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Nicholas Martin and David Mack, On Behalf of Themselves and Others v. Leading Edge Recovery Solutions

August 10, 2012


The opinion of the court was delivered by: Judge Joan H. Lefkow


Nicholas Martin and David Mack filed this putative class action against Leading Edge Recovery Solutions, LLC and Capital One Bank (USA), N.A., alleging violations of the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227, et seq.*fn1 Before the court are Leading Edge's and Capital One's motions to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). For the following reasons, the motions [#38, 57] will be denied.


Leading Edge is a debt collection company; Capital One is a national bank that issues credit cards. In 2010, both companies used equipment that allowed them to dial and call telephone numbers that had been pre-loaded by their employees into an automatic dialing system. They also used automatic dialing software manufactured by Aspect Software. (See Compl. Ex. A.)

Leading Edge used automatic dialing equipment, along with Aspect Software, to call Martin's and Mack's cell phones in 2010. Leading Edge called Mack's cell phone ten times during September 2010 and left one or more prerecorded voice messages.*fn3 Leading Edge called Martin at least once using automatic dialing equipment. Leading Edge had received Martin's and Mack's cell phone numbers from Capital One, which requested Leading Edge to collect on an account for Julie Mack, who is Mack's mother and Martin's aunt.*fn4

Capital One or its affiliate also called Martin's and Mack's cell phones sometime between 2007 and 2011 in connection with a debt collection. Some or all of these calls were made using predictive dialing equipment and used a prerecorded or artificial voice message.

Neither Martin nor Mack gave their cell phone numbers to Leading Edge or Capital One. Martin and Mack were annoyed by the calls, which used air time from their cell phone plans and forced them to attend to unwanted calls.


A motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) challenges the court's subject matter jurisdiction. Fed. R. Civ. P. 12(b)(1). The burden of proof is on the party asserting jurisdiction. United Phosphorus, Ltd. v. Angus Chem. Co., 322 F.3d 942, 946 (7th Cir. 2003). In determining whether subject matter jurisdiction exists, the court must accept all well-pleaded facts alleged in the complaint and draw all reasonable inferences from those facts in the plaintiff's favor. Sapperstein v. Hager, 188 F.3d 852, 855 (7th Cir. 1999). "Where evidence pertinent to subject matter jurisdiction has been submitted, however, 'the district court may properly look beyond the jurisdictional allegations of the complaint . . . to determine whether in fact subject matter jurisdiction exists.'" Id. (quoting United Transp. Union v. Gateway W. Ry. Co., 78 F.3d 1208, 1210 (7th Cir. 1996)).

A motion to dismiss under Rule 12(b)(6) challenges a complaint for failure to state a claim upon which relief may be granted. Fed. R. Civ. P. 12(b)(6); Gen. Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1080 (7th Cir. 1997). In ruling on a motion to dismiss, the court accepts as true all well-pleaded facts in the plaintiff's complaint and draws all reasonable inferences from those facts in the plaintiff's favor. Dixon v. Page, 291 F.3d 485, 486 (7th Cir. 2002). In order to survive a Rule 12(b)(6) motion, the complaint must not only provide the defendant with fair notice of the claim's basis, but must also establish that the requested relief is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 622, 687, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009); see also Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007). The allegations in the complaint must be "enough to raise a right of relief above the speculative level." Twombly, 550 U.S. at 555. At the same time, the plaintiff need not plead legal theories. Hatmaker v. Mem'l Med. Ctr., 619 F.3d 741, 743 (7th Cir. 2010). Rather, it is the facts that count.


Leading Edge and Capital One argue that the complaint must be dismissed for lack of subject matter jurisdiction because plaintiffs have not established "injury in fact," a requirement for standing under Article III. Leading Edge argues that, in the alternative, plaintiffs' complaint must be dismissed under Rule 12(b)(6) for failure to state a claim.

I. Article III Standing

To have Article III standing, plaintiffs must allege (1) an injury in fact, (2) a causal connection between the injury and the conduct complained of, and (3) a likelihood that the injury will be redressed by a favorable decision. See, e.g., Lujan v. Defenders of Wildlife, 504 U.S. 555, 560, 112 S. Ct. 2130, 119 L. Ed. 2d 351 (1992). An injury in fact is "an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical." Id. (citations and quotations omitted). Such an injury may exist by virtue of a violation of statutorily-created legal rights, so long as the plaintiff is within the class of persons who are given a statutory right to relief and alleges a "distinct and palpable injury to himself." Warth v. Seldin, 422 U.S. 490, 501, 95 S. Ct. 2197, 45 L. Ed. 2d 343 (1975); see also Summers v. Earth Island Inst., 555 U.S. 488, 497, 129 S. Ct. 1142, 173 L. Ed. 2d 1 (2009) (although Congress can create procedural rights, Article III still requires the party bringing suit to show that the action "injures him in a concrete and personal way" (citation omitted)). A plaintiff need not suffer a substantial injury in order to establish Article III standing, however. See, e.g., Am. Bottom Conservancy v. U.S. Army Corps of Eng'rs, 650 F.3d 652, 656 (7th Cir. 2011) ("The magnitude, as distinct from the directness, of the injury is not critical to the concerns that underlie the requirement of standing."); Doe v. Cnty. of Montgomery, Ill., 41 F.3d 1156, 1159 (7th Cir. 1994) ("[A]n identifiable trifle is enough for standing to fight out a question of principle; the trifle is the basis for standing and the principle supplies the motivation." (quoting United States v. Students Challenging Regulatory Agency Procedures (SCRAP), 412 U.S. 669, 689 n.14, 93 S. Ct. 2405, 37 L. Ed. 2d 254 (1973)). Even a ...

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