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Moggg v. Jacobs

United States District Court, S.D. Illinois

August 18, 2016

JONATHAN MOGG, Plaintiff,
v.
MITCHELL D. JACOBS, individually and d/b/a Jacobs Law Office, Defendant.

          MEMORANDUM AND ORDER

          J. PHIL GILBERT DISTRICT JUDGE

         This is an action filed by plaintiff Jonathan Mogg alleging that defendant Mitchell D. Jacobs violated the Fair Debt Collections Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., when Jacobs, on behalf of his client Ardmore Finance Corporation (“Ardmore”), sent a collections letter to Mogg and filed a lawsuit against Mogg after Mogg had filed a petition for Chapter 13 bankruptcy. This matter comes before the Court on the parties’ cross-motions for summary judgment (Docs. 34 & 37) and their respective responses (Docs. 50 & 46). The parties have also submitted various other documents either in support of or opposing their summary judgment motions (Docs. 35, 36, 38, 39, 41 & 47), all of which the Court has considered in ruling on the pending motions.

         I. Standard for Summary Judgment

         Summary judgment must be granted “if 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.

         The initial summary judgment burden of production is on the moving party to show the Court that there is no reason to have a trial. Celotex, 477 U.S. at 323; Modrowski v. Pigatto, 712 F.3d 1166, 1168 (7th Cir. 2013). Where the non-moving party carries the burden of proof at trial, the moving party may satisfy its burden of production in one of two ways. It may present evidence that affirmatively negates an essential element of the non-moving party’s case, see Fed. R. Civ. P. 56(c)(1)(A), or it may point to an absence of evidence to support an essential element of the non-moving party’s case without actually submitting any evidence, see Fed. R. Civ. P. 56(c)(1)(B). Celotex, 477 U.S. at 322-25; Modrowski, 712 F.3d at 1169. Where the moving party fails to meet its strict burden, 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. Celotex, 477 U.S. at 322-26; Anderson, 477 U.S. at 256-57; Modrowski, 712 F.3d at 1168. 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). 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.

         II. Facts

         The essential framework of this case is undisputed. Mogg borrowed $200.00 from Ardmore. Having failed to pay it back according to the terms of the loan, Ardmore engaged Jacobs to collect the debt from Mogg. Before paying the debt, Mogg, through counsel, filed a petition for bankruptcy under Chapter 13 on September 23, 2014, and listed Ardmore as one of his creditors. See Case No. 14-31584-lkg (Bankr. S. D. Ill.).

         On October 15, 2014, Jacobs sent Mogg a letter trying to collect the debt to Ardmore. The letter stated, in pertinent part:

I represent Ardmore Finance Corporation d/b/a Ardmore Finance with regard to your account. On October 26, 2007, you borrowed $200.00 and agreed to repay that amount plus a finance charge of $98.00 by May 26, 2008. You have failed to do so and your account, which has been forwarded to me for collection has the balance of $2, 040.67, including all payments and credits and including interest up to today. Please forward your payment for this amount immediately or call the undersigned to arrange for payment or you may be responsible for attorney fees as well.

         Mogg did not pay as requested in the letter, so on December 4, 2014, Jacobs filed a state court lawsuit on behalf of Ardmore to collect the debt from Mogg. Mogg was still in bankruptcy at that time. Mogg sought legal assistance from his bankruptcy attorney to stop Jacobs’ collection activities.

         In January 2015, Jacobs received a suggestion of bankruptcy Mogg had filed in the state court action. Following receipt of that document, Jacobs took no further action to collect the debt outside the bankruptcy proceedings. On January 5, 2015, the state court stayed the collection case pending discharge or closure of Mogg’s bankruptcy proceedings. Jacobs took no affirmative action to dismiss the case at that time, although he dismissed the case within 30 days of receiving notice that Mogg’s bankruptcy plan had been confirmed in March 2016.

         The parties dispute other facts. First, Mogg asserts Ardmore received notice of his bankruptcy petition three times: (1) at the time of filing on September 23, 2014, (2) on October 6, 2014, when the Trustee sent notice of the creditor’s meeting, and (3) on November 18, 2014, when Mogg’s attorney sent creditors an Amended Plan. He argues it is reasonable to conclude from these facts that Jacobs knew of the bankruptcy filing before sending his October 15, 2014, letter and filing the December 4, 2014, collection action. Mogg has pointed to no evidence in the District Court or Bankruptcy Court record that the original petition was sent to Ardmore when it was filed, so the Court cannot credit his assertion to that effect. There is a certificate of service attesting that on October 6, 2014, the Trustee sent the notice of the creditors meeting to creditors on the matrix, of which Ardmore was one (Doc. 36-7 at 4). There is also a certificate of service attesting to that on November 18, 2014, Christy Heuer, presumably someone working in Mogg’s bankruptcy attorney’s office, mailed Mogg’s Amended Plan to Ardmore (Doc. 36-5 at 9-13). The reasonable inference that can be drawn from the foregoing evidence is that two notices were mailed to Ardmore that, if received, should have alerted it to the existence of Mogg’s bankruptcy proceeding.

         On the other side, Jacobs has presented evidence that neither he nor Ardmore ever received any notice of Mogg’s bankruptcy and that he did not know of the bankruptcy proceeding at the time he acted to collect the debt to Ardmore. He has presented affidavit testimony from Ardmore’s president, Andrew Doehring, that Ardmore never received notice of a bankruptcy filing and that, if it had, it would have implemented its established procedure to notify Jacobs. That procedure was (1) making a note on the Ardmore file whenever a matter was referred to Jacobs for collection, (2) after receiving any notice relating to a debtor, looking at the debtor’s file to see if it had been referred to Jacobs, and (3) if it had been referred, immediately forwarding a copy of the notice to Jacobs. Jacobs has also presented his own affidavit testimony that neither he nor his office ever received a notice of Mogg’s bankruptcy filing from Ardmore. The Court believes Doehring is competent to testify about the procedures in place at Ardmore to convey information about bankruptcy filings to Jacobs in cases it had referred to him for collection. However, Doehring and Jacobs have not established that they have personal knowledge of every piece of paper that comes in the mail to their offices such that they could testify that no notice regarding Mogg’s bankruptcy arrived. Nevertheless, there is no issue of fact about whether Jacobs knew of Mogg’s bankruptcy filing before he sent his October 15, 2014, letter or filed the December 4, 2014, lawsuit; the uncontroverted evidence shows he did not.

         The parties further dispute the harm, if any, Mogg suffered as a result of receiving Jacobs’ October 15, 2014, letter and of being sued. Mogg states in his affidavit that he was “highly confused and upset” by Jacobs’ demand for payment; was “deceived [by the letter and the collection lawsuit] into thinking [he] had to pay” the debt; “sought out the assistance of [his] attorney to protect [him] self and ensure the collections stopped, ” for which he spent time and money; and was “inconvenienced and felt harassed” by Jacobs’ collection efforts. Mogg Aff ¶¶ 7-11. Jacobs notes that Mogg never paid any of the Ardmore debt and claims that his emotional disturbance was not substantial enough to amount to a concrete injury.

         In October 2015, Mogg filed this lawsuit under the FDCPA alleging ...


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