United States District Court, N.D. Illinois, Eastern Division
DONNNA M. GRITTERS, Plaintiff,
OCWEN LOAN SERVICING, LLC; NATIONSTAR MORTGAGE, LLC; and PIERCE & ASSOCIATES, P.C., Defendants.
MEMORANDUM OPINION AND ORDER
L. Alonso Judge
following reasons, Defendant Pierce & Associates,
P.C.'s Motion for Summary Judgment  is denied,
Plaintiff's Motion for Summary Judgment Against Defendant
Pierce & Associates, P.C.,  is granted, Defendant
Ocwen Loan Servicing, LLC's Motion for Summary Judgment
 is granted in part and denied in part, and
Plaintiff's Motion for Summary Judgment Against Defendant
Ocwen Loan Servicing, LLC,  is granted in part and
denied in part.
turning to the discussion, the Court notes at the outset the
difficulties it encountered with the parties'
presentations. First, complaint allegations are not proper
support for asserted statements of fact, and to the extent
any asserted fact was supported only in this way, it was not
considered. Second, disputes of asserted facts supported only
with arguments instead of citations to the record are also
improper. Where a party failed to properly support its
dispute, the asserted facts were deemed undisputed. Third,
the parties' practice of citing lengthy exhibits without
page or line references, and the parties' multiple
mathematical errors and/or scrivener's errors
unnecessarily complicated the Court's review of a
significant factual record.
otherwise noted, the following facts are undisputed. In 2003,
Donna Gritters took out a mortgage loan with The Federal Home
Loan Mortgage Corporation (“Freddie Mac”) for her
home. Ocwen Loan Servicing serviced the loan from August 2009
until May 2013. The loan was in default at the time Ocwen
acquired the servicing rights, and in February 2010,
Ocwen's counsel, Pierce & Associates, filed for
foreclosure against Gritters. Pierce is a law firm in the
business of collecting debts. Shortly thereafter, Freddie Mac
approved Ocwen's request to consider a loan modification,
after consideration of a breakdown of payoff funds including
such items as loan principal and interest, and $500 in
estimated foreclosure fees and $1, 322 in estimated
modification agreement was entered into by the parties a few
weeks later with an effective date of March 4, 2010.
Following an initial payment by Gritters, and the entry of
the agreement, her new principal balance was $62, 691.34,
escrow balance was $927.85, and suspense account balance was
$994.04. [Pl Resp. Ocwen SOF ¶26.] When Gritters called
Ocwen on April 1, 2010, it confirmed receipt of the required
initial payment. Ocwen also entered notes into its loan
servicing system directing Pierce to put the foreclosure
action on hold. The foreclosure action was not dismissed,
however, until more than a year later, on May 6, 2011, In
order to effectuate the loan modification, Ocwen made a
series of credits and debits to Gritters' loan between
April 6 and April 27, 2010 and the loan was brought
contractually current on April 27, 2010. Ocwen sent several
account statements to Gritters during this time, some with
conflicting information. Among the various activities on the
account that month, certain expenses incurred in filing the
foreclosure action were charged to Gritters on April 6, and
then credited back on April 27 “because the foreclosure
costs were included in the new principal balance under the
Loan Modification.” [Ocwen SOF ¶9; Pl Resp. Ocwen
21, 2010, Ocwen assessed $700 for attorneys' fees related
to the foreclosure, based on an invoice it received from
Pierce in April. On May 27, 2010, Ocwen received a $625
payment from Gritters. It applied $624.26 to her June 2010
payment, and $.74 towards the foreclosure attorneys' fees
charge. On June 14, 2010, Ocwen made an investor suspense
adjustment to the loan, applying $624.96 of the $994.04
suspense account to Gritters' July 2010 payment
obligation, and the remaining $369.78 to the foreclosure
attorneys' fees charge. Ocwen similarly applied certain
portions of Gritters' August, September, and October 2010
payments to the attorneys' fees charge. In December 2010,
Ocwen received a $48 bill for an assignment fee in
conjunction with the prior foreclosure action, which it
assessed to Gritters in April 2011. Pierce testified that it
understood the assignment charge was not to be passed on to
the borrower, but also that it was Ocwen's decision
whether to do so.
the modification, Gritters was late in making several of her
monthly payments and she missed certain payments. Gritters
testified she had no knowledge of anything Ocwen did to cause
her payments to be late. When she was late, Ocwen assessed
March 2011, Ocwen projected an escrow shortage for the coming
year and advised Gritters that her escrow payments and
correspondingly, her monthly installments would increase.
From April 2010 through March 2011, $4, 250.07 was paid from
Gritters' escrow account to taxes and insurance. Around
April 2011, Gritters discovered that her house was still
listed in foreclosure. Gritters stated in a declaration that
she called Ocwen about it, and was told that her loan was
current, and no foreclosure had been initiated.
also had difficulty understanding Ocwen's accounting.
Between April 2010 and April 2011, Ocwen sent Gritters
statements she testified she did not understand, and at least
during that first month, statements that were contradictory.
Gritters testified that she was confused about the loan's
status, and began to suffer from anxiety and panic attacks.
According to Gritters, she felt like she was in a perpetual
state of default, and she feared that she would lose her
home. She communicated her confusion and sought information
from Ocwen both through phone calls and letters.
summer of 2011, Gritters reached out to the Office of the
Illinois Attorney General to dispute Ocwen's handling of
her account and to request assistance. Between 2011 and 2012,
Gritters sent four such letters to the Illinois Attorney
General's Office, which forwarded each to Ocwen. In
September 2013, Gritters sent a fifth request for information
to Ocwen. Although the parties dispute whether these five
letters triggered response obligations under federal law and
if so whether Ocwen responded adequately, it is undisputed
that Ocwen responded to each.
in May 2013, servicing of Gritters' account was
transferred from Ocwen to Nationstar. Gritters was notified
of the transfer, and informed she had been assigned a single
point of contact at Nationstar. At the time of the transfer,
both Ocwen and Nationstar considered the loan to be in
default. On August 1, 2013, Nationstar sent Gritters a letter
attempting to collect a defaulted amount of $3, 345.59 by
September 5, 2013. Plaintiff's attempts at partial
payment were rejected by Nationstar.
August 2013, Gritters complained to the Office of the
Illinois Attorney General about Nationstar and Ocwen. In
September 2013, the Attorney General's Office forwarded
her letter to Nationstar for response. When Nationstar
responded, it reported that it had investigated the complaint
and determined that no changes to the account were warranted.
On September 6, 2013, Gritters against wrote to Nationstar
requesting numerous categories of information. Gritters
dubbed her letter a Qualified Written Request under the Real
Estate Settlement Procedures Act. Nationstar timely
responded, providing a copy of the Note and Security
Instrument, the May 31, 2013 servicing transfer notice, a
payoff statement good through September 30, 2013, and payment
history on the account from May 21, 2013 through the date of
the same time, Nationstar retained Pierce as its foreclosure
counsel. Pierce assigned the referral a new file number from
the one associated with the 2010 Ocwen referral. On September
16, 2013, Pierce sent Gritters a “loss mitigation
solicitation letter” on behalf of Nationstar, in which
it invited her to provide Nationstar certain information to
determine whether she was eligible for alternatives to
foreclosure. Pierce next communicated with Gritters on
October 25, 2013, when it informed her that it had been hired
by Nationstar to commence foreclosure proceedings.
Pierce's October 25 letter provided Gritters with the
total amount of debt due on the mortgage and note, and
identified Nationstar as the creditor. It also included debt
validation language under § 1692 of the FDCPA. At the
time, Nationstar was servicing the loan and Freddie Mac was
November 11, 2013, Gritters' counsel sent a “Fair
Debt Collection Practices Dispute Letter” to Nationstar
Mortgage c/o Pierce & Associates requesting that both
Nationstar and Pierce verify the debt pursuant to 15 U.S.C.
§ 1692g. Both Pierce and Nationstar acknowledged receipt
shortly thereafter, and promised a response. On November 26,
2013, Nationstar responded to Gritters' letter, again
providing a copy of the Note and Security Instrument, the May
31, 2013 servicing transfer notice, a payoff statement good
through September 30, 2013, and payment history on the
account from May 21, 2013 through the date of the response.
Pierce did not provide a separate response to Gritters'
November 11, 2013 request, testifying instead that it had
relied upon Nationstar's response.
January 2014, Pierce filed a foreclosure complaint against
Gritters in the Circuit Court of Cook County. In March 2014,
Pierce sent Gritters a “Notice of Initial Case
Management Conference” in the foreclosure action. This
action was filed in the interim, in February 2014.
court shall grant summary judgment 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). When deciding cross-motions for summary
judgment, the Court must “construe the evidence and all
reasonable inferences in favor of the party against whom the
motion under consideration is made.” Premcor USA,
Inc. v. Amer. Home Assurance Co., 400 F.3d 523, 526 (7th
Cir. 2005). The court may not weigh evidence or determine the
truth of the matters asserted. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 249 (1986).
“genuine” dispute is one that could change the
outcome of the suit, and is supported by evidence sufficient
to allow a reasonable jury to return a favorable verdict for
the non-moving party. Spivey v. Adaptive Mktg. LLC,
622 F.3d 816, 822 (7th Cir. 2010). The court will enter
summary judgment against a party who does not “come
forward with evidence that would reasonably permit the finder
of fact to find in [its] favor on a material question.”
Modrowski v. Pigatto, 712 F.3d 1166, 1167 (7th Cir.
Summary Judgment Motion/ Gritters'
argues at the outset that Gritters fails to demonstrate a
concrete particularized injury sufficient to establish
Article III standing. Even if she could make such a showing,
Pierce says, summary judgment would still be appropriate
because: (1) Gritters knew of her right under § 1692g to
request verification of her mortgage debt, and when she did
request verification, it was provided by the loan servicer as
well as by Pierce; (2) any failure to disclose the identity
of the holder of her mortgage was immaterial since Gritters
knew it; and (3) the foreclosure case notice that Pierce
forwarded to Gritters did not violate the FDCPA's
prohibition against contacting a represented debtor directly
since the court permitted it and it was not a communication
sent in connection with the collection of a debt.
cross-moves for summary judgment against Pierce, arguing
Pierce's FDCPA violations gave rise to cognizable
injuries-in-fact without the need for further evidence of
injury or actual damages in order to establish standing.
According to Gritters, summary judgment in her favor is
appropriate since there is no question of material fact that
Pierce: (1) failed to send her a debt validation letter
within the statutory time-frame following its initial
communication with her; (2) failed to disclose the identity
of the current creditor of her mortgage loan when it sent its
untimely debt validation letter; (3) failed to verify her
debt in response to her dispute; and (4) communicated with
her directly despite knowing she was represented by counsel.
order to establish Article III standing, a plaintiff must
establish that she “(1) suffered an injury in fact, (2)
that is fairly traceable to the challenged conduct of the
defendant, and (3) that is likely to be redressed by a
favorable judicial decision.” Spokeo, Inc. v.
Robins, 136 S.Ct. at 1547 (citing Lujan v. Defenders
of Wildlife, 504 U.S. 555, 560-61 (1992)). “To
establish injury in fact, a plaintiff must show that he or
she suffered ‘an invasion of a legally protected
interest' that is ‘concrete and particularized'
and ‘actual or imminent, not conjectural or
hypothetical.'” Id. at 1548 (quoting with
alteration Lujan, 504 U.S. at 560). “A
‘concrete' injury must be ‘de
facto'; that is, it must actually exist.”
Id. at 1548. “‘Concrete'” is
not, however, necessarily synonymous with
‘tangible.'” Id. at 1549.
“Although tangible injuries are perhaps easier to
recognize, . . . intangible injuries can nevertheless be
concrete.” Id. In determining whether an
intangible harm constitutes a sufficiently concrete injury,
“both history and the judgment of Congress play
important roles.” Id.
several pre-Spokeo FDCPA cases, the Seventh Circuit
recognized standing to challenge unlawful debt collection
demands even without proof of additional harm. See, e.g.,
Keele v. Wexler, 149 F.3d 589, 594 (7th Cir. 1998)
(standing existed based “on the debt collector's
misconduct, not whether the debt is valid or . . . whether
the consumer has paid an invalid debt.”); Phillips
v. Asset Acceptance Corp., 736 F.3d 1076, 1082-83 (7th
Cir. 2013) (standing existed where debt collectors had filed
allegedly unlawful suits against consumers, even though
consumers had not been served). Spokeo does not
disturb these holdings. See, e.g., Aguirre v. Absolute
Resolutions Corp., No. 15 C 11111, 2017 WL 4280957, at
*4 n. 3 (N.D. Ill. Sept. 27, 2017) (collecting cases finding
Article III standing to sue for statutory damages under the
FDCPA on clams of intangible injuries from allegedly
predatory debt collection practices).
the Supreme Court's decision in Spokeo, the
Seventh Circuit has interpreted it to mean that a statutory
violation alone gives rise to a concrete harm where the
“violation present[s] an appreciable risk of harm to
the underlying concrete interest that Congress sought to
protect by enacting the statute” at issue. Groshek
v. Time Warner Cable, Inc., 865 F.3d 884, 887 (7th Cir.
2017) (internal quotation marks omitted) (citing Meyers
v. Nicolet Rest. of De Pere, LLC, 843 F.3d 724, 727 (7th
Cir. 2016); Spokeo, 136 S.Ct. at 1549-50). In those
cases, the plaintiff “need not allege any
additional harm beyond the one Congress has
identified.” Spokeo, 136 S.Ct. at 1549. Under
these authorities, several district courts have found that a
misrepresentation about a debt is a sufficient injury for
standing because a primary purpose of the FDCPA is to protect
consumers from receiving false and misleading information
about one's debts. See, e.g., Marquez v. Weinstein,
Pinson & Riley, P.S., No. 14 C 739, 2017 WL 4164170,
at *4 (N.D. Ill. Sept. 20, 2017); Pierre v. Midland
Credit Mgmt., Inc., No. 16 C 2895, 2017 WL 1427070, at
*1, *4 (N.D. Ill. Apr. 21, 2017). Accordingly, because
Gritters had a right to receive information under the FDCPA
that she claims was not provided, she alleges a concrete harm
sufficient to give rise to Article III standing.
argues summary judgment should be granted in her favor
because Pierce failed to provide her with a debt validation
letter within five days of its September 16, 2013 letter to
her in connection with its efforts to collect the debt.
Pierce admits that it is a debt collector, and that it did
not send the debt validation letter until October 25, 2013,
but says that judgment in its favor should nevertheless be
granted because its September letter was not an
“initial communication” triggering disclosure
obligations under the FDCPA. Pierce bases this argument both
on the claim that its September letter was simply
informational, and on the fact that it had previously
communicated with Gritters in 2010 when she had fallen behind
on her mortgage. While Gritters does not dispute the 2010
communications, she says they are irrelevant since they were
years earlier and on behalf of a different client.
five days of its initial communication with a consumer, a
debt collector must provide certain information to the
consumer in what is known as a “debt validation
letter.” 15 U.S.C. § 1692g(a). The notice must
inform the debtor of the amount of the debt and the name of
the creditor to whom the debt is owed, and state that the
debt will be assumed valid if the ...