In re Snowden

Rupanjali Snowden (debtor) took a $575 payday loan from Check Into Cash of Washington Inc. (CIC) (creditor). Before repayment was due, Snowden advised CIC that she could not repay and was considering filing for bankruptcy. CIC advised Snowden that CIC would not cash the check securing Snowden’s loan. Snowden eventually filed for Chapter 7 bankruptcy and listed CIC as an unsecured creditor. CIC employees repeatedly called Snowden at work after the bankruptcy filing to ask about repayment. One month after the bankruptcy filing, Snowden learned that her bank account was overdrawn by over $800 because CIC had cashed the check securing the loan. Snowden suffered significant distress and worry following the overdraft. In April 2009, Snowden moved for sanctions against CIC based on CIC’s willful violation of the Bankruptcy Code’s automatic stay of collection actions against a debtor. Snowden sought return of the funds and overdraft charges, emotional-distress and punitive damages, and attorney’s fees. In May 2009, Snowden sought to settle with CIC for $25,000. CIC sent Snowden an email claiming that CIC was without fault and proposing to pay Snowden $1,445. Snowden did not accept CIC’s offer, and the matter went to trial. The bankruptcy court ultimately found Snowden’s assertions of emotional distress credible. On December 10, 2009, the court found that CIC had willfully violated the automatic stay and awarded Snowden emotional-distress damages, punitive damages, and attorney’s fees. However, the court declined to award any attorney’s fees incurred after CIC’s May 2009 email. The district court confirmed the award. With respect to attorney’s fees, the district court characterized CIC’s May 2009 email as a tender that would have remedied the automatic-stay violation had Snowden accepted CIC’s offer. The court thus held that attorney’s fees incurred after Snowden rejected CIC’s tender were not incurred in remedying the stay violation and, therefore, were not recoverable. The parties appealed.