Dude v. Congress Plaza, LLC et al
Filing
330
ORDER AND OPINION granting 326 Motion to Dismiss for Failure to State a Claim. This case is CLOSED. Signed by Judge Kenneth A. Marra on 5/6/2020. See attached document for full details. (ir)
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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO. 17-CV-80522 MARRA/MATTHEWMAN
DIETMAR DUDE,
Plaintiff/Counterclaim-Defendant,
v.
CONGRESS PLAZA LLC and
THOMAS R. FARESE, et al.,
Defendants/Counterclaim-Plaintiffs.
_____________________________________/
ORDER AND OPINION GRANTING MOTION TO DISMISS
THIS CAUSE is before the Court upon Counterclaim Defendant Dietmar Dude’s
“Response to Second Amended Counterclaim” (“Motion to Dismiss”) [DE 326]. The
Court has carefully considered the Motion to Dismiss, the response, the reply, and is
otherwise fully advised in the premises.
Background
Previously, Defendants Congress Plaza, LLC and Congress 1010, LLC filed an
Amended Counterclaim that brought a single claim of fraud against Dietmar Dude
(“Dude”). See DE 271. After a hearing on Dude’s Motion to Dismiss the Amended
Counterclaim, the Court dismissed the counterclaim without prejudice. See DE 324.
In the Order, the Court reminded the counterclaimants of the specific requirements
of pleading fraud pursuant to Federal Rule of Civil Procedure Rule 9(b). The Court
also stated, “[i]n light of the convoluted history of the relationship of the parties, and
this case, the Court requests that extraneous allegations that do not specifically
support the Count be omitted.” DE 324 at 3.
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Now, Congress Plaza, LLC and Thomas R. Farese (“Counterclaim-Plaintiffs) have
filed a Second Amended Counterclaim (“SAC”) against Harald Dude and Monique
Roberts, as Trustees of the Tennison Irrevocable Trust, successor to Dietmar Dude
(hereinafter referred to as the “Trust”) (“Counterclaim-Defendant”) asserting
violation of the Fair Debt Collection Practices Act (“FDCPA”) (Count I) and violation of
the Florida Consumer Collection Practices Act (“FCCPA”) (Count II). DE 325.
Counterclaim-Defendant1 moves to dismiss the SAC asserting that
Counterclaim-Plaintiffs have failed to state a cause of action because the FDCPA and
FCCPA only apply to consumer debts, and the debt at question in this case is not a
consumer debt. DE 326 at 1-2. Alternatively, Counterclaim-Defendant asserts that
Counterclaim-Plaintiffs have failed to plead properly that the CounterclaimDefendant is a “debt collector” and that the challenged conduct is related to debt
collection. DE 326 at 4.
Standard of Review
Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a “short
and plain statement of the claim showing that the pleader is entitled to relief.” In
ruling on a motion to dismiss, the Court must determine that the complaint contains
“sufficient factual matter, accepted as true, to ‘state a claim to relief that is
plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 677 (2009), citing Bell
Atlantic Corp. v. Twombly, 550 U.S. 544 (2007). When considering a motion to
dismiss, the Court must accept all of the plaintiff's allegations as true in determining
1
Even though Dietmar Dude is listed as the only Plaintiff/Counterclaim-Defendant, “it is not disputed
that the Tennison Irrevocable Trust took a general assignment of Dietmar Dude’s causes of action
and/or claims in this matter on February 12, 2018 . . .” DE 327, ¶ 6.
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whether a plaintiff has stated a claim for which relief could be granted. Hishon v.
King & Spalding, 467 U.S. 69, 73 (1984). "A motion to dismiss a counterclaim pursuant
to Federal Rule of Civil Procedure 12(b)(6) is evaluated in the same manner as a
motion to dismiss a complaint." Geter v. Galardi South Enters., Inc., 43 F. Supp. 3d
1322, 1325 (S.D. Fla. 2014).
Discussion
The stated purpose of the FDCPA is to protect consumers from abusive debt
collection practices by debt collectors. 15 U.S.C § 1692(e). The purpose of the
FCCPA, the Florida analogue to the FDCPA, “is to deter bad collection practices,” and
“to protect Florida consumers from illegal [and] unscrupulous practices of debt
collectors and other persons.” Gause v. Medical Business Consultants, Inc., 424 F.
Supp. 3d 1175, 1186–87 (M.D. Fla. 2019) quoting Brook v. Chase Bank USA, N.A., 566
F.App'x 787, 790 (11th Cir. 2014) (per curiam) (citation omitted). “When viewed in
toto, the purpose and intent of the FCCPA, like the FDCPA, is . . . not meant to
preclude a creditor or someone otherwise holding a secured interest from invoking
legal process to foreclose.” See Trent v. Mortg. Elec. Registration Sys., Inc., 618 F.
Supp. 2d 1356, 1361 (M.D. Fla. 2007) (“Trent”).
To state a claim under the FDCPA, a plaintiff must plead: “(1) the plaintiff has
been the object of collection activity arising from consumer debt, (2) the defendant
is a debt collector as defined by the FDCPA, and (3) the defendant has engaged in an
act or omission prohibited by the FDCPA.” Bohringer v. Bayview Loan Servicing, LLC,
141 F. Supp. 3d 1229, 1235 (S.D. Fla. 2015) citing Bentley v. Bank of Am., N.A., 773 F.
Supp. 2d 1367, 1371 (S.D. Fla. 2011) (internal quotation marks and citation omitted);
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Freire v. Aldridge Connors, LLP, 994 F. Supp. 2d 1284, 1287 (S.D. Fla. 2014). To
recover under either the FDCPA, or the FCCPA, a plaintiff must make a threshold
showing that the money being collected qualifies as a "debt." 2 15 U.S.C. § 1692 et
seq.
Debt Collector
Section 1692a of the FDCPA defines “debt collector” as any person who uses
any instrumentality of interstate commerce or the mails in any business the principal
purpose of which is the collection of any debts, or who regularly collects or attempts
to collect, directly or indirectly, debts owed or due or asserted to be owed or due
another. 15 U.S.C. § 1692a(6). The substantive provisions of the FDCPA that follow
§ 1692a prohibit “debt collectors” from taking certain actions. Therefore, a finding
that an individual or entity is a “debt collector” is a prerequisite for a determination
of liability under the FDCPA. Birster v. Am. Home Mortgage Servicing, Inc., 481 F.
App'x 579, 581-82 (11th Cir. 2012).
Section 1692a(6) of Title 15 of the United States Code states that a creditor
collecting its own debts under its own name is not a debt collector. See 15 U.S.C.
§ 1692a(6). Moreover, “[u]nder the FDCPA, consumer's creditors, a mortgage
servicing company, or an assignee of a debt are not considered ‘debt collectors,’ as
long as the debt was not in default at the time it was assigned.” Reese v. JPMorgan
2
The FDCPA defines debt as follows:
[A]ny obligation or alleged obligation of a consumer to pay money arising out of a transaction
in which the money, property, insurance, or services which are the subject of the transaction are
primarily for personal, family, or household purposes, whether or not such obligation has been reduced
to judgment. 15 U.S.C. § 1692a(5).
The FDCPA also defines “consumer” in the following manner:
The term “consumer” means any natural person obligated or allegedly obligated to pay any
debt. 15 U.S.C. § 1692a(3).
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Chase & Co., 686 F. Supp. 2d 1291, 1307 (S.D. Fla. 2009); Perry v. Stewart Title Co.,
756 F.2d 1197, 1208 (5th Cir.1985) (same); see also, Trent, 618 F. Supp. 2d at 1360-61
(mortgagee attempting to enforce a mortgage is not a debt collector for purposes of
the FDCPA or FCCPA).
The alleged wrongful conduct asserted against Counterclaim-Defendant are
actions of a mortgagee attempting to enforce a mortgage, or a creditor attempting to
collect its own debt. See, i.e., SAC ¶¶ 23, 24. Accordingly, because CounterclaimDefendant is not alleged to be a debt collector, the SAC fails to state a cause of
action under the FDCPA. See Trent, 618 F. Supp. 2d at 1360-61.
The elements necessary to plead a claim under the FCCPA are similar but
distinguishable from the elements of establishing a claim under the FDCPA. The first
prong is substantially identical to the FDCPA, as the FCCPA only applies to consumer
debt. Fla. Stat. § 559.55(6). The second prong differs from the FDCPA in that the
FCCPA prohibits acts of “persons” and, accordingly, is not limited to “debt
collectors.” Fla. Stat. § 559.72. Bentley v. Bank of America, N.A., 773 F. Supp. 2d
1367, 1372 (S.D. Fla. 2011) citing Schauer v. General Motors Acceptance Corp., 819
So.2d 809, 812 (Fla. Dist. Ct. App. 2002) (concluding that the FCCPA “is not restricted
to debt collectors” as it “mandates that no person shall engage in certain practices in
collecting consumer claims”). The third prong requires an act or omission prohibited
by the FCCPA. Accordingly, the FCCPA claim does not fail because CounterclaimDefendant is not a “debt collector.”
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Consumer Debt
The FDCPA defines the term “debt” as any obligation or alleged obligation of a
consumer to pay money arising out of a transaction in which the money, property,
insurance, or services which are the subject of the transaction are primarily for
personal, family, or household purposes, whether or not such obligation has been
reduced to judgment. 15 U.S.C. § 1692a(5) (emphasis added). The FCCPA
implements a definition of consumer debt that parallels the definition used by the
FDCPA. See Oppenheim v. I.C. Sys., Inc., 627 F.3d 833, 839 (11th Cir. 2010).
Accordingly, actions arising out of commercial debts are not covered by the
protective provisions of the FDCPA or FCCPA. See, e.g., First Gibraltar Bank, FSB v.
Smith, 62 F.3d 133, 135–36 (5th Cir. 1995). Counterclaim-Plaintiffs do not plead that
the dispute arose from a transaction that was “primarily for personal, family, or
household purposes.” They merely make purely conclusory remarks that the debt at
issue would qualify under the debt protection statutes.
It is apparent from a review of the SAC that the mortgage transaction at issue
was a commercial one, not one for personal, family or household purposes. See SAC
¶¶ 4, 7-16. In particular, Counterclaim-Plaintiffs specifically allege in paragraphs 7
and 8 that the mortgage transaction in question was to acquire the “commercial
property known as ‘Madrid Park.’” Because the Promissory Note was not personal in
nature, it does not constitute a debt as defined by the federal or Florida statute.
Pelletier v. Estes Groves, Inc., Case No. 16-14499-CIV-MARRA, 2018 WL 4208328, at
*10 (S.D. Fla. Mar. 28, 2018) (dismissing with prejudice the FDCPA and FCCPA claims
in a second amended complaint “[b]ecause the Promissory Note and Guaranty relate
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to a business transaction and since the FDCPA [and FCCPA] do[] not apply to a loan for
a business purpose, the FDCPA [and FCCPA] do[] not apply to the debt at issue.”)
citing Lingo v. City of Albany Dep't of Cmty. & Econ. Dev., 195 F. App'x 891, 893 (11th
Cir. 2006) (“The statute does not apply to the loan obtained by Lingo, which was a
loan for a business, not for ‘personal, family, or household purposes.’”) and First
Gibraltar Bank, FSB v. Smith, 62 F.3d 133, 136 (5th Cir. 1995) (concluding that
guaranty agreement in connection with a commercial transaction was not personal in
nature and therefore did not constitute a debt as defined by the FDCPA).
Conclusion
Having failed to plead allegations that they were the object of collection
activity arising from a consumer debt, and that Counterclaim-Defendant is a debt
collector as defined under the FDCPA, Counterclaim-Plaintiffs have failed to state a
cause of action under the FDCPA and FCCPA. Accordingly, the SAC is due to be
dismissed for failure to state a claim on which relief may be granted. This is CounterPlaintiffs second attempt at asserting a counterclaim. Moreover, since it is apparent
from a review of the SAC that the mortgage transaction in question was commercial in
nature, granting Counterclaim-Plaintiffs leave to amend to assert that the debt was
for personal, family or household purposes would be futile.
Accordingly, it is hereby ORDERED AND ADJUDGED that CounterclaimDefendant’s Motion to Dismiss [DE 326] is granted with prejudice.
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The Clerk is directed to CLOSE this case.
DONE AND ORDERED in Chambers this 6th day of May, 2020, at West Palm
Beach, Palm Beach County, Florida.
KENNETH A. MARRA
United States District Judge
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