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Bernal v. NRA Group LLC

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

August 30, 2016

JOSEPH BERNAL, individually and on behalf of all others similarly situated, Plaintiff,
v.
NRA GROUP, LLC, Defendant.

          MEMORANDUM OPINION AND ORDER

          Gary Feinerman Judge.

         In this putative class action, Joseph Bernal alleges that NRA Group, LLC attempted to collect delinquent consumer debts by sending him and members of the putative class a form collection letter that violated the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., by purporting to assess a percentage-based collection fee. Doc. 1. NRA answered and asserted affirmative defenses. Doc. 12. Bernal now moves for class certification pursuant to Federal Rule of Civil Procedure 23. Doc. 17. The motion is granted.

         Background

         Congress enacted the FDCPA to eliminate abusive debt collection practices and to protect debt collectors who abstain from abusive practices. See Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 559 U.S. 573, 577 (2010); Bentrud v. Bowman, Heintz, Boscia & Vician, P.C., 794 F.3d 871, 874 (7th Cir. 2015). Section 1692e of Title 15 prohibits a debt collector from using “any false, deceptive, or misleading representation or means in connection with the collection of any debt.” 15 U.S.C. § 1692e; see Ruth v. Triumph P'ships, 577 F.3d 790, 799-800 (7th Cir. 2009). This provision, essentially a “rule against trickery, ” Beler v. Blatt, Hasenmiller, Leibsker & Moore, LLC, 480 F.3d 470, 473 (7th Cir. 2007), sets forth “a nonexclusive list of prohibited practices” in sixteen subsections, McMahon v. LVNV Funding, LLC, 744 F.3d 1010, 1019 (7th Cir. 2014). Section 1692f prohibits debt collectors from employing “unfair or unconscionable means to collect or attempt to collect any debt, ” including attempting to collect “any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is authorized by the agreement creating the debt or permitted by law.” 15 U.S.C. § 1692f(1).

         Bernal lives in Illinois. Doc. 1 at ¶ 3. NRA operates a nationwide delinquent debt collection business, acts as a debt collector within the meaning of the FDCPA, and is licensed as a debt collection agency in Illinois. Id. at ¶¶ 4-6. NRA sent Bernal a collection letter dated February 17, 2015, demanding payment of a debt that Bernal allegedly owed to Six Flags Entertainment Corporation. Id. at ¶ 7; Doc. 1-3. The Six Flags agreement on which Bernal allegedly defaulted provides:

If your account is in arrears for more than 30 days (after you miss two payments) and the Minimum Term has not yet expired, then your account will be permanently cancelled and you will be subject to the Termination Fee, plus costs (including reasonable attorney's fees) incurred by us in attempting to collect amounts due or otherwise enforcing this agreement, or 2) the Minimum Term has expired, then your account will be permanently cancelled and you will be billed for any amounts that are due and owing plus any costs (including reasonable attorney's fees) incurred by us in attempting to collect amounts due or otherwise enforcing this agreement.

Doc. 22-1 at 2. The collection letter stated a principal balance of $267.31 and an additional $43.28 in “costs, ” for a total “amount owed” of $310.59. Doc. 1 at ¶ 7; Doc. 1-3 at 1.

         Bernal alleges that the $43.28 did not represent the actual cost to NRA of collecting the debt, but rather reflected a flat sixteen percent collection fee, and that NRA's attempt to collect that fee violated §§ 1692e and 1692f. Doc. 1 at ¶¶ 7, 10-17. The proposed class consists of other Illinois residents from whom NRA attempted to collect a debt owed to Six Flags, plus a percentage-based collection cost, with the same form collection letter that Bernal received. Id. at

         ¶¶ 18, 20. The proposed class is defined as follows:

[A]ll persons similarly situated in the State of Illinois from whom Defendant attempted to collect a delinquent consumer debt allegedly owed for a Six-Flags account, via a collection letter identical to the letter that is attached to the Complaint … as to which a percentage based charge for “Costs” had been added to the debt, from one year before the date of this Complaint [February 3, 2016] to the present.

Doc. 17 at ¶ 6.

         Discussion

         A court's analysis of class certification “is not free-form, but rather has been carefully scripted by the Federal Rules of Civil Procedure.” Chi. Teachers Union, Local No. 1 v. Bd. of Educ. of Chi, 797 F.3d 426, 433 (7th Cir. 2015). To be certified, a proposed class must satisfy the four requirements of Rule 23(a): “(1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims and defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class.” Fed.R.Civ.P. 23(a); see Bell v. PNC Bank, Nat'l Ass'n, 800 F.3d 360, 373 (7th Cir. 2015). If Rule 23(a) is satisfied, the proposed class must fall within one of the three categories in Rule 23(b): “(1) a mandatory class action (either because of the risk of incompatible standards for the party opposing the class or because of the risk that the class adjudication would, as a practical matter, either dispose of the claims of non-parties or substantially impair their interests), (2) an action seeking final injunctive or declaratory relief, or (3) a case in which the common questions predominate and class treatment is superior.” Spano v. Boeing Co., 633 F.3d 574, 583 (7th Cir. 2011); see also Bell, 800 F.3d at 373. Finally, the class must be “identifiable as a class, ” meaning that the “class definitions must be definite enough that the class can be ascertained.” Oshana v. Coca-Cola Co., 472 F.3d 506, 513 (7th Cir. 2006); see also Mullins v. Direct Dig., LLC, 795 F.3d 654, 659-61 (7th Cir. 2015). “Failure to meet any one of the requirements of Rule 23 precludes certification of a class.” Harriston v. Chi. Tribune Co., 992 F.2d 697, 703 (7th Cir. 1993) (internal quotation marks omitted).

         The putative class representative bears the burden of showing that each requirement is satisfied. See Chi. Teachers Union, 797 F.3d at 433; Messner v. Northshore Univ. HealthSystem, 669 F.3d 802, 811 (7th Cir. 2012); Retired Chi. Police Ass'n v. City of Chicago, 7 F.3d 584, 596 (7th Cir. 1993). Although “as a general principle, a court is not allowed to engage in analysis of the merits in order to determine whether a class action may be maintained[, ] … the boundary between a class determination and the merits may not always be easily discernible, ” Retired Chi. Police, 7 F.3d at 598-99 (internal quotation marks omitted), and “the class determination generally involves considerations that are enmeshed in the factual and legal issues comprising the plaintiff's cause of action.” Chi. Teachers Union, 797 F.3d at 435 (quoting Comcast Corp. v. Behrend, 133 S.Ct. 1426, 1432 (2013)) (internal quotation marks omitted); see also Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 351 (2011) (noting that class certification analysis “[f]requently … will entail some overlap with the merits of the plaintiff's underlying claim”) (quoting Gen. Tel. Co. v. Falcon, 457 U.S. 147, 160 (1982)) (internal quotation marks omitted). “[A] district court must make whatever factual and legal inquiries are necessary to ensure that requirements for class certification are satisfied before deciding whether a class should be certified, even if those considerations overlap the merits of the case.” Am. Honda Motor Co. v. Allen, 600 F.3d 813, 815 (7th Cir. 2010); see also Kartman v. State Farm Mut. Auto. Ins. Co., 634 F.3d 883, 889-90 & n.6 (7th Cir. 2011). The Seventh Circuit has instructed district courts to exercise “caution” before certifying a class. Thorogood v. Sears, Roebuck & Co., 547 F.3d 742, 746 (7th Cir. 2008). That caution demands a close look at each Rule 23 requirement.

         I. Ascertainability

         As noted, a class definition “must be definite enough that the class can be ascertained.” Oshana, 472 F.3d at 513; see also Jamie S. v. Milwaukee Pub. Sch., 668 F.3d 481, 495-97 (7th Cir. 2012); 7A Charles Alan Wright et al., Federal Practice and Procedure § 1760 (3d ed. 2016) (“[T]he requirement that there be a class will not be deemed satisfied unless the class description is sufficiently definite so that it is administratively feasible for the court to determine whether a particular individual is a member.”). “Class definitions have failed this requirement when they were too ...


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