ORDER GRANTING SUMMARY JUDGMENT

LARRY ALAN BURNS, District Judge.

When Tony Nguyen failed to pay about $35,000 in credit card debt, LVNV Funding hired a collection firm to recover the debt. The Firm filed two collection actions in California state court alleging Nguyen's debts became due within the four year statute of limitations. Nguyen consulted counsel who advised him not to respond. The clerk entered default judgments. Nguyen moved to set them aside. After a hearing, the state trial court upheld the judgments. The state appellate court held oral argument and affirmed. Nguyen never raised the statute of limitations issue in the state proceedings. [See Dkts. 74, 83.]

As things stand, LVNV holds a final judgment from a California court ordering Nguyen to pay LVNV about $35,000. Nguyen has now filed an action under the Fair Debt Collection Practices Act in this Court. He doesn't deny that he owes the money. Instead, he theorizes that Defendants violated the FDCPA by allegedly filing the state court collection actions beyond the statute of limitations. Defendants have moved for summary judgment alleging that Nguyen is collaterally estopped from raising the statute of limitations issue in this action.

Federal courts must defer "to the preclusion law of the State in which judgment was rendered." Marrese v. Am. Acad. of Orthopaedic Surgeons, 470 U.S. 373, 380 (1985); 28 U.S.C. § 1738. Under California law, the collateral estoppel doctrine bars courts from reconsidering issues that were "actually litigated and determined in the first action." Murray v. Alaska Airlines, Inc., 50 Cal.4th 860, 867 (2010).

The sticking point here is that the California courts entered a default judgment against Nguyen. Given the strong preference for resolving disputes on the merits, it seems incorrect to say the statute of limitations issue was actually litigated and determined. But in California, the rule is clear: "Even a judgment of default in a civil proceeding is res judicata as to all issues aptly pleaded in the complaint and defendant is estopped from denying in a subsequent action any allegations contained in the former complaint." Murray, 50 Cal. 4th at 871 (quotations omitted; emphasis added). Since LVNV pleaded that the collection actions were timely, and default judgment was entered and affirmed, Murray compels the conclusion that Nguyen is estopped from denying the timeliness of the state actions in this case. [Dkts. 73-2 at 59, 62.)1

Nguyen's primary counterargument is that there's an exception to the broad rule articulated in Murray: default judgments don't affect defenses pleaded in the complaint. He maintains that since the statute of limitations is an affirmative defense, collateral estoppel doesn't bar him from raising that issue as the basis for this action. For support, he relies on Four Star Electric v. F & H Construction:

Four Star Elec., Inc. v. F & H Constr., 7 Cal.App.4th 1375, 1382 (1992). The Court doesn't find Four Star controlling for two reasons.

First, Nguyen hasn't offered any analysis on how to square Four Star with the categorical language in Murray that says any and all issues pleaded are considered res judicata when a default judgment is entered. Second, assuming Four Star does carve-out an exception, it doesn't apply in this case. That's because Defendants filled out check-the-box complaints approved by the Judicial Council of California that required Defendants to affirm that their collection actions were filed within the last four years. See Cal. Civ. Proc. Code § 425.12 and § 1911 . That context matters. The Court can't say Defendants added surplusage or immaterial allegations as a sneaky way to avoid the Four Star exception. Rather, Defendants checked a box on a court-approved form complaint certifying essentially two allegations: Nguyen owed them money, and it became due within the last four years. [Dkts. 74-1 at 7, 74-9 at 7; attached as Appendix A.]

While the Court understands Nguyen's argument-the California courts only decided that he owed money to LVNV, not whether the actions were filed on time-that distinction doesn't hold up. Under Murray, when the California courts denied Nguyen's request to set the default aside, they necessarily found Nguyen owed LVNV $35,000. They also implicitly found that LVNV's decision to file the state court collection actions was timely and lawful. For this Court to now repudiate the state courts' findings is exactly the type of second guessing the collateral estoppel doctrine is designed to prevent. "A party cannot by negligence or design withhold issues and litigate them in consecutive actions. Hence the rule is that the prior judgment is res judicata on matters which were raised or could have been raised, on matters litigated or litigable." Mitchell v. Jones, 172 Cal.App.2d 580, 585 (1959) (but noting, as in Four Star, an exception for any unnecessary defense).

The California Supreme Court has explained that courts should consider two overarching concerns when invoking collateral estoppel. "Ultimately, the inquiry that must be made is whether the traditional requirements and policy reasons for applying the collateral estoppel doctrine have been satisfied by the particular circumstances of [the] case." Murray, 50 Cal. 4th at 868. And "it is the opportunity to litigate that is important in these cases, not whether the litigant availed himself or herself of the opportunity." Murray, 50 Cal. 4th at 869. Finding that Nguyen is collaterally estopped here comports with both concerns. By refusing to allow him to litigate the statute of limitations issue, the Court is "conserving judicial resources and promoting judicial economy by minimizing repetitive litigation, preventing inconsistent judgments which undermine the integrity of the judicial system, and avoiding the harassment of parties through repeated litigation." Id. at 879. Nguyen had three opportunities to raise his statute of limitations concern with the California courts. He chose not to. The Fair Debt Collection Practices Act doesn't function to provide litigants with a second chance to try out new arguments in federal court after failing to raise them in state court.

* * *

Since there's no dispute as to any material fact and the Defendants are entitled to judgment as a matter of law, their motion for summary judgment is GRANTED [Dkts. 71, 73]; plaintiff's motion is DENIED. [Dkt. 76.] Fed. R. Civ. P. 56. Because Nguyen's Rosenthal Act claim mimics the Fair Debt Collection Practices Act, the Court grants Defendants' summary judgment on both claims. See Gates v. MCT Grp., Inc., 678 F. App'x 539, 541 (9th Cir. 2017).2

IT IS SO ORDERED.

Appendix A