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IN THE STATE COURT OF DEKALB COUNTY

STATE OF GEORGIA

CACH, LLC, Successor in Interest of }


BANK OF AMERICA, N.A., }
}
Plaintiff, }
} CIVIL ACTION FILE
v. }
} NO. 08A90282-3
SHARON D. CAIN, }
}
Defendant. }

ORDER

This is a credit-card debt collection case in which the Defendant asserts that Plaintiff,

an assignee, has no standing to collect the debt and has counterclaimed for violations of the

Fair Debt Collection Practices Act and the Georgia Fair Business Practices Act. The case

came before the Court on July 6, 2009, for a hearing on Defendant's Motion for Summary

Judgment, filed April 28, 2009, and Plaintiffs Motion for Summary Judgment, filed May 29,

2009. For reasons articulated more thoroughly below, the Court denies in part and grants in

part each of the parties' motions. Thus, Defendant's Motion to Exclude Plaintiffs Affidavits

and Motion in Limine are denied as moot.

Defendant's Motion for Summary Judgment

Defendant filed a Motion for Summary Judgment on April 28, 2009, relying on

Plaintiffs responses to Defendant ' s Requests for Admissions. Defendant asserts that

Plaintiffs responses are sufficient to overcome her liability for the debt that she is alleged to

owe and are sufficient to set forth the requisite bad faith and deceptive practices to establish
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her Counterclaims alleging violations orthe federal Fair Debt Collection Practices Act.
Defendant relies on the responses to three Requests for Admission. !

Defendant ' s Request for Admission No.3 states:

A bank, credit card company, or other entity ("third-party entity") assigned or


purported to assign a debt allegedly due it from the Defendant/ Plaintiff in
Counterclaim to the Plaintiff/Defendant in Counterclaim for collection at some
time prior to the filing of Plaintiff/Defendant in Counterclaim's complaint
herein .

Plaintiffs Response to NO.3 states:

Objection. Plaintiff objects to Defendant ' s request as it is vague and


ambiguous, ill-defined, and made with the intent to harass the Plaintiff as it is
irrelevant and not reasonably calculated to lead to the discovery of admissible
evidence. Subject to and without waiving the foregoing objections, Plaintiff
states: admit in part and deny in part. Plaintiff admits that it was assigned
Defendant's account from the original creditor and denies the remainder of the
request.

Defendant's Request for Admission No . 4 states:

The debt referred to in Request No.3 above constituted a " debt" as that term is
defined in 15 U.S.c.A. § 1692a.

Plaintiffs Response to No.4 states :

Objection, the request calls for a legal interpretation and conclusion. As such,
Plaintiff is unable to admit or deny and therefore states: Denied.

Defendant's Request for Admission No. 41 states:

You are unable to produce a complete copy of each, every and all documents
making Lip and/or referenced in and/or incorporated by reference in the
agreement of assignment to you of the debt sued on herein.

! Although Defcndant filed a Request for Filing Original Discovery on April 28 , 2009, to
make Plaintiffs responses to discovery a part of the record, Plaintiffwas unable to locatc
the originals and submitted copies, along with an explanatory letter dated August 4, 2009,
which were received by the Court on August 13 , 2009. Defendant has filed no object ion
to the filing of these copies.

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Plaintiffs responses stopped at No . 40, and there was no response numbered 41.

However, the Court notes that the response o . 40 referenced in quotations "all documents"

and those words are not used in Defendant's Request for Admission No. 40. The response

labeled 40 states :

Objection, the request is overly broad, unduly burdensome, vague, ambiguous,


non-specific and ill-defined in its request regarding "all documents." Plaintiff
further objects as the request is made with the intent to harass the Plaintiff and
is an attempt to discover infonnation that may be subject to attorney-cl ient
privilege; the work-product doctrine; that is of a confidential and proprietary
nature to the Plaintiff; and, that is irrelevant and not reasonably calculated to
lead to the discovery of admi3siblc evidence. Subject to and without waiving
the foregoing objection, due to the nature of the request, Plaintiffis unable to
admit or deny and therefore must state: Denied.

Defendant asserts that the responses to admissions 3 and 4 and the failure to respond

to 41 establish that there is no debt and that there are no documents to establish Plaintiffs

case.

As for Defendant's counterclaims, she argues that Plaintiff violated 15 USC

§ 1692e(l 0), which prohibits "[t]he use of any false representation or deceptive means to

collect or attempt to collect any debt or to obtain infonnation concerning a consumer."

Because Plaintiff has responded to the admissions that there was no debt, and that there is no

documentation to establish its case, Defendant contends that she has established that Plainti ff

made a false representation or used deceptive means to collect the debt.

Defendant asserts that she is entitled to statutory damages under 15 USC

~ I 692k(a)(2)(A) and attorney's fees under 15 USC § I 692k(a)(3).

On May 29 , 2009, Plaintiff filed its own Motion for Summary Judgment, along with a

response, to . Defendant ' s motion.

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Plaintiffs Response to Defendant ' s Motion for Partial Summary Judgment and

Memorandum in Support Thereof, filed on May 29, 2009, does not address the Defendant ' s

assertions regarding the Requests for Admissions . Instead, Plaintiff erroneously asserts that

Defendant has cited Ponder v. CACVo/Colorado, LLC, 289 Ga. App . 858,658 S.E.2d 469

(2008), which holds that " an assignment must be in writing in order for the contractual right to

be enforceable by the assignee." Plaintiff asserts that a Ponder argument fails because

Plaintiffhas provided evidence that it holds a written assignment. (Plaintiff does not address

Defendant ' s arguments regarding the Fair Business Practices Act claims in the response, but

does discuss them in its own Motion for Summary Judgment filed the same day as the

response.)

Plaintiff asserts that its Affidavits, Bill of Sale, Account Statements and Account

Information Report are admissible to prove a proper assignment and a valid debt.

Plaintiffs evidence is an Affidavit of Olga Zhivnitskaya, who says she is a custodian

ofrecords of CACH, LLC. The Affidavit references Exhibits A, Band C, but of the

documents attached only one, Exhibit A, is labeled.

Exhibit A is an October 30, 2006, Bill of Sale from Bank of America, N.A., to CACH ,

LLC. It references an Exhibit B, which is not attached, but which purportedly sets forth "those

certain Accounts" that are subject to the agreement. The Exhibit A Bill of Saie docs not make

any specific mention of the debt at issue in this case.

There also is a copy of an Affidavit of Claim and Certification of Debt by Brian

Kilpatrick of Bank of America who says that the original contract in this matter has been

d ~ stroyed and is no longer available but that based on computeri zed records and hard copy

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books and records that the debt at issue in this was sold to CACH, LLe. Attached are Bank of

America Visa Account statements from Jul y 2004 to November 2004. There are no records

attached to the Kilpatrick Affidavit to indicate the account was sold to CACH , LLe.

Plaintiff contends that these document are business records that prove a valid

assignment, prove the existence of the account and the balance due. Plaintiff contends its

records custodian lays the foundation for these business records under the hearsay exception

in O .e.G.A. §24-3-14(b). Plaintiff asserts that under Boyd v. Calvwy Portfolio Services, In c.,

285 Ga. App . 390, 646 S.E.2d 496 (2007), it can rely on routine business records transferred

to it by Bank of America to establish the existence of the debt and Plaintiffs right to collect it.

Defendant filed a consolidated Motion to Exclude Plaintiffs Affidavits, Defendant's

Reply Brief on Summary Judgment, and Defendant's Opposition to Plaintiffs Motion on June

1, 2009. 2 Defendant's reply relies in large part on the recent decision of Nyankojo v. North

Star Capital Acquisition, 298 Ga. App. 6, 679 S.E.2d 57 (2009) (holding that "testimony

regarding the contents of business records, unsupported by the records themselves, by one

without personal knowledge of the facts constitutes inadmissible hearsay"). Defendant asserts

2 Also on June 1,2009, Defendant filed a Motion in Limine asking the Court to exclude
evidence that had not been produced in response to Defendant's earlier discovery requests
or evidence seeking to explain or contradict admission or evidence and witnesses not
previously identified in Plaintiffs Pre-Trial Order. Defendant argues that the indi viduals
who supplied the affidavits in support of Plaintiffs response to the summary judgment
motion had not previously been identified and erroneous ly asserts that they were being
filed "on the very last business day prior to the date of trial." The Court notes that this
case had been scheduled for a motions calendar, and not for trial. And \vhile a proposed
Consolidated Pre-Trial Order was recei ved by the Court on April 28, 2009 , it has not yet
I been si,gned or filed while the potentially dispositive Mo tions for Summary Judgment

have .been pending .


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that both of Plaintiffs A ffida vits fail because they are unsupported by records and are not

based on personal knowledge .

Following the motions hearing, Plaintiff on July 10, 2009 , filed a Supplemental

Memorandum in Support of Plaintiffs Motion for Summary Judgment and Motion to Dismiss

Counterclaim and in Opposition to Defendant's Motion for Summary Judgment. In this,

Plainti ff insists that the Zhivnitskaya Affidavit has the requisite evidentiary foundation with

its Exhibit A Bill of Sale executed by Bank of America. Plaintiff states in Section A of the

supplement:

Defendant appears to argue that the introduction of this Bill of Sale is


insufficient to establish Plaintiffs entitlement to proceed upon the subject
account in that the Master Purchase and Sale Agreement originally executed by
and between Plaintiff and Bank of America and referenced in the Bill of Sale is
not before the Court. Although the particular terms of the purchase by and
between Plaintiff and Bank of America (e.g. sales price, quantity, duration) as
may be contained in the Purchase Agreement are not before the Court, and, for
that matter, are not material to any of the pertinent issues in this case,
nonetheless, the record does contain through the Bill of Sale clear evidence that
all rights of Bank of America with respect to the subject account were
transferred on the date indicated to Plaintiff and that the latter clearly has
standing to sue in its own name and on its own behalf with respect to the
subject account.

Plaintiff attempts to distinguish Nyallkojo, which involved two assignments for which

the Court of Appeals found there was no competent evidence to establish that they involved

the same account that was at issue in this case. Plainti ff insists that it has provided such

ev idence in this case through the Bill of Sale which shows " ownership of the subj ect account

owed by the Defendant, originall y to MBNA and Bank of America as its successor in interest,

and later sold to the Plaintiffherein. "3

.1 Plaintiff also asserts that De fendant has not presented any evidence in support of its

. co untercl aim .

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Defendant's Response to Plaintiffs Supplemental Memorandum in Support of

Plaintiffs Motion for Summary Judgment and Motion to Dismiss Counterclaim, filed on Jul y

17, 2009, points out that Plaintiffs assertion does not recognize that the Bill of Sale makes no

specific reference to the account at issue in this case and that while it references an exhibit that

might contain information about the accounts that were transferred, that exhibit is not attached

and has not been put into evidence elsewhere in the record. Defendant ' s response also

continues to argue that the Plaintiffs Affidavits contain inadmissible hearsay. In addition,

Defendant notes an unexplained discrepancy between the account number referenced in those

Affidavits and the account number on the billing statements that Plaintiff has introduced.

Plaintiffs Motion for Summary Judgment

In Plaintiffs Motion for Summary Judgment, filed on May 29, 2009, along with its

response to Defendant' s motion, Plaintiff asserts that Defendant entered into a contract on

February 28, 2003, with Bank of America, .A. for a credit card which she used to make

purchases. Plaintiff contends that the outstanding balance at the time of Defendant's default

was $5,887.12 and that the terms of the contract provided for the recovery of attorney ' s fees .

Plaintiff CACH, LLC states that it is the successor in interest for the Bank of America, N.A.

account as reflected by business records attached to the motion ..j

Plainti ff contends it is the holder of a vaiid assignme nt and thus a contract exists

between it and the Defendant; that Defendant has breached the tem1S of the cardholder

.jThe Court notes that the copy of the Bill of Sale attached to the Plaintiffs Motion for
Summary Judgment, unrelated to an affidavit, does not constitute admissible evidence. However,
the Bill of Sale is the same as that attached to the Affidavit of Olga Zhivnitskaya filed in
conjunction with Plaintiffs response to Defendant ' s Motion for Summary Judgment, which
rqferences an Exhibit B, which is not attached , but which purportedl y sets forth " those certain
Accounts" that are subject to the agreement.

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agreement by failing to make required payments; and, that Plaintiff is entitled to reasonable

attorney's fees and costs pursuant to the cardho Ider agreement. Plainti ff further asserts that

Defendant's affirmative defenses regarding the statute of limitations, laches and a lack of

consideration must fail. In addition, Plaintiff asserts it did not violate the Fair Debt Collection

Practices Act (FDCP A) and that the Georgia Fair Business Practices Act (FBP A) does not

apply in this case because it only applies to the unregulated consumer marketplace.

As to Defendant's FDCP A allegation, Plaintiff asserts that there is no evidence that the

amount or character of the debt was misrepresented and there is no evidence that Plaintiff does

not have the legal right to collect the debt. Plaintiff further argues that Defendant can offer no

evidence that Plaintiff knew or should have known that such information was false .

In addition, Plaintiffs motion contends that Count Three of Defendant's Counterclaim

for litigation costs and attorney's fees pursuant to O .e.G.A. §9-15-14 should fail because the

Plaintiffs claim against the Defendant is justified.

As stated supra, Defendant filed a consolidated Motion to Exclude Plaintiffs

Affidavits, Defendant's Reply Brief on Summary Judgment, and Defendant's Opposition to

Plaintiffs Motion on June 1,2009.

Defendant argues that Plaintiff has failed to establish that it has standing, since both of

Plaintiffs affidavits constitute inadmissible hearsay. Because Piaintiffhas no standing,

Defendant asserts she "has avoided all liability to Plaintiff for any alleged debt, and Defendant

has simultaneously established that Plaintiff violated the federal Fair Debt Collection Practices

Act by pursing an action that it had not right to pursue." Thus, Defendant contends that her

consolidated motions should be granted and the Plaintiffs Motion for Summary Judgment
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should be denied.

Analysis

Generally, in order

[t]o prevail at summary judgment under O .CG.A. § 9-11 -56, the moving party
must demonstrate that there is no genuine issue of material fact and that the
undisputed facts, viewed in the light most favorable to the nonmo ving party,
warrant judgment as a matter of law. O.CG.A. § 9-11-56(c).A defendant may
do this by showing the court that the documents, affidavits, depositions and
other evidence in the record reveal that there is no evidence sufficient to create
a jury issue on at least one essential element of plaintiffs case. If there is no
evidence sufficient to create a genuine issue as to any essential element of
plaintiffs claim, that claim tumbles like a house of cards. All of the other
disputes of fact are rendered immaterial.

Lau's Corp. Inc. v. Haskins, 261 Ga. 491,491,405 S.E. 2d 474,475-76 (1991) (Emphasis in

original). Not only must a plaintiff establish every element of its claim as a matter of law, but

also it must "pierce the defenses set up in [the] answer." Crown Ford, Inc. v. Crawford, 221

Ga. App. 881, 882,473 S.E.2d 554 (1996) .

1. Standing

The Plaintiff in this case, CACH, LLC, asserts that it is a successor in interest to a

credit-card contract that Defendant allegedly entered and breached with Bank of America,

N.A. Although the law generally requires that contract provisions may be enforced only by a

party to that contract, there is an exception that allows a party to assign the contractual right to

collect payment, even where a lawsuit must be brought to enforce that right. See, Scott v.

Cllshman & Wakefield of Ga., 249 Ga. App. 264,265 , 547 S .E.2d 794 (200 1). However, "the

assignment must be in writing in order for the contractual right to be enfo rc eable by an

assignee." Ponder v. CACV of Colorado, 289 Ga. App . 858, 859, 658 S.E. 2d 469, 470 (2008)

(c iting SCO{{, 249 Ga. App. at 266 , 5-+7 S.E.2d 794). In Pondcr, the Georgia Court of Appeals

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held that summary judgment in favor of an assignee was improper because there was no

evidence in the record to support the assignee's assertion that it was a successor in interest to

the right of recovery that originally belonged to the bank that had entered into the contract at

issue in that case. Poncier, 289 Ga. App. at 859 -60, 658 S.E. 2d 470.

Unlike Poncier, in which the only assertion of the assignee's interest was in the style of

the complaint, lei., the Plaintiff in this case has filed two Affidavits, which it contends proves

that it is the successor in interest to the Bank of America, N.A. contract with Defendant and

that it has a right to sue to recover the debt allegedly owed as a result of her default under the

tenns of that credit card agreement. However, the Court agrees with Defendant that this case is

controlled adversely to Plaintiff by Ponder's only progeny: Nyankojo v. North Star Capital

Acquisition, 298 Ga. App. 6, 679 S.E.2d 57 (2009).

In Nyankojo, the Court of Appeals held that the affidavit of a company president that

he had reviewed certain documents that showed his company was the assignee of the subject

debt was legally insufficient without producing the actual records. As in Nyankojo, the

Plaintiff in this case has not produced any business records to show that the account that

Defendant allegedly had with Bank of America, N.A. was assigned in writing to CACH, LLC.

Plaintiff presented the Affidavit of Olga Zhivnitskaya, who says she is a custodian of

records of CACH, LLC. The Affidavit references Exhibits A, Band C, but of the documents

attached only one, Exhibit A, is labeled. While Exhibit A is an October 30, 2006, Bill of Sale

from Bank of America, N.A., to C ACH, LLC, it contains no reference to the account at issue

in this case. Instead, the Bill of Sale references an Exhibit B, which is not attached, but which

purportedly sets forth "those certain Accounts" that are subject to the agreement. Thus, there is
I. .

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no evidence that the right to sue for the debt at issue in this case was among those sold to

C ACH, LLC on October 30, 2006 .

Plaintiff also filed a copy of an "Affidavit of Claim and Certification of Debt" by Brian

Kilpatrick of Bank of America who says that the original contract in this matter has been

destro yed and is no longer available but that based on computerized records and hard copy

books and records that the debt at issue in this was sold to CACH, LLe. Filed along with this

are Bank of America billing statements, but nothing to show that the right to sue for the debt at

issue in this case was assigned in writing to CACH, LLC.

Accordingly, the Court finds that Plaintiff has failed to prove that it has standing to

bring this claim and that Defendant is entitled to summary judgment on this issue.

The question then becomes what effect Plaintiffs failure to prove it has standing to

bring the claim has on the debt itself and on Defendant's counterclaims under the Fair Debt

Collection Practices Act and the Georgia Fair Business Practices Act.

O .e.G.A. § 9-11-17 (a) provides that "[e]very action shall be prosecuted in the name

of the real party in interest. . .. No action shall be dismissed on the ground that it is not

prosecuted in the name of the real party in interest until a reasonable time has been allowed

after objection for ratification of commencement of the action by, or joinder or substitution of,

the real party in interest; and such ratification, joinder, or substitution shall have the same

effect as if the action had been commenced in the name of the real party in interest. "

Plaintiff has had ample time after objection fo r ratification , joinder, or substitution and

has not done so . Defendant has repe atedl y and clearly pointed out that Plainti ff has th e burden

of showing an appropriate written assignment; accon.lingly, it was incumbent upo n Plainti ff to

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produce evidence (and perhaps move to set aside an admission, see n.5, infra) which has not

been done. Accordingly, Defendant is entitled to summary judgment on the Plaintiffs claim.

2. Fair Debt Collection Practices Act

Defendant asserts in her Motion for Summary Judgment on her counterclaim that

Plainti ff, by seeking to collect a debt to which it is not legally entitled, has made false

representations and has used deceptive means in violation of 15 U.S.c. § 1692e(1 0). 5 Plaintiff

responds that Defendant can offer no evidence that Plaintiff knew or should have known that

the information it was communicating was false.

However, the Court finds that the Plaintiff misstates the burden of proof on this issue.

Because the Act imposes strict liability, a consumer need not show intentional
conduct by the debt collector to be entitled to damages. However, a debt
collector may escape liability if it can demonstrate by a preponderance of the
evidence that its "violation [of the Act] was not intentional and resulted from a
bona fide error notwithstanding the maintenance of procedures reasonably
adapted to avoid any such error." § 1692k( c).

Russell v. Equifax A.R.S , 74 F.3d 30, 33 -34 (C.A.2 (N.Y .), 1996). See also Edwards v.

Niagra Credit Solutions, Inc., 2009 U.S. App. LEXIS 22500 (decided October 14, 2009)

(stating "[a] debt collector asserting the bona fide error defense must show by a preponderance

of the evidence that its violation of the Act: (1) was not intentional ; (2) was a bona fide error;

and (3) occurred despite the maintenance of procedures reasonably adapted to avoid any such

error").

Nevertheless, Defendant has not met her burden in summary judgment as to this

5For this point, Defendant relies upon Plainti ffs responses or lack of response to the
aforementioned Requests for Admission . The Court notes that a denial of a Request for
Admission does not establish an evidentiary point. Moreover, Plaintiffs improper objections and
equivocal responses to these Requests for Admission arguably deem them to be admitted.

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defense.

"[A]t summary judgment a party who will not bear the burden of proof at trial need not
conclusively prove the opposite of each element of the non-moving party's case.
Rather, that party must demonstrate hy reference to evidence in the record that there is
an absence of evidence to support at least aile essential element of the 1I01l-moving
party 's case."

L([u 's, 261 Ga. at 495 (Emphasis supplied). Although Plaintiffhas failed to come forward with

evidence that its actions in this regard were not intentional, were a bona fide error or occurred

despite maintenance of procedures that could reasonably be expected to avoid such an error,

Defendant has not pointed out the absence of such evidence and Plaintiffs responsibility to

produce it. Instead, Defendant asserted that she had conclusively demonstrated her case

without conclusively showing the absence of this defense or the absence of evidence satisfying

Plaintiffs affirmative burden.

Accordingly, as to the Fair Debt Collection Practices Act, Defendant's motion is

denied. Defendant may proceed to trial or may file a renewed motion which points out the

absence of evidence to support this defense.

3. Georgia Fair Business Practices Act

Plaintiff asserts that Defendant's claim under the Georgia Fair Business Practices Act

must faii because it only applies to the unregulated consumer marketplace. The Court notes

that Defendant has not responded to this argument. The Court agrees with Plainti ff that the

Georgia Act does not apply in this case such as this where proper trade practices are defined

and consumer remedies are provided by other bodies of law, i.e., the Fair Debt Collection

Practice Act. See. 0. C. C.A. ,~. \ 0-\-396 and Chancellor v. CateH"a), Linco!n-MercllIY. Illc. 233

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Ga. App. 38,502 S.E. 2d 799 (1998). Accordingly, Plaintiffs Motion for Summary Judgment

is GRANTED IN PART as to this issue.

4. O.e.G.A. §9-1S - 14 Claim

Finally, Plaintiff contends that Count Three of Defendant's Counterclaim for litigation

costs and attorney's fees pursuant to O.e.G.A. §9-1S-14 should fail because the Plaintiffs

claim against the Defendant isjustified .

In light of the analysis in Part 2, supra, this claim is not ripe for resolution .

Summary

For the foregoing reasons Defendant's Motion for Summary Judgment is GRANTED

as to its challenge to Plaintiffs standing to bring this claim. As to Plaintiffs alleged violation

of the Fair Debt Collection Practices Act, the motion is DE lED WITHOUT PREJUDICE to

filing a renewed motion for summary judgment. Plaintiffs Motion for Summary Judgment is

GRANTED as to Defendant's claim under the Georgia Fair Business Practices Act. The claim

for attorney fees under O.e.G.A. § 9- 15-14 is DEFERRED. Defendant's Motion to Exclude

Plaintiffs Affidavits and Motion in Limine are DENIED AS MOOT.

SO ORDERED, this 22...day of October, 2009.

fA) ~ ?vJ ?2----- -


WAYNE M.PURi)OM, JUDGE
STATE COURT OF DEKALB COUNTY

Copy to:
All Parties (kw)

1-+
Cerk. Stats r; ~'_ rt, Oekaib County

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