KRAFT v. PHELAN HALLINAN DIAMOND & JONES, PC et al

Filing 40

OPINION filed. Signed by Judge Brian R. Martinotti on 07/30/2019. (jmh)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
____________________________________
:
:
:
Plaintiff,
:
v.
:
:
:
PHELAN HALLINAN DIAMOND &
:
JONES, P.C. a/k/a PHELAN HALLINAN :
and SCHMIEG, P.C.; PHELAN
:
HALLINAN and SCHMIEG, LLC;
:
ROSEMARIE DIAMOND; FRANCIS S. :
HALLINAN; LAWRENCE T. PHELAN; :
and DANIEL G. SCHMIEG,
:
:
Defendants.
:
____________________________________:
WARREN R. KRAFT,

Civil Action No. 3:17-cv-13765-BRM-DEA

OPINION

MARTINOTTI, DISTRICT JUDGE
Before this Court is a Motion to Dismiss filed by Defendants Phelan Hallinan Diamond &
Jones, P.C. a/k/a Phelan Hallinan and Schmieg, P.C. (“Phelan Hallinan”), Phelan Hallinan and
Schmieg, L.L.C. (“Phelan Hallinan Schmieg”), Rosemarie Diamond (“Diamond”), Francis S.
Hallinan (“Hallinan”), and Lawrence T. Phelan (“Phelan”) (collectively “Defendants”)1 seeking
to dismiss Plaintiff Warren R. Kraft’s (“Kraft” or “Plaintiff”) Amended Complaint (the “Amended
Complaint”) pursuant to Federal Rules of Civil Procedure 12(b)(1), 12(b)(5), and 12(b)(6) (ECF
No. 28), and Kraft’s Motion for Reconsideration of this Court’s Order determining the Motion to
Dismiss to be fully briefed. (ECF No. 35). Kraft opposed Defendants’ Motion to Dismiss. (ECF

Defendant Daniel G. Schmieg (“Schmieg”) is not represented by Flaster Greenberg, PC, as are
the other defendants, and has not filed a Motion to Dismiss. Notwithstanding, at other points in
this Opinion, this Court will use the term “Defendants” with the purpose of including Schmieg.
1

No. 32.) Having reviewed the submissions filed in connection with the motion and having declined
to hold oral argument pursuant to Federal Rule of Civil Procedure 78(b), for the reasons set forth
below and for good cause appearing, Defendants’ Motion to Dismiss is GRANTED WITH
PREJUDICE and Kraft’s Motion for Reconsideration is DENIED AS MOOT.
I.

BACKGROUND
A. Factual Background

For the purposes of this Motion to Dismiss, the Court accepts the factual allegations in the
Amended Complaint as true and draws all inferences in the light most favorable to the plaintiff.
See Phillips v. Cty. of Allegheny, 515 F.3d 224, 228 (3d Cir. 2008).2 Furthermore, the Court also
considers any “document integral to or explicitly relied upon in the complaint.” In re Burlington
Coat Factory Secs. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997) (quoting Shaw v. Dig. Equip. Corp.,
82 F.3d 1194, 1220 (1st Cir. 1996)).
Phelan Hallinan is a high-volume mortgage foreclosure law firm with its principal place of
business in Philadelphia, Pennsylvania and an office in Mount Laurel, New Jersey. (ECF No. 26
¶ 15.) Phelan, Hallinan, and Schmieg are each equity partners at Phelan Hallinan whereas Diamond
is a managing partner responsible for overseeing the firm’s New Jersey operations. (ECF No. 26
¶¶ 16-19.)3 On behalf of Phelan Hallinan, Diamond handled the foreclosing proceeding
Washington Mutual Bank, F.A. v. Laura Princiotta, Docket No. F-17248-06, in the Superior Court
of New Jersey, Monmouth County, Chancery Division. (ECF No. 26 ¶ 19.)

This Court recognizes that the presumption of truthfulness of the allegations contained in Kraft’s
Complaint applies only when considering Defendants’ Motion to Dismiss pursuant to Rule
12(b)(6). No presumption of truthfulness attaches to a plaintiff’s allegations when a defendant
moves for dismissal for lack of subject matter jurisdiction. U.S. ex rel. Atkinson v. PA. Shipbuilding
Co., 473 F.3d 506, 509 (3d Cir. 2007).
2

3

Defendants Phelan, Hallinan, Schmieg, and Diamond are referred to as the “Phelan Defendants.”
2

At all times relevant to this litigation, Kraft resided at an address in Middletown, New
Jersey (the “Premises”). (ECF No. 26 ¶ 25.) Kraft acquired ownership of the Premises by
inheritance when his father passed away in 1996. (ECF No. 26 ¶ 26.) The Premises was apparently
encumbered by a mortgage, which PNC Mortgage Corporation, the mortgagor, assigned to the
Federal National Mortgage Association (“FNMA”) on March 3, 1994. (ECF No. 26 ¶ 29.) On
September 29, 2006, Washington Mutual N.A. (“Washington Mutual”), a predecessor in interest
to Wells Fargo regarding the mortgage on the Premises, commenced a property foreclosure action
in the Superior Court of New Jersey against Kraft due to non-payment.4 (ECF No. 26 ¶ 30.) Wells
Fargo acquired the mortgage servicing rights and the mortgage from Washington Mutual after the
debt was in default. (ECF No. 26 ¶ 35.) Washington Mutual and Wells Fargo retained Phelan
Hallinan as legal counsel to litigate and prosecute the foreclosure action. (ECF No. 26 ¶ 34.)
Kraft contends “Washington Mutual and Wells Fargo never possessed the original note,
never owned or controlled the underlying debt, and never obtained a valid assignment of the note”
as the original note was lost while in the possession of FNMA. (ECF No. 26 ¶¶ 37-38.)5 The record
in the foreclosure litigation indicates that the original note was lost and never transferred from
FNMA to Washington Mutual or Wells Fargo.6 (ECF No. 26 ¶ 40.) Kraft alleges that Washington

4

This Court interpreted the facts to the best of its ability. The facts are largely disjointed and
exceedingly difficult to follow. Often, the Amended Complaint is completely bereft of important
connectors between crucial facts. For instance, Kraft fails to specify in which Superior Court this
foreclosure action took place and fails entirely to provide any connection between FNMA,
Washington Mutual, and Wells Fargo in acquisition of the mortgage.
The note, executed by Raymond Kraft, Kraft’s father, and Laura (Princiotta) Kraft (“Princiotta”),
Kraft’s ex-wife, on February 22, 1994, is provided by the Defendants. (ECF No. 28-4, Ex. B.)
5

6

Alex Sims, a Wells Fargo Vice President responsible for the delivery of promissory notes,
executed an Affidavit of Lost Note on September 2, 2008 certifying that the promissory note
relating to the subject mortgage debt was “lost, never delivered to and never in the possession of
Washington Mutual and Wells Fargo.” (ECF No. 26 ¶ 41.)
3

Mutual never obtained a valid assignment of the loan obligation and that during the course of the
state foreclosure action, the Phelan Defendants made “repeated and numerous false
representations” to the court, including that “Washington Mutual and Wells Fargo obtained a valid
assignment of the underlying debt obligation and had legal authority to enforce the note and
foreclose [] Kraft’s home.” (ECF No. 26 ¶¶ 46, 60-61.) On July 24, 2007, a Final Judgment of
Foreclosure was entered in favor of Washington Mutual pertaining to the defaulted mortgage on
the Premises. (ECF No. 26 ¶ 48.)
Kraft contends that on June 9, 2011, New Jersey Supreme Court Chief Justice Rabner
“entered an Order requiring that in all [New Jersey] foreclosure actions where a default judgment
has been entered . . . the plaintiff . . . must file with the court and serve on the parties a Plaintiff’s
Counsel’s Certification of Diligent Inquiry” containing “certain information and attesting to the
truth, accuracy and authenticity of factual assertions and documents” before a sheriff’s sale can
occur. (ECF No. 26 ¶ 49.)7 Caroline Courtney (“Courtney”), Wells Fargo’s Vice President of Loan
Documentation, executed a Certificate of Diligent Inquiry indicating that she personally reviewed
the certification and confirmed the amount due under the mortgage via an Amended Certification
of Amount Due. (ECF No. 26 ¶¶ 53-57.) Courtney then conveyed this information to Eric
Rochkind (“Rochkind”), legal counsel for the Phelan Defendants. (ECF No. 26 ¶¶ 53, 63.)8
Kraft alleges Courtney “never reviewed the original or true copy of the original note”
because it was “lost and never transferred” and that as such, Courtney could not “confirm the

7

Kraft does not cite this case or provide this order.

8

Courtney, Rochkind, and David Rubin, another attorney for the Phelan Defendants, executed
certifications in support of a Motion to Amend the Final Judgment and Writ of Execution on the
Premises to comply with the Certification of Diligent Inquiry requirements. (ECF No. 26 at 3943.)
4

accuracy and authenticity of the original promissory note because it was lost.” (ECF No. 26 ¶¶ 6667.) Similarly, Kraft contends Rochkind could not confirm the accuracy of the recorded
assignments to Washington Mutual and Wells Fargo because FNMA never transferred or delivered
the original note. (ECF No. 26 ¶¶ 68-70.) Accordingly, Kraft claims the “Phelan Defendants chose
to proceed with false certifications and false representations of the legal status of the debt to give
the false impression of having a legal status it did not enjoy.” (ECF No. 26 ¶ 51.)
B. Procedural History
On December 28, 2017, Kraft filed the Complaint asserting a violation of the Fair Debt
Collection Practices Act (“FDCPA”), 15 U.S.C. §§ 1692-1692p against the Defendants. (ECF No.
1.) On December 29, 2017, summonses were issued to the Defendants. (ECF No. 3.) Because Kraft
had not served the Complaint, on April 26, 2018, this Court issued a Notice of Call for dismissal
of the Complaint pursuant to Federal Rule of Civil Procedure 4(m). (ECF No. 4.)9 On May 7, 2018,
this Court entered an Order of Dismissal without prejudice pursuant to Rule 4(m). (ECF No. 5.)
On May 14, 2018, Kraft wrote a letter to the Court indicating that Defendants had agreed
to waive formal service of process and that he expected waiver forms from Defendants’ counsel,
Kenneth Goodkind, Esq, which would subsequently be supplied to the Court. (ECF No. 7.)
Accordingly, Kraft requested that this Court vacate its May 7, 2018 Order of Dismissal. (Id.) On

9

Federal Rule of Civil Procedure 4(m) states, in pertinent part:
If a defendant is not served within 90 days after the complaint is
filed, the court – on motion or on its own after notice to the
plaintiff – must dismiss the action without prejudice against that
defendant or order that service be made within a specified time.
But if the plaintiff shows good cause for the failure, the court must
extend the time for service for an appropriate period.

Fed. R. Civ. Pro. 4(m).
5

May 17, 2018, Defendants submitted a letter opposing Kraft’s request to vacate the Order of
Dismissal. (ECF No. 8.) On May 23, 2018, this Court vacated the May 7, 2018 Order of Dismissal
and allowed Kraft 45 days from the date of the Order to effectuate service on the Defendants and
supply proof thereof. (ECF No. 9.)
On January 16, 2019, Defendants filed a Motion to Dismiss Kraft’s Complaint, asserting a
lack of subject matter jurisdiction pursuant to Rule 12(b)(1), insufficient service of process
pursuant to Rule 12(b)(5), and failure to state a claim pursuant to Rule 12(b)(6). (ECF No. 23.) On
February 7, 2019, in apparent response to the Motion to Dismiss, Kraft filed the Amended
Complaint against the Defendants asserting a claim for false or misleading representations, in
violation of the FDCPA (“Count One”) and unfair practices, in violation of the FDCPA (“Count
Two”). (ECF No. 26.) On March 4, 2019, Defendants filed a Motion to Dismiss Kraft’s Amended
Complaint on identical grounds. (ECF No. 28.) On April 1, 2019, Kraft filed an Opposition to
Defendants’ Motion to Dismiss.
On April 5, 2019, this Court issued a Text Order indicating that it was in receipt of the
moving papers pertaining to Defendants’ Motion to Dismiss and Kraft’s Opposition thereto, and
that as such, it considered the matter fully briefed. (ECF No. 34.) On April 18, 2019, Kraft filed a
Motion for Reconsideration of this Court’s April 5, 2019 Text Order determining the matter to be
fully briefed. (ECF No. 35.)10
II.

LEGAL STANDARDS

10

On April 18, 2019, simultaneously with his Motion for Reconsideration, Kraft filed a Second
Opposition to Defendants’ Motion to Dismiss despite this Court’s April 5, 2019 Order that the
matter is fully briefed. (ECF No. 36.) On April 23, 2019, Defendants filed a letter opposing Kraft’s
Motion for Reconsideration and urging this Court to sua sponte strike Kraft’s Second Opposition
to Defendants’ Motion to Dismiss as it violated the April 5, 2019 Order. (ECF No. 37.) This Court
considered Kraft’s Second Opposition despite the tardiness of its filing.
6

A. Rule 12(b)(1) Standard
“When subject matter jurisdiction is challenged under Rule 12(b)(1), the plaintiff must bear
the burden of persuasion.” Symczyk v. Genesis Healthcare Corp., 656 F.3d 189, 191 n.4 (3d Cir.
2011) (quoting Kehr Packages, Inc. v. Fidelcor, Inc., 926 F.2d 1406, 1409 (3d Cir. 1991)). No
presumption of truthfulness is accorded to the plaintiff’s allegations. Atkinson, 473 F.3d at 509.
When faced with a Rule 12(b)(1) challenge to jurisdiction, the court “must start by
determining whether [it is] dealing with a facial or factual attack to jurisdiction.” Id. “If [it] is a
facial attack, the court looks only at the allegations in the pleadings and does so in the light most
favorable to the plaintiff.” “If [it] is a factual attack, however, it is permissible for a court to review
evidence outside the pleadings.” Id. Moreover, the trial court is free to weigh and evaluate the
evidence in determining whether its jurisdiction has been demonstrated. Symczyk, 656 F.3d at 191
n.4 (citing Mortensen v. First Fed. Sav. & Loan Ass’n, 549 F.2d 884, 891 (3d Cir. 1997)). A
jurisdictional challenge is a factual challenge if “it concerns not an alleged pleading deficiency,
but rather the actual failure of [plaintiff’s] claims to comport with the jurisdictional prerequisites.”
Atkinson, 473 F.3d at 514.

B. Rule 12(b)(6) Standard
In deciding a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), a
district court is “required to accept as true all factual allegations in the complaint and draw all
inferences in the facts alleged in the light most favorable to the [plaintiff].” Phillips v. Cty. of
Allegheny, 515 F.3d 224, 228 (3d Cir. 2008). “[A] complaint attacked by a Rule 12(b)(6) motion
to dismiss does not need detailed factual allegations.” Bell Atlantic Corp. v. Twombly, 550 U.S.

7

544, 555 (2007) (citations omitted). However, the plaintiff’s “obligation to provide the ‘grounds’
of his ‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic recitation
of the elements of a cause of action.” Id. (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). A
court is “not bound to accept as true a legal conclusion couched as a factual allegation.” Papasan,
478 U.S. at 286. Instead, assuming the factual allegations in the complaint are true, those “[f]actual
allegations must be enough to raise a right to relief above the speculative level.” Twombly, 550
U.S. at 555.
“To survive a motion to dismiss, a complaint must contain sufficient factual matter,
accepted as true, to ‘state a claim for relief that is plausible on its face.’” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 570). “A claim has facial plausibility when the
pleaded factual content allows the court to draw the reasonable inference that the defendant is
liable for misconduct alleged.” Id. This “plausibility standard” requires the complaint allege “more
than a sheer possibility that a defendant has acted unlawfully,” but it “is not akin to a probability
requirement.’” Id. (quoting Twombly, 550 U.S. at 556). “Detailed factual allegations” are not
required, but “more than an unadorned, the defendant-harmed-me accusation” must be pled; it
must include “factual enhancements” and not just conclusory statements or a recitation of the
elements of a cause of action. Id. (citing Twombly, 550 U.S. at 555, 557).
“Determining whether a complaint states a plausible claim for relief [is] . . . a contextspecific task that requires the reviewing court to draw on its judicial experience and common
sense.” Iqbal, 556 U.S. at 679. “[W]here the well-pleaded facts do not permit the court to infer
more than the mere possibility of misconduct, the complaint has alleged—but it has not
‘show[n]’—‘that the pleader is entitled to relief.’” Id. at 679 (quoting Fed. R. Civ. P. 8(a)(2)).
However, courts are “not compelled to accept ‘unsupported conclusions and unwarranted

8

inferences,’” Baraka v. McGreevey, 481 F.3d 187, 195 (3d Cir. 2007) (quoting Schuylkill Energy
Res. Inc. v. Pa. Power & Light Co., 113 F.3d 405, 417 (3d Cir. 1997)), nor “a legal conclusion
couched as a factual allegation.” Papasan, 478 U.S. at 286.
While, as a general rule, the court may not consider anything beyond the four corners of
the complaint on a motion to dismiss pursuant to Rule 12(b)(6), the Third Circuit has held that “a
court may consider certain narrowly defined types of material without converting the motion to
dismiss [to one for summary judgment pursuant to Rule 56].” In re Rockefeller Ctr. Props. Sec.
Litig., 184 F.3d 280, 287 (3d Cir. 1999). Specifically, courts may consider any “‘document integral
to or explicitly relied upon in the complaint.’” Burlington Coat Factory, 114 F.3d at 1426 (quoting
Shaw, 82 F.3d at 1220).
III.

DECISION

Defendants argue this Court should dismiss Kraft’s Amended Complaint as they were not
properly served, the Amended Complaint lacks subject matter jurisdiction, and the Amended
Complaint fails to state a claim upon which relief may be granted. (ECF No. 28-1 at 1-4.) Kraft
argues that he is a proper plaintiff pursuant to the FDCPA as his case is analogous to those
involving water and sewage debt obligations, which qualify as consumer debts pursuant to the
FDCPA. (ECF No. 32 at 4-8.) This Court addresses the arguments in turn.
A. Service
Pursuant to Federal Rule of Civil Procedure 4(m), if a defendant is not served within 90
days after a complaint is filed, the court must dismiss the action without prejudice against that
defendant, or order that service be made within a specified time. See Fed. R. Civ. Pro. 4(m). On
April 26, 2018, this Court issued a Notice of Call for dismissal of the Complaint pursuant to Rule
4(m), as Kraft had not served the Complaint upon the Defendants and on May 7, 2018, this Court

9

entered an Order of Dismissal without prejudice pursuant to Rule 4(m). (ECF Nos. 4 & 5.)
Thereafter, this Court vacated its dismissal of the case and issued an Order indicating that Kraft
has 45 days from the date of the Order, May 23, 2018, within which to effectuate service and file
proof of same. (ECF No. 9.)
On July 13, 2018, Kraft requested that summonses be issued to Defendants. (ECF Nos. 12
& 13.) This request was made outside of the court-imposed 45-day deadline, which expired on
July 8, 2018. This Court issued a second Notice of Call for dismissal on December 13, 2018 (ECF
No. 14), only after which time Kraft requested for summonses to be issued to Defendants. (ECF
Nos. 15 & 16.) Accordingly, Kraft did not properly serve the Defendants until December 17, 2018,
well past the deadline set by this Court.
Kraft argues that his failure to properly effectuate service was due, in part, to Defendants’
failure to cooperate with his requests to have them waive service. (ECF No. 32 at 2.) However, it
is the burden of the plaintiff only to ensure that a defendant has been served. Grand Entm’t Grp.,
Ltd. v. Star Media Sales, Inc., 988 F.2d 476, 493 (3d Cir. 1993). Accordingly, Defendants’ alleged
failure to cooperate with a request for a service waiver does not constitute justifiable excuse for
failure to effectuate service. See MCI Telecomms. Corp. v. Teleconcepts, Inc., 71 F.3d 1086, 1097
(3d Cir. 1995) (holding that “good cause” may excuse late service and that factors to consider in
determining whether good cause exists include the reasonableness of the plaintiff’s efforts to serve,
prejudice caused to defendants, and whether plaintiff moved for an enlargement of time to serve).
Therefore, Defendants’ Motion to Dismiss for lack of service is GRANTED.
B. FDCPA Claim
Defendants argue even if they had been properly served, Kraft may not proceed under the
FDCPA as he is not a proper plaintiff pursuant to the statute. The two-count Amended Complaint

10

asserts violations of Section 1692(e) of the FDCPA, alleging Defendants made false and
misleading representations, and Section 1692(f) of the FDCPA, alleging unfair practices. (ECF
No. 26 at 12-25.) Typically, “[t]o prevail on an FDCPA claim, a plaintiff must prove that (1) she
is a consumer, (2) the defendant is a debt collector, (3) the defendant’s challenged practice involves
an attempt to collect a ‘debt’ as the [FDCPA] defines it, and (4) the defendant has violated a
provision of the FDCPA in attempting to collect the debt.” Douglass v. Convergent Outsourcing,
765 F.3d 299, 303 (3d Cir. 2014); see also Jensen v. Pressler & Pressler, 791 F.3d 413, 417 (3d
Cir. 2015). Even when accepting the allegations in the Amended Complaint as fact, Kraft still fails
to establish a prima facie case of a FDCPA violation, and as such, the Amended Complaint must
be dismissed.
Kraft is not a “consumer” for the purposes of the FDCPA. The term “consumer” means
“any natural personal obligated or allegedly obligated to pay any debt.” 15 U.S.C. § 1692(a)(3).
To have standing to bring an action pursuant to the FDCPA, a plaintiff must allege that he or she
actually owes a debt. Benali v. AFNI, Inc., No. 15-3605, 2017 WL 39558, at *6 (D.N.J. Jan. 4,
2017) (granting summary judgment where a plaintiff testified that the debt owed was not “his”).
Here, Kraft has not alleged that he owes any debt. Kraft’s deceased father and ex-wife, Princiotta,
were the original mortgagors of the mortgage serviced by Washington Mutual and Wells Fargo.
(ECF No. 26 ¶ 78.) Kraft alleges he is a “natural person obligated or allegedly obligated to pay the
underlying debt of the mortgage” (ECF No. 26 ¶¶ 11, 86, 89), however, he is not one of the original
mortgagors, and did not sign the mortgage or promissory note. (ECF No. 26 ¶¶ 66; ECF No. 28-4,
Ex. B).
Kraft contends he qualifies as a consumer pursuant to the FDCPA because he is a
“homeowner . . . within the purview of the FDCPA as he is a natural person obligated or alleged

11

to be obligated to pay the aforesaid principal debt . . . incidental to the mortgage because of a
covenant that runs with the aforesaid residential property.” (ECF No. 26 ¶ 89.) However, even if
there were some covenant in the mortgage, such would still be insufficient to establish Kraft as a
consumer owing a debt for the purposes of the FDCPA. Actions premised on a mortgagor’s
promissory note are in personam, therefore, in the event of a default, the mortgagee may foreclose
on the property to satisfy the debt and should there be a deficiency, may recover personally only
against a signatory to the promissory note. See In re Matter of Estate of Zahn, 702 A.2d 482, 48587 (N.J. App. Div. 1997). Kraft does not allege that he signed the promissory note and therefore
has not alleged any debt owed by him. Kraft’s contention that he is obligated to pay this debt is a
merely a bald, conclusory statement which this Court may not consider in ruling on Defendants’
Motion to Dismiss. Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009) (holding that
“conclusory or ‘bare-bones’ allegations will no longer survive a motion to dismiss”).
In further support of his argument that he constitutes a “consumer” pursuant to the FDCPA,
Kraft cites Pollice v. Nat’l Tax Funding, 225 F.3d 379 (3d Cir. 2000) and Piper v. Portnoff Law
Assocs., 396 F.3d 227 (3d Cir. 2005). Both decisions are wholly inapplicable to the issues present
in this litigation. In Pollice, the Third Circuit held that a homeowner’s obligation to pay money to
government entities for water and sewer service constituted a debt for the purposes of the FDCPA,
and thus they were consumers and proper plaintiffs pursuant to the statute, stating:
[W]e conclude that homeowners’ water and sewer obligations meet
the definition of ‘debt’; indeed, these obligations constituted ‘debts’
from the time they initially were owed to the government entities,
and they retained that status after their assignment . . . At the time
these obligations first arose, homeowners (‘consumers’ of water and
sewer services) had an ‘obligation . . . to pay money’ to the
government entities which arose out of a ‘transaction’ (requesting
water and sewer service) the subject of which was ‘services . . .
primarily for personal, family, or household purposes.’

12

Pollice, 225 F.3d at 400 (citations omitted)
In Piper, the Third Circuit reaffirmed the holding in Pollice in confirming that a law firm’s
efforts to recover money on behalf of its client, a municipality, for delinquent tax and water bills
fell within the purview of the FDCPA. Piper, 396 F.3d at 233-34. These cases are distinguishable
from this matter. Both cases cited by Kraft address water and sewer charges as “debts” under the
FDCPA, and do not concern a foreclosure whatsoever, nor whether a non-signatory to a
promissory note may be deemed to owe a debt on his or her property. Moreover, Pollice explicitly
held that a prerequisite to recognizing a plaintiff as an FDCPA consumer is maintaining a debt
obligation that arose from a transaction. Pollice, 225 F.3d at 400. Here, Kraft has not alleged that
he was party to any transaction, nor has he alleged facts indicating that he is liable for any debt.
Accordingly, Kraft lacks standing to pursue his claims under the FDCPA. As the Amended
Complaint only asserts causes of actions pursuant to the FDCPA, Defendants’ Motion to Dismiss
is GRANTED.

13

IV.

CONCLUSION

For the reasons set forth above, Defendants’ Motion to Dismiss is GRANTED WITH
PREJUDICE and Kraft’s Motion for Reconsideration is DENIED AS MOOT as set forth herein
and in the accompanying order.

Date: July 30, 2019

/s/ Brian R. Martinotti___________
HON. BRIAN R. MARTINOTTI
UNITED STATES DISTRICT JUDGE

14