United States District Court, N.D. Illinois
February 24, 2004.
DAVID WILSON, individually and on behalf of all others similarly situated, Plaintiff,
COLLECTO, Inc., a Massachusetts corporation, d/b/a Collection Company of America, Defendant
The opinion of the court was delivered by: AMY J. ST. EVE, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff David Wilson moved for certification of a class of debtors
affected by an alleged violation of the Fair Debt Collection Practices
Act ("FDCPA"), 15 U.S.C. § 1692 et seq. by Defendant Collecto, Inc.
("Collecto"). Collecto filed a memorandum in opposition to class
certification. For the reasons discussed below, plaintiff's motion is
In a letter dated July 9, 2002 (the "First Letter"), Defendant informed
Plaintiff that his account with Cingular Wireless ("Cingular") had been
placed with Defendant for collection. In accordance with the FDCPA, the
letter further stated that
[u]nless you dispute the validity of your debt, or any
portion thereof, within thirty days after receipt of
this notice, we shall assume the debt to be valid. If
you notify us in writing of your dispute within this
thirty day period, we will obtain verification of
the debt, or a copy of a judgment against you, and a
copy of such verification or judgment will be mailed
to you. Upon your written request within the thirty
day period, we will provide you with the name and
address of the original creditor, if different from
the current creditor.
Plaintiff did not respond to the First Letter. In a letter dated August
7, 2002 (the "Second Letter"), Defendant informed Plaintiff that
[a]s a result of your continued failure to liquidate
the above reference [sic] account, we have on this day
informed our client that you have not paid this debt
or made arrangements to pay. You should know that our
client has the right to take further steps to collect
Your unpaid account can negatively affect your
credit for many years. If you can't pay this in
full, please call to discuss a payment arrangement
We urge you to contact this office today.
Plaintiff filed the Complaint in this action on July 7, 2003, alleging
that Collecto violated § 1692g of the FDCPA when it sent the Second
Letter within thirty days of the First Letter, thus overshadowing and
rendering ineffective the notice provided in the First Letter.*fn1
Plaintiff asserted that he brought the action on behalf of all consumer
debtors in Illinois from whom Defendant attempted to collect debts using
letters such as the First and Second Letters where the Second Letter was
sent within 30 days of the First Letter.*fn2
On July 8, 2003, Plaintiff filed a Chapter 13 bankruptcy petition,
listing his claim against Defendant as "Property Claimed as Exempt" with
a listed value of $1000. On October 29, 2003, Bankruptcy Judge Black
issued an order confirming plaintiff's Chapter 13 plan.
Rule 23(a) of the Federal Rules of Civil Procedure provides the
threshold requirements for all federal class action suits: (1) numerosity
(the class must be so large "that joinder of all members is
impracticable"); (2) commonality (there must exist "questions of law or
fact common to the class"); (3) typicality (named parties* claims "are
typical . . . of the class"); and (4) adequacy of representation (the
representative must be able to "fairly and adequately protect the
interests of the class"). Keele v. Wexler, 149 F.3d 589, 594 (7th Cir.
1998) (citing Amchem Products. Inc. v. Windsor, 521 U.S. 591, 613, 117
S.Ct. 2231, 2245, 138 L.Ed.2d 689 (1997)).
Additionally, a party seeking certification of a class must show that
the proposed class satisfies one of the requirements set forth in Rule
23(b). In this case, Plaintiff requests that the Court certify the class
pursuant to Rule 23(b)(3). This subsection applies when "the questions of
law or fact common to the members of the class predominate over any
questions affecting only individual members, and that a class action is
superior to other available methods for the fair and efficient
adjudication of the controversy." Fed, R. Civ. P. 23(b)(3).
"[T]he party seeking class certification assumes the burden of
demonstrating that certification is appropriate." Retired Chicago Police
Ass'n v. City of Chicago, 7 F.3d 584, 596 (7th Cir. 1993) (citing Trotter
v. Klincar, 748 F.2d 1177, 1184 (7th Cir. 1984)). In determining whether
a party has carried this burden, a court need not accept all of the
complaint's allegations as true. Szabo v. Bridgeport Machines, Inc.,
249 F.3d 672, 675 (7th Cir. 2001). Rather, in deciding whether to certify
a class, a judge "should make whatever factual and legal inquiries are
necessary under Rule 23." Id. at 676.
In order to satisfy the requirement of numerosity, Plaintiff must show
that the number of members in the class is so large that joinder would be
impracticable. Fed.R.Civ.P. 23(a). Defendant correctly points out that
this standard requires Plaintiff to show that such joinder would be
extremely difficult or inconvenient. See Dants v. USN Communications,
Inc., 189 F.R.D. 391, 399 (N.D. Ill. 1999). "The exact numbed of class
members need not be pleaded or proved, but impracticability of joinder
must be positively shown, and not merely speculative." Keele v. Wexler,
No. 95 C 3483, 1996 WL 124452, *3 (N. D. Ill. Mar. 19, 1996); Gomez v.
Cumerford, 883 F. Supp. 702, 706 (N.D. Ill. 1993).
Plaintiff has asserted 280 potential members of this class. Defendant
attempts to limit this number, arguing that Plaintiff has pled that only
35 debtors actually received the Second Letter within 30 days of the
first. As discussed below, Plaintiff has pled a sufficient cause of
action on behalf of the class of debtors who received letters that were
sent within the 30 day period. Given the number of potential
claimants, and considering the fact that individual plaintiff's in this
case would be unlikely to sue on their own, the Court finds that joinder
is impracticable. See Keele, 1996 WL 124452 at *3. Plaintiff has
therefore met the numerosity requirement of Rule 23.
Rule 23 requires Plaintiff to show that "there are questions of law or
fact common to the class." Fed R. Civ. P. 23(a)(2). The rule does not
require perfect harmony throughout the class. `The presence of some
factual variations among class members' experiences will not defeat class
certification." Wagner v. NutraSweet Co., 170 F.R.D. 448, 451 (N.D. Ill.
1997) (citing Rosario v. Livaditis, 963 F.2d 1013 (7th Cir. 1992)).
Plaintiff points out that each member of the class received a Second
Letter that was sent within thirty days of a First Letter. This,
Plaintiff argues, provides a common issue as to whether or not such
letters violate the FDCPA. Defendant, on the other hand, argues that
differences in (1) dates of receipt of the Second Letters and (2)
classification of underlying debt destroy commonality in this case. The
A. Tinling of Violation
Defendant argues that the timing issue destroys commonality. Because
each member of the purported class would have to show that he received
the Second Letter within the thirty day period, Defendant argues,
each prospective plaintiff would present a unique issue of fact.
Plaintiff counters that the Defendant's violation of the FDCPA occurred
on the date Defendant mailed the letter. Because the class would be
limited to those debtors who received letters dated within thirty days of
each other, Plaintiff argues, the class suffered a common injury.
In support of its position that the date of mailing is determinative,
Plaintiff points to cases construing the FDCPA's statute of limitations.
Several courts have found that "under the FDCPA, the violation occurs
when the debt collector mails the letter." Friedman v. Anvan Corp., No.
97 C 2364, 1998 WL 559779 *2 (N.D. Ill. Aug. 28, 1998); see also Friedman
v. HHL Fin. Serv., Inc., No. 93 C 1545, 1993 WL 286487 *2 (N.D. Ill.
Jul. 29, 1993). Finding that the statute of limitations had run based on
a date calculated from the mailing of the offending letter, these courts
impose a burden on debtors to file suit within a year of the collector's
action. Because courts give the burden of the earlier dale to debtors in
the statute of limitations context, it seems appropriate that they also
have the benefit of the earlier date in a § 1692g
Regardless, for each of the 280 debtors to whom Defendant has admitted
sending a Second Letter within thirty days of a First Letter, Defendant
had to have known that barring a mail service mishap the Second
Letter would arrive within the statutory thirty days of receipt of the
First Letter. Defendant may not hope for such mishaps to defeat
commonality with respect to the timing of the alleged FDCPA violations.
B. Business Debt
Defendant argues that because the FDCPA does not apply to business
debts, each member of the class will have unique issues as to the nature
of her debt to Cingular. Further, Defendant points to plaintiff's self
described "hobby" of selling items through eBay and a booth at a local
antique mall, maintaining that there is an issue as to whether the
Cingular debt was a business debt in connection with plaintiff's sales.
In response to this argument, Plaintiff points to Sledge v. Sands,
182 F.R.D. 255 (N.D. Ill. 1998). In that FDCPA case, the defendant argued
that the putative class lacked commonality because the court would have
to determine, for each member, whether business or personal debt gave
rise to the collection at issue. Rejecting this argument, Judge Bucklo
held that "[t]hose individuals that received a collection letter based on
business debts should not be included as class members. But this has no
bearing on the issues common to the class. . . ."*fn3 Id. at 258, "The
fact that some of the proposed class members may not
ultimately meet the requirements to be part of the class does not
defeat commonality." Id. at 258.
In this case, Plaintiff alleges that his debt to Cingular arose from
personal use of a wireless telephone. plaintiff's deposition testimony is
consistent with the personal use allegation. Defendant has not
brought any evidence of business use of the Cingular telephone at
issue.*fn4 The weight of the evidence, therefore, supports plaintiff's
allegation that his debt was personal in nature. Because there are issues
common to all proposed class members, Rule 23's commonality requirement
The typicality requirement of Rule 23 is closely related to
commonality. "The typicality requirement is met when the representative
party's claim arises from the same event or practice or course of conduct
that gives rise to the claims of other class members and his or her
claims are based on the same legal theory." Ludwig v. Pilkington North
America, Inc., No. 02 C 1086, 2003 WL 22478842, *3 (N.D. Ill. Nov. 4,
2003) (citing De La Fuente v. Stokely-Van Camp, Inc., 713 F.2d 225, 232
(7th Cir. 1983) (internal quotation omitted).
Defendant's opposition to typicality is essentially identical to its
opposition to commonality. Defendant argues that plaintiff's claim is not
typical of the claims of the class because not all class members can show
that they received the offending letter within thirty days of the First
Letter. As discussed above, this argument fails. The critical, common,
and typical issue in this case is whether Defendant sent a confusing
letter to a class of debtors before the
thirty day period for debt disputes had run. As discussed above, a
violation of the FDCPA can occur when the offending letter is mailed by
the debt collector. Accordingly, all members of the proposed class have
claims with essentially the same characteristics in terms of common
events and legal theories as plaintiff's claim.
Defendant also argues that the business debt issue precludes a
finding of typicality in this case. As discussed above, Plaintiff has
sufficiently alleged that his debt to Cingular was personal in nature.
Defendant has presented no evidence to the contrary. Therefore,
plaintiff's claim is typical of the proposed class claim insofar as it is
predicated by a personal debt. To the extent members of the proposed class
assert that only business debts underlie the offending collection
effort, however, such debtors will be excluded from the class.
IV. Adequate Representation
The final requirement of Rule 23(a) calls for the Court to examine
whether the proposed representative of a class will fairly and adequately
represent the interests of the class. `This requirement has three
elements: (1) the chosen class representative cannot have antagonistic or
conflicting claims with other members of the class, . . . (2) the named
representative must have sufficient interest in the outcome to ensure
vigorous advocacy, . . . and (3) counsel for the named plaintiff must be
competent, experienced, qualified, and generally able to conduct the
proposed litigation vigorously." Carbajal v. Capital One, F.S.B., No. 03 C
1123, 2004 WL 125089, *3 (N.D. Ill. Jan. 4, 2004) (citing Gammon v. GC
Serv. Ltd. P'ship, 162 F.R.D. 313, 317 (N.D. Ill. 1995) (citations and
internal quotations omitted)). Defendant has not challenged the adequacy
of plaintiff's counsel. Rather, Defendant challenges plaintiff's personal
adequacy to represent the proposed class because (1) Defendant has fact
intensive defenses to plaintiff's individual claim;
(2) Plaintiff has declared Chapter 13 bankruptcy, and his bankruptcy case
is still pending; and (3) Plaintiff lacks the understanding required to
represent the class.
With regard to Defendant's individual defenses, the Court has already
addressed the business debt and timing of receipt issues. These
arguments fail to cast doubt upon plaintiff's adequacy as the class
representative. Defendant also contends that because Plaintiff never
intended to dispute the underlying debt and was never actually confused
by the Second Letter, he is not an adequate representative. These
arguments also fail. Violations of the FDCPA are determined by applying
the "unsophisticated consumer" standard to the letters at issue.
Accordingly, such analysis "is not dependant upon actual reliance by the
plaintiff." Sledge, 182 F.R.D. at 258 (citing Gammon, 27 F.3d at 1257).
These particular defenses to plaintiff's individual claim, therefore, do
not affect the adequacy of plaintiff's representation of this proposed
Defendant next argues that the trustee in plaintiff's bankruptcy has
the right to substitute as the real party in interest in this action.
Such a substitution, Defendant argues, would give rise to conflicting
duties owed to plaintiff's creditors and the members of the purported
class. Plaintiff counters that the Bankruptcy Court confirmed plaintiff's
Chapter 13 plan, thus vesting to Plaintiff all property not specifically
mentioned in the plan. The Court agrees with Plaintiff. The Bankruptcy
Court confirmed plaintiff's plan, which listed the FDCPA claim as
exempt. plaintiff's FDCPA claim, therefore, is beyond the reach of the
bankruptcy trustee. See In re Bell, 225 F.3d 203, 216 (2d Cir. 2000) ("It
is well settled law that the effect of . . . exemption is to remove
property from the estate and vest it in the debtor.") In re Yonikus,
996 F.2d 866, 870 (7th Cir. 1993). Defendant's cited case, Dechert v.
Cadle Co., 333 F.3d 801 (7th Cir. 2003), is
inapplicable. In that case, the court prevented a bankruptcy trustee from
acting as a representative plaintiff in a FDCPA class action suit. The
debtor (the original named plaintiff in the class action), however, had
not claimed the suit as exempt property as Plaintiff has done in this
Defendant's third argument, that Plaintiff lacks the understanding to
serve as class representative, also fails. plaintiff's deposition
testimony shows at least the minimum understanding of his claims, and
exhibits a willingness and commitment to represent the proposed class. As
Defendant has shown neither conflict between Plaintiff and the proposed
class nor a lack of minimum understanding of the claim or his role in
this action, Plaintiff is an adequate representative of the proposed
V. Rule 23(b)(3) Analysis
Rule 23(b)(3) requires the Court to find that questions of law or fact
common to the class predominate over individual questions, and that the
class action offers a superior form of adjudicating this matter.
Defendant opposes certification under this section with the same
objections discussed above. None of the purported individual issues
predominate over the common issue in this case. Further, the recovery for
each individual plaintiff would be small, making it unlikely that
individual plaintiff's would file separate suits. Likewise, the issue in
this case whether or not a form letter violated the FDCPA is
particularly well suited for adjudication under Rule 23,
For the reasons stated above, plaintiff's motion for class
certification is granted.