Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Hunte v. Safeguard Properties Management, LLC

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

May 3, 2018

JEREMY HUNTE, Plaintiff,
v.
SAFEGUARD PROPERTIES MANAGEMENT, LLC, and JPMORGAN CHASE BANK, N.A., Defendants.

          MEMORANDUM OPINION AND ORDER

          Gary Feinerman Judge.

         Jeremy Hunte sued Safeguard Properties Management, LLC and JPMorgan Chase Bank, N.A., alleging that Safeguard violated the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., and that both defendants violated state law. Doc. 1. The court granted Defendants' motions to dismiss the original complaint and allowed Hunte to replead. Docs. 48-49 (reported at 255 F.Supp.3d 722 (N.D. Ill. 2017)). Hunte filed an amended complaint, Doc. 58, and rather than respond to Defendants' motions to dismiss, Docs. 60, 63, he sought and was granted leave to file a second amended complaint, Docs. 71-73. After Defendants again moved to dismiss, Docs. 75, 78, the court dismissed with prejudice Hunte's FDCPA claims on the merits, relinquished jurisdiction over the state law claims, and entered judgment. Docs. 88-90 (reported at 2017 WL 5891060 (N.D. Ill. Nov. 27, 2017)). Hunte now moves under Rule 59(e) for reconsideration. Doc. 96. Because the arguments that Hunte presents on reconsideration are forfeited, meritless, or both, his motion is denied.

         Background

         The court assumes familiarity with the background set forth in the court's earlier opinions. To be liable under the FDCPA, a defendant must be a “debt collector” as defined in 15 U.S.C. § 1692a(6). Although the statute provides several possible ways a defendant may qualify as a “debt collector, ” the second amended complaint invoked just two. Doc. 73 at ¶¶ 6-7. The first defines a debt collector as “any person … who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.” 15 U.S.C. § 1692a(6). The second-which applies only where, as here, the plaintiff alleges a § 1692f(6) violation-defines a debt collector as “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the enforcement of security interests.” Ibid.

         In moving to dismiss the second amended complaint, Defendants first contended that Hunte had not plausibly alleged that Safeguard was a “debt collector” under § 1692a(6)'s “regularly collects or attempts to collect … debts” prong. Doc. 76 at 5-6; Doc. 79 at 11-12. According to Safeguard, Hunte's allegation that “Safeguard placed a sign on his property with Chase's contact information” was insufficient. Doc. 79 at 12. Chase similarly argued that Hunte “[did] not allege that Safeguard sent [him] … collection notices, made collection phone calls, or otherwise ‘regularly' attempted to collect any debts from Hunte or anyone else.” Doc. 76 at 5-6.

         Defendants next contended that Hunte had not plausibly alleged that Safeguard was a “debt collector” under § 1692a(6)'s “enforcement of security interests” prong. Doc. 76 at 5; Doc. 79 at 8-11. For its part, Safeguard acknowledged Hunte's allegations that it (1) “markets its services to mortgage companies with delinquent and defaulted borrowers, ” and (2) “advertises field services that it provides to its client[s], and among these services are communicating with delinquent borrowers on behalf of mortgage companies, contacting mortgagors to request that they call mortgage companies, and reporting back to mortgage companies whether it has made contact with mortgagors and regarding the condition of mortgaged properties.” Doc. 73 at ¶ 5; Doc. 79 at 8-9. Nevertheless, Safeguard contended that Hunte had not plausibly alleged that it fit within the “enforcement of security interests” prong because he “ma[de] no allegation that Safeguard sent him anything in the mail or contacted him via telephone or … used any instrumentality of interstate commerce toenforce any security interest.” Doc. 79 at 9 (emphasis added). Chase similarly argued that Hunte “[did] not allege that Safeguard ever sent [him] anything in the mail or contacted [him] via telephone (or any other ‘instrumentality of interstate commerce')-only that Safeguard physically visited the Property, placed a notice on the Property, and later removed [his] belongings.” Doc. 76 at 5.

         Hunte responded that Safeguard's notices on his property-together with its marketing activities-qualified it as a “debt collector” under the “regularly collects or attempts to collect … debts” prong “because the notices [it] placed in [Hunte's] windows conveyed information regarding the alleged debt, including the identity of the debt collector and creditor.” Doc. 82 at 10. Hunte also contended that Safeguard fit within the “enforcement of security interests” prong because its “property preservation services include communicating with delinquent borrowers on behalf of mortgage companies, contacting mortgagors to request that they call mortgage companies, and reporting back to mortgage companies whether it has made contact with mortgagors and regarding the condition of mortgaged properties.” Id. at 6, 13 (internal quotation marks omitted). Significantly, Hunte did not address Defendants' argument that he had not plausibly alleged that Safeguard fit within the “enforcement of security interests” prong given that he had failed to claim that it sent him anything via any instrumentality of interstate commerce or the mails, nor did Hunte contend that Safeguard could fit within that prong so long as it used the mails or other instrumentality of interstate commerce in any aspect of its work for Chase, even if not in communicating with Hunte himself. Ibid.

         With the parties' arguments so presented (and not presented), the court held that Hunte had not plausibly alleged that Safeguard was a “debt collector” under § 1692a(6). 2017 WL 5891060, at *6. As to the “collects or attempts to collect … debts” prong, the court reasoned that “Safeguard's signs pertain to the property's being deemed vacant and abandoned; they do not refer to Hunte's mortgage debt, let alone try to collect it.” Id. at *4. The court added that “while the complaint alleges that Safeguard tried to dispossess Hunte of his home, it does not allege or give rise to a reasonable inference that Safeguard was doing so in order to collect a debt on Chase's behalf.” Ibid. As to the “enforcement of security interests” prong, the court reasoned that the complaint's allegations concerning Safeguard's use of the mails or other instrumentalities of interstate commerce bore no relation to its “alleged interactions with Hunte, which occurred exclusively in person.” Id. at *5. The court thus held that Hunte could not clear the plausibility threshold because “the complaint [did] not allege that Safeguard uses the instrumentalities of interstate commerce or the mails in performing” its security interest enforcement services. Ibid. Nor, in light of the exclusively in-person nature of Safeguard's interactions with Hunte, was it “reasonable to infer” that it did so with other debtors. Ibid.

         In so holding, the court noted that it had discussed a closely related issue with Hunte's counsel at a hearing concerning the first amended complaint. Ibid. Specifically, the court had asked Hunte's counsel whether Safeguard communicated with affected homeowners exclusively by posting physical notices on their properties, or also through the mails or instrumentalities of interstate commerce. Id. at *3, *5; Doc. 94 at 5-8. When Hunte's counsel could not say, the court expressed concern that the first amended complaint's allegation that “Safeguard regularly collects or attempts to collect defaulted consumer debts using the mails and telephone” was not properly founded. 2017 WL 5891060, at *3, *5. In light of that concern, counsel sought leave to further amend and file a second amended complaint. Doc. 71.

         Discussion

         Rule 59(e) provides: “A motion to alter or amend a judgment must be filed no later than 28 days after the entry of judgment.” Fed.R.Civ.P. 59(e). “Amendment of the judgment is proper only when ‘the movant presents newly discovered evidence that was not available at the time of trial or if the movant points to evidence in the record that clearly establishes a manifest error of law or fact.'” Stragapede v. City of Evanston, 865 F.3d 861, 868 (7th Cir. 2017) (quoting In re Prince, 85 F.3d 314, 324 (7th Cir. 1996)). “A manifest error occurs when the district court commits a wholesale disregard, misapplication, or failure to recognize controlling precedent.” Ibid. (internal quotation marks omitted). Significant for present purposes, precedent teaches that a Rule 59(e) motion “is not appropriately used to advance arguments or theories that could and should have been made before the district court rendered a judgment, or to present evidence that was available earlier.” LB Credit Corp. v. Resolution Trust Corp., 49 F.3d 1263, 1267 (7th Cir. 1995) (citation omitted). Nor does Rule 59(e) “provide a vehicle for a party to undo its own procedural failures.” Moro v. Shell Oil Co., 91 F.3d 872, 876 (7th Cir. 1996).

         A.Enforcement of Security Interests” Prong of § 1692a(6)

         In seeking reconsideration, Hunte contends that the court made a manifest error of law in holding that Safeguard did not qualify as a “debt collector” under § 1692a(6)'s “enforcement of security interests” prong because Hunte failed to allege that it “use[d] an instrumentality of interstate commerce [or the mails] in the enforcement of security interests.” Doc. 96 at 3. Hunte argues that the statute required him to allege only two things: first, that “Safeguard uses an instrumentality of interstate commerce” in some aspect of its business, and second, that the “principal purpose” of that business “is the enforcement of security interests.” Id. at 3-4.

         As noted, Hunte did not make that argument in opposing Defendants' motions to dismiss the second amended complaint-this despite the court having raised a closely related issue regarding the first amended complaint, in response to which Hunte sought and was given leave to replead. And had Hunte made that argument, it likely would have failed. It is true that the “enforcement of security interests” prong defines a “debt collector” as “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the enforcement of security interests.” 15 U.S.C. § 1692a(6) (emphasis added). It also is true that in interpreting a different though (for present purposes) materially similar prong of § 1692a(6)'s definition of a “debt collector”-“any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, ” ibid.-the Eleventh Circuit broadly held that “a party can qualify as a ‘debt collector' … by using an ‘instrumentality of interstate commerce or the mails' in operating a business that has the principal purpose of collecting debts.” Reese v. Ellis, Painter, Ratterree & Adams, LLP, 678 F.3d 1211, 1218 (11th Cir. 2012) (emphasis added) (quoting 15 U.S.C. § 1692a(6)); see also Anderson v. Bank of Am., N.A., 2014 WL 4631222, at *9 (D. Or. Sept. 12, 2014) (“Anderson also alleges ‘BOA utilizes the means of interstate commerce to conduct its business, ' in part by using ‘the internet, mail, and telephones to conduct business across state lines.' These allegations, when taken as true, establish that BOA uses an ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.