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Lewis v. Northwest Collectors, Inc.

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

January 25, 2016




         Plaintiff Richard Lewis ("Plaintiff) brought suit against Defendant Northwest Collectors, Inc. ("Defendant"), alleging violations of the Fair Debt Collection Practices Act ("FDCPA"). The debt arises from PRA Behavioral, LLC's ("PRA") medical treatment of Plaintiff. PRA later assigned Plaintiffs debt to Defendant, who then sought to collect the debt. Before the Court are the parties' cross-motions for summary judgment. This opinion addresses both parties' motions. For the following reasons, Plaintiffs motion is denied, and Defendant's motion is granted in part and denied in part.

         I. BACKGROUND

         The parties' pleadings in this case are meager. The Complaint entails merely sixteen paragraphs outside of the jurisdictional and party statements, covering four counts. Regarding the Local Rule 56.1 statements of facts, Plaintiff provides only eleven paragraphs pertaining to material facts, and Defendant pleads just ten additional facts. Furthermore, Plaintiff fails to comply with LR 56.1(b)(3) in his response to Defendant's statement of additional facts. Plaintiff states that all but one of Defendant's additional facts are "irrelevant, " "undisputed, " or both. Then, Plaintiff proceeds to set forth legal arguments attempting to establish the irrelevance of many of Defendant's statement of additional facts. Irrelevance is not a basis upon which Plaintiff may present a dispute of material fact pursuant to LR 56.1; nor is Plaintiffs LR 56.1(b)(3) response the proper place to use legal arguments to undermine Defendant's position. Accordingly, the Court deems such facts undisputed and adopts Defendant's factual assertions.

         Between June and October 2014, Plaintiff incurred debts with PRA for medical treatment. On or around February 20, 2015, the Bankruptcy Court for the Northern District of Illinois mailed a notice of Plaintiff s pending bankruptcy action to PRA. Defendant, however, disputes that PRA actually received such notice.

         On March 16, 2015, PRA placed Plaintiffs debt for collection with Defendant, including Plaintiffs full name, date of birth, and social security number. Although the parties make no mention of additional information housed within the identification materials, the document also entails notations regarding what appear to be Plaintiffs bankruptcy status and bankruptcy attorney. However, the meanings of these notations are not clearly self-evident, and the parties provide no elaboration to elucidate the context. Defendant never performed or attempted to perform a bankruptcy scrub to determine whether Plaintiff had filed for bankruptcy. However, Defendant's 30(b)(6) witness represented that Defendant has an agreement with PRA, which provides that PRA will not refer debtors in bankruptcy and will immediately notify Defendant upon obtaining knowledge that an account is subject to bankruptcy or discharge in bankruptcy.

         On March 18, 2015, Defendant mailed a collection letter to Plaintiff. When Plaintiff received Defendant's letter referencing the PRA debt, Plaintiff knew that his bankruptcy petition listed the PRA debt. After receiving Defendant's collection letter, Plaintiff was concerned about extra fees to his bankruptcy attorney if the attorney were to amend the bankruptcy filings to reflect the debt to Defendant. Additionally, Plaintiff relayed Defendant's letter to his bankruptcy attorney, who responded that he "would take care of it." Def.'s Additional Statement of Material Facts ¶ 6, Ex. 4, Trans, p. 15:17-21 (internal quotations omitted). Although Plaintiff feared paying additional attorney fees, Plaintiff was aware that his bankruptcy proceedings fell under Chapter Seven, which is a liquidation of all debts listed in the bankruptcy petition. Accordingly, Plaintiff also knew that any debt listed in that bankruptcy filing would be discharged and that he would no longer be liable for repayment of listed debts. The pleadings do not present evidence indicating that the bankruptcy proceedings have been completed.

         Plaintiff asserts that on May 21, 2015, [1] Defendant sent to PRA a letter notifying PRA of Plaintiffs claims. Defendant contends, and deposition testimony and letter itself reflect, that Plaintiffs claims are not enumerated in that letter. Instead, the letter attached as an exhibit merely explains that Defendant had the accounts in its system, PRA should refer all contacts to Defendant, debtors may send payments directly to PRA, and PRA must notify Defendant of any bankruptcy notifications or disputes received in order for Defendant to comply the FDCPA.

         The parties fail to elucidate in their statements of fact how or when Defendant actually acquired knowledge of Plaintiff s bankruptcy. Deposition testimony, however, reflects that Defendant learned of Plaintiff s bankruptcy when Defendant contacted Plaintiff by phone. During that call, Plaintiff stated that he was filing Chapter Seven bankruptcy and volunteered his bankruptcy attorney. After learning of Plaintiff s bankruptcy, Defendant updated Plaintiffs account to reflect his status as bankrupt. According to Defendant, it took no further collection efforts after it changed Plaintiffs account status.

         In Count I, Plaintiff invokes 15 U.S.C. § 1692e(2), alleging that Defendant sent him a collection letter seeking to collect a debt that Defendant knew or should have known was part of Plaintiffs bankruptcy filings. In doing so, Defendant allegedly misrepresented the status of the debt. Count II sets forth an infraction of § 1692e(10) for allegedly falsely representing to Plaintiff that it could collect a debt that Defendant knew or should have known was included in Plaintiffs bankruptcy proceedings. Count III alleges that Defendant's attempt to collect the debt was unfair and unconscionable in violation of § 1692f because Defendant knew or should have known the debt was included in Plaintiffs bankruptcy. Finally, in Count IV, Plaintiff points to § 1692c(a)(2), claiming that Defendant violated the FDCPA because Defendant communicated directly with Plaintiff despite his retention of counsel concerning the debt. Both parties move for summary judgment on all four counts.


         A. Standard of Review

         "Summary judgment is appropriate when '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.'" Northfield Ins. Co. v. City of Waukegan, 701 F.3d 1124, 1128 (7th Cir. 2012) (quoting Fed.R.Civ.P. 56(a)); see also Celotex Corp. v. Catrett. 477 U.S. 317, 322 (1986). "A genuine issue of material fact exists when the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Wells v. Coker, 707 F.3d 756, 760 (7th Cir. 2013) (internal quotation marks and citation omitted). "On summary judgment a court may not make credibility determinations, weigh the evidence, or decide which inferences to draw from the facts; these are jobs for a factfinder." Payne v. Pauley, 337 F.3d 767, 770 (7th Cir. 2003) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986)). The general standards for summary judgment are unaltered by cross summary judgment motions: the Court "construe[s] all facts and inferences therefrom in favor of the party against whom the motion under consideration is made." Selective Ins. Co. of S.C. v. Target Corp., No. 16-1669, 2016 WL 7473786, at *2 (7th Cir. Dec. 29, 2016) (citation and quotation marks omitted).

         B. Claims Regarding Defendant's Attempts to Collect Debts ...

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