United States District Court, N.D. Illinois, Eastern Division
WEI LIANG, on behalf of plaintiff and the class members described herein, Plaintiff,
FRONTLINE ASSET STRATEGIES, LLC, LVNV FUNDING, LLC, RESURGENT CAPITAL SERVICES, L.P., and ALEGIS GROUP, LLC, Defendants.
MEMORANDUM OPINION AND ORDER
Z. Lee United States District Judge.
Wei Liang filed suit against Frontline Asset Strategies, LLC
(“FAS”), LVNV Funding, LLC (“LVNV”),
Resurgent Capital Services, L.P. (“Resurgent”),
and Alegis Group, LLC (“Alegis”) asserting
violations of the Fair Debt Collection Practices Act (FDCPA),
15 U.S.C. § 1692e. Defendants have filed a motion to
dismiss Plaintiff's Third Amended Complaint and strike
certain allegations therein. For the reasons stated below,
the motion  is granted in part and denied in part.
and Procedural Background
case arises from efforts by FAS to collect a debt from
Plaintiff. 3d Am. Compl. ¶¶ 40, 42, ECF No. 51. The
debt in question originated from a credit card account on
which Plaintiff allegedly defaulted. Id.
¶¶ 26-27. In 2005, an entity not before this court,
North Star Capital Acquisition, LLC (“North
Star”), obtained a default judgment against Plaintiff
with regard to the debt. Id. ¶ 26. Defendants
contend that, by a series of transfers, LVNV then became the
owner of the debt, and employed FAS to recover it.
Id. ¶¶ 38, 40, 42. The focus of Plaintiff's
action is a letter in which he claims that FAS made various
false or misleading representations while attempting to
collect the debt. Id. ¶ 42; see Id.
originally filed suit on October 13, 2015, after which he
amended his complaint twice in lieu of responding to
Defendants' motions to dismiss. In his second amended
complaint, he raised two primary grounds on which he alleged
the letter was false or misleading: first, that “it did
not disclose that the judgment in question was a dormant
judgment under Illinois law”; and second, that the
letter suggested defendants were the judgment creditors,
despite the fact that they are not. Liang v. Frontline
Asset Strategies, LLC, No. 15 C 09054, 2016 WL 7409913,
at *1 (N.D. Ill.Dec. 22, 2016).
Court dismissed each of these claims with prejudice.
Id. at *4. In regard to Plaintiff's first claim,
the Court concluded that “even if the letter had
disclosed the dormant status of the judgment, it would not
have had any practical impact on an unsophisticated
consumer's rights or decision-making process in relation
to the debt, ” and thus was not a material statement
that could give rise to FDCPA liability. Id. at
*2-4. Then, in regard to Plaintiff's second claim, the
Court found that “the letter notes that LVNV is the
creditor to whom the debt is owed; it makes no statement that
would mislead a debtor into thinking that LVNV was also the
judgment creditor.” Id. at *4. Finally, the
Court observed that, in his briefing, Liang “also
appear[ed] to challenge LVNV's ownership of the debt,
” but that his second amended complaint did not clearly
raise a claim based on lack of ownership. Id. It
therefore granted Plaintiff leave to amend insofar as
“he ha[d] a nonfrivolous argument that LVNV is not the
owner of the debt at issue.” Id.
Plaintiff's Third Amended Complaint, he clarifies his
allegation that LVNV did not own the debt on which it sought
to collect only to represent otherwise in FAS's letter.
3d Am. Compl. ¶ 1, 50. Specifically, he states that a
bill of sale seeking to assign certain “Accounts”
from North Star to another entity, which in turn assigned the
accounts to LVNV, was insufficient to transfer ownership of
Plaintiff's debt. Id. ¶¶ 38-39;
see id., Ex. M. This bill of sale states as follows:
“[North Star] hereby transfers, sells, conveys, grants,
and delivers to Buyer, its successors and assigns, all right
title and interest of any kind in and to the Accounts set
forth in the data file named ‘Zenith-NorthStar-2011-12,
' as shown in the Accounts Schedule, which is hereby
incorporated by reference.” Id., Ex. M.
Plaintiff maintains that, because his defaulted account had
been reduced to a judgment, it was no longer an
“account, ” and thus could not have been
transferred by the bill of sale, negating LVNV's claim to
ownership. Id. ¶ 39.
addition to this claim, Plaintiff continues to assert that
Defendants violated the FDCPA by “[a]ttempting to
collect a dormant judgment, on which defendants were not the
judgment creditor.” Id. ¶ 50.
Motion to Strike
first move to strike various allegations from Plaintiff's
Third Amended Complaint. “The court may strike from a
pleading an insufficient defense or any redundant,
immaterial, impertinent, or scandalous matter.”
Fed.R.Civ.P. 12(f). Motions to strike are generally
disfavored because they “potentially serve only to
delay.” Heller Fin., Inc. v. Midwhey Powder
Co., 883 F.2d 1286, 1294 (7th Cir. 1989). “But
where, as here, motions to strike remove unnecessary clutter
from the case, they serve to expedite, not delay.”
Id. A district court “has considerable
discretion in striking any redundant, immaterial, impertinent
or scandalous matter.” Delta Consulting Grp., Inc.
v. R. Randle Const., Inc., 554 F.3d 1133, 1141 (7th Cir.
allegations that Defendants seek to strike all relate to the
two bases for Plaintiff's claims that the Court dismissed
with prejudice in its previous order (i.e.,
Plaintiff's theories related to the relevant
judgment's dormancy and LVNV's non-status as a
judgment creditor). Def.'s Mot. Dismiss 4-6, ECF No. 53.
District courts have regularly stricken allegations seeking
to revive claims that have been previously dismissed with
prejudice. E.g., Brunson v. Schauf, No.
CIV. 12-225-GPM, 2013 WL 66158, at *1-2 (S.D. Ill. Jan. 4,
2013); David v. Vill. of Oak Lawn, No. 95 C 7368,
1996 WL 494268, at *2 (N.D. Ill. Aug. 27, 1996); Gardean
Envtl. Co. v. Local 225, Laborers Int'l Union,
AFL-CIO, No. 92 C 4545, 1993 WL 462833, at *3 (N.D. Ill.
Nov. 9, 1993); Wallace v. Xerox Corp., No. 87 C
8810, 1989 WL 51119, at *2-3 (N.D. Ill. May 8, 1989).
to avoid this result, Plaintiff first contends that the
Court's previous order “did not say that anything
was to be deleted.” Pl.'s Resp. 10, ECF No. 58
(emphasis omitted). But this argument misses the mark. The
Court unequivocally dismissed Plaintiff's claims based on
these allegations with prejudice, thereby precluding
Plaintiff from raising them again, as he has here.
further states that “[t]he fact that the Court held
that facts A and B were insufficient absent fact C does not
make facts A and B irrelevant after C is added.” Resp.
at 10. This argument misconstrues the Court's opinion.
The Court did not hold that “facts A and
B”-i.e., the issues Plaintiff raised as to the
relevant judgment's dormancy and LVNV's non-status as
a judgment creditor-were “insufficient absent fact
C”-i.e., Plaintiff's allegation of lack of
ownership. The Court ruled that the former theories failed to
state a claim under the FDCPA, regardless of whether
Plaintiff further disputed LVNV's ownership of the debt.
Liang, 2016 WL 7409913, at *4. ...