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Pierre v. Midland Credit Management, Inc.

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

April 21, 2017

RENETRICE R. PIERRE, Individually and on Behalf of others Similarly Situated, Plaintiff,
v.
MIDLAND CREDIT MANAGEMENT, INC., a Kansas Corporation, Defendant.

          MEMORANDUM OPINION AND ORDER

          HARRY D. LEINENWEBER, JUDGE.

         Before the Court is the Plaintiff's Second Motion for Class Certification [ECF No. 31]. For the reasons stated herein, the Court grants Plaintiff's Motion.

         I. BACKGROUND

         Plaintiff Renetrice Pierre (“Pierre”) brings this action against Defendant Midland Credit Management, Inc. (“Midland”) under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. (“FDCPA”), alleging that Midland's collection letters fail to provide necessary disclosures, in violation of various provisions of 15 U.S.C. §§ 1692(e)-(f).

         On September 2, 2006, Pierre, a resident of Winnetka, Illinois, opened a credit card account with Target National Bank. (See, ECF No. 40 (“Sec. Am. Compl.”) at Ex. 2.) That bank charged off Pierre's account on October 26, 2008. (Ibid.; Carson Tr. 118:21-119:3.) Pierre's account was subsequently assigned to Midland Funding LLC, which then sued Pierre on December 6, 2010 in Lake County Circuit Court to collect a balance due that included interest accrued from the date of the charge-off. (See, Sec. Am. Compl. at Ex. 2; Carson Tr. 112:7-16, 120:5-15.)

         On September 2, 2015, Midland sent Pierre a letter seeking to collect on the same debt underlying the Lake County action. (Sec. Am. Compl. at Ex. 1.) Midland primarily services and collects the charged-off credit card debt that Midland Funding LLC purchases in large portfolios. (See, ECF No. 46 (“Def.'s Br.”) at 6.) As relevant, Midland's letter informed Pierre that she had been pre-approved for “a discount program designed to save [her] money” and that she could “put this debt behind [her].” The letter detailed three payment options: a lump sum payment, 12 monthly installment payments, or an alternative payment plan to be negotiated by calling Midland. (Sec. Am. Compl. ¶ 11 & Ex. 1.) The first two options indicated a “payment due date” of October 2, 2015, and the letter also indicated that the offer would expire on that date. (Id. ¶ 12 & Ex. 1; see also, Carson Tr. 45:7-21.) Separately, the letter advised Pierre that “[b]ecause of the age of your debt, we will not sue you for it, we will not report it to any credit reporting agency, and payment or nonpayment of this debt will not affect your credit score.” (Sec. Am. Compl. ¶ 13 & Ex. 1.)

         According to its Rule 30(b)(6) witness, Midland composes collection (or “discount”) letters like those it sent to Pierre using a computer template; with the exception of personal and account information, these letters are otherwise identical form letters. (Carson Tr. 22:18-23:18, 159:9-162:13.) In addition, the letter's mentions of “we” and “us” refer to Midland (the debt servicer), not the entity that actually owns the debt (Midland Funding LLC). (Id. at 168:8-171:24.) Midland maintains a database of contact information for each of the individuals to whom such letters are sent, and it periodically updates this repository via skip traces. (Id. at 93:16-94:9.)

         On March 7, 2016, Pierre filed this lawsuit on behalf of herself and others similarly situated, claiming that Midland's mailing of these letters violated the FDCPA. Her original Complaint defined a “Time-Barred Debt Class, ” an “Initial Communication Class, ” and a “5-Day Notice Class.” Pierre defined the “Time-Barred Debt Class” as follows:

All persons with Illinois addresses to whom Midland Credit Management, Inc. sent a letter seeking to collect a time-barred debt that failed to disclose that the alleged debtor could not be sued for the alleged debt, failed to disclose that even a partial payment would revive the ability to sue on the alleged debt and failed to disclose that the alleged debtor had the option not to pay the alleged debt.

(ECF No. 1 (“Compl.”) ¶ 21.) On June 28, 2016, Pierre amended her Complaint, dropping the “Initial Communication” and “5-Day Notice” classes and defining the putative class as follows:

All persons with Illinois addresses to whom Midland Credit Management, Inc. sent a letter seeking to collect a time-barred debt that failed to disclose that the alleged debtor could not be sued for the alleged debt, failed to disclose that even a partial payment would revive the ability to sue on the alleged debt, failed to disclose that the alleged debtor had the option not to pay the alleged debt and failed to disclose that the letter was from a debt collector.

(ECF No. 20 (“First Am. Compl.”) ¶ 19.) Pierre then propounded written discovery to Midland, requesting the number of letters Midland sent from March 7, 2015 through March 7, 2016 to these putative class members. Midland responded:

Defendant states that it estimates that between March 7, 2015, and March 7, 2016, it sent approximately 68, 754 letters to persons with Illinois addresses which contained the following statement: “The law limits how long you can be sued on a debt. Because of the age of your debt, we will not sue you for it, we will not report it to any credit reporting agency, and payment or non-payment will not affect your credit score.”

(ECF No. 31 (“Pl.'s Mot.”) at Ex. B, no. 21.) Pierre now seeks certification of the following proposed class:

All persons with Illinois addresses to whom Midland Credit Management, Inc. sent, from March 7, 2015 through March 7, 2016, a letter containing the following statement: “The law limits how long you can be sued on a debt. Because of the age of your debt, we will not sue you for it, we will not report it to any credit reporting agency, and payment or non-payment will not affect your credit score.”

(Pl.'s Mot. at 3.) Pierre amended her Complaint a second time to recite the same class definition. (See, Sec. Am. Compl. ¶ 18.) In sum, Midland sent letters to 68, 754 Illinois residents between March 7, 2015 and March 7, 2016; each letter contained the same quoted language now included in Pierre's proposed class definition; and each was otherwise identical to Pierre's letter with the exception of unique personal and account information. (See also, Carson Tr. 89:22-90:9, 93:7-11.)

         II. LEGAL STANDARD

         To certify a class under Federal Rule of Civil Procedure 23 (“Rule 23”), a court must find that the class (a) is defined such that its members are ascertainable and (b) meets not only the requirements of Rule 23(a) but also one of the three subsections of Rule 23(b). See, e.g., Jamie S. v. Milwaukee Pub. Schs., 668 F.3d 481, 493 (7th Cir. 2012). Under Rule 23(a), the class members must be so numerous that joining each is impracticable (numerosity); there must be class-wide questions of law or fact (commonality); the named parties' claims or defenses must be typical of the class (typicality); and the representative must be able to protect the interests of the class adequately (adequacy). Fed.R.Civ.P. 23(a); see, Siegel v. Shell Oil, 612 F.3d 932, 935 (7th Cir. 2010). Pierre in this case proceeds under Rule 23(b)(3), which additionally requires for certification that common questions of law or fact “predominate over any questions affecting only individual members, and . . . a class action is superior” to other available methods of adjudication. Fed.R.Civ.P. 23(b)(3).

         The Court must conduct a rigorous analysis to determine whether Pierre has shown by a preponderance of the evidence that the putative class meets the Rule 23 criteria. See, Messner v. Northshore Univ. HealthSys., 669 F.3d 802, 811 (7th Cir. 2012). In doing so, the Court will resolve factual disputes that are material to class certification, as it is required to do at this stage. See, ibid.

         III. ANALYSIS

         Midland opposes certification on the following grounds: Pierre lacks standing as a named plaintiff, the class is not sufficiently identifiable, Pierre's claims are not typical of those of the class, Pierre and her counsel are not adequate representatives, individual issues predominate, and a class action is not a superior method for adjudicating the controversy. The Court rejects each of these arguments below and finds that Plaintiff has carried her burden under Rule 23.

         A. ...


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