DocketNumber: Case No. 8:17-cv-00566-T-02TGW
Citation Numbers: 347 F. Supp. 3d 1039
Judges: Jung
Filed Date: 11/5/2018
Status: Precedential
Modified Date: 7/25/2022
This matter comes to the Court on Defendant Servis One, Inc.'s ("BSI") Motion to Dismiss Plaintiff's Second Amended Complaint With Prejudice. Dkt. 29. Following this Court's order on a prior motion to dismiss, BSI is the only remaining defendant. Dkt. 23. Plaintiff has filed a response in opposition to the instant motion. Dkt. 35. The Court hereby GRANTS in part BSI's Motion to Dismiss.
BACKGROUND
The Court outlined this case's factual and procedural background in its Order on a prior motion to dismiss. Dkt. 23 at 1-3. Essentially, Plaintiff brought claims in federal court following entry of a Florida state court judgment for foreclosure on a mortgage. Id. Finding that some of these claims were inextricably intertwined with the state court's foreclosure judgment and that Plaintiff had an opportunity to raise them in the prior proceeding, the Court dismissed with prejudice claims relating to the validity of the debt under the Rooker -*1042Feldman doctrine.
In response, Plaintiff filed her Second Amended Complaint (the "Complaint") alleging debt collection practices in violation of the Fair Debt Collection Practices Act,
Plaintiff attached to her Complaint two examples of the communications at issue. Dkt. 24 at 8, 10. One is a letter from BSI titled "Mortgage Statement" and dated July 18, 2016.
The second attached document is a Form 1099-C Cancellation of Debt that lists BSI as the creditor and an "[a]mount of debt discharged" of $354,354.47. Dkt. 24 at 10. Plaintiff contends that this was misleading and a false representation of the legal status of the debt because, first, no money is owed to BSI, and second, McCormick 106, LLC continued to "pursue [Plaintiff] for a personal judgment for a deficiency judgment on the note in August of 2017." Dkt. 24 ¶ ¶ 19-20. She further argues the document is "false or misleads [Plaintiff] that the document was a document authorized [or] issued by the United States or creates a false impression as to its source, authorization, or approval."
LEGAL STANDARD
To survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead sufficient facts to state a claim that is "plausible on its face." Ashcroft v. Iqbal,
Courts should limit their "consideration to the well-pleaded factual allegations, documents central to or referenced in the complaint, and matters judicially noticed." La Grasta v. First Union Sec., Inc. ,
DISCUSSION
The FDCPA prohibits a "debt collector" from using a "false, deceptive, or misleading representation or means in connection with the collection of any debt." 15 U.S.C. § 1692e. This includes falsely representing the amount or legal status of a debt, § 1692e(2)(A), threatening to take an unlawful action, § 1692e(5), distributing a written communication which simulates or is falsely represented to be a document authorized by an official source, § 1692e(9), or using false or deceptive means to collect a debt, § 1692e(10).
BSI first argues that res judicata and Rooker - Feldman bar Plaintiff's claims. Dkt. 29. Even if the claims are not barred, BSI contends its conduct does not constitute "debt collection" and the FDCPA and FCCPA therefore do not apply.
Though Plaintiff's claims are not barred by res judicata or Rooker - Feldman , the conduct alleged is not debt collection under the FDCPA and FCCPA. As such, because all of Plaintiff's claims are premised on violations of the FDCPA and FCCPA, dismissal is appropriate.
I. Res judicata does not bar Plaintiff's claims.
"Res judicata bars the filing of claims which were raised or could have been raised in an earlier proceeding." Ragsdale v. Rubbermaid, Inc.,
BSI argues that Plaintiff could have raised these arguments at the state proceeding. Indeed, Plaintiff included the purported mortgage statement (but not the 1099-C) in her motion to vacate the judgment of foreclosure and demand for evidentiary hearing. Dkt. 29 at 41.
Even assuming the court denied the motion on the merits, res judicata does not preclude claims "which arise after the original pleading is filed in the earlier litigation. Instead...claims that 'could have been brought' are claims in existence at the time the original complaint is filed or claims actually asserted...in the earlier action." In re Piper Aircraft Corp.,
*1044II. Rooker-Feldman does not bar Plaintiff's claims.
Similarly, Rooker - Feldman does not bar Plaintiff's claims because Plaintiff's claims are independent from the state court judgment. To bar claims under Rooker - Feldman , the claim must be "inextricably intertwined" with a state court decision, meaning that (1) "the success of the federal claim would 'effectively nullify' the state court judgment"; or (2) "the federal claim would succeed 'only to the extent that the state court wrongly decided the issues.' " Alvarez v. Attorney Gen. for Fla. ,
The Court has already determined that Rooker - Feldman does not bar claims based on alleged debt collection activity following entry of the state court judgment, only claims that seek to dispute the debt. This is because a court could find that the judgment was valid but attempts to collect the judgment nonetheless unlawful; such a finding would not nullify or contravene the underlying state court decision. BSI raises no new arguments in this regard. Dkt. 29 at 5-6; see also Target Media Partners v. Specialty Mktg. Corp. ,
III. BSI's alleged conduct does not constitute debt collection.
Plaintiff's only claims allege violations of the FDCPA and FCCPA. "[T]o state a plausible FDCPA claim under § 1692e, a plaintiff must allege, among other things, (1) that the defendant is a debt collector and (2) that the challenged conduct is related to debt collection." Reese v. Ellis, Painter, Ratterree & Adams, LLP ,
"[T]he Eleventh Circuit has not established a bright-line rule" as to what qualifies as "in connection with the collection of any debt." Dyer v. Select Portfolio Servicing, Inc. ,
Based on the allegations in Plaintiff's Complaint, including the attached documents, the Court finds as a matter of law *1045that BSI's conduct was not related to debt collection under the FDCPA or FCCPA.
1. The July 18, 2016 letter was a mortgage statement and not debt collection.
The Federal Truth in Lending Act ("TILA") Regulation Z requires BSI, a servicer, to send monthly mortgage statements.
The Consumer Financial Protection Bureau (the "CFPB") has issued a bulletin providing that a "servicer acting as a debt collector would not be liable under the FDCPA for complying with [monthly mortgage statement] requirements." Implementation Guidance for Certain Mortgage Servicing Rules, 10152013 CFPBGUIDANCE,
This contrasts with communications using language that falls outside the realm of TILA or "debt collection language." This might include, for example, increasingly severe language, Kelliher ,
*1046Caceres v. McCalla Raymer, LLC ,
But here BSI's letter simply contains the amount due, payment due date, and delinquency information, all in conformity with TILA requirements.
In Jackson , the court found the addition of a payment coupon to be a "significant" deviation from the CTFB bulletin.
The statements in France , meanwhile, included an incorrectly charged late fee if the amount was not paid by a specific date. France ,
In short, the Court finds that the July 18, 2016 letter, virtually a carbon copy of the sample form provided by Regulation Z, does not constitute debt collection.
2. BSI's filing of the 1099-C was not debt collection.
Plaintiff does not seem to argue that BSI's filing and delivery of the 1099-C itself constitutes collection activity. She instead alleges the 1099-C represents a discrete violation of the FDCPA should the Court find BSI engaged in debt collection. In any event, the Court finds that nothing on the face of the 1099-C nor implicit in its filing suggests debt collection.
While most caselaw about the 1099-C concerns whether it can single-handedly extinguish a debt, see Ware v. Bank of Am. Corp. ,
Here, there is similarly no indication that BSI's 1099-C was filed in connection with the collection of a debt. While the Court need not reach Plaintiff's underlying claim about the misleading nature of the 1099-C, it does note that both the above case law and Internal Revenue Service opinion suggest that a 1099-C does not by itself extinguish debt or even preclude a creditor from pursuing collection. In re Zilka ,
Even when weighed together, the two documents and Plaintiff's allegations are insufficient for the Court to find that BSI was engaged in debt collection. As a result, the FDCPA and FCCPA, including the provision requiring a debt collector to send documents to a debtor's counsel, do not apply.
In her Complaint, Plaintiff does allude to additional written communications that might evidence debt collection. The Court therefore grants Plaintiff leave of twenty days (20) to amend her Complaint, if possible and consistent with the foregoing, to include any such information.
CONCLUSION
Based on the foregoing, it is hereby ORDERED AND ADJUDGED as follows:
I. Defendant BSI's Motion to Dismiss (Dkt. 29) is GRANTED in part;
II. Plaintiff's Second Amended Complaint is DISMISSED with leave to amend . Plaintiff may file a Second Amended Complaint within twenty (20) days of the entry of this Order. In the absence of timely amendment, dismissal will be with prejudice without any further action of the Court.
DONE AND ORDERED at Tampa, Florida, on November 5, 2018.
The Rooker - Feldman doctrine originates from a pair of cases decided by the U.S. Supreme Court, Rooker v. Fid. Tr. Co. ,
There does seem to be a factual dispute about whether Plaintiff included the 1099-C in her motion to vacate the state court judgment. While Defendant claims she did, Dkt. 29 at 5, the document is not attached in the exhibit and in her Complaint Plaintiff seems to assert she received the 1099-C in February 2017, long after the filing of the motion, Dkt. 24 at 4. In any event, the dispute is moot. It is also irrelevant in determining whether BSI's activity constitutes "debt collection" as discussed below.
Though Plaintiff argues that fact-finding is necessary to determine whether the written communications are related to debt collection, she cites to no case for this proposition. Indeed, cases resolved at the 12(b)(6) stage outnumber by a wide margin cases where courts saw the need to develop the factual record. Florida courts have proceeded similarly. See, e.g. , Vanecek v. Discover Fin. Servs., LLC , No. COCE14023621,
The bulletin does not specify whether senders are not liable under the FDCPA because statements sent pursuant to Regulation Z are not "debt collection" as contemplated by the statute or for a separate reason. The court in Brown took the former approach. See also Green v. Specialized Loan Servicing LLC ,
The court also observed that if the 1099-C did contain false information, the claimant could "dispute the amount of cancelled debt with the Internal Revenue Service to reduce his unwanted tax liability, or bring suit against [the collector] under alternative provisions of law." Id. at 582 (citations omitted).