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COLLINS v. SPARACIO

March 19, 2004.

THOMAS A. COLLINS, individually and on behalf of all others similarly situated, Plaintiff
v.
STEVEN SPARACIO and LAW OFFICES OF STEVEN J. SPARACIO, Defendants



The opinion of the court was delivered by: JOAN H. LEFKOW, District Judge

MEMORANDUM OPINION AND ORDER

Plaintiff, Thomas A. Collins ("Collins"), brings this putative class action against Steven J. Sparacio and the Law Offices of Steven J. Sparacio (collectively "Sparacio") alleging violations of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. This court's jurisdiction is invoked pursuant to 15 U.S.C. § 1692(k). Before the court is Sparacio's motion for summary judgment. For the reasons stated below, Sparacio's motion is granted.

SUMMARY JUDGMENT STANDARDS

  Summary judgment obviates the need for a trial where there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). To determine whether any genuine fact exists, the court must pierce the pleadings and assess the proof as presented in depositions, answers to interrogatories, admissions, and affidavits that are part of the record. Fed R. Civ. P. 56(c) Advisory Committee's notes. The party seeking summary judgment bears the initial burden of proving there is no genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). In response, the nonmoving Page 2 party cannot rest on bare pleadings alone but must use the evidentiary tools listed above to designate specific material facts showing that there is a genuine issue for trial. Id. at 324; Insolia v. Philip Morris Inc., 216 F.3d 596, 598 (7th Cir. 2000). A material fact must be outcome determinative under the governing law. Insolia, 216 F.3d at 598-99. Although a bare contention that an issue of fact exists is insufficient to create a factual dispute, Bellaver v. Quanex Corp., 200 F.3d 485, 492 (7th Cir. 2000), the court must construe all facts in a light most favorable to the nonmoving party as well as view all reasonable inferences in that party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).

 
FACTS STATED IN A LIGHT MOST FAVORABLE TO PLAINTIFF
  Central to disposition of this motion is an understanding of the relationship between two entities, Areawide Cellular, LLP ("Areawide") and Cellular One. Areawide served as an independent agent and dealer for Cellular One. (Def. L.R. 56.1 ¶ 16.) Cellular One sold its cellular telephone services through authorized agents and dealers rather than directly to the public. (Id.) Authorized agents and dealers, including Areawide, were responsible for providing demonstrations of Cellular One's services, explaining its benefits and the terms and conditions of the services, and selling telephones, (Def. L.R. 56.1 ¶ 17.) Areawide would in most scenarios sell a customer a cellular telephone and a cellular telephone calling plan for a specified number of minutes per month. (Def. L.R. 56.1 ¶ 18.) The cellular telephone services would then be provided by Cellular One, who would issue monthly bills to the customers for the services. (Def. L.R. 56.1 ¶ 19.) Typically, a customer who purchased a telephone and a cellular telephone calling plan from Areawide would sign two separate contracts, one with Areawide and another with Cellular One. (Def. L.R. 56.1 ¶ 20.) Page 3

  Areawide was compensated by Cellular One on a commission basis. (Def. L.R. 56.1 ¶ 21.) To earn its commission, a customer would have to remain on the calling plan with Cellular One for a certain period time, ranging from 180 to 365 days. (Id.) If a customer did not remain on the calling plan with Cellular One for the required time period, Areawide would forfeit its commission. (Def. L.R. 56.1 ¶ 22.) Areawide included a provision in its contract with customers for a cancellation fee of $300 which would cover the discounted cost of a telephone sold, its commission, and associated costs in the event that a customer canceled his or her services early. (Def. L.R. 56.1 ¶ 23.) Moreover, during the time of purchasing a cellular phone, customers with poor credit histories were often required to pay a $250 deposit to obtain the cellular phone services. (Def. L.R. 56.1 ¶ 24.) Such amounts were remitted by Areawide to Cellular One and Cellular One would either hold the deposit for a certain period of time or apply it to a customer's account. (Def. L.R. 56.1 ¶ 25.)

  On November 8, 1999, Collins entered into two agreements, one with Areawide and the other with Cellular One. (Def. L.R. 56.1 ¶¶ 6, 8.) His agreement with Areawide was to purchase a cellular telephone and cellular telephone services. (Def. L.R. 56.1 ¶ 6.) The agreement provided that Collins agreed

  to remain on service with Areawide Cellular, an authorized Cellular One agent, for a minimum period of 730 days. In the event I change agents or suspend, cancel or reduce my service with Areawide Cellular, as described in this invoice, I authorize Areawide Cellular to either charge against my credit card as cancellation fee $300.00 or to cash my check in the amount of $300.00. If Areawide Cellular is unable to either charge my credit card for the cancellation fee or cash my check for any reason, I agree to pay Areawide Cellular the $300.00 cancellation fee within fifteen (15) days of changing agents or superseding, cancelling or reducing my service. If I fail to pay such fee within the 15-day period, I agree that I will be liable to Areawide Cellular for its court costs and reasonable attorney's fees accrued in collecting the same. Page 4

 (Def. Ex. C.)

  Collins's agreement with Cellular One was for cellular telephone services. (Def. L.R. 56.1 ¶ 8.) Collins was required to pay a $250 dollar deposit to obtain his cellular phone services. (Def. L.R. 56.1 ¶ 24.) The agreement provided that
This Service Agreement, including these preprinted General Terms and Conditions and any documents expressly referred to herein (excluding the web-site referred to below) make up the complete agreement between you and Cellular One, and supersede any and all prior agreements and understandings relating to the subject matter of this agreement.
(Def. Ex. D.) This agreement also provided that "[i]f you terminate service before the end of the minimum Agreement Term, or if Cellular One terminates your service for nonpayment or other default before the end of the minimum Agreement Term, you agree to pay a $150.00 early termination charge." (Id.)

  Within one year of signing his contracts with Areawide and Cellular One, Collins failed to make his regular monthly payments to Cellular One for his cellular telephone services and, therefore, Cellular One cancelled these services. (Def. L.R. 56.1 ¶¶ 10-11.) As a result, Cellular One charged Collins $150 for early termination of his account. (Def. L.R. 56.1 ¶ 1.)

  On January 23, 2002, Sparacio, an Illinois attorney, filed a law suit against Collins on behalf of Areawide. (Def. L.R. 56.1 ¶ 12.) That complaint, which first stated in the caption "Amount Claimed $600.00 Costs," otherwise provided in its entirety:
The plaintiff claims as follows
1. That pursuant to the specific request to the Defendant, Thomas A. Collins, the plaintiff did sell certain goods/wares and merchandise and/or certain services to the defendant as per Exhibit attached hereto.
  2. That the plaintiff, Areawide Cellular LLC, has performed all that it was required to do to perform under the agreement. Page 5 3. That pursuant to the attached agreement the plaintiff is entitled to reasonable attorneys' fees of $300.00 plus collection fees in the sum of $0.00.
 
4. That plaintiff has demanded payment from the defendant in the sum of $300.00 which sum remains due.
Wherefore, plaintiff, Areawide Cellular LLC, prays for the ...

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