nonmoving party and drawing all reasonable inferences and resolving
all ambiguities in [his] favor.”20 Summary judgment is appropriate if
“there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.”21
B. Interpreting Benzemann I
The parties’ dispute is based principally on our construction of
the FDCPA’s statute of limitations in Benzemann I.
19 Giordano v. Mkt. Am., Inc., 599 F.3d 87, 93 (2d Cir. 2010).
20 Fox v. Costco Wholesale Corp., 918 F.3d 65, 71 (2d Cir. 2019) (internal
quotation mark omitted).
21 Fed. R. Civ. P. 56(a).
As noted above, an FDCPA claim must be brought “within one
year from the date on which the violation occurs.
”22 We held in
Benzemann I “that where a debt collector sends an allegedly unlawful
restraining notice to a bank, the FDCPA violation does not ‘occur’ for
purposes of [the statute of limitations] until the bank freezes the
debtor’s account.”23 Though this conclusion appears straightforward,
we also observed that “the FDCPA violation here did not ‘occur’ until
Citibank froze [Plaintiff]’s account because it was only then that he had
a complete cause of action and notice of the FDCPA violation.”24
Plaintiff makes much of this latter passage in Benzemann I. He
contends that, as interpreted in Benzemann I, the FDCPA’s limitations
period commences only when an individual is injured by unlawful
conduct and receives “notice of the FDCPA violation.”25 Here, under
Plaintiff’s theory, the statute of limitations did not begin to run until
Plaintiff learned that Citibank had frozen his accounts pursuant to the
unlawful restraining notice that Houslanger prepared. Plaintiff argues
that, because he did not learn of the restraining notice until December
14, 2011, his FDCPA claim, which he commenced exactly one year
later, is timely.
22 15 U.S.C. § 1692k(d).
23 Benzemann I, 806 F.3d at 103.
24 Id. at 103 (emphasis added).
25 Pl.’s Br. 9.
We conclude that our observation regarding “notice” cannot
bear the weight Plaintiff assigns to it. To the extent our decision in
Benzemann I created any confusion, we now make clear that an FDCPA
violation occurs, triggering the statute of limitations, when an
individual is injured by unlawful conduct.
* * *
We reject Plaintiff’s position for several reasons. As an initial
matter, we did not consider in Benzemann I the issue that Plaintiff now
contends we decided. The question before us in Benzemann I was
whether an FDCPA violation can occur, for the purposes of the statute
of limitations, before the victim is injured. We concluded that it could
not. In reaching that conclusion, we were not required to—and, we
now make clear, did not—examine whether the triggering of the
statute of limitations also requires “notice of the FDCPA violation.”
Because that issue was not before us, there is no basis for assuming
that we reached it, especially in light of the otherwise clear principle
we expressly described as our holding.26
In any event, read as a whole, Benzemann I makes clear that we
intended to tether the commencement of the FDCPA’s limitations
period to the date of injury. We began by reciting the “general
26 See Columbia Broad. Sys., Inc. v. Am. Soc’y of Composers, Authors & Publishers,
620 F.2d 930, 935 (2d Cir. 1980) (“[A]ppellate courts, endeavoring to rule beyond
the precise holding of a case, normally make that intention unmistakably clear.”);
United States v. Rubin, 609 F.2d 51, 69 n.2 (2d Cir. 1979) (Friendly, J., concurring) (“A
judge’s power to bind is limited to the issue that is before him.”).
principle of law that a cause of action accrues when conduct that
invades the rights of another has caused injury.”27 We then noted that
“[b]efore Citibank froze [Plaintiff]’s account, [he] had suffered no
injury” and therefore “could not have sued Houslanger.”28 To avoid
an “anomaly” wherein “the FDCPA’s statute of limitations . . . begin[s]
to run before an FDCPA plaintiff [can] file suit,”29 we concluded that
an FDCPA violation cannot occur before an individual is injured by
unlawful conduct.30 Thus, from the very beginning, our focus in
Benzemann I was the date of Plaintiff’s injury.
In addition, our instructions to the District Court refute
Plaintiff’s interpretation. Having determined that an FDCPA violation
occurs for the purposes of the statute of limitations when a bank
freezes a debtor’s account, we directed the District Court to conduct
further proceedings to ascertain the date of the freeze.31 If we had
concluded that an FDCPA violation could not occur until an
individual received “notice of the FDCPA violation,” as Plaintiff
suggests, this instruction presumably would have been different. We
also directed the District Court to consider whether the discovery rule
27 Benzemann I, 806 F.3d at 101 (internal quotation marks and brackets
29 Id. at 101, 102.
30 Id. at 103.
applies to FDCPA claims only if it determined that Citibank froze
Plaintiff’s accounts on December 13, 2011.32 This instruction is
consistent with the conclusion that Plaintiff’s knowledge—or lack
thereof—is irrelevant in determining when an alleged FDCPA
Accordingly, a careful reading makes clear that we did not
intend in Benzemann I to expand the FDCPA’s statute of limitations by
requiring that individuals receive “notice of the FDCPA violation.”
* * *
Aside from the fact that Benzemann I simply does not say what
Plaintiff would like, there are other reasons to reject Plaintiff’s
proposed notice requirement. First, the statutory text provides no
support for such a rule. We have observed that statutes of limitation
“inevitably reflect[ ] a value judgment concerning the point at which
the interests in favor of protecting valid claims are outweighed by the
interests in prohibiting the prosecution of stale ones.”33 Thus, “strict
adherence to limitation periods is the best guarantee of evenhanded
administration of the law.”34 Here, strict adherence requires little
imagination, since the statutory text is unambiguous: FDCPA claims
must be brought “within one year from the date on which the violation
32 Id. at 103 n.2.
33 Carey v. Int’l Bhd. of Elec. Workers Local 363 Pension Plan, 201 F.3d 44, 47 (2d
Cir. 1999) (internal quotation marks omitted).
34 Id. (internal quotation marks omitted).
occurs.”35 A “violation”—“[a]n infraction or breach of the law”36—
“occurs” when it “take[s] place.”37 It is one thing to conclude, as we
did in Benzemann I, that a breach of the law might not take place until
unlawful conduct causes an injury. But it is quite another to suggest
that a breach of the law does not take place until a victim receives
notice of the statutory violation. On Plaintiff’s theory, if an individual
never received such notice, a breach of the law never took place—no
matter that the individual was in fact injured by unlawful conduct.
This novel interpretation might help Plaintiff evade the FDCPA’s
statute of limitations, but it appears to us unsupported by the common
understanding of the words “violation” and “occur.”
Second, unlike the rule we adopted in Benzemann I and restate
today, Plaintiff’s proposal is not easily administrable. Plaintiff makes
no attempt to define the contours of what constitutes sufficient “notice
of the FDCPA violation” other than to suggest that, here, it means
“notice of [a] [r]estraining [n]otice that violates the FDCPA.”38 But
even this limitation provides only so much help. A restraining notice
might violate the FDCPA for any number of reasons. Where, as here,
a fundamental error is evident on the face of the restraining notice, the
notice might itself provide “notice of the FDCPA violation.” That will
not always be the case, however. Yet Plaintiff does not identify a way
35 15 U.S.C. § 1692k(d).
36 Violation, BLACK’S LAW DICTIONARY (10th ed. 2014).
37 Occur, WEBSTER’S THIRD NEW INTERNATIONAL DICTIONARY 1561 (1981).
38 Pl.’s Br. 6.
to distinguish between this straightforward case and those instances
in which the type of “notice” necessary to identify “the FDCPA
violation” will be far less self‐evident. Were we to adopt a notice
requirement, the question of how much notice is enough would, we
think, bedevil litigants and courts for some time to come.
Finally, and relatedly, Plaintiff’s proposal undermines the
policies that statutes of limitation serve. Among other things,
limitations periods encourage putative plaintiffs to diligently
prosecute their claims39 and “promote justice by preventing surprises
through plaintiffs’ revival of claims that have been allowed to slumber
until evidence has been lost, memories have faded, and witnesses have
disappeared.”40 Plaintiff’s rule, which incents strategic delay—not to
39 See Statute of Limitations, BLACK’S LAW DICTIONARY (10th ed. 2014) (“The
purpose of [statutes of limitation] is to require diligent prosecution of known claims
. . . .”); see also, e.g., Crown, Cork & Seal Co. v. Parker, 462 U.S. 345, 352 (1983)
(“Limitations periods are intended to . . . prevent plaintiffs from sleeping on their
rights.”); United States v. Wiley, 78 U.S. 508, 513–14 (1870) (Statutes of limitation “are
enacted upon the presumption that one having a well‐founded claim will not delay
enforcing it beyond a reasonable time, if he has the power to sue.”).
40 CTS Corp. v. Waldburger, 573 U.S. 1, 8 (2014) (internal quotation marks and
brackets omitted). See also, e.g., Bd. of Regents v. Tomanio, 446 U.S. 478, 487 (1980)
(“[T]here comes a point at which the delay of a plaintiff in asserting a claim is
sufficiently likely either to impair the accuracy of the fact‐finding process or to
upset settled expectations that a substantive claim will be barred without respect to
whether it is meritorious.”); Bell v. Morrison, 26 U.S. 351, 360 (1828) (Statutes of
limitation are “wise and beneficial law[s]” that “afford security against stale
demands, after the true state of the transaction may have been forgotten, or be
incapable of explanation.”); cf. Oliver W. Holmes, Jr., The Path of the Law, 10 HARV.
L. REV. 457, 476–77 (1897) (“[T]he foundation of the acquisition of rights by lapse of
time is to be looked for in the position of the person who gains them, not in that of
mention endless litigation concerning the sufficiency of notice—does
just the opposite.
* * *
For these reasons, we conclude that an FDCPA violation occurs
for the purposes of the one‐year statute of limitations when an
individual is injured by unlawful conduct. Here, Plaintiff was injured
on December 13, 2011, when Citibank froze his accounts. Because
Plaintiff filed suit one year and one day later, his FDCPA claim is timebarred.
C. The “Discovery Rule”
Plaintiff also contends that his claim is timely pursuant to the
common‐law “discovery rule.” We disagree.
Under the discovery rule, “a plaintiff’s cause of action accrues
when he discovers, or with due diligence should have discovered, the
injury that is the basis of the litigation.”41 We have not had occasion to
decide whether the discovery rule applies to FDCPA claims and need
the loser. . . . A thing which you have enjoyed and used as your own for a long time,
whether property or an opinion, takes root in your being and cannot be torn away
without your resenting the act and trying to defend yourself, however you came by
41 Guilbert, 480 F.3d at 149 (internal quotation marks omitted).
not do so here because, as the District Court recognized, Plaintiff’s
claim would be time‐barred in any event.42
The Supreme Court has made clear that, under the discovery
rule, “discovery of the injury, not discovery of the other elements of a
claim, is what starts the clock.”43 This standard is plainly satisfied here.
By Plaintiff’s own account, he discovered the injury—that Citibank
had frozen his accounts—on the same day that it occurred: December
13, 2011. Accordingly, Plaintiff’s FDCPA claim is time‐barred even
under the discovery rule.44
42 In concluding that the FDCPA’s text does not support Plaintiff’s proposed
notice requirement, we do not mean to preclude the possibility that the FDCPA’s
statute of limitations is subject to the discovery rule. Indeed, we have previously
observed that “federal court[s] generally employ[ ] the ‘discovery rule.’” Id.
(emphasis added). There might be reason to question this presumption. See, e.g.,
TRW Inc. v. Andrews, 534 U.S. 19, 27 (2001) (noting that, though “lower federal
courts generally apply a discovery accrual rule when a statute is silent on the issue,”
the Supreme Court has “not adopted that position as [its] own” (internal quotation
marks omitted)). But we need not reach this issue here. Although we interpret the
words “violation” and “occur” as a signal that the FDCPA’s limitations period
generally commences when an individual is injured by unlawful conduct, we do
not discount the possibility that the discovery rule or, in appropriate circumstances,
another doctrine could alter or extend the limitations period. In addition, we note
that the Supreme Court has recently granted certiorari in an action that raises this
question and might soon conclusively resolve the issue. See Rotkiske v. Klemm, 890
F.3d 422 (3d Cir. 2018), cert. granted, 139 S. Ct. 1259 (Feb. 25, 2019) (No. 18‐328).
43 Rotella v. Wood, 528 U.S. 549, 555 (2000) (emphasis added).
44 We have previously described the discovery rule as applying to both the
complained‐of injury and its cause. See A.Q.C. ex rel. Castillo v. United States, 656
F.3d 135, 140 (2d Cir. 2011) (“The diligence‐discovery rule sets the accrual date at
the time when, with reasonable diligence, the plaintiff has or . . . should have
D. “Equitable Tolling”
Finally, Plaintiff contends that his claim is timely under the
doctrine of “equitable tolling.” Once again, we disagree.
As an initial matter, Plaintiff failed to raise this argument before
the District Court.45 “[A]n appellate court [generally] will not consider
an issue raised for the first time on appeal.”46 Although we can exercise
our discretion to do so “where necessary to avoid a manifest
injustice,”47 Plaintiff has not attempted to meet this standard.
discovered the critical facts of both his injury and its cause.” (internal quotation
marks omitted; emphasis added)). We need not decide today whether we can
reconcile our description of the discovery rule in cases such as A.Q.C. with the
limitation the Supreme Court expressed in Rotella, which we appeared to adopt in
Guilbert. We agree with the District Court that, to the extent Plaintiff did not know
the precise cause of his injury on December 13, 2011, he possessed enough
information to strongly suspect that it had been caused by conduct that was legally
actionable. See Benzemann, 2018 WL 1665253, at *6–*7 (noting Plaintiff’s deposition
testimony that he contacted his attorney shortly after learning his accounts were
frozen because he concluded, in light of his experience in 2008, that he “might
[have] a legal problem” (internal quotation marks omitted)).
45 We reject Plaintiff’s contention that he implicitly raised the issue during
oral argument before the District Court on the motion to dismiss that was the
subject of our decision in Benzemann I. Had Plaintiff in fact intended to raise
equitable tolling more than three years ago, it is highly unlikely that he would have
failed to do so again in opposing Houslanger’s motion for summary judgment.
46 Spinelli v. Nat’l Football League, 903 F.3d 185, 198 (2d Cir. 2018) (internal
quotation mark omitted).
47 Id. at 198–99.
In any event, Plaintiff’s argument fails on the merits. As a
general matter, equitable tolling “pauses the running of, or tolls, a
statute of limitations when a litigant has pursued his rights diligently
but some extraordinary circumstance prevents him from bringing a
timely action.”48 Assuming, for the sake of argument only, that the
doctrine of equitable tolling applies to the FDCPA, there is ample
reason to conclude that Plaintiff has failed to satisfy its requirements.
Plaintiff discovered that Citibank froze his accounts on
December 13, 2011 and began investigating the incident that evening.
By the next day, Plaintiff had gathered all the information necessary to
bring an FDCPA claim. Yet, for reasons known only to Plaintiff and
his counsel, Plaintiff waited just over one year to commence this
action. In the circumstances, it would be difficult indeed to describe
Plaintiff’s pursuit of his rights as “diligent.” Nor, in light of Plaintiff’s
ability to ascertain the necessary information in less than twenty‐four
hours, does it appear that an extraordinary circumstance prevented
him from commencing this action in a timely fashion.
To summarize, we hold that:
(1) An FDCPA violation “occurs,” for the purposes of the
FDCPA’s one‐year statute of limitations, when an individual
is injured by the alleged unlawful conduct. Because Plaintiff
filed suit one year and one day after Citibank froze his
48 CTS Corp., 573 U.S. at 9 (internal quotation marks omitted).
accounts—the injury caused by the claimed FDCPA
violation—his claim is time‐barred.
(2) Even if the “discovery rule” applies to FDCPA claims as a
general matter—an issue we do not decide—Plaintiff’s claim
is time‐barred because he discovered his injury on the same
day that it occurred.
(3) Even if Plaintiff had properly raised the doctrine of
“equitable tolling” before the District Court, it would not
salvage his claim because he did not diligently pursue his
rights, and no extraordinary circumstance precluded him
from timely commencing this action.
Outcome: For the foregoing reasons, we AFFIRM the District Court’s
March 23, 2018 judgment.