Garland v. Orlans PC et al

Filing 27

ORDER Staying this Case Pending Ruling by the U.S. Supreme Court in Obduskey v. McCarthy & Holthus LLP. Signed by District Judge Denise Page Hood. (JOwe)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
FREDDIE GARLAND, individually
and on behalf of all others similarly
situated,
Plaintiff,
Civil Action No. 18-11561
HON. DENISE PAGE HOOD

v.
ORLANS PC, LINDA ORLANS,
and ALISON ORLANS,
Defendants.
______________________________/

ORDER STAYING THIS CASE PENDING
RULING BY THE U.S. SUPREME COURT IN
OBDUSKEY V. McCARTHY & HOLTHUS LLP
On May 17, 2018, Plaintiff filed this proposed class action lawsuit, alleging
that Defendants violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et
seq. (“FDCPA”), and the Regulation of Collection Practices Act, M.C.L. § 445.251
et seq., when they mailed one or more similar letters to Plaintiff and others. On July
18, 2018, Defendants filed a Motion to Dismiss pursuant to Rules 12(b)(1) and
12(b)(6). The Motion to Dismiss was fully briefed and set for a hearing on October
3, 2018. When reviewing Defendants’ reply brief, the Court noted that Defendants
argued that this case should be held in abeyance pending the U.S. Supreme Court’s
decision in Obduskey v. McCarthy & Holthus LLP, No. 17-1307, 138 S.Ct. 2710

(June 28, 2018). As Defendants asserted, the Supreme Court granted a writ of
certiorari on the following question: “Whether the FDCPA applies to non-judicial
foreclosure proceedings?” Obduskey v. McCarthy & Holthus LLP, 2018 WL
4348239, at *I (Brief for the Petitioner). Defendants argue that, if the Supreme Court
determined that the FDCPA does not apply to non-judicial proceedings, Plaintiff’s
FDCPA claim (and the RCPA claim) must be dismissed. Based on Defendants’
argument, the Court ordered the parties to submit limited briefs addressing whether
this case should be stayed, and the parties timely filed those briefs.
The Court has reviewed the parties’ pleadings, the Tenth Circuit’s decision in
Obduskey v. McCarthy & Holthus, 879 F.3d 1216 (10th Cir. 2018), the Sixth Circuit’s
decision in Glazer v. Chase Home Fin. LLC, 704 F.3d 453 (6th Cir. 2013), and the
FDCPA. For the following reasons, the Court agrees with Defendants and orders
that this case be held in abeyance pending the U.S. Supreme Court’s decision in
Obduskey.
First, the Court is persuaded that the FDCPA claim at issue is based upon a
non-judicial mortgage foreclosure. Second, in Obduskey, the Tenth Circuit was
presented with – and expressly rejected – an argument raised by the plaintiff that
“relie[d] upon the Sixth Circuit’s decision in Glazer” holding that a non-judicial
mortgage foreclosure was covered under the FDCPA. Obduskey, 879 F.3d at 1221.
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Those competing interpretations of the FDCPA vis a vis non-judicial mortgage
foreclosures led to the U.S. Supreme Court granting a writ of certiorari on the issue.
Third, the Court finds that, if non-judicial mortgage foreclosures are not
covered by the FDCPA, Plaintiff’s FDCPA claim likely will fail as a matter of law.
Fourth, if there is no potentially viable FDCPA claim before the Court, the Court
would be stripped of federal subject matter jurisdiction and likely would exercise its
discretion to decline supplemental jurisdiction over Plaintiff’s RCPA claim. The
RCPA claim is rooted in Michigan law but whether it applies to a non-judicial
foreclosure has not been litigated in or decided by Michigan courts. For that reason,
in the absence of federal subject matter jurisdiction, the Court believes that a
determination of the RCPA’s applicability to a non-judicial foreclosure would best
be litigated in Michigan state courts.
Fifth, the U.S. Supreme Court likely will issue a ruling that provides certainty
as to the viability – or non-viability – of the FDCPA claim in this case. Right now,
it is not clear whether Glazer (the currently controlling law over this case) will be
upheld or overruled, such that if the Court were to move forward, there is
approximately a 50% chance that doing so will be for no purpose. The Court
recognizes that if it declines to stay this case, the case will proceed without delay and
the parties (and the Court) will expend significant resources before the Supreme
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Court rules. The Court also recognizes that if it stays the case, the parties (and the
Court) will not expend any resources but the case will not move forward in this Court.
The Court concludes that any risks associated with staying the case in this Court
(specifically, granting a delay that is rendered unnecessary because the Supreme
Court follows Glazer) is greatly outweighed by the risks associated with moving
forward with this case (specifically, requiring the parties and the Court to
unnecessarily expend significant resources if the Supreme Court follows Obduskey).
For all of those reasons, the Court finds that the interests of justice weigh in
favor of staying the case pending the U.S. Supreme Court’s ruling regarding the issue
upon which it granted a writ of certiorari in Obduskey.
Accordingly, for the reasons set forth above,
IT IS ORDERED that this case is STAYED until the United States Supreme
Court renders a decision in the matter of Obduskey v. McCarthy & Holthus LLP, No.
17-1307, 138 S.Ct. 2710 (June 28, 2018).
IT IS ORDERED.

Dated: November 21, 2018

S/Denise Page Hood
Denise Page Hood
Chief Judge, United States District Court

I hereby certify that a copy of the foregoing document was served upon counsel of
record on November 21, 2018, by electronic and/or ordinary mail.
S/LaShawn R. Saulsberry
Case Manager
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