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.

Horia v. Nationwide Credit And Collection, Inc.

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

July 31, 2018

HENRY HORIA, Plaintiff,
v.
NATIONWIDE CREDIT AND COLLECTION, INC., Defendant.

          MEMORANDUM OPINION AND ORDER

          Andrea R. Wood United States District Judge

         Plaintiff Henry Horia has sued Defendant Nationwide Credit and Collection, Inc. (“Nationwide”) alleging violations of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692, et seq., and the Illinois Collection Agency Act (“ICAA”), 225 ILCS 425, et seq. Now before the Court is Nationwide's motion to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (Dkt. No. 13.) In its motion, Nationwide argues that Horia's claims are barred under the doctrine of res judicata. For the reasons that follow, the Court agrees and Nationwide's motion is thus granted.

         BACKGROUND

         For purposes of the instant motion, the Court accepts the facts alleged in the complaint as true and draws all inferences in Horia's favor. See Carlson v. CSX Transp., Inc., 758 F.3d 819, 826 (7th Cir. 2014).

         According to the complaint, Horia failed to pay a debt that he allegedly owed to Gottlieb Memorial Hospital and his account was placed with Nationwide for collection. (Compl. ¶¶ 10-12, Dkt. No. 1.) Sometime later, Horia consulted with attorneys at Community Lawyers Group (“CLG”) regarding his debt. (Id. ¶ 13.) And on July 21, 2017, CLG sent a letter to Nationwide indicating that Horia disputed the accuracy of the reported debt. (Id. ¶¶ 13-15.) Horia then obtained his credit report from Experian consumer credit reporting agency to verify that Nationwide had in fact reported that the debt was disputed. (Id. ¶ 17.) While the report showed that in August 2017 Nationwide communicated information regarding Horia's debt to Experian, Nationwide failed to disclose that the debt was disputed. (Id. ¶¶ 18, 19.) Horia alleges that this failure resulted in Experian materially lowering his credit score and caused him emotional distress. (Id. ¶¶ 25, 31.) Horia claims that, by failing to disclose the dispute to Experian, Nationwide has violated § 1692e(8) of the FDCPA (Count I), and the ICAA, 225 ILCS 425/9 (Count II). (Id. ¶¶ 34, 36.)

         This is not Horia's first lawsuit against Nationwide. In his prior suit, Horia v. Nationwide Credit & Collection, Inc., No. 17-cv-06103 (N.D. Ill.) (“Horia I”), [1] Horia alleged that Nationwide violated the exact same provisions of the FDCPA and the ICAA as in the present case, but the earlier suit concerned a debt owed to a different hospital (“Horia I debt”). (See Compl. ¶¶ 10, 34, 36, Horia v. Nationwide Credit & Collection, Inc., No. 17-cv-06103, Dkt. No. 1.) As alleged in Horia I, CLG sent a letter to Nationwide regarding the disputed debt. (Id. ¶¶ 13-15.) The letter was sent on the same day as and was identical to the letter in the present case, except that it referenced the Horia I debt. (Compare Ex. C to Compl., Horia v. Nationwide Credit & Collection, Inc., No. 17-cv-06103, Dkt. No. 1-1, with Ex. C to Compl., Dkt. No. 1-1.) As also alleged in the present case, Horia then obtained his credit report from Experian and found out that in August 2017 Nationwide failed to disclose the disputed nature of the Horia I debt. (Compl. ¶¶ 17-19, Horia v. Nationwide Credit & Collection, Inc., No. 17-cv-06103, Dkt. No. 1.)

         Horia claimed that Nationwide's failure lowered his credit score and caused him emotional distress. (Id. ¶¶ 25, 31.) Horia I ultimately was dismissed with prejudice pursuant to a settlement agreement between the parties 16 days before the complaint in the present case was filed. (Nov. 1, 2017 Minute Entry, Horia v. Nationwide Credit & Collection, Inc., No. 17-cv-06103, Dkt. No. 15.)

         In light of the dismissal with prejudice of Horia I, Nationwide now moves to dismiss the present case on the basis that Horia has engaged in impermissible claim-splitting by bringing the two suits separately. Nationwide argues that by splitting his claims, Horia is attempting to circumvent the $1, 000 limit on statutory damages for an FDCPA action and allow CLG to recover attorney's fees twice. See 15 U.S.C. §§ 1692k(a)(2)(A), (a)(3).

         DISCUSSION

         “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim for relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).[2] Facts that are “merely consistent with” a defendant's liability and conclusory statements are, by themselves, insufficient. Id. (quoting Twombly, 550 U.S. at 557). Instead, a claim may be considered plausible when “the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Adams v. City of Indianapolis, 742 F.3d 720, 728 (7th Cir. 2014) (quoting Iqbal, 556 U.S. at 678).

         Nationwide argues that Horia's FDCPA claim should be dismissed because it is an attempt at claim-splitting, which is prohibited under the doctrine of res judicata. Res judicata “promotes predictability in the judicial process, preserves the limited resources of the judiciary, and protects litigants from the expense and disruption of being haled into court repeatedly.” Palka v. City of Chicago, 662 F.3d 428, 437 (7th Cir. 2011). When it applies, the doctrine precludes the subsequent litigation of claims that were raised or could have been raised in a prior action. Barr v. Bd. of Tr. of W. Ill. Univ., 796 F.3d 837, 839 (7th Cir. 2015). Res judicata “blocks a second lawsuit if there is (1) an identity of the parties in the two suits; (2) a final judgment on the merits in the first; and (3) an identity of the causes of action.” Id. at 840 (citing Palka, 662 F.3d at 437).

         The first element of res judicata is satisfied here because the parties are identical in Horia I and the present suit. The second element is also met, as a dismissal with prejudice pursuant to a settlement agreement is a final judgment on the merits. See Brooks-Ngwenya v. Indianapolis Pub. Sch., 564 F.3d 804, 808-09 (7th Cir. 2009). However, the parties dispute whether the third element is satisfied. Nationwide argues that due to the similarities between Horia I and the present case, the causes of action in the two cases are the same. Horia, on the other hand, contends that res judicata does not apply because the two cases concern two different debts.

         To determine whether an identity of the cause of action exists, federal courts apply the “same transaction” test. See Czarniecki v. City of Chicago, 633 F.3d 545, 548 & n.3 (7th Cir. 2011). The test is fact-oriented-“[t]wo claims are one for purposes of res judicata if they are based on the same, or nearly the same, factual allegations.” Id. at 550 (quoting Brzostowski v. Laidlaw Waste Sys., Inc., 49 F.3d 337, 339 (7th Cir. 1995)). In other words, “[w]hether there is an identity of the cause of action depends on whether the claims comprise the same core of operative facts that give rise to a remedy.” Adams, 742 F.3d at 736 (internal quotation marks omitted). And “[o]nce a transaction has caused [an] injury, all claims arising from that transaction must be brought in one suit or be lost.” Car Carriers, Inc. v. Ford Motor Co., 789 F.2d 589, 593 (7th Cir. 1986).

         In the present case, Horia has brought his FDCPA claim under the provision of that statute that prohibits debt collectors from using “any false, deceptive, or misleading representation or means in connection with the collection of any debt, ” which includes “[c]ommunicating or threatening to communicate to any person credit information which is known or which should be known to be false, including the failure to communicate that a disputed debt is disputed.” 15 U.S.C. § 1692e(8) (emphasis added). Horia's FDCPA claim in Horia I was brought under the same provision. In both Horia I and the present case, Horia has disputed a debt held by debt collector Nationwide. In both cases, Nationwide allegedly knew or should have known that the debts at issue were disputed because Horia sent almost identical letters to Nationwide on July 21, 2017 to notify it of the disputed debts. In both cases, Horia obtained his Experian credit report and found out that the debts were not reported as being disputed.[3] Horia concluded in both cases that Nationwide had failed to communicate the disputed nature of his debts to Experian. And he alleges, in ...


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.