Bruner v. Allianceone Receivables Management, Inc.

Filing 55

MEMORANDUM Opinion and Order Signed by the Honorable John Z. Lee on 2/28/17. Mailed notice(ca, ).

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
TERESA BRUNER,
Plaintiff,
v.
ALLIANCEONE RECEIVABLES
MANAGEMENT, INC.,
Defendant.

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15 C 9726
Judge John Z. Lee

MEMORANDUM OPINION AND ORDER
Plaintiff Teresa Bruner (“Bruner”) brought this action against Defendant
AllianceOne Receivables Management, Inc. (“AllianceOne”). She challenges certain
actions AllianceOne took to collect a debt from her under the Fair Debt Collection
Practices Act (FDCPA), 15 U.S.C. § 1692 et seq., and Illinois Consumer Fraud and
Deceptive Business Practices Act (ICFA), 815 Ill. Comp. Stat. 505/1 et seq.
AllianceOne has moved to dismiss part of Bruner’s First Amended Complaint under
Federal Rule of Civil Procedure (“Rule”) 12(b)(6).

For the reasons that follow,

AllianceOne’s motion to dismiss [30] is granted in part and denied in part.
Background
In 2006, Bruner took out a residential mortgage from CitiMortgage, Inc. that
she was unable to pay back.

Am. Compl. ¶ 11, ECF No. 29.

She filed for

bankruptcy in 2008, which resulted in discharge of her debt on the mortgage loan.
Id. ¶¶ 12, 15. The order discharging her debt on the loan “prohibits any attempt to
collect from the debtor a debt that has been discharged. For example, a creditor is

not permitted to contact a debtor by mail, phone, or otherwise . . . , or take any
other action to collect a discharged debt from the debtor.” Id., Ex. C. 1 Thus, Bruner
is no longer personally liable for the debt on her mortgage loan. Am. Compl. ¶ 18.
In 2015, AllianceOne acquired servicing rights to the debt. Id. ¶ 20. Then,
purportedly acting with knowledge of her bankruptcy, AllianceOne sent a dunning
letter to Bruner regarding the debt on September 18, 2015. Id. ¶¶ 23–24. The
letter explained that AllianceOne was attempting to collect the debt and that “any
information obtained [would] be used for that purpose.” Id., Ex. D. In addition to
sending the letter, AllianceOne allegedly made at least eleven phone calls to
Bruner’s cell phone using various phone numbers over a six-week period. 2

Id.

¶¶ 27–28. Bruner felt harassed by AllianceOne’s actions and was concerned and
confused about her rights post-bankruptcy.

Id. ¶¶ 29, 31–32.

She therefore

consulted with counsel “to ensure that Defendant’s collection efforts ceased.” Id.
¶ 29. This lawsuit soon followed.
Legal Standard
To survive a motion to dismiss pursuant to Rule 12(b)(6), a complaint must
“state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007).

“A claim has facial plausibility when the plaintiff pleads

The Court can consider this and all other attachments to Bruner’s complaint in
ruling on AllianceOne’s motion to dismiss. Williamson v. Curran, 714 F.3d 432, 436 (7th
Cir. 2013).
1

The complaint does not explicitly state that the calls occurred over a six-week
period, but it states that the calls began “shortly after” AllianceOne sent the dunning letter.
Id. ¶ 27. It is reasonable to infer that they ended no later than when Bruner filed her suit
on October 30, 2015.
2

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factual content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). Additionally, when considering motions to dismiss, the Court accepts “all
well-pleaded factual allegations as true and view[s] them in the light most favorable
to the plaintiff.” Lavalais v. Vill. of Melrose Park, 734 F.3d 629, 632 (7th Cir. 2013)
(citing Luevano v. Wal–Mart Stores, Inc., 722 F.3d 1014, 1027 (7th Cir. 2013)). At
the same time, “allegations in the form of legal conclusions are insufficient to
survive a Rule 12(b)(6) motion.” McReynolds v. Merrill Lynch & Co., Inc., 694 F.3d
873, 885 (7th Cir. 2012) (citing Iqbal, 556 U.S. at 678). As such, “[t]hreadbare
recitals of the elements of the cause of action, supported by mere conclusory
statements, do not suffice.” Iqbal, 556 U.S. at 678.
Analysis
I.

Count I: FDCPA
In Count I, Bruner alleges that AllianceOne has violated three different

provisions of the FDCPA: 15 U.S.C. §§ 1692d, 1692e, and 1692f. AllianceOne does
not challenge Bruner’s claim under § 1692e.
A.

Section 1692d

AllianceOne first challenges Bruner’s claim under § 1692d.

Under this

provision, “[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. Bruner alleges that AllianceOne’s dunning letter and
“relentless[]” calls harassed, oppressed, and abused her. Am. Compl. ¶ 41. To that
end, Bruner focuses on one particular type of conduct specified in the statute:
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“Causing a telephone to ring or engaging any person in telephone conversation
repeatedly or continuously with intent to annoy, abuse, or harass any person at the
called number.” 15 U.S.C. § 1692d(5).
AllianceOne argues that Bruner’s allegations of a single letter and at least
eleven calls to her cell phone over a span of six weeks do not amount to a violation
of § 1692d as a matter of law. Mot. Dismiss 4, ECF No. 30. As an initial matter,
AllianceOne contends that sending a single collection letter that is not threatening
or profane cannot constitute a violation of § 1692d. Id. at 4–5. Bruner does not
dispute this point in her response, and courts have generally held that sending a
single collection letter in this fashion cannot give rise to a claim under § 1692d. See,
e.g., Harrer v. RJM Acquisitions, LLC, No. 10-CV-7922, 2012 WL 162281, at *6
(N.D. Ill. Jan. 19, 2012).
The focus of Bruner’s claim is instead the eleven calls she claims that
AllianceOne made to her cell phone over a six-week period. AllianceOne contends
that these calls do not violate § 1692d(5) as a matter of law because they cannot of
themselves demonstrate an intent to annoy, abuse, or harass. 3
There is no precise test for determining when repeated phone calls violate
§ 1692d(5). Allen v. Bank of Am., N.A., No. 11 C 9259, 2012 WL 5412654, at *7
(N.D. Ill. Nov. 6, 2012) (“The Seventh Circuit has not articulated a standard for

AllianceOne also makes the narrower argument that Bruner did not plead the word
“intent” in connection with her § 1692d(5) claim. Mot. Dismiss at 5. The Court is satisfied,
however, that Bruner’s description of AllianceOne’s conduct and her characterization of
that conduct as “relentless[]” and “repeated” is sufficient for the purposes of Rule 8. See
Am. Compl. ¶¶ 40–42.
3

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evaluating § 1692d claims.”).

But in ascertaining whether repeated phone calls

were made with the requisite intent, courts of this circuit typically look to the
volume and pattern of calls made, as well as whether a plaintiff has requested that
a collection agency stop calling. Kube v. Creditors Collection Bureau, Inc., No. 10 C
7416, 2012 WL 3848300, at *2 (N.D. Ill. Aug. 30, 2012); Majeski v. I.C. Sys., Inc., 08
CV 5583, 2010 WL 145861, at *3 (N.D. Ill. Jan. 8, 2010). A district court outside
this circuit has summarized relevant factors as including “the volume, frequency,
and persistence of calls,” “whether defendant continued to call after plaintiff
requested it cease,” and “whether plaintiff actually owed the alleged debt.” Davis v.
Diversified Consultants, Inc., 36 F. Supp. 3d 217, 228 (D. Mass. 2014). Typically,
whether conduct violates § 1692d(5) is a factual inquiry that is inappropriate to
conduct on a motion to dismiss. Allen, 2012 WL 5412654, at *7 (citing Jeter v.
Credit Bureau, Inc., 760 F.2d 1168, 1179 (11th Cir. 1985)).
Here, the Court cannot find that, as a matter of law, AllianceOne’s purported
calls do not violate § 1692(d). Eleven (or more) unwanted phone calls from various
numbers could be indicative of intent to harass Bruner. Other district courts have
permitted claims to proceed at the motion to dismiss stage based on this volume of
calls (or fewer). Carr v. NCO Fin. Sys., Inc., No. CIV.A. 11-2050, 2011 WL 6371899,
at *3 (E.D. Pa. Dec. 20, 2011) (nine specifically identified calls plus “other calls”);
Valentine v. Brock & Scott, PLLC, No. 2:09-CV-2555-PMD, 2010 WL 1727681, at *4
(D.S.C. Apr. 26, 2010) (eleven calls). Without more, the Court cannot adequately
assess whether the pattern and frequency of these calls over the six-week period

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increase or decrease the likelihood of intentional harassment. While the courts
faced with a similar volume of calls were also presented with shorter time periods,
Carr, 2011 WL 6371899, at *3 (thirty days); Valentine, 2010 WL 1727681, at *4
(nineteen days), the Court does not believe this should foreclose Bruner’s claim at
this stage.

Given the circumstances alleged, an average of two calls per week

plausibly indicates intent to harass or annoy. 4
In addition to the volume and frequency of calls, Bruner maintains that she
is not personally liable for the debt, which also weighs in favor of permitting her
claim to proceed. Davis, 36 F. Supp. 3d at 228. And finally, while Bruner does not
claim that she asked for the calls to stop, the Court will not hold that against her at
this stage. At this posture, the Court must draw the reasonable inference in her
favor that, at least for some of the calls, she had good reason not to answer: namely,
she may have feared the dunning letter’s warning that “[t]his is an attempt to
collect a debt, and any information obtained will be used for that purpose.” 5 Am.
Compl., Ex. D.

AllianceOne directs the Court to Zarichny v. Complete Payment Recovery Services,
Inc., 80 F. Supp. 3d 610 (E.D. Pa. 2015), in which the court concluded that allegations of at
least eleven calls over a period of six months did not state a claim for relief under
§ 1692d(5). Id. at 621. But the Zarichny court expressly relied on the period of six months,
id., which is much longer than that at issue in this case.
4

The complaint does not specify whether the calls went unanswered, or whether
Bruner spoke with a representative of AllianceOne. At the summary judgment stage, some
courts have taken unanswered calls to suggest difficulty reaching the plaintiff, rather than
intent to harass. Saltzman v. I.C. Sys., Inc., No. 09-10096, 2009 WL 3190359, at *7 (E.D.
Mich. Sept. 30, 2009). But as stated previously, the Court must draw all reasonable
inferences in Bruner’s favor at this stage, and it therefore will not infer that AllianceOne
had difficulty reaching Bruner.
5

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The parties debate the applicability of various summary judgment decisions
in which courts have held that a reasonable jury could find a § 1692d(5) violation
based on a volume of calls larger than that Bruner alleges she endured. See Resp.
4–5, ECF No. 36; Reply 3–4, ECF No. 38. These cases are of little relevance at this
time. At the summary judgment stage, after development of a full record (from
which the courts in the cases cited by the parties benefited), the Court can fully
assess whether a reasonable jury could find in Bruner’s favor.

At this stage,

however, based on the Court’s foregoing analysis, she states a plausible claim for
relief. AllianceOne’s motion to dismiss Bruner’s § 1692d claim is therefore denied.
B.

Section 1692f

Bruner’s final claim under the FDCPA is that AllianceOne violated § 1692f.
Under this provision, “[a] debt collector may not use unfair or unconscionable means
to collect or attempt to collect any debt.” 15 U.S.C. § 1692f. Bruner asserts in part
that, by attempting to collect a debt discharged in bankruptcy, AllianceOne has
committed conduct specifically barred by § 1692f: “[t]he collection of any amount . . .
unless such amount is expressly authorized by the agreement creating the debt or
permitted by law.” Id. § 1692f(1).
In analyzing Bruner’s § 1692f claim, the Court must consider the claim from
the perspective of an unsophisticated debtor. McMillan v. Collection Prof’ls, Inc.,
455 F.3d 754, 758 (7th Cir. 2006). The question of whether means are unfair or
unconscionable “requires a fact-bound interpretation” of how an unsophisticated
debtor would perceive the means alleged. Id. at 759; see also Turner v. J.V.D.B. &
Assocs., Inc., 330 F.3d 991, 996 (7th Cir. 2003) (“[T]he existence of a violation hinges
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on objective factors that relate to a consumer who receives the demand for
payment.”).

Additionally, “[w]hether the collection of a debt violates § 1692f(1)

depends solely on two factors: (1) whether the debt agreement explicitly authorizes
the charge; or (2) whether the charge is permitted by law.” Turner, 330 F.3d at 996.
In Turner v. J.V.D.B. Associates, Inc., the Seventh Circuit dealt with a case in
which a debt collector sent a dunning letter much like that in this case to the
plaintiff, seeking to collect a debt discharged in bankruptcy. Id. at 995. The court
observed that, like in this case, the contents of the letter tracked requirements for
such letters specified in § 1692g(a), under which debt collection letters must provide
various items of information to their recipients. Id. at 997–98. Noting that there
could nevertheless be liability for collecting a discharged debt under another
provision of the FDCPA (§ 1692e), the court refused to hold that such conduct also
violates § 1692f. Instead, the court concluded that it “[did] not see how a reasonable
jury could conclude that furnishing this information would, in any sense, be an
‘unfair or unconscionable means’ of debt collection when directed toward an
unsophisticated but reasonable consumer whose debt had been discharged in
bankruptcy.” Id. at 998. The court’s specific holding was as follows: “a letter simply
providing the information required by § 1692g(a) is not an unfair or unconscionable
means of debt collection under § 1692f.” Id.
Thus, under Turner, Bruner cannot state a claim under § 1692f merely based
on the dunning letter she alleges AllianceOne sent. But Bruner’s claim, of course, is
based on more than the letter; it is based on the letter in conjunction with the

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eleven (or more) phone calls she alleges AllianceOne placed to her cell phone.
Recognizing this, AllianceOne seeks to dismiss Bruner’s § 1692(f) claim based on a
broader construction of the holding in Turner. It cites Todd v. Collecto, Inc., 731
F.3d 734 (7th Cir. 2013), in which the Seventh Circuit summarized its holding in
Turner as follows: “Asking a consumer to pay a debt discharged in bankruptcy . . . is
not unfair or unconscionable within the meaning of § 1692f, though it violates
another provision of the FDCPA.” Id. at 739. Based on this summary, AllianceOne
insists that Todd controls and disposes of this case, because all Bruner claims that
AllianceOne did is ask her to pay a debt discharged in bankruptcy. Mot. Dismiss at
5; Reply at 5.
AllianceOne reads Todd, however, for more than it is worth. Todd’s reference
to “[a]sking a consumer to pay a debt” cannot be construed to encompass more than
the conduct that was at issue in Turner: simply sending a § 1692g(a)-compliant
dunning letter.

Bruner, however, alleges eleven phone calls in addition to

AllianceOne’s dunning letter.

Where a plaintiff alleges conduct beyond a

§ 1692g(a)-compliant dunning letter, courts of this circuit have regularly held that
the plaintiff states a claim under § 1692f. Snyder v. Ocwen Loan Servicing, LLC,
No. 14 C 8461, 2015 WL 1910989, at *4 (N.D. Ill. Apr. 27, 2015) (“Turner does not
apply to [alleged] telephone communications.”); Gritters v. Ocwen Loan Servicing,
LLC, No. 14 C 00916, 2014 WL 7451682, at *7 (N.D. Ill. Dec. 31, 2014); see also Gros
v. Midland Credit Mgmt., Inc., No. 06 C 5510, 2008 WL 4671717, at *7 (N.D. Ill.
Oct. 20, 2008) (holding plaintiff had established a triable issue of fact where

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defendant’s conduct went beyond sending a § 1692g(a)-compliant dunning letter,
because “[i]t may very well be that an unsophisticated consumer would feel that
they were unfairly treated in receiving three letters and four phone calls about a
debt that had already been discharged”). The Court sees no reason to deviate from
these holdings. AllianceOne’s argument based on Todd is therefore rejected.
AllianceOne also seeks to dismiss Bruner’s § 1692(f) claim on the basis that
unanswered telephone calls cannot violate the statute. Resp. at 6. AllianceOne
asserts that unanswered calls are not “communications” and thus cannot violate the
FDCPA.

Id.

This argument fails in two respects.

First, as previously noted,

Bruner’s complaint does not state that AllianceOne’s calls were unanswered.
Second, AllianceOne’s position that unanswered calls are not “communications,”
and thus cannot violate the FDCPA, is incorrect. In some respects, the argument
proves too much: if unanswered calls could not violate the FDCPA in any respect,
§ 1692d(5)’s bar on “[c]ausing a telephone to ring” would be superfluous. But more
to the point, the language of § 1692f does not require a “communication,” as that
term is used in the FDCPA. See 15 U.S.C. § 1692(a)(2); Tourgeman v. Collins Fin.
Servs., Inc., No. 08-CV-1392 JLS NLS, 2011 WL 3176453, at *4 (S.D. Cal. July 26,
2011) (holding that § 1692f “do[es] not require a ‘communication’”). AllianceOne
cites various cases in support of its position, Mot. Dismiss at 6–7, but each
addresses a portion of the statute that expressly requires a “communication.” Davis
v. Phelan Hallinan & Diamond, PC., No. CV 15-3621 (RBK-AMD), 2016 WL
1078166, at *4 (D.N.J. Mar. 18, 2016) (discussing § 1692c(b), which concerns debt

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collectors’ “[c]ommunications with third parties”); Worsham v. Acct. Receivables
Mgmt., Inc., No. CIV. JKB-10-3051, 2011 WL 5873107, at *3 (D. Md. Nov. 22, 2011)
(applying § 1692b(3), which limits “[a]ny debt collector communicating with any
person other than the consumer for the purpose of acquiring location information
about the consumer”); Wilfong v. Persolve, LLC, No. CIV. 10-3083-CL, 2011 WL
2678925, at *2 (D. Or. June 2, 2011) (analyzing § 1692c(c), which concerns debt
collectors “[c]easing communication” with consumers). Bruner therefore need not
allege a “communication” to make out her § 1692f claim.

For these reasons,

AllianceOne’s motion to dismiss Bruner’s § 1692f claim is denied.
II.

Count II: ICFA
In Count II of her complaint, Bruner alleges that AllianceOne, by “engaging

in unfair and deceptive acts or practices by using fraud, deception, and
misrepresentations in its attempts to collect [Bruner’s] discharged debt,” violated
the ICFA. Am. Compl. ¶ 56. Under the ICFA, “[u]nfair methods of competition and
unfair or deceptive acts or practices . . . in the conduct of any trade or commerce are
hereby declared unlawful whether any person has in fact been misled, deceived or
damaged thereby.” 815 Ill. Comp. Stat. 505/2. The elements of a cause of action for
damages under the ICFA are: “(1) a deceptive act or practice by [defendant]; (2) that
the act or practice occurred in [a] course of conduct involving trade or commerce; (3)
that [defendant] intended [plaintiff] to rely on the deception; and (4) that actual
damages were proximately caused by the deception.” Oshana v. Coca-Cola Co., 472
F.3d 506, 513 (7th Cir. 2006) (citing Avery v. State Farm Mut. Auto. Ins. Co., 835
N.E.2d 801, 850 (Ill. 2005)).
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In moving to dismiss Bruner’s ICFA claim, AllianceOne argues that Bruner
has (1) failed to plead she was deceived by AllianceOne’s actions, and (2) failed to
state a claim for actual damages.

Mot. Dismiss at 8–9.

argument is more or less dead on arrival.

AllianceOne’s first

At various points in her complaint,

Bruner states that she was deceived. Am. Compl. ¶ 59 (“Plaintiff did in fact rely on
Defendant’s deceptive and unfair acts to her detriment as she was led to believe
that her bankruptcy had no legal effect and was forced to retain counsel as a result
of Defendant’s misrepresentations.”); see also id. ¶ 32 (“Plaintiff was in a state of
utter confusion as she was led to believe her bankruptcy had no legal effect.”).
Thus, Bruner has adequately pleaded acts of deception and that she was in fact
deceived.
But AllianceOne’s second argument has stronger footing. The only damages
Bruner alleges in her complaint are that she “expended time and incurred costs
consulting with her attorneys as a result of [AllianceOne’s] deceptive collection
actions.” Id. ¶ 30; see also id. ¶ 59. In her response, she clarifies that her complaint
“cited the costs she incurred in bringing [this] suit,” which she filed “as her only
means of getting [AllianceOne] to cease its harassment.” Resp. at 5. But costs
incurred in bringing an ICFA claim cannot constitute “actual damages” under the
statute. Rather, the ICFA provides separately for recovery of attorney’s fees and
costs in the event of a successful suit. 815 Ill. Comp. Stat. 505/10a(c). Courts have
been uniform in holding that attorney’s fees and costs incurred in bringing a suit
under the ICFA are not actual damages. Bednar v. Pierce & Assocs., P.C., No. 16 C

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6638, 2016 WL 6647944, at *4 (N.D. Ill. Nov. 10, 2016); Garcia v. Receivables
Performance Mgmt., LLC, No. 14 C 5367, 2014 WL 5543885, at *2 (N.D. Ill. Nov. 3,
2014). If Bruner had “filed an appearance or incurred any expenses in defending” a
debt collection lawsuit, such an expenditure of time and money could constitute
actual damages. Armbrister v. Pushpin Holdings, LLC, 896 F. Supp. 2d 746, 756
(N.D. Ill. 2012) (emphasis added). But that is not what she claims here.
In her response, Bruner raises for the first time the novel claim that “any
usage of minutes on [her] cell phone plan” or any decrease in “the value of [her] cell
phone plan, battery life, storage, or functionality” occasioned by AllianceOne’s calls
constitute actual damages as well. Resp. at 5–6. Of course, she cannot amend her
complaint, which is bereft of her cellular damage theory, by her response.
Thomason v. Nachtrieb, 888 F.2d 1202, 1205 (7th Cir. 1989). But in any event, the
cases she cites in support of her theory all address what constitutes being “charged”
for a call under the Telephone Consumer Protection Act (TCPA). Resp. at 5–6; see
47 U.S.C. § 227. These cases reason that, where a cell phone subscriber purchases a
cell phone plan, the subscriber is in a sense “charged” for a TCPA-offending call by
virtue of having paid for a cell phone plan in the first place. E.g., Fini v. Dish
Network L.L.C., 955 F. Supp. 2d 1288, 1297 (M.D. Fla. 2013).
Whatever the merits of this theory under the TCPA, it holds no water where
the ICFA is concerned. Actual damages under the ICFA must follow from “‘actual
pecuniary loss.’” Kim v. Carter’s Inc., 598 F.3d 362, 365 (7th Cir. 2010) (quoting
Mulligan v. QVC, Inc., 888 N.E.2d 1190, 1197 (Ill. App. Ct. 2008)). They must be

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calculable and “measured by the plaintiff[’]s loss.”

Morris v. Harvey Cycle &

Camper, Inc., 911 N.E.2d 1049, 1053 (Ill. App. Ct. 2009). Bruner’s asserted cellular
damages—depreciation of the value of her cell phone plan (without any allegation of
additional costs incurred), battery life, storage, and functionality—are not plausibly
calculable or measurable. Thus, they cannot constitute actual damages under the
ICFA. Nelson v. Ashford Univ., LLC, No. 16-CV-3491, 2016 WL 4530325, at *3
(N.D. Ill. Aug. 29, 2016) (rejecting a similar theory of cellular damages premised on
vague notions of diminished service and storage, and noting that the plaintiff did
not allege “any cost that would not have otherwise occurred, such as overage
charges for telephone or data services”). Because Bruner does not plead actual
damages, her ICFA claim is dismissed.
Conclusion
For the foregoing reasons, AllianceOne’s motion to dismiss [30] is granted in
part and denied in part. Bruner’s claims under the FDCPA in Count I of her First
Amended Complaint may proceed as alleged. Her ICFA claim in Count II, however,
is dismissed.
IT IS SO ORDERED.

ENTERED

2/28/17

__________________________________
John Z. Lee
United States District Judge

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