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Hill v. Wells Fargo Bank, N.A.

United States District Court, Seventh Circuit

May 24, 2013

BRIAN HILL and MELISSA HILL, on behalf of themselves and all others similarly situated, Plaintiffs,
v.
WELLS FARGO BANK, N.A., d/b/a WELLS FARGO HOME MORTGAGE, and LPS FIELD SERVICES, INC., Defendants.

MEMORANDUM OPINION AND ORDER

GARY FEINERMAN, District Judge.

Brian and Melissa Hill brought this lawsuit against Wells Fargo Bank, N.A., and LPS Field Services, Inc. The amended complaint alleges: (1) violation by LPS only of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq.; (2) violation of the Illinois Consumer Fraud and Deceptive Business Practices Act ("ICFA"), 815 ILCS 505/1 et seq.; (3) common law trespass; and (4) invasion of privacy. Doc. 42. The FDCPA and ICFA claims are brought on behalf of a putative class, while the trespass and privacy claims are not. LPS has moved to dismiss the FDCPA and ICFA claims under Federal Rule of Civil Procedure 12(b)(6). Doc. 43. Wells Fargo has moved to strike the amended complaint's class allegations, Doc. 49, and LPS joined that motion, Doc. 55. LPS's motion to dismiss is granted as to the FDCPA claim but denied as to the ICFA claim, and the motion to strike the class allegations is granted.

Background

In considering the motion to dismiss, the court assumes the truth of the amended complaint's factual allegations, though not its legal conclusions. See Munson v. Gaetz, 673 F.3d 630, 632 (7th Cir. 2012). The court must also consider "documents attached to the complaint, documents that are critical to the complaint and referred to in it, and information that is subject to proper judicial notice, " along with additional facts set forth in the Hills' brief opposing dismissal, so long as those facts "are consistent with the pleadings." Geinosky v. City of Chicago, 675 F.3d 743, 745 n.1 (7th Cir. 2012). The following facts are set forth as favorably to the Hills as these materials allow. See Gomez v. Randle, 680 F.3d 859, 864 (7th Cir. 2012).

The Hills, a married couple, are the owners of a residential property in Round Lake Beach, Illinois. Doc. 42 at ¶ 4. In 2001, they took out a $76, 599 mortgage loan on the property. Id. at ¶ 12. For several years, they lived at the property and made their mortgage payments on schedule. Id. at ¶ 13. At some point Brian lost his job as a carpenter, and ultimately the Hills' savings ran out and they missed their October 2009 mortgage payment. Id. at ¶¶ 14-15.

Wells Fargo is the mortgagee and mortgage servicer on the Hills' property. Id. at ¶ 5. In November 2009, Brian called Wells Fargo to request a loan modification in light of the Hills' inability to make the mortgage payments. Id. at ¶¶ 16-17. The Hills were given a six-month moratorium, but at the end of that period, when they requested a further modification, Wells Fargo sent them a letter demanding payment in full for the prior six months and threatening foreclosure if they did not pay. Id. at ¶¶ 18-20.

On June 7, 2010, Wells Fargo commenced a foreclosure action against the Hills in Illinois state court. Id. at ¶ 21. At the initial status hearing on September 17, 2010, the Hills informed the court and Wells Fargo that they intended to keep their home and hoped to resolve the matter. Id. at ¶ 25. They filed an answer, indicating their intent to oppose the foreclosure. Ibid. At some point, Wells Fargo retained LPS to act as its agent with respect to the mortgage, with instructions to make entries onto the Hills' property and into their home and to board up the home and place bulletins on the property. Id. at ¶ 7.

On November 1, 2010, Brian returned home to find that the home had been broken into. Id. at ¶ 26. The exterior door's deadbolt and doorknob had been replaced, the hot water tank had been drained through a hole drilled in the tank's floor, faucets had been opened to drain the water lines, the main gas valve had been shut off, and antifreeze had been dumped in the toilet. Ibid. The intruders had also rifled through the Hills' personal effects, and some of the Hills' possessions, including tools used by Brian in his work as a carpenter, were missing. Id. at ¶ 27. Brian filed a police report, an insurance claim, and, on December 9, 2010, a complaint with the Attorney General of Illinois alleging that Wells Fargo's agents had broken into his home while he was still defending the foreclosure action. Id. at ¶¶ 28-29. At a status hearing in the foreclosure case held December 17, 2010, the Hills told the judge about the break-in and theft, and the judge stated that nothing had transpired in the case that would have given Wells Fargo any right to enter the home. Id. at ¶ 30.

In the following months, LPS agents retained by Wells Fargo repeatedly visited the Hills' home and posted various stickers and forms on their windows and doors. Id. at ¶ 31. The posting on which the Hills focus is attached to the complaint and reads as follows:

NOTICE

LPS Field Services, Inc., inspected this property and found it to be vacant or abandoned. The mortgage holder has the right and duty to protect this property. Accordingly, it is likely that the mortgage holder will have the property secured and/or winterized within the next few days.
Therefore, if this property is NOT VACANT, please call the number below immediately [the posting gives LPS's telephone number].

Doc. 42-3 at 2.

On September 7, 2011, before any judgment of foreclosure had been granted, Brian returned home to find that the locks on the garage door had been changed. Doc. 42 at ¶ 33. The new lock was not properly installed, and so the home had been left unsecured, which forced the Hills to hire a locksmith to secure the home. Ibid. On September 23, 2011, Wells Fargo's agents again entered the Hills' home, without permission from either the Hills or the state court judge; the complaint does not say what the agents did inside the home. Id. at ¶ 34. On October 18, 2011, Wells Fargo instructed LPS to continue performing "vacant property svcs" on the home. Id. at ¶ 35. On November 15, 2011, Brian's neighbor told him that Wells Fargo's agents had been on the property yet again. Id. at ¶ 36. The Hills also received at least four letters from LPS from December 2011 through March 2012 inquiring whether the property had been abandoned. Id. at ¶ 37.

The Hills filed the present lawsuit on September 11, 2012. Doc. 1. The amended complaint's class allegations, Doc. 42 at ¶¶ 39-45, are described below in the section addressing Defendants' motion to strike. The court has original jurisdiction over the FDCPA claim under 28 U.S.C. § 1331 and supplemental jurisdiction over the state law claims under 28 U.S.C. § 1367(a). As noted above, the FDCPA claim is being dismissed, so the court adds that it also has jurisdiction over the state law claims under the diversity statute, 28 U.S.C. § 1332(a). The Hills are citizens of Illinois. Doc. 84. Wells Fargo is a citizen of South Dakota. Doc. 42 at ¶ 6; see Wachovia Bank v. Schmidt, 546 U.S. 303, 307 (2006) ("a national bank... is a citizen of the state in which its main office, as set forth in its articles of association, is located"). LPS is a Delaware corporation with its principal place of business in Florida, making it a citizen of those two States for diversity jurisdiction purposes. Doc. 42 at ¶ 8; see 28 U.S.C. § 1332(c)(1) ("a corporation shall be deemed to be a citizen of every State... by which it has been incorporated and of the State... where it has its principal place of business"). The amount in controversy, at least on the pleadings, exceeds the $75, 000 threshold of § 1332(a). Doc. 42 at ¶ 10.

Discussion

As indicated above, LPS has moved to dismiss the FDCPA and ICFA claims, while Wells Fargo and LPS have moved to strike the amended complaint's class allegations. Because Defendants have not challenged the trespass and privacy claims, neither of which are putative class claims, those counts need not be addressed in this opinion.

I. LPS's Motion to Dismiss

A. The FDCPA Claim

LPS's argument for dismissing the FDCPA claim is that most of the underlying events occurred outside the applicable statute of limitations and that the few events that occurred within the limitations period do not suffice to state an FDCPA claim. As the parties recognize, FDCPA claims are subject to a one-year statute of limitations. See 15 U.S.C. § 1692k(d) ("An action to enforce any liability created by this subchapter may be brought... within one year from the date on which the violation occurs."); Randolph v. IMBS, Inc., 368 F.3d 726, 730-31 (7th Cir. 2004) (same). Because the Hills filed this lawsuit on September 11, 2012, the question is whether LPS, the sole FDCPA defendant, committed any violations after September 11, 2011. Doc. 42 at ¶ 47 ("This Count is brought on behalf of Plaintiffs and the class for conduct occurring at any time between the one year prior to September 11, 2012 and the date a class is certified.").

The amended complaint alleges that LPS violated § 1692f(6), which provides as follows:

§ 1692f. Unfair practices
A debt collector may not use unfair on unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:
* * *
(6) Taking or threatening to take any nonjudicial action to effect dispossession or ...

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