United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
REBECCA R. PALLMEYER United States District Judge.
Lori Clanton brings this case under the Fair Debt Collection
Practices Act, 15 U.S.C. § 1692 eq seq. (the
“FDCPA”), and the Illinois Collection Agency Act,
225 ILCS 425, et seq. (the “ICAA”),
alleging that Defendants Midland Credit Management, Inc.
(“MCM”) and Midland Funding, LLC
(“MF”) submitted false information about
Clanton's debt to a credit reporting agency. The parties
have filed cross-motions for partial summary judgment.
Clanton contends that Defendants' undisputed conduct
violated the FDCPA, and believes that she is therefore
entitled to judgment as a matter of law on the FDCPA claim.
Defendants dispute that their conduct constituted an FDCPA
violation, and further observe that the ICAA does not create
a private right of action. As explained below, the
parties' motions are granted in part and denied in part.
MCM and MF
characterizes itself as a "debt buyer": it
purchases debt, which it then assigns to MCM for servicing
and collection. (Defs.' 56.1  ¶ 49.) MF holds a
collection agency license from the State of Illinois, but
"does not collect on the accounts that it purchases and
owns," and has "no employees or interaction with
any consumers." (Pl.'s 56.1  ¶ 6; Ross
Decl. ¶¶ 4-5, Ex. K to Defs.' 56.1.) A
“Senior Group Manager” at MCM, Sandra Ross, avers
that all consumer-facing activities, such as collection
efforts, are performed by MCM. (Ross Decl. ¶
and particularly its "Consumer Support Services"
department, investigates and responds to consumer disputes
and addresses credit reporting issues. (Defs. 56.1 ¶
26.) MCM's "Consumer Dispute Policy" addresses
identifying, investigating, recording, and responding to
customer disputes. (Id. ¶ 27.) And its
"Credit Bureau Reporting Policy" governs the
process by which MCM relays account information to credit
agencies. (Id. ¶ 28.) MCM provides copies of
these polices to its employees, and trains its employees in
adhering to them. (Id. ¶ 29.)
sample four-month period in 2018, MCM received 152, 844
disputes on approximately 24 million accounts. (Id.
¶ 38.) MCM's Consumer Dispute Policy requires it to
respond to each dispute, and communicate the dispute's
existence to credit agencies, within 30 days. (Id.
¶ 24.) Upon receiving a customer dispute, MCM's
first step is to update its internal records to reflect that
the account is disputed. (Id. ¶ 30.) It
thereafter communicates the fact that an account is disputed
to credit reporting agencies through a bi-monthly process
hereinafter referred to as the "Credit Reporting
Cycle." (Id. ¶¶ 19-20, 33, 35.)
initiates a Credit Reporting Cycle twice each month, on the
Monday following the first and third Sunday of the month.
(Id. ¶ 19-20.) The process begins in the
morning, when MCM automatically pulls data from its accounts,
creates a list of accounts to be reported, and then adds a
code to each disputed account to mark that they are, indeed,
disputed. (Id. ¶ 19.) Once this process is
complete, the list becomes, in MCM's characterization,
"finalized." (Id.) After this step, but
before MCM forwards the list to credit agencies, MCM executes
"quality control checks" to ensure the data is
accurate and free of duplicates. (Id. ¶ 21.)
Then, on Friday of the same week, MCM sends the list to three
major credit reporting agencies. (Id. ¶¶
22, 35.) A typical list includes over 6 million unique
accounts, not all of which are disputed. (Id.
2016, Plaintiff Lori Clanton made purchases on a credit card
issued by Synchrony Bank ("Synchrony"). (Defs.'
56.1 ¶ 1.) Clanton missed payments on the card and, in
doing so, incurred some amount of debt to Synchrony.
(Id. ¶ 5.) On August 28, 2017, Clanton entered
into a payment plan with MF to pay off this debt.
(Id. ¶ 6.) The rights to Clanton's debt
were assigned to MF, and her account was referred to MCM for
servicing. (Defs.' Resp. Pl.'s 56.1  ¶
10.)MF never contacted Clanton itself, and
there is no evidence it ever reported information about
Clanton's account to credit agencies. (Defs.' 56.1
point after entering into the payment plan, Clanton retained
counsel. (Defs.' 56.1 ¶ 10.) On Friday, November 17,
2017, Clanton's lawyers faxed MCM a letter stating, in
part, that "the debt reported on [Clanton's] credit
report is not accurate." (Id.; Pl.'s 56.1
¶ 14.) The following Wednesday, November 22, 2017, MCM
processed Clanton's letter and updated its system to
reflect that Clanton's debt was disputed.
(Defs.' 56.1 ¶¶ 18, 50.) This day fell in
the middle of a Credit Reporting Cycle-two days after MCM had
finalized a list, but two days before it sent that list to
credit bureaus. (Id. ¶ 22.) MCM did not
immediately update the list to reflect Clanton's dispute.
(Id.) And on Monday, November 27, 2017, MCM
communicated information regarding Clanton's alleged debt
to TransUnion, a consumer reporting agency, without relaying
that the debt was disputed. (Pl.'s 56.1 ¶¶
16-17.) As of December 2, 2017, Clanton's TransUnion
credit report still did not reflect that she disputed her
debt. (Id. ¶ 17.) It was not until the end of
the following reporting cycle, on Friday, December 8, 2017,
that MCM first reported to credit bureaus that Clanton's
account was disputed. (Defs.' 56.1 ¶ 23.) By this
point, three weeks had passed since Clanton faxed in her
declaration, Clanton states that as a result of the error in
her TransUnion credit report, she has "suffered stress,
aggravation, confusion and humiliation." (Clanton Decl.
¶ 8, Ex. B to Pl.'s 56.1.) When asked at her
deposition, however, what MCM and MF did that made her
"feel harmed," Clanton responded only that MCM and
MF had communicated inaccurate information to her over the
phone, without specifying what information was inaccurate.
(Defs.' 56.1 ¶ 17; Pl.'s Dep. at 69-70,
Ex. B to Defs.' 56.1.) She described her emotional
distress as "stress” and a “short temper,
” which she has been experiencing for “a couple
of years." (Pl.'s Dep. at 71-72.) Clanton testified
that other debt collection activity, unrelated to MF and MCM,
caused her to experience a short temper, as well, and stated
that she could not explain the difference in stress she
experienced in this case as compared to other cases.
(Id. at 71-73.) No. other witness has corroborated
Clanton's claim that she suffered actual damages, and it
is undisputed that Clanton did not seek treatment for
emotional distress in 2017. (Defs.' 56.1 ¶¶
Facts Related to Unclean Hands Defense
have raised the defense of "unclean hands," and
offer, as support, evidence of the conduct of Clanton's
lawyers-specifically, their communications, on Clanton's
behalf, of which she had no apparent knowledge: With regard
to the dispute letter sent to MCM in November 2017, Clanton
testified at her September 2018 deposition that she had not
previously seen the letter, and did not know why her lawyers
sent it. (Defs.' 56.1 ¶¶ 11-12.) Although
Clanton has disputed accounts with three other debt
collectors, during her deposition she did not remember when
she disputed one of the accounts, and did not remember the
second dispute at all. (Id. ¶ 61-62.)
Clanton's lawyers sent identical dispute letters to MCM
on behalf of 23 other individuals during a 10-month stretch
of time, in each instance leading to a lawsuit. (Id.
¶ 16.) Clanton did not send a similar letter to
Synchrony or to any credit bureau. (Id. ¶ 9.)
asked why she filed this lawsuit, Clanton testified only that
she was following her attorney's advice. (Pl.'s Dep.
at 26.) When asked what she hoped to achieve by filing the
lawsuit, Clanton testified, "I don't know,"
then clarified that she hoped her lawyers would "have
this rectified." (Id. at 27-28.) As of the date
of her deposition, Clanton was not aware that her debt with
MCM was ultimately marked disputed on December 8, 2017.
(Defs.' 56.1 ¶ 14.)
December 8, 2017, Clanton filed a Complaint  in this
court, alleging that Defendants violated the FDCPA and the
ICAA. The Complaint requests actual damages pursuant to 15
U.S.C. § 1692k(a)(1), statutory damages pursuant to 15
U.S.C. § 1692k(a)(2), costs and reasonable
attorneys' fees pursuant to 15 U.S.C. § 1692k(A)(3),
and similar damages under the ICAA. (Complaint 
¶¶ 39, 41.) Neither of the Defendants moved to
dismiss, and the parties proceeded with discovery. On October
29, 2018, Clanton moved for summary judgment  on her
FDCPA claim, arguing that Defendants' undisputed conduct
amounted to an FDCPA violation. On December 17, 2017,
Defendants responded with their own, joint motion for summary
judgment  on Clanton's FDCPA claim, arguing that
MF's conduct is not governed by the FDCPA, that MCM's
conduct does not amount to an ...