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Elizabeth Stricklin, Formerly Known As Elizabeth Noffsinger, On Behalf of Herself and Others v. First National Collection Bureau

March 30, 2012


The opinion of the court was delivered by: J. Phil Gilbert District Judge


This matter comes before the Court on the parties' cross-motions for judgment. Defendant First National Collection Bureau, Inc., ("First National") filed a Motion for Judgment on the Pleadings or in the Alternative Summary Judgment (Doc. 15) and a Memorandum in Support (Doc. 16) to which Plaintiff Elizabeth Stricklin filed a Response (Doc. 20). Stricklin then filed a Motion for Partial Summary Judgment and Memorandum in Support (Doc. 25) for summary judgment as to First National's liability to which First National filed a Memorandum in Opposition (Doc. 29).


I. Factual

The facts are not in dispute. Stricklin allegedly had a debt of $230.54 from a prior account with Sprint Nextel Corporation. The holder of that debt, Jefferson Capital Systems, LLC, then placed the debt with First National in order to collect the money allegedly owed by Stricklin. First National sent a collection notice to Stricklin on August 6, 2010 in which it stated the balance owed, the name of the current creditor, the name of the original creditor (stated as "Sprint Services"), the dispute process, and a "settlement offer" discounting the debt 60%. The August 6th letter offered for the payment to be made in three separate payments of $30.74 with each payment due within thirty days of the last payment. Stricklin did not respond to this letter and then received a similar notice on October 8, 2010. The October 8th letter contained the same information as above but was titled SETTLEMENT OFFER and gave a 70% reduction of the debt, offering four payments of $17.29 with the first payment to be received by October 29, 2010. Both letters also included payment coupons to send in with the payments but only the October letter included specific due dates for the payments on the coupons. The letters both state Stricklin may pay by credit card but a credit card payment requires a $50.00 minimum payment and there is a fee of $5.00 per $150.00. Finally, both letters state First National is not obligated to renew the offer if Stricklin does not make the payments in the time required.

Stricklin had a Sprint Nextel Corporation account in 2005 or 2006 but did not remember being delinquent on that account or seeing the company referred to as "Sprint Services." Stricklin contacted an attorney who is now representing her in this matter. Her counsel contacted First National and requested the true name of the original creditor and a copy of Stricklin's agreement with that creditor in the context of this litigation but it was not provided.

II. Procedural

Stricklin filed suit against First National on December 20, 2011. She filed an amended complaint on January 25, 2011 which is now the operative pleading in this case (Doc. 10). In the amended complaint, Stricklin states she is bringing suit on behalf of all similarly situated consumers in Illinois, Ohio, Kentucky, Missouri, Indiana, and Wisconsin. She alleges that First National violated the Fair Debt Collection Practices Act ("FDCPA") in its attempt to collect the debt from Stricklin. 15 U.S.C. § 1692 et seq. In support of this, Stricklin states in the amended complaint that the debt was time-barred by 47 U.S.C. § 415 and therefore it was unlawful for First National to attempt to collect it. She also claims First National used deceptive means to attempt to collect the debt, including: (1) failing to accurately identify the original creditor, (2) failing to disclose the amount owed, (3) deceiving Stricklin by using the words "settlement offer" into thinking there was litigation against her, and (4) deceiving Stricklin to hide the fact the debt was time-barred.

First National filed the current motion for summary judgment or in the alternative summary judgment on April 14, 2011 (Doc. 15). In support of its prayer in the alternative, First National refers to an affidavit and two exhibits to the affidavit which were submitted with its answer (Doc. 11). First National claims it is entitled to judgment because it complied with the FDCPA and accurately identified the Creditor owed, the amount owed, and argues that a collection of a debt which is time-barred is not a violation of the FDCPA. Further, First National argues the FDCPA provides a remedy which Stricklin has not employed. In response, Stricklin argues the motion should not be converted to summary judgment because First National has failed to attach the affidavit and exhibits to which it refers. On the merits, Stricklin argues the counter of First National's claims, namely that the means used were deceptive and violations of the FDCPA.*fn1

Stricklin then filed her motion for summary judgment (Doc. 25). In her motion for summary judgment, Stricklin argues there were five violations of the FDCPA which warrant judgment being entered for the plaintiff. The five violations are: (1) misidentification of the original creditor, (2) failure to state the amount of the debt being collected because of "transaction fees," (3) failure to indicate total due, (4) failure to identify to whom the debt was owed, and (5) implication there was ongoing litigation. In response, First National restates its arguments it has not violated the FDCPA. The Court turns to these arguments now.


I. Method of Review

First National titles its motion as a Motion for Judgment on the Pleadings or Alternatively for Summary Judgment (Doc. 15). First National asks the Court to convert the motion to one for summary judgment in order to use an affidavit attached to its answer (Doc. 11-1) and two exhibits (Doc. 11-1A, Doc. 11-1B). Stricklin argues repeatedly that these documents have not been entered into the record; however, they are in the record and can be found attached to Document 11 on the docket sheet. The letters at issue are not attached to the plaintiff's complaint but can only be found in the Affidavit and Exhibit to Affidavit attached to First National's Answer (Doc. 11).

The decision whether to convert a motion to dismiss into a motion for summary judgment is left to the discretion of the court. See Levenstein v. Salafsky, 164 F.3d 345, 347 (7th Cir.1998). If the Court wishes to consider evidence outside of the pleadings themselves, such as the very letters at issue, it is necessary to convert this motion to one for summary judgment. Federal Rules of Civil Procedure 12(d). The Seventh Circuit has held that if the document is central to the litigation, it can be submitted by either party without converting to summary judgment but goes on to limit the exception to contracts. Tierney v. Vale, 304 F.3d 734, 738-39 (7th Cir. 2002). Further, the purpose of requiring conversion from Rule 12(b) or Rule 12(c) to Rule 56, if matters outside the pleadings are considered by the court, is to make sure that each party has notice of evidence that the opposing party wants to present in support of his claim or defense; reference in the pleading to the evidence furnishes that notice.

Id. (citing Cortec Industries, Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir.1991)).

The Court notes discovery in this matter has been stayed (Doc. 26) but neither party will be prejudiced by proceeding to summary judgment. The parties agreed to stay discovery and the facts of this case are not in dispute. Both parties have moved for summary judgment. The only question is whether the letters First National mailed to Stricklin violated the FDCPA. Stricklin was surely on notice that First National would present the letters she is claiming violated the FDCPA as evidence and in fact submitted the letters with her own Motion for Summary Judgment (Doc. 25-1). The Court will examine the letters themselves and the briefs submitted by the parties to determine the outcome. As the plaintiff in this matter has filed a motion for summary judgment and the defendant's motion was briefed as a motion for summary judgment by both parties, the Court has decided treat the defendant's motion as a motion for summary judgment in order to efficiently resolve this dispute.

Summary judgment is appropriate where "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Spath v. Hayes Wheels Int'l-Ind., Inc., 211 F.3d 392, 396 (7th Cir. 2000). The reviewing court must construe the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in favor of that party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986); Chelios v. Heavener, 520 F.3d 678, 685 (7th Cir. 2008); Spath, 211 F.3d at 396.Where the moving party fails to meet its strict burden of proof, a court cannot enter summary judgment for the moving party even if the opposing party fails to present relevant evidence in response to the motion. Cooper v. Lane, 969 F.2d 368, 371 (7th Cir. 1992).

In responding to a summary judgment motion, the nonmoving party may not simply rest upon the allegations contained in the pleadings but must present specific facts to show that a genuine issue of material fact exists. Fed. R. Civ. P. 56(e)(2); Celotex, 477 U.S. at 322-26; Johnson v. City of Fort Wayne, 91 F.3d 922, 931 (7th Cir. 1996). A genuine issue of material fact is not demonstrated by the mere existence of "some alleged factual dispute between the parties," Anderson, 477 U.S. at 247, or by "some metaphysical doubt as to the material facts," Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); Michas v. Health Cost Controls of Illinois, Inc., 209 F.3d 689, 692 (7th Cir. 2000). Rather, a genuine issue of material fact exists only if "a fair-minded jury could return a verdict for the [nonmoving party] on the evidence presented." Anderson, 477 U.S. at 252. On cross-motions for summary judgment, "[w]e therefore apply the traditional standard that summary judgment will not lie unless, construing all inferences in favor of the party against whom the motion is made, no genuine issue of material fact exists." I.A.E., Inc. v. Shaver, 74 F.3d 768, 774 (7th Cir. 1996).

II. Alleged Violations of the FDCPA

a. Standard for Determining Whether the FDCPA Governs The FDCPA applies to debt collectors attempting to collect debts from consumers. 15 U.S.C. § 1692. A consumer is defined by the Act as "any natural person obligated or allegedly obligated to pay any debt." Id. at 1692a(3). The FDCPA further defines "debt" as "any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the.subject of the transaction [is] primarily for personal, family, or household purposes." 15 U.S.C. § 1692a(5). Stricklin's motion for summary judgment states there is no doubt the FDCPA applies to the situation at hand. First National concedes in its response that "while [First National] is normally a debt collector as defined by 15 U.S.C. § 1692a(6), it has insufficient information and knowledge to admit or deny whether it acted as debt collector as defined by 15 U.S.C. § 1692a(6) in this matter." It goes on to state Stricklin's assertion First National falls within the FDCPA "is contested." (Doc. 29, p. 7). First National did not present any further evidence it is not a debt collector in this matter and admitted it normally is a debt collector. The only evidence the Court is able to glean from the pleadings is from Stricklin's affidavit in which she states she had a cellular telephone ...

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