Duarte v. Convergent Outsourcing, Inc. et al
Filing
53
MEMORANDUM Opinion and Order signed by the Honorable Edmond E. Chang. For the reasons stated in the Opinion, Comcast's motion 22 to dismiss is denied. The status and motion hearings of 07/25/2018 remain as previously scheduled. Emailed notice(slb, )
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UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
BRENDA DUARTE,
Plaintiff,
v.
CONVERGENT OUTSOURCING, INC.,
and COMCAST CORPORATION,
Defendants.
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No. 17 C 06051
Judge Edmond E. Chang
MEMORANDUM OPINION AND ORDER
In March 2017, Brenda Duarte filed a lawsuit against a debt collector, hired
by Defendant Comcast, for its allegedly unlawful collection practices. R. 1, Compl.
¶¶ 13, 15, 18.1 Once that suit began, Comcast initially halted its collection efforts,
including through hired debt collectors. Id. ¶ 22. But as the months went by, while
the first case was still pending, Comcast allegedly hired another collection agency,
Defendant Convergent Outsourcing. Id. ¶ 24. In July 2017, Convergent sent a
collection letter to Duarte—even though she was represented by an attorney in the
first case. Id. ¶¶ 24-25. This second suit followed: Duarte sued Convergent and
Comcast for violations of the Fair Debt Collection Practices Act (FDCPA) and the
Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA), respectively.
1Citations
to the record are noted as “R.” followed by the docket number and the page
or paragraph number.
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Id. ¶¶ 46, 48.2 Now, Comcast moves to dismiss the ICFA count for failing to state an
adequate claim. R. 22, Def. Mot. to Dismiss at 1-2; Fed. R. Civ. P. 12(b)(6). For the
reasons discussed below, the motion is denied.
I. Background
For the purposes of this motion, the Court accepts as true the allegations in
the Complaint. Erickson v. Pardus, 551 U.S. 89, 94 (2007). Before the events leading
up to this suit, Brenda Duarte accumulated around $270 in charges for Comcast
services in her home. Compl. ¶ 11. When she could not afford to pay her bill, Comcast
hired a series of debt collectors to try to settle Duarte’s account. Id. ¶ 13. The first
collector used aggressive tactics and allegedly threatened Duarte with the addition
of interest and fees to the balance. Id. ¶ 15. While the first company pursued Duarte,
Comcast hired a second collection agency (Diversified Consultants), which began its
own attempts to collect the overdue bill. Id. ¶ 16.
When the second agency began reporting the delinquent account to the
national credit bureaus, Duarte sought the help of the Community Legal Group.
Compl. ¶¶ 17-18. Once she retained her attorneys, Duarte filed a lawsuit against the
first debt collector, alleging violations of the FDCPA.3 Id. ¶ 18. The first collector was
served in March 2017, and Duarte alleges that the debt collector notified Comcast of
the lawsuit, because the suit was related to its account. Id. ¶¶ 20-21. After Duarte
2This
Court has subject matter jurisdiction over the case under 28 U.S.C. § 1331 and
15 U.S.C. § 1692k(d). The Court has supplemental jurisdiction over the related state law
claim under 28 U.S.C. § 1367.
3That case is captioned Brenda Duarte v. Financial Business Customer Solutions, Inc.,
No. 17 C 01753 (N.D. Ill. 2017).
2
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filed the first suit, Comcast also allegedly retracted the collection account from both
of the collectors that it had hired. Id. ¶ 22.
While Duarte’s first lawsuit was pending, Comcast hired a third collection
agency, which is where Convergent Outsourcing enters the picture. Compl. ¶ 24.
Convergent began efforts to collect the same debt—the nearly $270 Comcast bill—
from Duarte. See id. ¶¶ 24-25. In July 2017, Convergent sent her a collection letter
for that account. Id. ¶¶ 25-27; id. Exh. G. But Duarte was already represented by an
attorney, the one who represented her in the still-pending first lawsuit. See id. ¶ 24.
Duarte alleges that this direct communication about the debt while she was
represented by an attorney violates the FDCPA. Id. ¶ 31. When she received the
letter, Duarte suffered feelings of nervousness and hopelessness, because she felt that
Convergent and Comcast would never stop hounding her, even after she got legal
help. Id. ¶ 32. She also felt annoyed, aggravated, and suffered emotional distress. Id.
¶ 33.
As for Comcast specifically, Duarte alleges that Comcast purposefully hires
multiple debt collection agencies as a business strategy. Compl. ¶ 34. That way, when
a consumer asserts her rights as to one, Comcast can switch to another, forcing the
consumer into a perpetual cycle of harassment. Id. ¶ 34-35. The various collectors
also allow Comcast to circumvent a consumer’s attorney representation. Id. ¶ 34. So
when Comcast hired its third debt collector for Duarte’s debt—when she had already
retained an attorney for that debt in the first lawsuit—Duarte was harmed by
Comcast’s renewed attempts to collect the debt. Id. ¶ 37. Duarte alleges that
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Comcast’s practice of switching collectors is an unfair method of competition, in
violation of ICFA. Id. ¶ 43.
II. Standard of Review
Under Federal Rule of Civil Procedure 8(a)(2), a complaint generally need only
include “a short and plain statement of the claim showing that the pleader is entitled
to relief.” Fed. R. Civ. P. 8(a)(2). This short and plain statement must “give the
defendant fair notice of what the … claim is and the grounds upon which it rests.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (cleaned up).4 The Seventh
Circuit has explained that this rule “reflects a liberal notice pleading regime, which
is intended to ‘focus litigation on the merits of a claim’ rather than on technicalities
that might keep plaintiffs out of court.” Brooks v. Ross, 578 F.3d 574, 580 (7th Cir.
2009) (quoting Swierkiewicz v. Sorema N.A., 534 U.S. 506, 514 (2002)).
But fraud allegations also must satisfy the heightened pleading requirement
of Federal Rule of Civil Procedure Rule 9(b), which requires that “[i]n alleging fraud
or mistake, a party must state with particularity the circumstances constituting
fraud or mistake.” Fed. R. Civ. P. 9(b) (emphasis added). So Rule 9(b)’s heightened
pleading standard applies to ICFA claims alleging deceptive business practices.
Pirelli Armstrong Tire Corp. Retiree Med. Benefits Trust v. Walgreen Co., 631 F.3d
436, 441 (7th Cir. 2011) (citation omitted). Those claims alleging only unfairness,
however, do not need to meet the heightened pleading standard reserved for fraud
4This
opinion uses (cleaned up) to indicate that internal quotation marks, alterations,
and citations have been omitted from quotations. See Jack Metzler, Cleaning Up Quotations,
18 Journal of Appellate Practice and Process 143 (2017).
4
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claims. Id. at 446. Because Duarte specifically alleges Comcast employed “unfair
methods of competition,” her Complaint need only meet the relaxed pleading
standards of Rule 8(a)(2). See Compl. ¶¶ 43, 48.
“A motion under Rule 12(b)(6) challenges the sufficiency of the complaint to
state a claim upon which relief may be granted.” Hallinan v. Fraternal Order of Police
of Chi. Lodge No. 7, 570 F.3d 811, 820 (7th Cir. 2009). “[A] complaint must contain
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, 678 (2009) (quoting Twombly, 550 U.S.
at 570). These allegations “must be enough to raise a right to relief above the
speculative level.” Twombly, 550 U.S. at 555. The allegations that are entitled to the
assumption of truth are those that are factual, rather than mere legal conclusions.
Iqbal, 556 U.S. at 678-79.
III. Analysis
Comcast moves to dismiss Duarte’s consumer fraud claim. R. 23, Def. Br. To
state a claim under ICFA for an unfair practice, Duarte must sufficiently allege (1)
an unfair act or practice committed by Comcast; (2) Comcast’s intent that she rely on
the unfair practice; and (3) that the unfair practice happened during a course of
conduct involving trade or commerce. Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547,
574 (7th Cir. 2012). Duarte also must allege that the unfair practice proximately
caused injury to her. Id. The Act should be “liberally construed to effectuate its
purpose.” Robinson v. Toyota Motor Credit Corp., 775 N.E.2d 951, 960 (Ill. 2002).
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A. Unfair Practice
To determine whether a practice is “unfair” under ICFA, the statute directs
courts to give consideration “to the interpretations of the Federal Trade Commission
and the federal courts relating to Section 5(a) of the Federal Trade Commission Act.”
815 ILCS 505/2. Relying on United States Supreme Court precedent, the Illinois
Supreme Court instructs courts to consider three factors: “(1) whether the practice
offends public policy; (2) whether it is immoral, unethical, oppressive, or
unscrupulous; [and] (3) whether it causes substantial injury to customers.” Robinson,
775 N.E.2d at 961 (quoting Federal Trade Comm’n v. Sperry & Hutchinson Co., 405
U.S. 233, 244 n.5 (1972)). But the factors are not a conjunctive listing of criteria: there
is no requirement that a practice must satisfy all three factors in order to be deemed
“unfair.” Robinson, 775 N.E.2d at 961.
Here, Duarte premises her ICFA claim on Comcast’s practice of switching debt
collectors to undermine a consumer’s right to force collectors to communicate solely
with her attorney. 15 U.S.C. § 1692c(a)(2); Compl. ¶¶ 30, 43, 48. Taken as true for
the purposes of a dismissal motion, Comcast’s serial hiring of collection agencies after
a consumer has hired an attorney could qualify as an unfair practice under ICFA.
Factor one under Robinson is public policy: bypassing the consumer’s attorney
generally undermines ICFA, which is a “regulatory and remedial statute intended to
protect consumers,” Robinson, 775 N.E.2d at 960, and specifically is an end-run
around the FDCPA’s dictate that debt collectors communicate with the attorney after
being retained by the consumer, 15 U.S.C. § 1692c(a)(2). The second factor is also
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satisfied: giving Duarte the benefit of reasonable inferences, it is unethical and
oppressive for Comcast to intentionally work around the protections that attorney
representation affords a consumer (if that is indeed what Comcast is doing). Indeed,
by definition, Comcast is siccing yet another collection agency on a consumer for the
same debt. Relatedly, and relevant to the third factor, it is reasonable to infer that a
consumer in Duarte’s shoes would feel distress at receiving yet another debt collection
communication from yet another debt collector after hiring an attorney (and, in this
case, after filing a federal lawsuit). So, at this stage of the litigation, the complaint
adequately alleges an “unfair” practice under ICFA.
B. Comcast’s Intent
There is no dispute that Comcast’s practice occurred in trade or commerce
(usually labelled the third element of an ICFA claim), so the only remaining disputes
are whether the complaint adequately alleges that Comcast intended that Duarte
rely on the alleged practice and whether Duarte suffered the type of injury that is
covered by ICFA.
On intent, the pertinent intent is not whether Comcast intended to deceive
Duarte, because she is proceeding on a viable claim that Comcast engaged in an
unfair practice. Instead, in this case ICFA only requires that Comcast engaged in an
unfair act that it intended a consumer rely on. Wigod, 673 F.3d at 575. So the
necessary intent is much simpler than what is needed in a deception case. The
allegations readily satisfy what is needed, because the reasonable inferences, Roberts
v. City of Chi., 817 F.3d 561, 564 (7th Cir. 2016), in Duarte’s favor are obvious:
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Comcast hired a debt collection agency to collect the debt and of course Comcast
intended Duarte to rely on the letters sent by the collector—after all, that’s why
Comcast hired the collector. See Hill v. Wells Fargo Bank, N.A., 946 F. Supp. 2d 817,
826 (N.D. Ill. 2013). Comcast tries to hold Duarte to the more difficult intent
requirement. Def. Br. at 3. But Duarte’s unfair-practice claim is not subject to Rule
9(b)’s heightened pleading standard, because a practice can be unfair without being
deceptive (like this one), People ex rel. Hartigan v. Knecht Services, Inc., 575 N.E.2d
1378, 1385 (Ill. App. Ct. 1991). Intent is adequately alleged.
C. Actual Damages
Comcast’s final argument is that the ICFA claim must fail because Duarte does
not allege that she “sustained actual pecuniary harm.” Def. Br. at 3 (emphasis added).
In emphasizing the absence of “pecuniary” harm, Comcast contends that ICFA does
not provide a cause of action for consumers who do not suffer some sort of financial
harm—it is not enough, in Comcast’s view, that Duarte alleges that she only suffered
emotional distress, Compl. ¶ 33, from the receipt of yet another debt collection letter
from yet another debt collector after hiring an attorney. Comcast cites a Seventh
Circuit case, Kim v. Carter’s Inc., 598 F.3d 362, 365 (7th Cir. 2010) (cited by Def. Br.
at 3), for the proposition that ICFA requires financial harm in order to state a valid
claim. Indeed, although not cited by Comcast, there are Illinois state court opinions
that generally say that financial harm is required. E.g., Morris v. Harvey Cycle and
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Camper, Inc., 911 N.E.2d 1049, 1053 (Ill. App. Ct. 2009).5 But the Illinois Supreme
Court has not yet fully addressed the issue.
Before delving into those cases and their holdings, it is useful to set out the
starting point for any statutory analysis: the statute’s text. In the pertinent provision
of ICFA, Section 10a creates a private right of action for violations of the Act that
result in “actual damages”:
Any person who suffers actual damages as a result of a violation of this Act
committed by any other person may bring an action against such person. The
court, in its discretion may award actual economic damages or any other relief
which the court deems proper …
815 ILCS 505/10a(a) (emphases added). The first sentence authorizes the private
right of action and the second sentence describes the relief that a court may award.
The private right of action created by ICFA does require that the victim suffer “actual
damages.” But that term—“actual damages”—is not on its face limited to financial or
pecuniary harm. Indeed, it is the relief-describing second sentence that uses a term
that is limited to financial harm—“actual economic damages”—whereas the first
sentence does not. So the private right of action created by the first sentence of
Section 10a(a) does not seem to require financial harm as an element of an ICFA
claim.
5Some
federal district court decisions have adopted the pecuniary-loss requirement.
See, e.g., Carrol v. S.C. Johnsons & Son, Inc., 2018 WL 1695421, at *6 (N.D. Ill. Mar. 29,
2018) (The actual damage element of an ICFA claim requires that the plaintiff suffer “actual
pecuniary loss.” (citation omitted)); Liston v. King.com, Ltd., 254 F. Supp. 3d 989, 1005 (N.D.
Ill. 2017) (“The actual damage component requires that a private party plaintiff allege an
‘actual pecuniary loss.’” (citation omitted)); Lowry v. Wells Fargo Bank, N.A., 2016 WL
4593815, at *6 (N.D. Ill. Sept. 2, 2016) (“The actual damage element of a private ICFA action
requires that the plaintiff suffer ‘actual pecuniary loss.’” (citation omitted)).
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It is true, however, that some opinions, when reciting the elements of an ICFA
claim, characterize the requisite damage as financial harm. But that is the danger of
reading a listing of elements as addressing all types of ICFA claims when the actual
holding of the case does not deal with a case like Duarte’s. For example, the one and
only case that Comcast cites for the financial-harm element is Kim v. Carter’s Inc.,
598 F.3d 362, 365 (7th Cir. 2010). In Kim, consumers alleged that a children’s clothing
maker, Carter’s, advertised discounts on clothes as some percentage off of “suggested”
retail prices. Id. at 363. The consumers asserted that, in reality, the suggested prices
were actually much higher than Carter’s regular prices, so it looked like the discounts
represented a great deal when in fact the savings were a sham. Id. The consumers
brought an ICFA claim against Carter’s.
In assessing the viability of the claim, the Seventh Circuit first noted that this
type of false comparison between an actual and fictitious “suggested retail price” did
qualify as an “unfair or deceptive” under ICFA. 598 F.3d at 365. But the problem with
the claim was that there was no pecuniary harm, because the consumers did not
allege that the clothes were not worth what they had paid for them. Id. at 365-66.
The “plaintiffs in this case got the benefit of their bargain and suffered no actual
pecuniary harm.” Id. at 366. No actual damages, so no ICFA claim. Id.
But Kim involved a very different type of ICFA claim than the one that Duarte
is pursuing. In Kim, the consumers asserted that they were deceived by the purported
discount, and the deception led them to buy the clothes. 598 F.3d at 366. So naturally
the Seventh Circuit evaluated whether, despite the deception, the consumers received
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the benefit of the bargain (they did). But in a case challenging an unfair practice in
which there is no bargain to assess, it makes little sense to ask whether the consumer
got the benefit of the non-existent bargain. And Comcast does not argue that the only
valid ICFA claims are ones that involve a fully executed sales transaction.6
In light of the contrast between the type of claim asserted in Kim versus the
type of claim advanced by Duarte, it is worth asking what authority Kim relied on for
the proposition that an ICFA plaintiff suffer “actual pecuniary loss.” 598 F.3d at 365.
The answer is that the one case cited for that proposition is an Illinois Appellate Court
decision, Mulligan v. QVC, Inc., 888 N.E.2d 1190, 1197 (Ill. App. Ct. 2008). But
Mulligan too was a comparative-price deception case involving a seller that listed
fictitious “retail values” next to the sales price. 888 N.E.2d at 1195-96. The Illinois
Appellate Court “examin[ed] the bargain” that the consumer made in the case, and
held that the consumer did not suffer “actual pecuniary loss” because no evidence
showed that “the value of what she received was less than the value of what she was
promised.” Id. at 1197.
So Mulligan, just like Kim, presented the question of what damages must be
shown in the context of an allegedly deceptive bargain—which is not the type of ICFA
claim that Duarte has brought here. Mulligan does not broadly hold that ICFA
requires—in all cases—actual pecuniary harm. The closest that Mulligan comes to
making a general pronouncement on that issue was simply to say that, while the
Illinois Attorney General may bring ICFA claims without a showing of actual
6Comcast
has not advanced any argument on whether the alleged practice occurred in
the conduct of Comcast’s “trade or commerce.” 815 ILCS 505/1(f); 815 ILCS 505/2.
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damage, “it is well settled that in order to maintain a private cause of action under
the Consumer Fraud Act, a plaintiff must prove that she suffered actual damage as
a result of a violation of the Act.” Mulligan, 888 N.E.2d at 1196 (emphasis added)
(citing Avery v. State Farm Mut. Auto. Ins. Co., 835 N.E.2d 801, 859 (Ill. 2005)).7 Even
at its broadest, Mulligan only said that “actual damage” must be shown—which is
the wording used in Section 10a of ICFA and is not confined to actual pecuniary
damage.
As noted earlier, however, there are other Illinois state court opinions (though
not cited by Comcast) that do generally say that financial harm is required for ICFA
claims. One widely cited case is Morris v. Harvey Cycle and Camper, Inc., 911 N.E.2d
1049, 1053 (Ill. App. Ct. 2009). In Morris, the plaintiff alleged that a car dealership
engaged in deceptive practices when trying to sell a car to her brother. The dealership
told the brother that the sale was contingent on financing, but took a down payment
from him and let him drive the car while the dealership tried to arrange financing.
Id. at 1051. After several days passed, the dealership called the brother and asked
him to return to the dealership in order (supposedly) to re-sign some loan papers. Id.
When the brother and the plaintiff arrived, the dealership announced that the
brother had not qualified for financing and pressured the plaintiff to co-sign for her
brother’s loan. Id. When she declined, the dealership demanded the car back but
refused to return her brother’s down payment. Id. at 1051-52. The dealership’s
7Avery
too made no broad declaration that all ICFA claims must show pecuniary
damage. The consumer in Avery offered no evidence that certain auto parts used in repairs
(non-original equipment manufacturer parts) caused any devaluation in his car. 835 N.E.2d
at 859 (consumer sold the car at the same price regardless of the difference in repair parts).
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employees yelled at the plaintiff, blocked the car to prevent them from leaving, and
then called the police to report that the car was stolen. Id. at 1052. The police officers
sided with the plaintiff and her brother, who were allowed to drive away from the
dealership. Id. Eventually, the brother was able to return the car in exchange for his
down payment. Id. After the ordeal, the plaintiff alleged an ICFA claim (among
others) against the dealership, seeking damages for emotional distress.
On those facts, Morris affirmed the dismissal of the ICFA claim, holding that
ICFA “provides remedies for purely economic injuries,” 911 N.E.2d at 1053 (citing
White v. DaimlerChrysler Corp., 856 N.E.2d 542, 550 (Ill. App. Ct. 2006)), and that
actual damages must be “calculable and ‘measured by the plaintiff’s loss,’” 911 N.E.2d
at 1053 (quoting City of Chi. v. Michigan Beach Housing Cooperative, 696 N.E.2d 804,
811 (Ill. App. Ct. 1998)). With only emotional-distress damages at stake, the ICFA
claim did not state a viable ICFA claim. But here again the cases cited by Morris did
not deal with unfair practices—only deceptive ones. In fact, Michigan Beach Housing
did not even involve an ICFA claim at all. In that case, the City of Chicago brought a
common-law fraud claim against a real-estate developer, asserting that the
developer’s misrepresentations caused a missed opportunity to convert low-income
rental housing into cooperative housing. 696 N.E.2d at 809. The Illinois Appellate
Court concluded that “the tort of common-law fraud primarily addresses the invasion
of economic interests,” and thus the intangible harm to the City’s housing policy did
not support a common-law fraud claim. Id. at 809-10. So Michigan Beach Housing
does not directly support the interpretation of ICFA proposed by Morris, because
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Michigan Beach Housing neither addressed ICFA nor unfair-practices claims, which
can be very different from deceptive-practices claims.
That leaves the other case cited by Morris, namely, White v. DaimlerChrysler
Corporation. In that case, the plaintiff invoked ICFA to challenge Chrysler’s use of
steel-made exhaust manifolds in Jeeps instead of the purported industry standard of
cast-iron exhaust manifolds. 856 N.E.2d at 545. The Jeep owner did not, however,
allege that the manifolds had malfunctioned in any way, nor could the owner specify
how the Jeep’s value was in any way diminished. Id. at 550. On those facts, the
Illinois Appellate Court held that the car owner had not sufficiently alleged “actual
damages.” Id. White did not discuss, at all, whether emotional-distress damages are
recoverable under ICFA—the Jeep owner asserted no such claim. What White does
say, in introducing the topic of damages, is that “[t]he Act provides remedies for
omissions resulting in purely economic injuries.” Id. That is the statement—“purely
economic injuries”—that Morris later picked up on in saying that ICFA “provides
remedies for purely economic injuries.” Morris, 911 N.E.2d at 1053 (citing White, 856
N.E.2d at 550). But White was merely introducing the topic of damages, and was not
using the formulation “purely economic injuries” as a shorthand for saying that ICFA
provides remedies solely for economic injuries, and not for emotional distress.
That White was not espousing a position on the pecuniary versus emotionaldistress divide is confirmed by tracing through the case that White relied on for the
statement that ICFA “provides remedies for omissions resulting in purely economic
injuries,” 856 N.E.2d at 550. White cited Pappas v. Pella Corp., 844 N.E.2d 995, 1002
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(Ill. App. Ct. 2006). In Pappas, the plaintiffs asserted that window-maker Pella had
sold them leaky windows. 844 N.E.2d at 1001. Pella argued that ICFA allowed
recovery only for products that were unreasonably dangerous. Id. The Illinois
Appellate Court rejected Pella’s argument, holding that there was no requirement of
unreasonable danger or bodily harm, and that purely economic injury was enough:
A defect could fall well short of the “unreasonably dangerous” standard yet still
be serious enough that a reasonable buyer would not purchase the product if
made aware of the defect.
An omission need not concern potential bodily harm. The Consumer Fraud Act
provides remedies for omissions resulting in purely economic injury.
844 N.E.2d at 1001 (emphasis added). Again, “purely” was not used in the sense of
limiting ICFA’s coverage to only pecuniary harm. Instead, Pappas was making the
point that a “purely” financial harm was compensable under ICFA, and there was no
requirement that there be bodily harm at all. Pappas in turn string-cited eight Illinois
Appellate Court cases, none of which addressed the issue of emotional-distress
damages under ICFA. Id. at 1001-02 (citing, among other cases, Dewan v. Ford Motor
Co., 842 N.E.2d 756, 760 (Ill. App. Ct. 2005)). The bottom line is that Morris
transformed a series of cases that allowed recovery for “purely” economic harms into
the proposition that the only form of damages allowed under ICFA are economic ones.
Although Illinois Appellate Court authority is entitled to “great weight” on matters
of Illinois law, Allstate Ins. Co. v. Menards, Inc., 285 F.3d 630, 637 (7th Cir. 2002),
Morris teeters on a shaky foundation. And when there are “persuasive indications”
that the state supreme court would disagree with the intermediate appellate court,
id., then the federal courts of course must decide the case as it predicts (as best as it
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can) the state supreme court would, id. (“the federal courts must assume the
perspective of the highest court in that state and attempt to ascertain the governing
substantive law on the point in question”).
It is time to return to where the analysis began: the statute’s text. People v.
Giraud, 980 N.E.2d 1107, 1109 (Ill. 2012) (holding that the “surest and most reliable
indicator” of legislative intent is “the statutory language itself, given its plain and
ordinary meaning”) (citing Ill. Graphics Co. v. Nickum, 639 N.E.2d 1282, 1287 (Ill.
1994)). And not just the particular statutory words in isolation divorced from context,
but the entirety of the pertinent provision. People v. Davis, 766 N.E.2d 641, 644 (Ill.
2002) (stating that courts should consider “the statute in its entirety”). As noted
earlier, Section 10a of ICFA authorizes a private right of action for violations that
result in “actual damages”:
Any person who suffers actual damages as a result of a violation of this Act
committed by any other person may bring an action against such person. The
court, in its discretion may award actual economic damages or any other relief
which the court deems proper …
815 ILCS 505/10a(a) (emphases added). Although the private right of action does
require that the victim suffer “actual damages,” that term is not limited to actual
financial or pecuniary harm. The second sentence of Section 10a does use a limiting
term—“actual economic damages”—but the first sentence does not. In keeping with
the interpretive principle that a statute should be construed “so that no part of it is
rendered meaningless or superfluous,” Giraud, 980 N.E.2d at 1110 (citing People v.
Jones, 824 N.E.2d 239, 242 (Ill. 2005)), the term “actual damages” must mean
something broader than “actual economic damages.” To interpret “actual damages”
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as covering only pecuniary injury would render the word “economic” superfluous.
Within a two-sentence breath, the Illinois legislature used two different terms, so the
two terms should not bear the same meaning. Carver v. Bond/Fayette/Effingham
Reg’l Bd. of School Trs., 586 N.E.2d 1273, 1276 (Ill. 1992). (“When the legislature uses
certain language in one part of a statute and different language in another, [the
Court] may assume different meanings were intended.”) So ICFA authorizes a cause
of action for anyone who has suffered “actual damages”—whether pecuniary or not—
and relief is available for not only “actual economic damages” but also for “any other
relief which the court deems proper.” 815 ILCS 505/10a(a).
There is at least one other commonly litigated Illinois statutory cause of action
for which Illinois courts have interpreted the term “actual damages” to encompass
emotional distress, and not just pecuniary harm. The Illinois Human Rights Act bars
discrimination in a variety of contexts, and the remedial provisions (both in the
Illinois Human Rights Commission and in the courts) authorize recovery for “actual
damages.” 775 ILCS 5/8A-104(B) (Commission may order respondent to “[p]ay actual
damages”); 775 ILCS 5/10-102(C)(1)(A) (“court may award to the plaintiff actual and
punitive damages”). It is long and well-settled that “actual damages” in that context
does include damages for nonpecuniary harm. Village of Bellwood Bd. of Fire and
Police Com’rs v. Human Rights Com’n, 541 N.E.2d 1248, 1258 (Ill. App. Ct. 1989)
(“Illinois courts have long recognized that actual damages may include compensation
for mental suffering.”); see also ISS Int’l Serv. Sys., Inc. v. Ill. Human Rights Comm’n,
17
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651 N.E.2d 592, 598 (Ill. App. Ct. 1995); Szkoda v. Illinois Human Rights Comm’n,
706 N.E.2d 962, 972 (Ill. App. Ct. 1998).
To be sure, as noted earlier, context matters. There might very well be Illinois
statutes for which the state supreme court would interpret “actual damages” to be
limited to pecuniary damages only. But all signs point to an interpretation of ICFA
as allowing recovery for emotional distress: the breadth of the term; the distinction
from “actual economic damages”; and the inaptness of trying to overlay a benefit-ofthe-bargain form of relief onto a claim asserting an unfair practice, rather than a
deceptive one. Duarte’s allegations of emotional distress, Compl. ¶ 33, state a viable
claim for actual damages under ICFA.8
IV. Conclusion
For the reasons discussed, Comcast’s motion to dismiss Duarte’s claim under
the Illinois Consumer Fraud and Deceptive Practices Act is denied. Duarte has
sufficiently pled that Comcast intended that she rely on the allegedly unfair
swapping-in of another debt collector, and that the unfair move caused her actual
damages. The status and motion hearing of July 25, 2018 remain in place.
ENTERED:
s/Edmond E. Chang
Honorable Edmond E. Chang
United States District Judge
DATE: July 16, 2018
8Of
course, alleging emotional distress from the use of another debt collector is one
thing at the pleading stage, when the truth of the allegation must be assumed. At trial,
Duarte will have the burden of proving it.
18
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