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Worley v. Municipal Collections of America, Inc.

United States District Court, N.D. Illinois, Eastern Division

February 27, 2015

WILLIAM CHRISTOPHER WORLEY, Plaintiff,
v.
MUNICIPAL COLLECTIONS OF AMERICA, INC., Defendant.

MEMORANDUM OPINION AND ORDER

JOHN Z. LEE, District Judge.

After Municipal Collections of America, Inc. ("MCOA") attempted to collect unpaid municipal fines that Plaintiff William Worley purportedly owed to Calumet City, Worley sued MCOA for violating the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692d, 1692e(2)(A), 1692g(b), 1692j, the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681, and the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227. In addition, Worley brought claims against MCOA pursuant to the Illinois Consumer Fraud and Deceptive Business Practices Act ("ICFA"), 815 Ill. Comp. Stat. 505/1 et seq., the Illinois Collections Agency Act, 225 Ill. Comp. Stat. 425/1 et seq. ("ICAA"), and Illinois state common law for invasion of privacy, malicious trespass, and infliction of emotional distress.

MCOA has moved to dismiss the FDCPA, TCPA, ICFA, invasion of privacy, trespass, and infliction of emotional distress claims under Federal Rule of Civil Procedure 12(b)(6). Worley in turn has moved to strike MCOA's affirmative defense of lack of standing under Rule 12(f) and for judgment on the pleadings under Rule 12(c). For the reasons provided herein, the Court grants Plaintiff's Rule 12(f) motion, denies Plaintiff's Rule 12(c) motion, and grants in part and denies in part MCOA's Rule 12(b)(6) motion.

Facts

According to Worley, MCOA has been contacting him to collect unpaid municipal fines that it claims Worley owes to Calumet City. Compl. ¶¶ 3, 5, 6. MCOA also reported the alleged debt to the credit reporting agencies Experian, Equifax, and TransUnion on April 30, 2013. Id. ¶¶ 8-9. A day later, on May 1, 2013, Plaintiff received a dunning notice from MCOA. Id.; Ex. C. The notice indicated that the creditor of Plaintiff's debt was "CITY OF CALUMET CITY LO, " that the debt arose from a municipal code violation, and that the unpaid amount was $1, 012.50. Id. ¶ 9; id., Ex. C.

Plaintiff immediately filed disputes with the credit reporting agencies, but the agencies determined that the debt was valid. Id. ¶ 10. Nevertheless, Plaintiff continued in his efforts to verify the debt by providing MCOA with a Notice of Dispute and Validation of Debt. Id. ¶ 11. Plaintiff never received a debt validation from MCOA, and MCOA continued its attempts to collect the debt by calling Plaintiff multiple times and by providing erroneous debt information to credit reporting agencies. Id. ¶¶ 12, 18, 23.

Interestingly, Plaintiff asserts that the conduct detailed in his Complaint "has more to do with [MCOA's] deceptive and illegal acts in their attempt to collect the alleged debt, as opposed to any legitimacy of the alleged debt." Id. ¶ 21. Moreover, Plaintiff asserts that MCOA has acted with malice to cause him emotional distress. Id. ¶ 28. Additionally, Plaintiff states that he "has suffered significant economic harm as a result of the erroneous credit reporting and [Defendant's] failure to verify or validate [the] alleged debt." Id. ¶ 19.

MCOA moves to dismiss Counts I, III, IV, VI, VII, and VIII. In Count I, Worley alleges that Defendant violated the FDCPA by implementing oppressive and abusive behavior to collect his alleged debt, "falsely representing the character, amount and/or legal status of an alleged debt, " failing to stop its collection attempts upon receipt of his notice of dispute, and by furnishing deceptive forms. Id. ¶¶ 30-36. In Count III, Plaintiff claims MCOA invaded his privacy in violation of Illinois common law when it illegally obtained his consumer credit report. Id. ¶ 55. In Count IV, Worley states that MCOA violated ICFA by misrepresenting the "character, amount and legal status of [his] alleged debt." Id. ¶¶ 33-36, 61. In Count VI, Plaintiff alleges that MCOA willfully violated the TCPA because it "possesse[d] ATDS' [automatic telephone dialing system] capabilities, and repeatedly contacted Plaintiff without express consent" while "knowing... there was no lawful debt to collect upon." Id. ¶ 74. In Count VII, he claims MCOA is liable under Illinois law for trespass because it "entered onto Plaintiff's personal consumer reports... and remains on said property." Id. ¶ 77. Finally, in Count VIII, Plaintiff alleges that MCOA is liable under Illinois law for infliction of emotional distress because it "engaged... in extreme and outrageous conduct with the specific intention of causing, or reckless disregard of the probability of causing emotional distress to Plaintiff" and, as a result, he has suffered embarrassment and emotional distress. Id. ¶¶ 80-81.

Discussion

I. Plaintiff's Motion to Strike an Affirmative Defense

Plaintiff moves to strike Defendant's affirmative defense of lack of standing pursuant to Rule 12(f), arguing that MCOA relies on nothing but conclusory language. See Def.'s Affirmative Defense ¶ 1 ("Plaintiff has not incurred an injury in fact, and therefore Plaintiff does not have standing under Article III of the United States Constitution to bring the instant claims."). The Court agrees that the affirmative defense should be stricken, but not for the reason urged by Plaintiff.

"Because a plaintiff must plead and ultimately prove standing, lack of standing is not an affirmative defense under federal law.'" De Lage Landen Fin. Servs. v. M.D.M. Leasing Corp., No. 07 C 0045, 2007 WL 4355037, at *3 (N.D. Ill.Dec. 10, 2007) (quoting Native Am. Arts, Inc. v. The Waldron Corp., 253 F.Supp.2d 1041, 1045 (N.D. Ill. Jan. 22, 2003)). MCOA's contention that Plaintiff lacks Article III standing is merely a denial of Plaintiff's jurisdictional allegation in paragraph 4 of the Complaint. See Ocean Atl. Woodland Corp. v. DRH Cambridge Homes, Inc., No. 02 C 2523, 2003 WL 1720073, at *4 (N.D. Ill. Mar. 31, 2003) ("[T]he basic concept of an affirmative defense is an admission of the facts alleged in the complaint, coupled with the assertion of some other reason defendant is not liable." (Quotation omitted.)). In his complaint, Plaintiff alleges that the Court has federal subject matter jurisdiction with respect to the FDCPA, TCPA, and FCRA claims and supplemental jurisdiction with respect to the state law claims. MCOA's purported affirmative defense of lack of standing merely denies that allegation. Compare Compl. ¶ 4, and Affirm. Defenses ¶ 1. Accordingly, the Court grants Plaintiff's Rule 12(f) motion to strike MCOA's affirmative defense of lack of standing.

II. MCOA's Motion to Dismiss

MCOA has moved to dismiss Counts I, III, IV, VI, VII, and VIII pursuant to Rule 12(b)(6). To survive a motion to dismiss pursuant to Rule 12(b)(6), the complaint must "state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The factual allegations in the complaint must at least "raise a right to relief above the speculative level." Bell Atl. Corp., 550 U.S. at 555. In reviewing MCOA's motion to dismiss, the Court must accept as true all well-pleaded allegations in the complaint and draw all possible inferences in the plaintiff's favor. See ...


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