Sellers et al v. Rushmore Loan Management Services, LLC

Filing 62

ORDER denying 56 Rushmore's Motion for Reconsideration; denying 58 Plaintiffs' Renewed Motion for Class Certification. The putative class claims are dismissed with prejudice. By 1/12/18, the parties shall file a joint case management report. Signed by Judge Timothy J. Corrigan on 12/12/2017. (SEJ)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
JACKSONVILLE DIVISION
RANDOLPH SELLERS, individually
and on behalf of a class of persons
similarly situated and TABETHA
SELLERS, individually and on behalf
of a class of persons similarly situated,
Plaintiffs,
v.

Case No. 3:15-cv-1106-J-32PDB

RUSHMORE LOAN MANAGEMENT
SERVICES, LLC,
Defendant.

ORDER
This consumer credit putative class action is before the Court on: (1) Defendant
Rushmore Loan Management Services, LLC’s Motion for Reconsideration of Ruling on
Summary Judgment (Doc. 56), to which Plaintiffs Randolph and Tabetha Sellers have
responded (Doc. 57); and (2) Plaintiffs’ Renewed Motion for Class Certification (Doc.
58), to which Rushmore has responded. (Doc. 61).
I.

BACKGROUND1
Plaintiffs filed this lawsuit on September 11, 2015 (Doc. 1), raising claims under

the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. (“FDCPA”), the Florida

Because the Court previously discussed the facts and procedural history of
this case in its Order on Summary Judgment (Doc. 55 at 2-7), the Court will
incorporate that more detailed discussion into this Order and present only limited
1

Consumer Collection Practices Act, Fla. Stat. §§ 559.55-559.785 (“FCCPA”), and the
Declaratory Judgment Act, 28 U.S.C. § 2201, based on their receipt of numerous
communications from Rushmore. On March 30, 2017, the Court held a hearing on
Rushmore’s motion for summary judgment. (Docs. 33, 59). The Court granted
Rushmore’s motion as to Count III, which involved Plaintiffs’ receipt of one Request
for Taxpayer Identification Number, but otherwise denied the motion. (Doc. 55).
Therefore, Plaintiffs’ claims that Rushmore violated the FDCPA and the FCCPA by
sending them several mortgage statements in an attempt to collect a debt previously
discharged in bankruptcy remain.
On May 16, 2017, Rushmore filed a motion for reconsideration, asking that the
Court review its denial of summary judgment as to Counts I, II, and IV in light of
recent Eleventh Circuit authority. (Doc. 56). Plaintiffs filed a response in opposition.
(Doc. 57).
On June 1, 2017, Plaintiffs renewed their motion for class certification,
requesting that the Court certify the following class:
All Florida consumers who (1) have or had a residential
mortgage loan serviced by Rushmore Loan Management
Services, LLC, which Rushmore obtained when the loan was
in default; (2) received a Chapter 7 discharge of their
personal liability on the mortgage debt; and (3) were sent a
mortgage statement dated September 11, 2013 or later, in
substantially the same form as Mortgage Statement I
and/or Mortgage Statement II, and was mailed to the
debtor’s home address2 in connection with the discharged
mortgage debt.

relevant background here.
2

Plaintiffs state that “[t]he ‘home address’ limitation in this class definition is
2

(Doc. 58 at 6). Rushmore opposes Plaintiffs’ motion for class certification on all possible
grounds, including that the proposed class is not ascertainable; Plaintiffs fail to meet
any of the requirements of Rule 23(a), Fed. R. Civ. P.; and they fail to satisfy the
predominance and superiority requirements of Rule 23(b), Fed. R. Civ. P. (Doc. 61).
II.

RUSHMORE’S MOTION FOR RECONSIDERATION
Rushmore requests that the Court reconsider its Order denying summary

judgment on Plaintiffs’ FDCPA and FCCPA claims as to Mortgage Statements I and
II (Doc. 55) in light of a recent Eleventh Circuit decision in Helman v. Bank of America,
No. 15-13672, 2017 WL 1350728 (11th Cir. Apr. 12, 2017) (unpublished).
The Court has reviewed Helman and finds that the disclaimer language in this
case is distinguishable from Helman, such that a jury should determine whether
Mortgage Statements I and II violate the FDCPA and FCCPA. See Lilly v. Bayview
Loan Servicing, LLC, No. 217CV345FTM99MRM, 2017 WL 4410040, at *4 (M.D. Fla.
Oct. 4, 2017) (“The language in Helman expressly stated that the debtor had no
personal obligation to repay the debt and no one could force her to do so. No language
even remotely resembling the same was used in this case. Therefore, the Court
declines to follow the result reached in Helman.”). Moreover, Plaintiffs received ten of
their mortgage statements after foreclosure on their home—a fact apparently not at
issue in Helman—further distinguishing the two cases. Therefore, Rushmore’s motion
for reconsideration is due to be denied.

designed to exclude from the class any statements that may have been sent to debtor’s
counsel instead of directly to the debtor.” (Doc. 58 at 6 n.6).
3

III.

PLAINTIFFS’ RENEWED MOTION FOR CLASS CERTIFICATION
A.

Rule 23 Class Certification Standard

“Questions concerning class certification are left to the sound discretion of the
district court.” Cooper v. S. Co., 390 F.3d 695, 711 (11th Cir. 2004) (citing Armstrong
v. Martin Marietta Corp., 138 F.3d 1374, 1386 (11th Cir. 1998)). A class action “may
only be certified if the trial court is satisfied, after rigorous analysis, that the
prerequisites of Rule 23 are satisfied.” Gen. Tel. Co. of SW v. Falcon, 457 U.S. 147, 161
(1982); see also Vega v. T–Mobile USA, Inc., 564 F.3d 1256, 1266 (11th Cir. 2009).
“This analysis does not permit courts to be ‘generous or forgiving’ of failures of proof
or to engage in speculation as to [Federal Rule of Civil Procedure] 23’s requirements.”
Mills v. Foremost Ins. Co., 269 F.R.D. 663, 669 (M.D. Fla. 2010) (citing Vega, 564 F.3d
at 1269). “For a district court to certify a class action, the named plaintiffs must have
standing, and the putative class must meet each of the requirements specified in
[Rule] 23(a), as well as at least one of the requirements set forth in Rule 23(b).”3 Klay
v. Humana, Inc., 382 F.3d 1241, 1250 (11th Cir. 2004).
As a threshold matter, Plaintiffs must demonstrate that the proposed class is
“adequately defined and clearly ascertainable.” Little v. T–Mobile USA, Inc., 691 F.3d
1302, 1304 (11th Cir. 2012). If the class is ascertainable, Plaintiffs must then satisfy
Rule 23(a) by demonstrating: (1) the class is so numerous that joinder of all member
is impracticable; (2) there are questions of law or fact common to the class; (3) the

Rushmore does not challenge Plaintiffs’ standing, so the Court will not
address it. (Doc. 61).
3

4

claims or defenses of the representative parties are typical of the claims or defenses of
the class; and (4) the representative parties will fairly and adequately protect the
interests of the class. Fed. R. Civ. P. 23(a).
Once all of Rule 23(a)’s requirements have been met, Plaintiffs must also meet
at least one of the class types under Rule 23(b). Plaintiffs bear the burden of showing
that the proposed class meets every requirement of Rule 23(a) and at least one of the
Rule 23(b) acceptable class types. Valley Drug Co. v. Geneva Pharms., Inc., 350 F.3d
1181, 1187 (11th Cir. 2003). Here, Plaintiffs seek certification under Rule 23(b)(3),
which requires the Court to find that “the questions of law or fact common to class
members predominate over any questions affecting only individual members, and that
a class action is superior to other available methods for fairly and efficiently
adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3).
B.

Analysis

While Rushmore challenges class certification on several grounds, the Court
limits its analysis to predominance, as failure to satisfy Rule 23(b) is dispositive. See
McCamis v. Servis One, Inc., No. 8:16-CV-1130-T-30AEP, 2017 WL 589251, at *5-6
(M.D. Fla. Feb. 14, 2017); Riffle v. Convergent Outsourcing, Inc., 311 F.R.D. 677, 68185 (M.D. Fla. 2015).
In a properly certified Rule 23(b)(3) class, “‘the issues in the class action that
are subject to generalized proof, and thus applicable to the class as a whole, must
predominate over those issues that are subject only to individualized proof.’” Jackson
v. Motel 6 Multipurpose, Inc., 130 F.3d 999, 1005 (11th Cir. 1997) (quoting Kerr v. City
of West Palm Beach, 875 F.2d 1546, 1557-58 (11th Cir. 1989)). “The predominance
5

requirement is far more demanding than Rule 23(a)’s commonality requirement.”
McCamis, 2017 WL 589251, at *5 (internal quotation marks and citation omitted).
“Common issues of fact and law predominate if they have a direct impact on every
class member’s effort to establish liability and on every class member’s entitlement to
injunctive and monetary relief.” Williams v. Mohawk Indus., Inc., 568 F.3d 1350, 1357
(11th Cir. 2009). “Common issues will not predominate over individual questions if,
‘as a practical matter, the resolution of . . . [an] overarching common issue breaks down
into an unmanageable variety of individual legal and factual issues.’” Cooper, 390 F.3d
at 722, overruled on other grounds, Ash v. Tyson Foods, Inc., 546 U.S. 454 (2006).
Certification is inappropriate in the event that “plaintiffs must still introduce a
great deal of individualized proof or argue a number of individualized legal points to
establish most or all of the elements of their individual claims.” Klay, 382 F.3d at 1254,
abrogated in part on other grounds by Bridge v. Phoenix Bond & Indem. Co., 553 U.S.
639 (2008) (citations omitted). The predominance inquiry requires an examination of
“the claims, defenses, relevant facts, and applicable substantive law, . . . to assess the
degree to which resolution of the classwide issues will further each individual class
member’s claim against the defendant.” Id. (internal quotations and citation omitted).
In this putative class action, Plaintiffs bring claims against Rushmore for
violations of the FDCPA and the FCCPA. Plaintiffs argue that common issues
predominate over individual questions and identify three common issues which they
argue will turn on common evidence:
(1) Whether the account statements were an attempt to collect a debt;

6

(2) Whether, given the relationship of the parties, Defendant’s communications
violated the FDCPA; and
(3) Whether, given the relationship of the parties, Defendant’s communications
violated the FCCPA.
(Doc. 58 at 9, 18-19). Plaintiffs identify only one defense available to Rushmore: that
Mortgage Statements I and II were not attempts to collect debts but were merely for
informational purposes. (Id. at 19). They state that Rushmore “does not point to any
individual facts or circumstances,” and therefore, “Rushmore will be able to make this
common argument to the jury on behalf of the statements sent to all class members
post-discharge.” (Id. at 19-20).
By contrast, Rushmore argues that individualized inquiries overwhelm the
common questions. Specifically, Rushmore posits that any of the following individual
issues predominate: (1) whether the statements were sent in connection with the
collection of a debt requires an individualized review of the Bankruptcy Code’s
application to the borrower; (2) whether the statements are deceptive or confusing
according to the least sophisticated consumer standard requires an individualized
analysis premised upon the particular circumstances of the particular borrower; and
(3) whether the oral statements made by one or more Rushmore representatives
related to a deed in lieu proposal constitute debt collection activity and are false or
misleading will involve highly individualized proof. (Doc. 61 at 20-21).
The Court agrees with Rushmore. Throughout the litigation, Plaintiffs have
proposed numerous different class definitions. With the first three iterations,

7

Plaintiffs narrowed the class definition as the pertinent issues crystallized. See Doc.
55 at 28-29 (discussing Plaintiffs’ evolving class definitions). However, in the proposed
class definition currently before the Court (their fourth), Plaintiffs revert to a
definition (similar to the second), which does not take into account the Sellers’ unique
circumstances.4
Plaintiffs’ current proposed class definition ignores that, in analyzing the
viability of their claims on summary judgment, the Court had to examine whether the
property was Plaintiffs’ principal residence at the time they received the challenged
communications and whether making periodic payments in lieu of foreclosure was an
option available to them. (Id. at 25-26). These inquiries were relevant to both of the
main issues before the Court: whether Mortgage Statements I and II would be
misleading to the least sophisticated consumer and whether the § 524(j) exception to
the Bankruptcy Code discharge injunction applied. Because Plaintiffs vacated the
property long before Rushmore sent the Mortgage Statements and were never offered
options that would allow them to make periodic payments to avoid foreclosure and
remain in the home, the Court found that the exception to the discharge injunction did
not apply, rendering analysis of whether the Bankruptcy Code preempted or precluded
the FCCPA or the FDCPA unnecessary. (Id. at 27). However, if the Court certified
Plaintiffs’ proposed class, such individualized inquiries would be required for every

Plaintiffs’ third definition, proposed spontaneously during oral argument on
summary judgment, began to address the Sellers’ individual circumstances by
including language related to failure to “reaffirm their home [in bankruptcy
proceedings].” (Doc. 55 at 29). The current definition before the Court omits such
language.
4

8

class member to determine whether the § 524(j) exception applied, and if so, whether
the Bankruptcy Code precluded and/or preempted the FDCPA and FCCPA.5 Such a
course of action—which Plaintiffs’ proposed class definition mandates—is the type of
extensive individualized factual inquiry that is too burdensome to allow class
certification.
Accordingly, it is hereby
ORDERED:

Plaintiffs rely on Prindle v. Carrington Mortg. Servs., LLC, No. 3:13-CV-1349J-34PDB, 2016 WL 4466838 (M.D. Fla. Aug. 24, 2016) in arguing that their proposed
class would not require individualized inquiry. There, the defendant argued (as
Rushmore does) that a fact finder would need to consider several individualized
factors, such as whether the debtor surrendered the property during bankruptcy, was
provided and rejected a reaffirmation agreement, continued to reside in the property,
among several others. Id. at *4. The Prindle court rejected these arguments on the
grounds that the defendant “failed to explain why those factors are relevant,” noting
that “the Court does not see them as particularly relevant.” Id.
5

While they may not have been relevant under the facts of Prindle, such
questions are highly relevant here because they were critical to the Court’s decision to
allow Plaintiffs’ claims to survive summary judgment and would be similarly crucial
to the resolution of individual class members’ claims. Had the answers to those
questions differed in this case, it would have potentially altered the Court’s analysis
of whether: (1) Mortgage Statements I and II were misleading under the
circumstances in which they were received; and (2) the § 524(j) exception to the
Bankruptcy Code’s discharge injunction applied.
Even the common questions Plaintiffs propose acknowledge this dilemma, for
the questions include the language “given the relationship between the parties.” While
this language appeared in the plaintiff’s common questions in Prindle, the Prindle
court did not have to consider the same threshold questions regarding whether the
§ 524(j) exception applied, as this Court did on summary judgment. Compare Prindle,
2016 WL 4466838, at * 3, with Doc. 55. Unlike here, the Prindle court reached the
preemption/preclusion issue at the summary judgment stage, and therefore would not
have had to do so for each of its proposed class members.
9

1.

Defendant Rushmore Loan Management Services, LLC’s Motion for

Reconsideration of Ruling on Summary Judgment (Doc. 56) is DENIED.
2.

Plaintiffs’ Renewed Motion for Class Certification (Doc. 58) is DENIED.

The putative class claims are DISMISSED with prejudice.
3.

By January 12, 2018, the parties shall file a joint case management

report, and the Court will enter a case management scheduling order for the
remainder of the case.
DONE AND ORDERED in Jacksonville, Florida the 12th day of December,
2017.

sj
Case Management Report Form (attached)
Copies:
Counsel of record

10

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
JACKSONVILLE DIVISION

Plaintiff(s),
v.

Case No.

Defendant(s).
______________________________________
CASE MANAGEMENT REPORT
The parties have agreed on the following dates and discovery plan pursuant to
Fed.R.Civ.P. 26(f) and Local Rule 3.05(c):

DEADLINE OR EVENT

AGREED DATE

Mandatory Initial Disclosures (pursuant to Fed.R.Civ.P.
26(a)(1))
[Court recommends 30 days after CMR meeting]

Certificate of Interested
Disclosure Statement

Persons

and

Corporate

[all parties are directed to complete and file the attached]

Motions to Add Parties or to Amend Pleadings
Disclosure of Expert Reports
Plaintiff:
Defendant:
Discovery Deadline
[Court recommends 5 months before trial to allow time for
dispositive motions to be filed and decided; all discovery must be
commenced in time to be completed before this date]

Dispositive and Daubert Motions
[Court requires 4 months or more before trial term begins]

DEADLINE OR EVENT

AGREED DATE
(month, year)

Trial Term Begins
[Local Rule 3.05 (c)(2)(E) sets goal of trial within 1 year of filing
complaint in most Track Two cases, and within 2 years in all Track
Two cases; trial term must not be less than 4 months after
dispositive motions deadline (unless filing of such motions is
waived). Trials before the District Judge will generally be set on a
rolling trial term toward the beginning of each month, with a Final
Pretrial Conference to be set by the Court the preceding month. If
the parties consent to trial before the Magistrate Judge, they will be
set for a date certain after consultation with the parties]

Estimated Length of Trial [trial days]
Jury / Non-Jury
Mediation
Deadline:
Mediator:
Address:

Telephone:
[Mediation is mandatory in most Track Two cases; Court
recommends either 2 - 3 months after CMR meeting, or just after
discovery deadline; if the parties do not so designate, the Court will
designate the mediator and the deadline for mediation. A list of
certified mediators is available on the Court’s website and from the
Clerk’s Office.]

All Parties Consent to Proceed Before Magistrate Judge

Yes____

No____

If yes, the parties shall complete and all counsel and/or
unrepresented parties shall execute the attached Form AO-85.

I.

Meeting of Parties
Lead counsel shall meet in person or, upon agreement of all parties, by telephone.

(If all parties agree to conduct the case management conference by telephone, they may
do so without filing a motion with the Court.) Pursuant to Local Rule 3.05(c)(2)(B) or
(c)(3)(A), a meeting was held on ___________________ (date) at
was attended by:

(time)

and

Name

Counsel for (if applicable)

_______________________________________

_________________________________

_______________________________________

_________________________________

_______________________________________

_________________________________

II.

Preliminary Pretrial Conference
Local Rule 3.05(c)(3)(B) provides that preliminary pretrial conferences are

mandatory in Track Three cases.
Track Two cases: Parties

(check one) [__] request

[__] do not request a preliminary

pretrial conference before entry of a Case Management and Scheduling Order in this Track
Two case. Unresolved issues to be addressed at such a conference include:
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
III.

Pre-Discovery Initial Disclosures of Core Information
Fed.R.Civ.P. 26(a)(1)(A) - (D) Disclosures
The parties

(check one)

[__] have exchanged [__] agree to exchange information

described in Fed.R.Civ.P. 26(a)(1)(A) - (D) on or by
IV.

(date).

Agreed Discovery Plan for Plaintiffs and Defendants
A.

Certificate of Interested Persons and Corporate Disclosure Statement

This Court makes an active effort to screen every case in order to identify parties
and interested corporations in which the assigned judge may be a shareholder, as well as
for other matters that might require consideration of recusal. Therefore, each party,
governmental party, intervenor, non-party movant, and Rule 69 garnishee shall file and
serve within fourteen (14) days from that party’s first appearance a Certificate of

Interested Persons and Corporate Disclosure Statement using the attached mandatory
form. No party may seek discovery from any source before filing and serving a Certificate
of Interested Persons and Corporate Disclosure Statement.

All papers, including

emergency motions, are subject to being denied or stricken unless the filing party has
previously filed and served its Certificate of Interested Persons and Corporate Disclosure
Statement. Any party who has not already filed and served the required certificate is
required to do so immediately. Each party has a continuing obligation to file and serve an
amended Certificate of Interested Persons and Corporate Disclosure Statement within
eleven days of 1) discovering any ground for amendment, including notice of case
reassignment to a different judicial officer; or 2) discovering any ground for recusal or
disqualification of a judicial officer. A party should not routinely list an assigned district
judge or magistrate judge as an “interested person” absent some non-judicial interest.
B.

Discovery Plan/Deadline

The parties shall not file discovery materials with the Clerk except as provided in
Local Rule 3.03. Parties should exchange discovery in the most efficient way, which
usually means electronically. In propounding and responding to discovery, the parties are
directed to consult and comply with the Federal Rules of Civil Procedure, the Local Rules
of the United States District Court for the Middle District of Florida, and the Middle District
of

Florida’s

Discovery

Handbook,

available

on

the

Court's

website:

www.flmd.uscourts.gov/forms/Civil/2015-Civil_Procedure_Handbook.pdf. Each party shall
timely serve discovery requests so that the rules allow for a response prior to the discovery
deadline. The Court may deny as untimely all motions to compel filed after the discovery
deadline or those that fail to comply with the meet and confer requirements contained in

Local Rule 3.01(g). The Court notes that the words "confer" and "good faith" contemplate
the parties will exchange thoughts and arguments to try to resolve an issue and will not
simply engage in unilateral noticing that a motion will be filed. In addition to agreeing to
comply with the above, the parties agree as follows:
_____________________________________________________________________
_____________________________________________________________________
C.

Confidentiality Agreements/Motions to File Under Seal

Whether documents filed in a case may be filed under seal is a separate issue from
whether the parties may agree that produced documents are confidential. The Court is a
public forum, and disfavors motions to file under seal. The Court will permit the parties to
file documents under seal only upon motion and order entered under Local Rule 1.09.
The parties may reach their own agreement (without Court endorsement) regarding
the designation of materials as “confidential.”

The Court discourages unnecessary

stipulated motions for a protective order. The Court will enforce appropriate stipulated and
signed confidentiality agreements. See Local Rule 4.15. Each confidentiality agreement
or order shall provide, or shall be deemed to provide, that “no party shall file a document
under seal without first having obtained an order granting leave to file under seal on a
showing of particularized need.” With respect to confidentiality agreements, the parties
agree as follows: ______________________________________________________
____________________________________________________________________

D.

Disclosure or Discovery of Electronically Stored Information and

Assertion of Claims of Privilege
Pursuant to Fed.R.Civ.P. 26(f)(3), the parties have made the following agreements
regarding the disclosure and discovery of electronically stored information as well as the
assertion of claims of privilege or protection of trial preparation materials after production:
____________________________________________________________________
____________________________________________________________________
V.

Mediation
Absent a Court order to the contrary, the parties in every case will participate in

Court-annexed mediation as detailed in Chapter Nine of the Court’s Local Rules. The
parties have agreed on a mediator from the Court’s approved list of mediators as set forth
in the table above, and have agreed to the date stated in the table above as the last date
for mediation. The list of mediators is available from the Clerk, and is posted on the Court’s
web site at www.flmd.uscourts.gov. If the parties do not so designate, the Court will
designate the mediator and the deadline for mediation.
VI.

Requests for Special Handling
Requests for special consideration or handling (requests may be joint or unilateral):

____________________________________________________________________
____________________________________________________________________
__________________________________________________________________

Date: _____________________
Signature of Counsel (with information required by Local Rule 1.05(d)) and Signature of
Unrepresented Parties.
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________

CERTIFICATE OF INTERESTED PERSONS
AND CORPORATE DISCLOSURE STATEMENT
I hereby disclose the following pursuant to this Court’s interested
persons order:
1.)
the name of each person, attorney, association of persons, firm, law
firm, partnership, and corporation that has or may have an interest in the
outcome of this action — including subsidiaries, conglomerates, affiliates,
parent corporations, publicly-traded companies that own 10% or more of a
party’s stock, and all other identifiable legal entities related to any party in
the case:
[insert list]
2.)
the name of every other entity whose publicly-traded stock, equity,
or debt may be substantially affected by the outcome of the proceedings:
[insert list]
3.)
the name of every other entity which is likely to be an active
participant in the proceedings, including the debtor and members of the
creditors’ committee (or twenty largest unsecured creditors) in bankruptcy
cases:
[insert list]
4.)
the name of each victim (individual or corporate) of civil and
criminal conduct alleged to be wrongful, including every person who may
be entitled to restitution:
[insert list]
I hereby certify that, except as disclosed above, I am unaware of any
actual or potential conflict of interest involving the district judge and
magistrate judge assigned to this case, and will immediately notify the Court
in writing on learning of any such conflict.
[Date]

[Certificate of Service]

_____________________________
[Counsel of Record or Pro Se Party]
[Address and Telephone]