Hunt v. Ocwen Mortgage Servicing, Inc. et al

Filing 36

MEMORANDUM Opinion and Order Signed by the Honorable Marvin E. Aspen on 11/8/2017: Defendants' motion to stay proceedings (Case Number 17 C 3474, Docket Entry #15) is granted. Proceedings in the seven consolidated cases are stayed. The previo us rulings denying the motions to stay in Lewis, Verdin, and Walsh are vacated. The parties shall file briefs within 21 days of the ACA International v. Federal Communications Commission decision, addressing the impact of the D.C. Circuit Court of Appeal's ruling on the proceedings in this case.Mailed notice(mad, )

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
TODD BURNETT,
Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.

JOHNNY D. HUNT,
Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.

BENJAMIN LEWIS,
Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.

)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)

No. 17 C 3474
Hon. Marvin E. Aspen

No. 17 C 3476
Hon. Jorge L. Alonso

No. 17 C 3478
Hon. John Z. Lee

GIDGET SIMPSON,

)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)

Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.

SAUL VERDIN,
Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.

GERARD A. WALSH,
Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.

DERRICK WATTS,
Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.

2

No. 17 C 3480
Hon. Amy J. St. Eve

No. 17 C 3482
Hon. Jeffrey T. Gilbert

No. 17 C 3483
Hon. John J. Tharp, Jr.

No. 17 C 3484
Hon. Maria Valdez

MEMORANDUM OPINION AND ORDER
MARVIN E. ASPEN, District Judge:
Presently before us is Defendant’s motion to stay the proceedings in the above cases we
have consolidated for pretrial purposes. (Def. Mot. (No. 17 C 3474, Dkt. No. 15) at 1.) The
motion1 seeks to stay the proceedings in these cases until the D.C. Circuit issues its ruling in
ACA International v. Federal Communications Commission, No. 15–1211 (D.C. Cir., argued
Oct. 19, 2016) (“ACA International”). Plaintiffs filed a response in opposition to Defendants’
motion to stay, and Defendant Ocwen Loan Servicing (“OLS”) filed a reply.
(No. 17 C 3474, Dkt. Nos. 22, 31.) For the reasons stated below, we grant Defendant’s motions
to stay and vacate the previous rulings denying the motions to stay in Lewis, Verdin, and Walsh.
The parties are hereby directed to promptly notify us after the D.C. Circuit has issued its ruling
in ACA International, and shall file briefs within 21 days of the decision addressing the impact of
the ruling on the claims in these cases.
BACKGROUND
Defendant argues we should stay the claims in the consolidated cases against OLS
because the D.C. Circuit’s ruling will be “dispositive” of Plaintiffs’ Telephone Consumer
Protection Act (“TCPA”) claims. (Def. Mot. at 2.) Namely, Defendant argues ACA
International will address three of petitioners’ arguments that are relevant to the cases before us:
(1) the definition of an automatic telephone dialing system (“ATDS”) under the TCPA,
1

The relevant issues in the seven cases are largely identical and the briefs on the motions to stay
are effectively the same, although the parties did not file responses and replies in all of the
individual cases. We accordingly find it unnecessary to require consolidated briefing on the
present motion to stay, as previously requested by the parties. (Dkt. Nos. 34 at 3, 38 at 3.) For
simplicity, in this order we refer to the motion, response, reply, and complaint filed in Burnett,
No. 17 C 3474, the earliest filed case.

3

(2) formation of “prior express consent” with reassigned numbers, and (3) procedures for
revocation of consent. (Id. at 1–2); see also 30 F.C.C.R. 7961, 7971–78, 7989–8012
(July 10, 2015); Joint Brief for Petitioners, ACA International, No. 15-1211,
Dkt. No. 1585568 at 4.
ACA International concerns an appeal of the Federal Communication Commission’s
(“FCC”) July 10, 2015 Declaratory Ruling interpreting the TCPA. 30 F.C.C.R. 7961
(July 10, 2015). The D.C. Circuit heard arguments on October 19, 2016 in a consolidated
challenge by nine companies who sought judicial review of the Declaratory Ruling pursuant to
5 U.S.C. § 500 et seq. (the Administrative Procedure Act), 28 U.S.C. §§ 2342–44, and
47 U.S.C. § 402. See Ankcorn v. Kohl’s Corp., No. 15 C 1303, 2017 WL 395707, at *2
(N.D. Ill. Jan. 30, 2017) (summarizing the procedural history of ACA International).
Before we consolidated the captioned seven cases, Defendant filed substantially identical
motions to stay the cases individually, four of which the originally assigned judges either granted
or denied. Lewis, No. 17 C 3478 (Dkt. No. 25) (denying motion to stay); Simpson,
No. 17 C 3480 (Dkt. No. 19) (granting motion to stay); Verdin, No. 17 C 3482 (Dkt. No. 19)
(denying motion to stay); Walsh, No. 17 C 3483 (Dkt. No. 20) (denying motion to stay). To
allow for the seven cases to proceed on the same calendar, we now issue a consolidated ruling on
the seven motions to stay and vacate the previous rulings denying the motions to stay in Lewis,
Verdin, and Walsh.
LEGAL STANDARD
The Supreme Court has repeatedly held that “courts have inherent power to stay
proceedings and ‘to control the disposition of the causes on its docket with economy of time and

4

effort for itself, for counsel, and for litigants.’” Stone v. I.N.S., 514 U.S. 386, 411,
115 S. Ct. 1537, 1552 (1995) (quoting Landis v. N. Am. Co., 299 U.S. 248, 254,
57 S. Ct. 163, 166 (1936)). Orders staying proceedings must both be “[]moderate” and within
“reasonable limits.” Landis, 299 U.S. at 257, 57 S. Ct. at 167. In evaluating a motion to stay,
courts consider whether the stay will: (1) “unduly prejudice or tactically disadvantage the nonmoving party,” (2) “simplify the issues in question and streamline the trial,” and (3) “reduce the
burden of litigation on the parties and on the court.” Genzyme Corp. v. Cobrek Pharm., Inc.,
No. 10 CV 00112, 2011 WL 686807, at *1 (N.D. Ill. Feb. 17, 2011); Tap Pharm. Prods.,
Inc. v. Atrix Labs., Inc., No. 03 C 7822, 2004 WL 422697, at *1 (N.D. Ill. Mar. 3, 2004). “The
proponent of a stay bears the burden of establishing its need.” Clinton v. Jones,
520 U.S. 681, 708, 117 S. Ct. 1636, 1651 (1997).
ANALYSIS
I.

Plaintiff’s Request for Judicial Notice
As a preliminary matter, we first consider Plaintiff’s request that we take judicial notice

of the documents attached as Exhibits A and B to Plaintiff Burnett’s response in opposition of
the motion to stay. (Dkt. Nos. 22–2, 22–3, 22–4.) Exhibits A and B include minute entries in
two cases, Verdin, No. 17 C 3482, a case consolidated before us, and Prouty v. Ocwen Loan
Servicing, LLC, No. 17 C 1106 (D. Co.). (Dkt. Nos. 22–3, 22–4.) Federal Rule of Evidence 201
allows a court to take judicial notice of any fact that is “not subject to reasonable dispute”
because it is generally known in the court’s jurisdiction or “can be accurately and readily
determined from sources whose accuracy cannot be reasonably questioned.”
Fed. R. Evid. 201(b). Judicial notice of these documents is proper because the entries’ existence

5

is not in dispute and their accuracy can be easily confirmed by examining the court’s docket.
Stern v. Great W. Bank, 959 F. Supp. 478, 481 (N.D. Ill. 1997) (taking judicial notice of the
court record of a related proceeding); Cagan v. Intervest Midwest Real Estate Corp.,
774 F. Supp. 1089, 1093 (N.D. Ill. 1991) (finding judicial notice of a court order in another case
proper). Further, Defendant has not expressed any challenge to the authenticity of these entries.
However, we take judicial notice only for the limited purpose of recognizing the existence of
these docket entries. See Montegna v. Ocwen Loan Servicing, LLC, No. 17 C 939 AJB BLM,
2017 WL 4680168, at *3 (S.D. Cal. Oct. 18, 2017) (taking limited notice of Verdin document in
similar proceeding against OLS).
II.

Motion to Stay
We now turn to Defendant’s motion to stay the proceedings in the seven cases at issue.

Defendant suggests the interpretation of the issues before the D.C. Circuit in ACA International
will be determinative of the claims in these cases, and that the outcome of ACA International
could “narrow” or “extinguish” plaintiffs’ claims. (Def. Mot. at 5–6.) Defendant thus argues a
stay in these cases will allow the court to avoid inconsistent rulings and potentially irrelevant
discovery without prejudice to plaintiffs. (Id. at 6–8).
We agree that the ruling in ACA International will both simplify legal issues in these
cases and reduce the burden of litigation on the parties and the court. Genzyme,
2011 WL 686807, at *1; Tap Pharm. Prods., 2004 WL 422697, at *1. To successfully prove
their claims under the TCPA, Plaintiffs must demonstrate that OLS called each Plaintiff with an
ATDS or a prerecorded voice without express prior consent. 47 U.S.C. § 227. The D.C.
Circuit’s ruling will thus provide guidance on determinative issues in Plaintiffs’ TCPA claims,

6

including what devices qualify as an ATDS under the statute and how consent can be revoked,
issues that decide OLS’s liability. The D.C. Circuit may indeed vacate the FCC’s Declaratory
Ruling, which would transform the elements that must be proven under the TCPA, in effect
clarifying the legal issues involved in pretrial motions and shaping the focus of discovery.
Ankcorn v. Kohl's Corp., No. 15 CV 1303, 2017 WL 395707, at *3 (N.D. Ill. Jan. 30, 2017)
(staying cases with TCPA claims until the ACA International ruling because the D.C. Circuit
may vacate the FCC’s Declaratory Ruling); see also CE Design, Ltd. v. Prism Bus. Media, Inc.,
606 F.3d 443, 446 (7th Cir. 2010) (explaining the broad powers of federal courts of appeals “to
enjoin, set aside, suspend (in whole or in part), or to determine the validity of” all final FCC
orders). Accordingly, staying these proceedings until ACA International is decided will preserve
resources of the court and the parties by avoiding rulings and discovery rendered irrelevant by
the D.C. Circuit’s ruling. Abdallah v. FedEx Corp. Servs., Inc., No. 16 C 03967,
2017 WL 3669040, at **1–2 (N.D. Ill. Mar. 20, 2017) (staying TCPA case pending ACA
International because the D.C. Circuit’s interpretation of an ATDS will require discovery
requests be “reprised or at least reevaluated”).
Despite these advantages of efficiency and clarification, we may not stay proceedings if
the stay would cause undue prejudice to the non-moving party. Genzyme,
2011 WL 686807, at *1. Significantly, a stay in this case will not deprive Plaintiffs of needed
relief from the alleged unlawful calls because Plaintiffs do not allege the calls are presently
ongoing. (Am. Compl. (No. 17 C 3474, Dkt. No. 22) at 6); Ankcorn, 2017 WL 395707, at *4
(finding no risk of continuing harm to plaintiff from a stay pending ACA International because
plaintiff no longer received calls). Plaintiffs argue a delay would prejudice plaintiffs in

7

discovery because witnesses will forget relevant observations and documents may be misplaced
or destroyed. (Pl. Resp. (Dkt. No. 22) at 4–8.) However, this type of prejudice is “inherent in
any stay” and does not justify denial of a motion to stay. Ankcorn, 2017 WL 395707, at *4
(citing VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1319 (Fed. Cir. 2014) (“It is
undoubtedly true, as many courts have observed, that with age and the passage of time,
memories may fade and witnesses may become unavailable. Without more, however, these
assertions here are not sufficient to justify a conclusion of undue prejudice.”). Furthermore,
Defendant indicates it has been retaining relevant records since the service of the Complaint
(Def. Reply (Dkt. No. 31) at 6), and Plaintiffs do not explain why their own phone records could
not be recovered absent court-ordered discovery. (Pl. Resp. 5–6.) We accordingly find any
difficulty Plaintiffs may encounter as a result of a stay does not rise to the level of undue
prejudice rendering a stay improper.
Plaintiff also argues the stay would be “indefinite and potentially lengthy.” (Id. at 4–5);
see Franklin v. Ocwen Loan Servicing, LLC, No. 17 CV 02702 JST, 2017 WL 4922380, at *4
(N.D. Cal. Oct. 31, 2017) (declining to find the decision in ACA International imminent because
the case has been fully briefed and argued for over a year without an opinion). While the oral
arguments in ACA International were held more than a year ago, we do not find the unknown
date of a ruling renders a stay outside definite limits. Furthermore, the stay will not be limitless
during potential appeals: as Defendant requests, the stay will end once the D.C. Circuit has
issued its opinion. (Def. Mot. at 1.) The parties can address any pending appeals of the D.C.
Circuit’s opinion in their briefs after the ruling. We accordingly find a stay appropriate in these
proceedings.

8

CONCLUSION
For the aforementioned reasons, we grant Defendant’s motion to stay proceedings in the
seven consolidated cases and vacate the previous rulings denying the motions to stay in Lewis,
Verdin, and Walsh. The parties shall file briefs within 21 days of the ACA International decision
addressing the impact of the D.C. Circuit’s ruling on the proceedings in this case. It is so
ordered.

____________________________________
Marvin E. Aspen
United States District Judge
Dated: November 8, 2017
Chicago, Illinois

9