Neff v. Schlee & Stillman, LLC et al

Filing 29

MEMORANDUM OPINION and ORDER Granting 24 MOTION for Judgment on the Pleadings - Signed by District Judge Judith E. Levy. (FMos)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
Steven Neff,
Plaintiff,

Case No. 16-cv-10555

v.

Judith E. Levy
United States District Judge

Schlee & Stillman, LLC, and
LVNV Funding, LLC,

Mag. Judge Mona K. Majzoub

Defendants.
________________________________/
OPINION AND ORDER GRANTING PLAINTIFF’S MOTION FOR
JUDGMENT ON THE PLEADINGS [24]
Before the Court is plaintiff Steven Neff’s motion for judgment on
the pleadings.

(Dkt. 24.)

Plaintiff seeks judgment on the sole

remaining count against defendants Schlee & Stillman, LLC, and
LVNV Funding, LLC.
For the reasons set forth below, plaintiff’s motion is granted.
I.

Background
Plaintiff Steven Neff is an individual alleging he has a debt

obligation arising from his Credit One Bank credit card, which was used
“primarily for personal, family, or household purposes.” (Dkt. 1 at 4.)

He alleges defendant LVNV Funding, LLC acquired the debt after
plaintiff defaulted on his obligations to pay off the debt, and LVNV
Funding, LLC then hired defendant Schlee & Stillman, LLC to collect
the debt. (Id. at 4.)
On September 25, 2015, Schlee & Stillman, LLC sent plaintiff a
letter, informing plaintiff the letter was “an attempt by a debt collector
to collect a debt.” (Dkt. 1-1 at 2.) The letter was titled “Re: LVNV
Funding LLC Assignee of Credit One Bank, N.A.” (Id.)
After receiving this letter, plaintiff filed a complaint against
defendants for alleged violations of the Fair Debt Collection Practices
Act (“FDCPA”).

(Dkt. 1.)

Defendants filed a motion to dismiss all

counts. (Dkt. 5.)
On August 12, 2016, the Court granted in part and denied in part
defendants’ motion to dismiss. (Dkt. 12.) Plaintiff was permitted to
proceed with Count One, which alleged defendants violated 15 U.S.C.
§ 1692g(a)(2) of the FDCPA by failing to effectively provide the name of
the creditor to whom the debt was owed in the September 25, 2015
letter.

(Id.)

On October 21, 2016, plaintiff filed this motion for

judgment on the pleadings. (Dkt. 24.)
2

II.

Legal Standard
“The standard of review for a Rule 12(c) motion is the same as for

a motion under Rule 12(b)(6) for failure to state a claim upon which
relief can be granted.” Fritz v. Charter Twp. of Comstock, 592 F.3d 718,
722 (6th Cir. 2010).

“For purposes of a motion for judgment on the

pleadings, all well-pleaded material allegations of the pleadings of the
opposing party must be taken as true, and the motion may be granted
only if the moving party is nevertheless clearly entitled to judgment.”
Id. (quoting JPMorgan Chase Bank, N.A. v. Winget, 510 F.3d 577, 581
(6th Cir. 2007)).
III. Analysis
Plaintiff argues he is entitled to judgment on the pleadings
because there is no dispute that the name of the creditor, Credit One
Bank, was not effectively provided in the letter received from
defendants, and because the Court already decided the issue in its order
granting in part and denying in part defendants’ motion to dismiss.
(Dkt. 24 at 3–5.)

Defendants argue that whether the creditor was

adequately identified is a question of fact for the jury to decide, and that
plaintiff has not proven—and defendant denies—that plaintiff qualifies
3

as a consumer, that the debt arose out of a consumer transaction, and
that defendant LVNV Funding, LLC was a debt collector as defined by
the FDCPA. (Dkt. 26 at 1–2.)
As an initial matter, defendants argue that they do “not admit”
plaintiff is a consumer, that the debt arose from a consumer
transaction, or that LVNV Funding, LLC is a debt collector. (Dkt. 26 at
2.) The argument is based on their answer to the complaint. For each
of these three arguments, defendants wrote in the answer, “Neither
admit nor denied, leave Plaintiff to its proofs.” (Dkt. 15 at 2.)
But such a statement is “considered insufficient as a denial under
Fed. R. Civ. P. 8(b), and would instead be deemed an admission.” Redd
v. Vails, Case No. 14-cv-14340, 2015 WL 1511029, at *4 n.2 (E.D. Mich.
Mar. 25, 2015) (citing United States v. Vehicle 2007 Mack 600 Dump
Truck, VIN 1M2K189C77M036428, 680 F. Supp. 2d 816, 828 (E.D.
Mich. 2010)); 5 CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FED. PRAC.
& PROC. § 1279 (3d ed.) (same). Thus, defendants have insufficiently
denied or disputed the three allegations set forth above, and they are
deemed admitted. Accordingly, the only issue for the Court to decide is
whether the letter sent to plaintiff adequately identified the name of
4

the creditor to whom the debt was owed in accordance with 15 U.S.C. §
1692g(a)(2).
15 U.S.C. § 1692g(a)(2) requires that an initial communication to
a debtor effectively convey “the name of the creditor to whom the debt is
owed.” 15 U.S.C. § 1692g(a)(2). “Courts use the ‘least sophisticated
consumer’ standard, an objective test, when assessing whether
particular conduct violates the FDCPA.” Barany-Snyder v. Weiner, 539
F.3d 327, 333 (6th Cir. 2008).

This standard “is lower than simply

examining whether particular language would deceive or mislead a
reasonable debtor” because the “basic purpose . . . is to ensure that the
FDCPA protects all consumer, the gullible as well as the shrewd.” Fed.
Home Loan Mortg. Corp. v. Lamar, 503 F.3d 504, 509 (6th Cir. 2007).
At the same time, the standard “prevents liability for bizarre or
idiosyncratic interpretations of collection notices by preserving a
quotient

of

reasonableness

and

presuming

a

basic

level

of

understanding and willingness to read with care.” Id. at 510 (internal
citation omitted).
And “it is well-settled that courts may properly make the objective
determination whether language effectively conveys a notice of rights to
5

the least sophisticated debtor.” Fed. Home Loan Mortg. Corp. v. Lamar,
503 F.3d 504, 508 n.2 (6th Cir. 2007) (internal quotations omitted).
Thus, this Court may, as a matter of law, determine whether the notice
sent to plaintiff would convey the name of the creditor to the least
sophisticated consumer.
As an initial matter, plaintiff overstates his case by arguing that
the Court already decided that the reference to Credit One Bank as an
“assignee” of LVNV Funding, LLC violated 15 U.S.C. § 1692g(a)(2). The
Court’s prior determination was made in the context of defendants’
motion to dismiss, which required the Court to take plaintiff’s
allegations as true. Thus, the Court’s prior order determined only that
plaintiff sufficiently pleaded a violation of 15 U.S.C. § 1692g(a)(2).
But, as a matter of law, this Court finds that the single reference
to Credit One Bank as an “assignee” does not effectively convey the “the
name of the creditor to whom the debt is owed.”
1692g(a)(2).

15 U.S.C. §

The term “assignee” is “a legal term that would not

necessarily help the least sophisticated consumer understand the
relationships between the parties listed.” Hartman v. Great Seneca Fin.
Corp., 569 F.3d 606, 613 (6th Cir. 2009). Further, there is no other
6

reference to Credit One in the letter sent to plaintiff, and the letter fails
to specify what the debt is or what it is for, listing only the amount
owed. Without more context, the least sophisticated consumer could not
be expected to understand that Credit One Bank is “the name of the
creditor to whom the debt is owed.” Accordingly, plaintiff is entitled to
judgment on the pleadings.
IV.

Conclusion

For the reasons set forth above, plaintiff’s motion for judgment on
the pleadings (Dkt. 24) is GRANTED.
IT IS SO ORDERED.
Dated: March 21, 2017
Ann Arbor, Michigan

s/Judith E. Levy
JUDITH E. LEVY
United States District Judge

CERTIFICATE OF SERVICE
The undersigned certifies that the foregoing document was served
upon counsel of record and any unrepresented parties via the Court’s
ECF System to their respective email or First Class U.S. mail addresses
disclosed on the Notice of Electronic Filing on March 21, 2017.
s/Felicia M. Moses
FELICIA M. MOSES
Case Manager

7