EDMOND E. CHANG, District Judge.
Plaintiffs Gordon and Majolis Swearingen
In deciding this summary judgment motion, the Court views the evidence in the light most favorable to Gordon and Majolis Swearingen. Gordon and Majolis are husband and wife and have been married for ten years. R. 46, Pl.'s Stmt. of Additional Facts (PSOF) ¶ 1. Portfolio is in the business of, among other things, collecting on unpaid, outstanding account balances. R. 41, Def.'s Amended Stmt. of Facts (DSOF) ¶ 5.
Sometime in the 1980s, Majolis incurred two debts whose value currently totals around $10,700. DSOF ¶¶ 1, 2; PSOF ¶¶ 2, 3. Portfolio purchased these debts from the original creditors and, beginning on October 14, 2010, began placing phone calls in an attempt to collect on them. DSOF ¶¶ 3, 25. Portfolio placed its last call to the Swearingens on December 28, 2010. DSOF ¶ 25. Portfolio admits to placing 22 calls during the period between October 14, 2010 and December 28, 2010. DSOF ¶ 25. The Swearingens contend the number of calls placed by Portfolio was "far higher," and totaled at least 32.
Portfolio placed at least some of its calls to the phone number 319-393-4693, which is the home telephone number for Gordon and Majolis.
Gordon admits that he, at times, made false statements to the Portfolio representative, including that he and Majolis had separated, in an effort to convince Portfolio to stop calling. DSOF ¶ 33; PSOF ¶¶ 48. In all the calls it placed, Portfolio was never able to speak with Majolis. DSOF ¶ 26. Gordon also testified to, and Portfolio denies, the following additional facts: Each time Portfolio called Gordon's cell phone, Gordon told the Portfolio representative that they would not be able to reach Majolis on that number, and requested that Portfolio stop calling his cell phone. PSOF ¶¶ 12, 24, 34, 35, 37. Gordon also requested, on numerous occasions, that Portfolio send a letter detailing Majolis's debts. PSOF ¶¶ 14, 20, 25, 38. On around four or five calls Portfolio used an "extremely loud buzzing sound" during the conversation. PSOF ¶ 42. Lastly, Gordon testified that the Portfolio representatives who called threatened to file a lawsuit to collect the debts owed. PSOF ¶¶ 5, 31, 39-41.
Gordon admitted that as the calls continued over the 10-week period, he began to raise his voice and use profanity, and even used a highly offensive racial slur on one occasion.
Summary judgment is proper "if the movant shows that there is no genuine dispute as to any material fact and the
The evidence presented at the summary judgment stage must comport with the Federal Rules of Evidence and be admissible at trial, United States v. 5443 Suffield Terrace, Skokie, Ill., 607 F.3d 504, 510 (7th Cir.2010), or must consist of affidavits or declarations "made on personal knowledge, set[ting] out facts that would be admissible in evidence, and show[ing] that the affiant or declarant is competent to testify on the matters stated." Fed.R.Civ.P. 56(c)(4). A non-movant's own deposition testimony may alone be sufficient to create genuine issues of material fact and defeat a motion for summary judgment if the party's testimony is based on personal knowledge or would otherwise be admissible at trial. See Marr v. Bank of America, N.A., 662 F.3d 963, 968 (7th Cir.2011) ("[U]ncorroborated, self-serving testimony, if based on personal knowledge or firsthand experience, may prevent summary judgment against the non-moving party, as such testimony can be evidence of disputed material facts."). The Court does not assess the credibility of witnesses or weigh evidence, Abdullahi v. City of Madison, 423 F.3d 763, 773 (7th Cir.2005), and will not grant summary judgment if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
"Congress enacted the FDCPA in 1977, 91 Stat. 874, to eliminate abusive debt collection practices, to ensure that debt collectors who abstain from such practices are not competitively disadvantaged, and to promote consistent state action to protect consumers." Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 559 U.S. 573, 130 S.Ct. 1605, 1608, 176 L.Ed.2d 519 (2010). "The primary goal of the FDCPA is to protect consumers from abusive, deceptive, and unfair debt collection practices." Bass v. Stolper, Koritzinsky, Brewster & Neider, SC, 111 F.3d 1322, 1324 (7th Cir.1997); see also Keele v. Wexler, 149 F.3d 589, 594 (7th Cir.1998) ("the FDCPA is designed to protect consumers from the unscrupulous antics of debt collectors, irrespective of whether a valid debt actually exists").
The enforcement provision of the Act imposes liability on "any debt collector who fails to comply with any provision of this title with respect to any person." 15 U.S.C. § 1692k(a) (emphasis added). By its plain language then, the FDCPA provides relief for debtors as well as non-debtors, provided no limitation in scope is stated within the specific provision on which the plaintiff's allegations are based.
The Swearingens have brought claims under 15 U.S.C. § 1692d, which governs harassing, oppressive and abusive conduct by debt collectors, and 15 U.S.C. § 1692e, which governs false, deceptive, and misleading conduct by debt collectors.
Section 1692d of the FDCPA provides that "a debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt." 15 U.S.C. § 1692d. Section 1692d also lists specific conduct that is prohibited, and includes "[c]ausing a telephone to ring or engaging any person in a telephone conversation repeatedly or continuously with intent to annoy, abuse, or harass any person at the called number." § 1692d(5). Courts have phrased the central issue under § 1692d(5) to be whether "the volume and pattern of calls demonstrates an intent to contact debtors rather than an intent to annoy, abuse or harass them." Chavious v. CBE Group, 2012 WL 113509, at *2 (E.D.N.Y. Jan. 13, 2012). Whether a debt collector's telephone calls were made with an "intent to annoy, abuse, or harass" may be inferred from circumstantial evidence. Hendricks v. CBE Group, Inc., 891 F.Supp.2d 892, 895, 2012 WL 1191861, at *3 (N.D.Ill. Apr. 10, 2012); see also Chavious, 2012 WL 113509, at *2; Pratt v. CMRE Financial Services, Inc., 2012 WL 86957, at *3 (E.D.Mo. Jan. 11, 2012). The issue of intent is often a question for the jury. See, e.g., Meadows v. Franklin Collection Service, Inc., 414 Fed.Appx. 230, 233 (11th Cir.2011) ("Ordinarily, whether conduct harasses, oppresses, or abuses will be a question for the jury."); Hendricks, 891 F.Supp.2d at 896, 2012 WL 1191861, at *4 (denying summary judgment on a § 1692d(5) claim, where Court concluded that "reasonable juror[s] could find that [the debt collector] placed calls to [plaintiff] with an intent to annoy, abuse or harass").
The Swearingens have sworn to sufficient facts to defeat a motion for summary judgment on their claims based on Portfolio's harassing phone calls.
In addition, Gordon testified that on numerous occasions he requested that Portfolio provide him with a letter or at least an address for him to write to request that the calls stop, and each time the Portfolio representative refused to provide him with an address. Gordon Dep. at 52:18-53:23, 93:8-15. Gordon's testimony in this respect is corroborated by the audio recording of the December 28, 2010 phone call, wherein Gordon can be heard asking for an address to write to Portfolio, and the Portfolio representative does not respond to the request. R. 46-4, Pl.'s Exh. C (audio file) at 1:05. Finally, Gordon testified that Portfolio used an "extremely loud buzzing sound" in some of the phone calls with him; the December 28 audio file corroborates that the loud buzz is heard during that call. Gordon Dep. at 125:24-126:6; R. 46-4, Pl.'s Exh. C (audio file) at 2:25. Portfolio has not provided any reason for using a buzzing device in its calls other than to harass the recipient of the phone call (again, at the summary judgment stage, the evidence is viewed in Plaintiffs' favor, meaning that we assume that Portfolio indeed employs such a device during its calls).
To the extent the Swearingens state a claim separately under § 1692d alone, they are not required to prove intent — the only question is whether the "natural consequence" of Portfolio's conduct was to "harass, oppress, or abuse" the Swearingens. See Horkey v. J.V.D.B. & Associates, Inc., 333 F.3d 769, 774 (7th Cir.2003) (noting that intent is irrelevant under the other provisions of § 1692d). In this regard, Gordon's testimony about the "extremely loud buzzing sound," confirmed by the recording produced by Portfolio, persuades the Court that a reasonable jury could find that the natural consequence of such a noise device is to harass the call recipient. The Swearingens' claim under § 1692d therefore provides a separate basis for denying Portfolio's motion with regard to the phone calls made to Gordon.
Debt collectors are also prohibited from using "any false, deceptive, or misleading representation or means in connection with the collection of any debt." 15
Id. at 645-46 (internal quotations and citations omitted).
As a preliminary matter, Portfolio argues both that it cannot be liable to Majolis under § 1692e because its representatives never actually spoke to the debtor, R. 33, Def.'s Br. at 10, and that threats made in phone calls answered by Gordon cannot be a basis for liability because Gordon is not the debtor and therefore does not have standing to sue under § 1692e. R. 48, Def.'s Reply Br. at 11. Portfolio cites to Dewey v. Associated Collectors, Inc., 927 F.Supp. 1172 (W.D.Wis.1996) in support of this argument. Because it is a district-court opinion, Dewey is not controlling authority, and also is distinguishable from the current case. Dewey considered allegations brought by a debtor's wife over a collection letter that was neither addressed to nor read by her. Id. at 1174. The district court granted the debt collector's motion to dismiss, but recognized that in some cases non-debtors have standing to sue under the FDCPA, since otherwise "collection agencies would [] escape[] liability because their illegal collection letters never reached the actual debtors." Id. at 1175. This case is exactly what Dewey envisioned — Portfolio's phone calls were always and only answered by Gordon, and Portfolio was never able to speak Majolis herself. DSOF ¶¶ 26, 32.
As explained above, courts have held that non-debtors may recover under the FDCPA, where prohibited conduct was either experienced by or directed toward the non-debtor. See also Garrett v. Empire Cooler Service, Inc., 2004 WL 838032, at *2 (N.D.Ill. Apr. 16, 2004) (non-debtor had standing to sue where debt collection practices were directed towards his property); Flowers v. Accelerated Bureau of Collections, Inc., 1997 WL 136313, at *7-8 (N.D.Ill. Mar. 19, 1997) (debtor's wife had standing to sue where debt collection practices were "both experienced by and direct toward" her). Any other rule would not only violate the purposes of the FDCPA, but would allow debt collectors to escape liability, no matter how egregious their conduct, whenever they were unsuccessful in reaching the debtor himself. Portfolio may be held liable for threats made to Gordon.
The second issue is whether Gordon has created a genuine issue of fact regarding Portfolio's conduct that could lead a reasonable jury to find that Portfolio either "threaten[ed] to take any action that cannot legally be taken or that is not intended to be taken," § 1692e(5), or "use[d] any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer," § 1692e(10). Gordon testified at his deposition as follows:
Gordon Dep. at 88:3-15. Although Portfolio denies that its representatives ever threatened that they were investigating and/or filing a lawsuit, R. 49, Def.'s Resp. PSOF ¶¶ 5, 31, 39-41, the Swearingens have provided enough admissible evidence, through Gordon's deposition testimony and sworn declaration, and in sufficient detail, to create a genuine issue of fact as to whether Portfolio threatened Gordon and Majolis with a debt collection lawsuit. Marr, 662 F.3d at 968 ("[U]ncorroborated, self-serving testimony, if based on personal knowledge or firsthand experience, may prevent summary judgment against the non-moving party, as such testimony can be evidence of disputed material facts."). See also Gordon Dep. at 63:18-64:13, 91:21-92:7, 97:19-22, 106:20-107:6, 108:1-17; Gordon Decl. ¶¶ 4, 11, 15-17.
The final issue this Court must decide is whether threatening to file a lawsuit on the debt in this case would violate either § 1692e(5) or § 1692e(10) of the FDCPA. The Swearingens have argued, and Portfolio has not denied, that Portfolio could not legally take, and did not intend to take, legal action with regard to the debts in this case, given the age of the debts in this case. R. 45, Pl.'s Resp. Br. at 18; R. 48, Def.'s Reply Br. at 5. Courts appear to be in agreement that although mere efforts to collect on a time-barred debt may not be prohibited by the FDCPA, threats to file a lawsuit on a time-barred debt may constitute a violation of § 1692e(5) of the Act. See Freyermuth v. Credit Bureau Servs., Inc., 248 F.3d 767, 771 (8th Cir.2001) (attempting to collect on a time-barred debt does not violate the FDCPA "in the absence of an express threat of litigation") (emphasis added); Murray v. CCB Credit Services, Inc., 04 C 7456, 2004 WL 2943656, at *2 (N.D.Ill. Dec. 15, 2004) ("[A] violation of the FDCPA occurs if the attempt to collect the time-barred debt is accompanied by a threat to sue, or if litigation has actually begun."); Walker v. Cash Flow Consultants, Inc., 200 F.R.D. 613, 616 (N.D.Ill.2001) ("[I]n order to survive a motion to dismiss, a defendant's attempt to collect on a time-barred debt must be accompanied by actual litigation or a threat, either explicit or implicit, of future litigation."); Beattie v. D.M. Collections, Inc., 754 F.Supp. 383, 393 (D.Del.1991) ("[T]hreatening [] a lawsuit which the debt collector knows or should know is unavailable or unwinnable by reason of a legal bar such as the statute of limitations is the kind of abusive practice the FDCPA was intended to eliminate."). Viewing the evidence in the light most favorable to the Swearingens, Portfolio knew it could not and did not intend to file a lawsuit to collect on Majolis's 20-year-old debts, and therefore the Swearingens have raised a genuine issue as to whether Portfolio violated § 1692e(5).
In addition, even if this Court were to find the Swearingens did not raise an issue of material fact as to whether Portfolio's threats constituted a violation of § 1692e(5), the Swearingens have also raised a genuine issue of material fact as to whether such threats by Portfolio constituted a "deceptive means to collect or attempt to collect any debt." 15 U.S.C. § 1692e(10). The Seventh Circuit has noted
Portfolio also moved for attorneys' fees on the basis of 15 U.S.C. § 1692k(a)(3). That section of the FDCPA awards attorneys' fees to defendants only "[o]n a finding by the court that an action under this section was brought in bad faith and for the purpose of harassment." 15 U.S.C. § 1692k(a)(3). Because this Court concludes that the Swearingens have successfully defeated Portfolio's motion for summary judgment, an award of attorneys' fees is not appropriate.
In its reply brief, Portfolio also moves for attorneys' fees under 28 U.S.C. § 1927.
For the reasons stated above, Portfolio's motion for summary judgment [R. 31] is denied. At the upcoming status hearing, the parties should be prepared to address the case schedule moving forward.
