Roth v. Nationstar Mortgage, LLC
Filing
20
OPINION AND ORDER denying 12 Nationstar's Motion to Dismiss for Failure to State a Claim. Signed by Judge John E. Steele on 7/1/2016. (KP)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
ARLENE ROTH,
Plaintiff,
v.
Case No: 2:15-cv-783-FtM-29MRM
NATIONSTAR MORTGAGE, LLC,
Defendant.
OPINION AND ORDER
This matter comes before the Court on Defendant Nationstar's
Motion to Dismiss for Failure to State a Claim (Doc. #12) filed on
January 19, 2016.
Plaintiff filed a Response (Doc. #16) on
February 22, 2016.
For the reasons stated below, Nationstar’s
Motion to Dismiss is denied.
I.
On December 14, 2015, Plaintiff Arlene Roth (Plaintiff) filed
a five-count Complaint (Doc. #1) against Defendant Nationstar
Mortgage,
LLC
559.72(9)
of
(FCCPA),
Fla.
(Nationstar)
the
Florida
Stat.
§
alleging
Consumer
559.55
et
violations
Collection
seq.,
of
Section
Practices
Sections
Act
1692e(2)(A),
1692e(10), and 1692f of the Fair Debt Collection Practices Act
(FDCPA), 15 U.S.C. § 1692 et seq., and a private settlement
agreement.
The claims are based on a communication Nationstar
sent Plaintiff on November 18, 2015 (the Informational Statement
or Statement) (Doc. #1-5), which Plaintiff alleges was sent for
the improper purpose of collecting on a mortgage debt for which
her
personal
liability
had
been
discharged
in
bankruptcy.
Plaintiff also argues that, by mailing the Statement directly to
her, rather than to her attorney, Nationstar materially breached
a settlement agreement from the parties’ previous lawsuit, also
alleging improper attempts to collect on the mortgage debt. 1
Nationstar’s Motion to Dismiss for Failure to State a Claim
(Motion to Dismiss) contends that all claims should be dismissed
because: 1) Plaintiff cannot state a claim under either the FCCPA
or the FDCPA since, as a matter of law, the Informational Statement
does
not
constitute
purposes;
2)
a
Section
communication
524
of
the
sent
for
Bankruptcy
debt-collection
Code
preempts
Plaintiff’s statutory claims; and 3) the Truth in Lending Act
(TILA) also preempts Plaintiff’s claims.
In
Response,
Plaintiff
argues
that
applicable
case
law
adequately supports her claim that the Informational Statement was
sent for debt-collection purposes.
2
She contends further that
Nationstar’s preemption arguments have been rejected by numerous
1
Plaintiff claims that Nationstar has a history of sending her
these types of statements post-bankruptcy. (Doc. #1, ¶¶ 13, 16.)
2
Specifically, the Complaint alleges that the Informational
Statement is an attempt to collect a debt because it “includes an
amount due, a payment due date, and most notably, a tear-off
[payment] coupon.” (Id. ¶ 20.)
- 2 -
district courts and circuit courts of appeals.
Finally, she
claims that she has sufficiently pled her breach of contract claim.
II.
Federal Rule of Civil Procedure 8(a) requires a complaint to
contain a “short and plain statement of the claim showing that the
pleader is entitled to relief.”
Fed. R. Civ. P. 8(a)(2).
In
evaluating a Rule 12(b)(6) motion seeking to dismiss a complaint
for failing to comply with Rule 8(a), the Court must accept as
true all factual allegations in the complaint and “construe them
in the light most favorable to the plaintiff.”
Baloco ex rel.
Tapia v. Drummond Co., 640 F.3d 1338, 1345 (11th Cir. 2011).
However,
mere
“[l]egal
conclusions
without
adequate
support are entitled to no assumption of truth.”
factual
Mamani v.
Berzain, 654 F.3d 1148, 1153 (11th Cir. 2011) (citations omitted).
To avoid dismissal under Rule 12(b)(6), the complaint must
contain sufficient factual allegations to “raise a right to relief
above the speculative level.”
U.S. 544, 555 (2007).
Bell Atl. Corp. v. Twombly, 550
To do so requires “enough facts to state a
claim to relief that is plausible on its face.”
Id. at 570.
This
plausibility pleading obligation demands “more than labels and
conclusions, and a formulaic recitation of the elements of a cause
of action will not do.”
Id. at 555 (citation omitted); see also
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (“Threadbare recitals
of the elements of a cause of action, supported by mere conclusory
- 3 -
statements, do not suffice.”); Chaparro v. Carnival Corp., 693
F.3d 1333, 1337 (11th Cir. 2012) (“Factual allegations that are
merely consistent with a defendant’s liability fall short of being
facially plausible.” (citation omitted)).
Instead, the complaint
must contain enough factual allegations as to the material elements
of each claim to permit the Court to determine - or at least infer
- that those elements are satisfied, or, in layman’s terms, that
the
plaintiff
has
suffered
a
redressable
harm
for
which
the
defendant may be liable.
III.
A.
Plaintiff’s FDCPA Claims (Counts II-IV)
The
FDCPA
seeks
“to
eliminate
practices by debt collectors.”
abusive
debt
15 U.S.C.A. § 1692.
collection
To that end,
debt collectors are prohibited, inter alia, from using "any false,
deceptive, or misleading representation or means in connection
with the collection of any debt,” 15 U.S.C. § 1692e, and from
employing “unfair or unconscionable means to collect or attempt to
collect any debt.”
Id. § 1692f.
“A demand for immediate payment
while a debtor is in bankruptcy (or after the debt's discharge) is
‘false’ in the sense that it asserts that money is due, although,
because of the . . .
is not.”
2004).
discharge injunction (11 U.S.C. § 524), it
Randolph v. IMBS, Inc., 368 F.3d 726, 728 (7th Cir.
A post-discharge demand for payment is thus “presumptively
wrongful under the [FDCPA].”
Id.
- 4 -
Plaintiff contends that Nationstar violated the FDCPA when it
sent the Informational Statement in an attempt to collect on a
debt it knew had already been discharged in Plaintiff’s bankruptcy
proceeding.
“[I]n order to state a plausible FDCPA claim under §
1692e[ and 1692f,] 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, 678 F.3d 1211, 1216 (11th
Cir. 2012).
Although Nationstar does not concede that it is a
“debt collector” under the FDCPA and reserves the right to later
contest that characterization, the issue currently before this
Court
is
whether
the
Complaint
adequately
alleges
that
the
Informational Statement is “related to debt collection.” 3
Not
all
communications
that
a
creditor
sends
a
debtor
regarding a discharged debt are “related to debt collection.”
Although the FDCPA does not expressly set forth what constitutes
collection-related activity, the Eleventh Circuit has held that
“if a communication conveys information about a debt and its aim
is at least in part to induce the debtor to pay, it falls within
3
In other words, the question is whether the Informational
Statement constitutes a “dunning letter.” See LeBlanc v. Unifund
CCR Partners, 601 F.3d 1185, 1189 n.7 (11th Cir. 2010) (per curiam)
(“Since ‘dunning’ means ‘to make persistent demands upon [another]
for payment,’ a ‘dunning letter’ may be considered as simply
another name for a letter of collection.” (alteration in original)
(citation omitted)).
- 5 -
the scope of the Act.”
Caceres v. McCalla Raymer, LLC, 755 F.3d
1299, 1302 (11th Cir. 2014) (citing Romea v. Heiberger & Assocs.,
163
F.3d
111,
116
(2d
Cir.
1998)).
Stated
differently,
a
communication comes within the purview of the FDCPA where it is
made with “an animating purpose of . . . induc[ing] payment by the
debtor.”
Dyer v. Select Portfolio Servicing, Inc., 108 F. Supp.
3d 1278, 1281 (M.D. Fla. 2015) (quoting Grden v. Leikin Ingber &
Winters PC, 643 F.3d 169, 173 (6th Cir. 2011) (citations omitted)).
The issue of whether a particular communication’s animating
purpose is to induce a debtor to pay is determined through the
eyes of the “least sophisticated consumer.” 4
See Caceres, 755
F.3d at 1303; LeBlanc, 601 F.3d at 1193, 1201.
In making this
determination, the district court must “look to the language of
the [communication] in question, specifically to statements that
demand payment[ and] discuss additional fees if payment is not
tendered.”
Pinson v. Albertelli Law Partners LLC, 618 F. App'x
551, 553 (11th Cir. 2015) (per curiam) (citations omitted).
key
question
is
whether
“the
least
sophisticated
The
consumer,”
reading such language in its entirety, would believe that the
sender was attempting to induce payment on a debt.
4
Nevertheless, “[c]ourts have interpreted the least sophisticated
consumer standard in a way that protects debt collectors from
liability for unreasonable misinterpretations.”
Tucker v. CBE
Grp., Inc., 710 F. Supp. 2d 1301, 1305 (M.D. Fla. 2010).
- 6 -
“Obviously communications that expressly demand payment will
almost
certainly
payment
by
omitted).
the
have
[an
debtor.”
animating]
purpose”
of
Grden,
F.3d
173
643
at
“induc[ing]
(citations
A demand for payment can also be implicitly made.
Pinson, 618 F. App'x at 553-54; see also Gburek v. Litton Loan
Servicing LP, 614 F.3d 380, 385 (7th Cir. 2010) (“[T]he absence of
a demand for payment is just one of several factors that come into
play in the commonsense inquiry of whether a communication from a
debt collector is made in connection with the collection of any
debt.”).
In determining whether a communication seeks to induce
payment by way of an implicit demand, courts consider, among other
factors, whether the communication “states the amount of the debt,
describes how the debt may be paid, [and] provides the phone number
and address to [which to] send payment.”
Pinson, 618 F. App'x at
553; see also Dyer, 108 F. Supp. 3d at 1282 (granting motion to
dismiss where “none of the letters discussed specifics of the
underlying debt, such as the terms of payment or deadlines”).
Turning to the Informational Statement at issue, the Court is
convinced
that
the
Complaint
sufficiently
alleges
Statement constitutes an attempt to collect a debt.
5
that
the
Viewing the
cumulative effect of the Statement’s language from the perspective
5
The Court acknowledges that the Bankruptcy Judge presiding over
the parties’ related bankruptcy action orally ruled that the
Informational Statement was not an attempt to collect a debt.
(Doc. #18-1.)
- 7 -
of the least sophisticated consumer, it is in fact difficult to
conceive
of
any
credible
reason
for
Nationstar
to
send
the
Informational Statement other than to pressure Plaintiff into
making
payments
on
the
mortgage
debt
for
liability had already been discharged. 6
which
her
personal
It is true that the
Informational Statement does not expressly state that it is “a
communication sent for the purpose of collecting a debt.”
as just discussed, this absence is not dispositive.
But,
The Statement
lists the total amount due, contains a payment due date, states
that a late fee will be charged for an untimely payment, gives six
possible payment methods, and separates out from the total amount
due the amount of fees and charges previously assessed.
not all.
advising
balance,”
That is
The Statement contains an “Important Messages” box
Plaintiff
and
that
expressly
her
“escrow
account
“recommend[ing
she]
has
make
a
negative
additional
payments” to avoid “an increase in [her] monthly escrow payment.” 7
6
Even if Nationstar did aim to provide Plaintiff with information,
the Statement may also be seen as an attempt to collect a debt.
Pinson, 618 F. App'x at 553; see also Caceres, 755 F.3d at 1302
(“[A] communication can have more than one purpose.”).
7
That the Statement alludes to “repercussions if payment [i]s not
tendered” substantially undercuts Nationstar’s argument that the
Statement was only intended to provide information. Pinson, 618
F. App'x at 554; see also Goodson v. Bank of Am., N.A., 600 F.
App'x 422, 431 (6th Cir. 2015) (courts should consider whether the
communication “threaten[s] consequences” for non-payment).
- 8 -
There is also a detachable “payment coupon,” which states the total
amount due and recalculates the amount due for a late payment. 8
The Court’s conclusion is amply supported by case law.
The
Pinson court determined that two letters “contained an implicit
demand for payment, because they stated the amount of the debt,
described how the debt could be paid, and informed [the plaintiff]
how he could tender payment.”
618 F. App'x at 554.
In Leahy-
Fernandez v. Bayview Loan Servicing, LLC, mortgage statements were
deemed communications sent in an attempt to collect a debt where
they listed
a
total
amount
due,
contained
a
payment
coupon,
mentioned other payment options, and stated that a fee would be
charged for late payments.
T-33TGW,
2016
WL
--- F. Supp. 3d ---, No. 8:15-CV-2380-
409633,
at
*6
(M.D.
Fla.
Feb.
3,
2016).
Similarly, in Patton v. Ocwen Loan Servicing, LLC, the plaintiff
sufficiently alleged that the defendant’s written communication
attempted
to
informational
collect
purposes
a
debt,
only”
despite
language,
the
presence
because
the
of
“for
statement
included a due date, the past due amount, a payment address, and
a detachable payment coupon.
No. 6:11-CV-445-ORL-19, 2011 WL
1706889, at *5 (M.D. Fla. May 5, 2011); see also Goodin v. Bank of
Am., N.A., 114 F. Supp. 3d 1197, 1206 & n.10 (M.D. Fla. 2015)
8
Although the coupon is titled “Voluntary Payment Coupon,” the
Statement mentions six possible payment methods.
The word
“voluntary” could easily be taken to mean that using the coupon to
pay was voluntary, not that any payment whatsoever was optional.
- 9 -
(letters containing payment instructions, a due date, and an amount
due had animating purpose of encouraging payment despite being
labeled
“FOR
INFORMATION
PURPOSES”
and
containing
disclaimer
language).
Nationstar argues that the Informational Statement cannot be
considered an attempt to collect a debt, since it contains a
disclaimer paragraph, which reads as follows:
This statement is sent for informational
purposes only and is not intended as an
attempt to collect, assess, or recover a
discharged debt from you, or as a demand for
payment from any individual protected by the
United States Bankruptcy Code.
If this
account is active or has been discharged in a
bankruptcy
proceeding,
be
advised
this
communication is for informational purposes
only and is not an attempt to collect a debt.
Please note, however, that Nationstar reserves
the right to exercise its legal rights,
including but not limited to foreclosure of
its lien interest.
(Doc. #1-5.)
This disclaimer, however, “is insufficient to shield
[Nationstar] as a matter of law from liability at this stage of
the
litigation.”
Leahy-Fernandez,
(citations omitted).
2016
WL
409633,
at
*6
Just because a disclaimer says that the
communication “‘is not an attempt to collect a debt,’ does not
make that true, especially in view of indications on the face of
the document that the communication is intended to obtain money
and is connected to a present or former obligation to pay an
indebtedness.”
Donnelly-Tovar
v.
- 10 -
Select
Portfolio
Servicing,
Inc., 945 F. Supp. 2d 1037, 1048 (D. Neb. 2013).
The Informational
Statement does contain such indications, including an “Important
Message” recommending that Plaintiff make payments to reduce her
negative escrow balance (i.e. threatening consequences for nonpayment).
Further,
Nationstar’s
boilerplate,
hypothetical
disclaimer language 9 is immediately followed by a “however” clause
reserving Nationstar’s right to pursue legal remedies against the
recipient.
It is thus plausible (if not probable) that the least
sophisticated consumer reading the disclaimer would not understand
that she could refrain from making payments without incurring
additional
fees
or
exposing
herself
to
future
legal
action.
Rather, she would feasibly be induced to make payments to avoid
those repercussions.
In sum, the Court finds that the Complaint plausibly alleges
that the Informational Statement was sent to induce payment on
Plaintiff’s mortgage debt.
As “no attempt to collect a debt” is
Nationstar’s sole argument for dismissal for failure to state a
claim, the request to dismiss is denied.
9
The disclaimer instead could have stated that Nationstar was
aware Plaintiff’s mortgage debt had been discharged in bankruptcy
and, as a result, Plaintiff had no personal obligation to repay
the debt and could not be pressured to do so. See In re Nordlund,
494 B.R. 507, 516-17 (Bankr. E.D. Cal. 2011); In re Jones, No. 0805439-AJM-7, 2009 WL 5842122, at *1 (Bankr. S.D. Ind. Nov. 25,
2009). The Informational Statement also could have specified that
the attached payment coupon was included as a “courtesy.” Id.
- 11 -
B.
Plaintiff’s FCCPA Claim (Count I)
The Complaint also alleges that the Informational Statement
violates Section 559.72(9) of the FCCPA, which states that no
person shall “[c]laim, attempt, or threaten to enforce a debt when
such person knows that the debt is not legitimate, or assert the
existence of some other legal right when such person knows that
the right does not exist.”
Specifically, Plaintiff claims that
Nationstar violated this provision by “sending the Informational
Statement to Plaintiff in an attempt to enforce debt [sic] that
had been discharged in Plaintiff’s bankruptcy and was thus no
longer legally owed to Defendant.”
(Doc. #1, ¶ 29).
For Plaintiff to succeed with this attempt-to-enforce theory,
a
discharged
debt
must
be
considered
legitimate” under the FCCPA.
a
debt
that
is
“not
Neither Nationstar’s Motion nor
Plaintiff’s Response adequately addresses this issue.
In support
of the argument that Plaintiff fails to state a claim under Section
559.72(9), Nationstar does contend that her “mortgage was not
extinguished
by
the
discharge,
and
[thus]
discharge actions were permissible by law.”
Nationstar’s
post-
(Doc. #12, p. 7.)
Nationstar appears to presume, then, that because a mortgage is
not extinguished by a bankruptcy discharge, the mortgage remains
a “legitimate debt.”
In response, Plaintiff “reiterates the
arguments made . . . in support of her” FDCPA claims (Doc. #16, p.
13) and stresses that “[i]n the event of any inconsistency between
- 12 -
any provision of this part and any provision of the federal act,
the provision which is more protective of the consumer or debtor
shall prevail.”
(Id. p. 14 (quoting Fla. Stat. § 559.552)).
Although the Court agrees that a bankruptcy discharge does
not extinguish the debt itself, the cases cited in Nationstar’s
Motion do not address whether a debt that survives bankruptcy is
a “legitimate debt” for collection purposes under the FCCPA.
Nationstar has thus failed to carry its burden of showing that
dismissal for failure to state a claim is warranted.
Moreover,
there is some authority for the proposition that “that although
[a] mortgage lien survive[s] the discharge, the debt as against
[the debtor] personally is no longer legitimate and, thus, attempts
to collect from her personally violate Section 559.72(9).”
Leahy-
Fernandez,
2016).
2016
WL
409633,
at
*7
(M.D.
Fla.
Feb.
3,
Accordingly, and because “[t]he FCCPA unequivocally states its
goal [is] to provide the consumer with the most protection possible
under either the state or federal statute,” LeBlanc, 601 F.3d at
1192, the Court denies Nationstar’s request to dismiss Plaintiff’s
FCCPA action for failure to state a claim.
C.
Implied Repeal/Statutory Preemption
Nationstar also seeks dismissal of Plaintiff’s FDCPA and
FCCPA claims on the ground that they are preempted under (or
- 13 -
impliedly
repealed
by
10
)
Section
524
Bankruptcy Code and TILA/Regulation Z.
of
the
United
States
The Court finds neither
argument convincing.
(1)
The Bankruptcy Code
At the time Nationstar filed its Motion to Dismiss, the
Eleventh Circuit had expressly declined to address “[w]hether the
Code ‘preempts’ the FDCPA when creditors misbehave in bankruptcy.”
Crawford v. LVNV Funding, LLC, 758 F.3d 1254, 1262 (11th Cir.
2014), cert. denied, 135 S. Ct. 1844, 191 L. Ed. 2d 724 (2015)).
That question has since been answered.
In Johnson v. Midland
Funding, LLC, the Eleventh Circuit joined the Second, 11 Third, 12
and Seventh 13 Circuits in finding “no irreconcilable conflict”
between the Code and the FDCPA, since the two “can be read together
in a coherent way.”
--- F. 3d ---, No. 15-11240, 2016 WL 2996372,
at *3 (11th Cir. May 24, 2016).
Crawford held that a debt collector violates the FDCPA by
filing a proof of claim it knows is stale (time-barred) in a
10
“One federal statute does not preempt another.
When two
federal statutes address the same subject in different ways, the
right question is whether one implicitly repeals the other . . .
.” Randolph, 368 F.3d at 730.
11
Garfield v. Ocwen Loan Servicing, LLC, 811 F.3d 86, 91 (2d Cir.
2016).
12
Simon v. FIA Card Servs., N.A., 732 F.3d 259, 274, 278 (3d Cir.
2013).
13
Randolph, 368 F.3d at 732.
- 14 -
bankruptcy proceeding.
758 F.3d at 1262.
Applying Crawford, the
Johnson district court concluded that, because the Bankruptcy Code
allows creditors to file stale proofs of claim in bankruptcy
proceedings, the Code and the FDCPA irreconcilably conflict, and
“the later-enacted Code impliedly repeal[s] the earlier-enacted
FDCPA.”
Johnson, 2016 WL 2996372, at *4.
In reversing the
district court, the Eleventh Circuit stressed that repeal by
implication due to an irreconcilable conflict is appropriate only
where there is “some sort of ‘positive repugnancy’ between the
statutes at issue” that makes coexistence impossible.
Id. (citing
J.E.M. Ag Supply, Inc. v. Pioneer Hi–Bred Int'l, Inc., 534 U.S.
124, 143–44 (2001)).
No such “positive repugnancy” exists between
the FDCPA and the Code, the Circuit Court concluded, because “[t]he
FDCPA and the Code differ in their scopes, goals, and coverage,
and can be construed together in a way that allows them to coexist.
. . . [They] can be reconciled because they provide different
protections
and
reach
different
actors.”
Id.
at
*5.
In
particular, the Code applies to all “creditors,” whereas “the FDCPA
dictates the behavior of only ‘debt collectors’ both within and
outside of bankruptcy.”
Id. (emphasis added).
But Johnson does not end the implied-repeal/preemption issue.
“Even though the Bankruptcy Code does not impliedly repeal all
FDCPA provisions to remedy conduct that violates the discharge
injunction, it might impliedly repeal some specific provisions
- 15 -
invoked to remedy such conduct.”
second
question,
then,
is
Garfield, 811 F.3d at 92.
whether
the
specific
“FDCPA
The
claim
[asserted] raises a direct conflict between the Code or Rules and
the FDCPA, or whether both can be enforced.”
Simon, 732 F.3d at
274.
Nationstar’s argument in this respect is that because redress
for violations of a bankruptcy discharge order may (allegedly) be
sought only through a contempt action, allowing Plaintiff to
“manufacture” private FDCPA and FCCPA claims based on the same
conduct circumvents the Code’s remedial scheme, thereby creating
an
irreconcilable
conflict.
Even
assuming
violations
of
a
bankruptcy discharge order cannot be redressed through a private
action in bankruptcy court (a claim for which Nationstar has cited
no Eleventh Circuit authority), it seems clear that, if there is
no irreconcilable conflict when a debt collector “open[s] himself
up to a potential lawsuit for an FDCPA violation” by acting in a
way the Bankruptcy Code permits, Johnson, 2016 WL 2996372, at *6,
then the fact that a debt collector can be sued in a private action
under the FDCPA but not under the Code likewise presents no
irreconcilable conflict.
different remedies.
The Code and the FDCPA simply provide
See id. (“The FDCPA easily lies over the top
of the Code’s regime, so as to provide an additional layer of
protection against a particular kind of creditor.”).
Indeed,
before Johnson was decided, numerous courts had already rejected
- 16 -
the “conflicting
remedies”
position
that
Nationstar
advances.
E.g., Leahy-Fernandez, 2016 WL 409633, at *3; Bacelli v. MFP, Inc.,
729 F. Supp. 2d 1328, 1336 (M.D. Fla. 2010); Gamble v. Fradkin &
Weber, P.A., 846 F. Supp. 2d 377, 382 (D. Md. 2012).
“This same rationale can be logically extended to the FCCPA.
A debt collector can comply simultaneously with the FCCPA and the
Bankruptcy Code.”
Hernandez v. Dyck-O'Neal, Inc., No. 3:14-CV-
1124-J-32JBT, 2015 WL 2094263, at *4 (M.D. Fla. May 5, 2015).
Like the Hernandez court, this Court fails to see how “a debtor's
choice to pursue the remedies provided under the FCCPA [would]
stand as an obstacle to the objectives of the Bankruptcy Code,”
id., and particularly after a discharge has already occurred in
bankruptcy.
See Lapointe v. Bank of Am., N.A., No. 8:15-CV-1402-
T-26EAJ, 2015 WL 10097518, at *3 (M.D. Fla. Aug. 26, 2015); see
also Leahy-Fernandez, 2016 WL 409633, at *4.
Accordingly, the
Court rejects Nationstar’s contention that the Bankruptcy Code
bars Plaintiff’s FDCPA and FCCPA claims.
(2)
TILA/Regulation Z
Nationstar also argues that Plaintiff’s claims are preempted
under TILA, 15 U.S.C. § 1601 et seq., as implemented through
“Regulation Z,” 12 C.F.R. § 1026.1.
Among other things, TILA
requires a mortgage loan servicer to “transmit to the obligor, for
each billing cycle, a statement setting forth” several pieces of
information, including “the amount of the principal obligation
- 17 -
under the mortgage” and a “description of any late payment fees.”
15
U.S.C.A.
§
1638(f)(1).
Nationstar
contends
that
since
Plaintiff’s FDCPA and FCCPA claims are based on Nationstar’s
sending the Informational Statement, and since TILA/Regulation Z
required (or at least permitted) Nationstar to send the Statement,
there is an irreconcilable conflict, barring Plaintiff’s claims.
The Court again disagrees.
TILA did not oblige Nationstar
to send Plaintiff the Informational Statement. 14
Consumer
statement
Financial
is
not
Protection
required
bankruptcy proceedings. 15
for
has
clarified
mortgage
The Bureau of
that
debts
a
periodic
discharged
in
Amendments to the 2013 Mortgage Rules
Under the Real Estate Settlement Procedures Act (Regulation X) and
the Truth in Lending Act (Regulation Z), 78 FR 62993-01.
sending
Plaintiff
a
periodic
statement
required, Johnson is instructive.
was
Because
permissive,
not
Like a debt collector who
14
Even if Nationstar mistakenly believed TILA required it to send
Plaintiff a periodic statement, it “could [have] compl[ied] with
federal law without potentially running afoul of the FCCPA [and
the FDCPA] by not including” extraneous material in the Information
Statement. Kelliher v. Target Nat. Bank, 826 F. Supp. 2d 1324,
1329 (M.D. Fla. 2011). Instead, Nationstar inserted an “Important
Message” recommending additional escrow payments and attached a
payment coupon.
15
The clarification was, in fact, provided in response to
questions “about how to reconcile the periodic statement
requirements . . . with various bankruptcy law requirements” and
“concerns that bankruptcy courts[] . . . may find servicers in
violation of an automatic stay or discharge injunction if [they]
provide a periodic statement.” Amendments to the 2013 Mortgage
Rules, 78 FR 62993-01.
- 18 -
chooses to file a stale claim in a bankruptcy proceeding, a debt
collector who elects to send a periodic statement regarding a
discharged debt exposes itself to a lawsuit under the FDCPA and
the FCCPA.
This creates no irreconcilable difference.
Fernandez, 2016 WL 409633, at *3, 5.
See Leahy-
Accordingly, TILA does not
require dismissal of Plaintiff’s statutory claims. 16
Accordingly, it is hereby
ORDERED:
Nationstar's Motion to Dismiss for Failure to State a Claim
(Doc. #12) is DENIED.
DONE and ORDERED at Fort Myers, Florida, this 1st day of July,
2016.
Copies:
Counsel of Record
16
The Motion also seeks dismissal of Plaintiff’s breach of
contract claim (Count V) under TILA.
Not only has the Court
already rejected the argument that TILA required Nationstar to
send the Informational Statement, Nationstar’s argument is
misdirected. Plaintiff’s claim is not based on the mere fact that
Nationstar sent the Informational Statement, but rather, on
Nationstar’s sending the Statement directly to Plaintiff, not her
lawyer, in violation of a material term in the parties’ settlement
agreement.
Nationstar’s
Motion
does
not
address
this.
Nationstar’s request for dismissal is thus denied.
- 19 -
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