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Magee v. Portfolio Recovery Associates, LLC

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

September 13, 2016

NACOLA MAGEE and JAMES PETERSON, individually and on behalf of all others similarly situated, Plaintiffs,
v.
PORTFOLIO RECOVERY ASSOCIATES, LLC, Defendant.

          MEMORANDUM OPINION AND ORDER

          JOHN W. DARRAH United States District Court Judge.

         On May 9, 2016, Portfolio Recovery Associates, LLC's (“Defendant”) Motion for Summary Judgment was denied as to Counts I and II of Plaintiffs' First Amended Complaint, and Plaintiffs Nacola Magee and James Peterson's (“Plaintiffs”) Motion for Summary Judgment was granted. On June 6, 2016, Defendant filed a Motion to Reconsider, or Alternatively, to Stay [294] pursuant to Federal Rule of Civil Procedure 59(e). For the reasons set forth below, Defendant's Motion [294] is denied.

         BACKGROUND

         Plaintiffs brought this class action against Defendant for alleged violations of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et. seq. On August 15, 2012, this Court granted Defendant's Motion to Dismiss Plaintiffs' initial Complaint and granted Plaintiffs leave to file an amended pleading. Plaintiffs filed a two-count amended complaint on August 23, 2012 (Dkt. 39), asserting violations of the FDCPA in Count I (Misleading Settlement Offers on Time-Barred Debts) and Count II (Threat of Credit Reporting).

         On October 16, 2015, Plaintiffs filed a Motion for Summary Judgment on all of Plaintiffs' claims. (Dkt. 269.) Defendant filed a Response to the Motion for Summary Judgment as well as a Cross-Motion for Summary Judgment. (Dkt. 277.) On May 9, 2016, the Court denied Defendant's Motion for Summary Judgment as to Counts I and II and granted Plaintiffs' Motion for Summary Judgment (“Order”). (Dkt. 292.) Defendant filed a Motion to Reconsider the Order granting Plaintiff's Motion for Summary Judgment on Count I of the First Amended Complaint or, alternatively, to stay this case pending the outcome of an appeal of a case cited in this Court's opinion. (Dkt. 294.)

         For purposes relevant to the Motion at issue, the Order held that Defendant's failure to include language stating that Plaintiffs' debt was time barred, that Plaintiffs could no longer be sued on that debt, and that Plaintiffs' partial payment would reset the statute of limitations period was clearly deceptive on its face. (Order at p. 4.) Therefore, summary judgment was awarded on Count I without extrinsic evidence as the deceptive language is materially false.[1]

         LEGAL STANDARD

         “Motions for reconsideration serve a limited function: to correct manifest errors of law or fact or to present newly discovered evidence.” Caisse Nationale de Credit Agricole v. CBI Indus., Inc., 90 F.3d 1264, 1269 (7th Cir.1996) (internal citation omitted). Under Federal Rule of Civil Procedure 59(e), a motion to alter or amend a judgment is permissible when there is newly discovered evidence or there has been a manifest error of law or fact. Harrington v. City of Chi., 433 F.3d 542, 546 (7th Cir. 2006). A manifest error of law is the “disregard, misapplication, or failure to recognize controlling precedent.” Oto v. Metro. Life Ins., 224 F.3d 601, 606 (7th Cir. 2000) (quoting Sedrak v. Callahan, 987 F.Supp. 1063, 1069 (N.D. Ill. 1997)). To succeed on a Rule 59(e) motion, the movant must “clearly establish one of the aforementioned grounds for relief.” Harrington, 433 F.3d at 546.

         Rule 59 is not intended as an opportunity to reargue the merits of a case, Neal v. Newspaper Holdings, Inc., 349 F.3d 363, 368 (7th Cir.2003), or to submit evidence that could have been presented earlier. Dal Pozzo v. Basic Machinery Co., Inc., 463 F.3d 609, 615 (7th Cir. 2006) (citing Frietsch v. Refco, Inc., 56 F.3d 825, 828 (7th Cir.1995)); see also Oto, 224 F.3d at 606 (7th Cir. 2000) (a motion to reconsider should not be used to rehash previous arguments).

         ANALYSIS

         Applying these guidelines here, the Motion must be denied. Defendant presents three arguments as to why the Court should reconsider its judgment granting Plaintiff's Motion for Summary Judgment on Count I under Rule 59(e). First, Defendant argues that the Court erred because it did not address whether an unsophisticated consumer would believe the Defendant's settlement offer implied that it would sue. Defendant further argues that the Court previously found that the letters were plainly and clearly not misleading. Finally, the Defendant argues that the Court erred in finding that the language in the letters could influence a consumer's decision and was material and that applying Pantoja v. Portfolio Recovery Associates, LLC, No. 13 C 7667, 2015 WL 848568, *3 (N.D. Ill. Jan. 14, 2015), was in error.

         Defendant raised its first argument (that an unsophisticated consumer would not believe the settlement offer implied that the Defendant would sue) in its Cross-Motion for Summary Judgment. In its Memorandum in Support of its Cross-Motion, Defendant argued that Plaintiffs must prove that the letters at issue deceived unsophisticated consumers into believing that the debts were legally enforceable. (See, e.g., Dkt. 277 at pp. 8, 14-15, 19.) In the Order, the Court determined that Defendant's failure to include language in the dunning letter that Plaintiff's debt was time barred, that Plaintiffs could no longer be sued on the debt and that a partial payment would reset the statute of limitations period is clearly deceptive on its face, and that the “settlement” language in the letters misleads consumers to believe that their time-barred debt is legally enforceable. Order at pp. 7-9. Because the Defendant raises arguments in the Motion that the Defendant has already presented and that this Court has already considered and rejected, the Motion is denied.

         Next, Defendant argues that the Court erred in finding the letter fell within the “clear violation” category because this Court previously held, on August 15, 2012, that the language in the letters was plainly and clearly not misleading.[2] According to Defendant, the Court previously held that the language in the letters fell within the plainly and clearly not misleading category because the Court noted that a dunning letter may use “settle” or “settlement” and that the operative pleading at the time did not contain allegations that the letters were threatening or confusing. (Dkt. 294 at p. 5.) Defendant's argument, however, takes liberties with the Court's prior ruling and misconstrues the holding.

         The prior ruling, granting Defendant's Motion to Dismiss the Plaintiffs' initial Complaint, held that the allegations in the initial Complaint had not alleged that the letters contained “any threat, either explicit or implicit, ” was accompanied by actual litigation, or that any language contained in the letters was confusing. (Dkt. 38 at p. 6.) The prior ruling noted that a debt collector is allowed to use the term “settle” or “settlement” in a debt-collection letter. (Id.) The prior ruling does not, however, hold that the letters were plainly and clearly not misleading nor does the prior ruling contradict the Order. In this respect, the prior ruling did not specifically hold that the letters were plainly and clearly not misleading. ...


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