Strohbehn v. Access Group Inc

Filing 164

ORDER signed by Judge J.P. Stadtmueller on 11/14/2017. 84 Plaintiff's Motion to Strike Access Group's Affirmative Defenses DENIED as moot. 85 Plaintiff's Motion to Strike Weltman, Weinberg & Reis Co.'s Affirmative Defenses GRANTED in part and DENIED in part; Defendant's sixth and seventh affirmative defenses STRICKEN. 90 and 134 Plaintiff's Motions to Seal Documents GRANTED. 124 Plaintiff's Expedited Motion for Extension of Time DENIED as moot. 87 Plaintiff's Motion for Partial Summary Judgment GRANTED. 94 Weltman, Weinberg & Reis Co.'s Motion for Summary Judgment GRANTED as to Access Group's cross-claim and DENIED as to Plaintiff's claims. 100 Access Group's Motion for Summary Judgment GRANTED in part; Access Group DISMISSED from action. See Order for further details. (cc: all counsel) (jm)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
ERIN STROHBEHN,

v.

Plaintiff,

Case No. 16-CV-985-JPS

ACCESS GROUP INC. and
WELTMAN WEINBERG & REIS CO.
LPA,

ORDER

Defendants.
1.

INTRODUCTION
In 2003, Plaintiff obtained students loans to pay for law school. In

2007, after she graduated and found work, she attempted to pay them off
in one large payment. She came close to doing so, but through an
accounting error (whether hers or otherwise), a small balance remained
owing. The balance sat, unpaid, for almost a decade. In 2016, Defendants
began employing various means to attempt collection of the balance.
Plaintiff claims their efforts violated the Fair Credit Reporting Act
(“FCRA”), the Fair Debt Collection Practices Act (“FDCPA”), the Wisconsin
Consumer Act (“WCA”), and Wisconsin’s privacy laws.
Each party has moved for summary judgment, and each motion is
fully briefed. For the reasons explained below, Plaintiff’s motion will be
granted, Defendant Access Group, Inc.’s (“Access”) motion will be granted
in part, and Defendant Weltman, Weinberg & Reis, Co., L.P.A.’s (“WWR”)

motion will be granted in part and denied in part.1 The Court will also
address Plaintiff’s motions to strike, filed in mid-August 2017.
2.

MOTIONS FOR SUMMARY JUDGMENT
2.1

Standard of Review

Federal Rule of Civil Procedure (“FRCP”) 56 states that the “court
shall grant summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” Fed. R. Civ. P. 56(a); see Boss v. Castro, 816 F.3d 910, 916 (7th
Cir. 2016). A “genuine” dispute of material fact is created when “the
evidence is such that a reasonable jury could return a verdict for the
nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The Court construes all facts and reasonable inferences in a light most
favorable to the non-movant. Bridge v. New Holland Logansport, Inc., 815 F.3d
356, 360 (7th Cir. 2016). In assessing the parties’ proposed facts, the Court
must not weigh the evidence or determine witness credibility; the Seventh
Circuit instructs that “we leave those tasks to factfinders.” Berry v. Chicago
Transit Auth., 618 F.3d 688, 691 (7th Cir. 2010).

In the course of briefing her motion for summary judgment, Plaintiff filed
an expedited motion for an extension of time to file her reply. (Docket #124).
However, Plaintiff’s motion was ill-timed, coming too late for the Court to take
any action. Plaintiff’s motion indicated that it was opposed by Access, and thus
Access had seven days to submit its response. Civil L. R. 7(h). That seventh day
was Plaintiff’s reply deadline, so she had no choice but to file her reply anyway,
or risk having the reply be stricken as tardy. The expedited motion will, therefore,
be denied as moot.
1

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2.2

Factual Background

Though the parties have submitted voluminous factual material,
only a relatively small portion of it is relevant to the Court’s disposition.2 In
the interest of brevity, the Court has limited its factual recitation
accordingly. It notes the parties’ disputes where appropriate.3
From 2003 to 2006, Plaintiff obtained five separate student loans
through Access to help pay for law school. Plaintiff was loaned a total of
$60,000, with the individual loans ranging from $1,000 to $16,000. Though
they were disbursed at separate times, all were subject to the same
contractual terms. The loan agreements provided that Plaintiff had two
repayment options: “either 1) consecutive monthly payments until all
interest and princip[al] [was] paid over 240 months or 2) minimum monthly
payments of $50 (that might result in paying off the loan before the
expiration of 240 months).” (Docket #146 at 7). The agreements further
stated that Plaintiff had “the right to prepay all or any part of” the loans “at
any time without penalty.” See, e.g., (Docket #93-3 at 4).
From 2003 to 2009, the servicer for her loans was Kentucky Higher
Education Student Loan Servicing Corporation (“KHESLC”). Plaintiff’s
first payment on her loans was due in April 2007. When that time came,
Plaintiff attempted to consolidate and pay off her loans through a loan

The parties’ factual briefs are replete with immaterial facts and even less
material disputes. This has unnecessarily increased the burden on the Court,
which is duty-bound to wade through their lengthy and largely irrelevant
submissions. The Court views this as a symptom of the wasteful, nit-picking,
never-surrender approach all parties have applied to this otherwise relatively
straightforward case. The Court trusts that this unnecessarily antagonistic
approach will not continue through the conclusion of this matter.
2

Plaintiff filed two motions to seal certain documents marked confidential
by Access. (Docket #90 and #134). The Court will grant those motions.
3

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consolidation company called CIT Group, Inc. (“CIT”). Through CIT,
Plaintiff paid $68,051 in a single lump sum to pay off all five loans at once
(the “Consolidation Payment”). Despite her belief that the Consolidation
Payment would eliminate her loan balances entirely, fees and interest had
raised Plaintiff’s total loan balance to approximately $73,000. Thus, the
Consolidation payment only satisfied two of the loans, leaving a total
balance on the three remaining of approximately $5,000.
Plaintiff did not send any instructions on how to apply the
Consolidation Payment. Without such instruction, KHESLC applied the
payment in accordance with its own internal policies. KHESLC’s policy
provided that prepayments, such as the Consolidation Payment, would be
used to pay off any currently due fees, interest, and principal. Any excess
funds would then be applied to successive future monthly payments until
the funds ran out. This would, in effect, postpone the due date for Plaintiff’s
next required monthly payment in accordance with the amount of excess
funds. In Plaintiff’s case, the Consolidation Payment was so large that
Plaintiff would remain in “prepaid” status until January 2016. Plaintiff
notes that there was no mention in the agreements of postponing the due
date of future payments as provided in KHESLC’s policy. Rather, the
agreements provided for regular monthly payments of at least $50 so long
as a balance remained outstanding, which has always been the case.
Access began servicing Plaintiff’s loans directly from June 2009 to
March 2012. Upon taking over from KHESLC, Access sent Plaintiff written
materials about her loans. These explained Access’ prepayment policy,
which was substantially similar to that employed by KHESLC. Defendants
maintain that each servicer repeatedly sent Plaintiff billing statements
which indicated that her loans were prepaid until January 2016 and that she
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did not owe any monthly payments until that time. Plaintiff disputes
receiving many of these notices, and reiterates that the statements could not
retroactively change the terms of the loan agreements.
In March 2012, Access brought in ACS Education Services (“ACS”),
also known as Xerox, to service the loans. The conduct which directly
underlies Plaintiff’s claims began in 2016. When Plaintiff’s prepaid status
ended in January 2016, ACS began to report the debts as delinquent to the
three major credit bureaus, also known as credit reporting agencies
(“CRAs”). ACS reported Plaintiff’s debts in accordance with their servicing
duties to Access. Each debt was reported as a separate tradeline on her
credit. The information ACS used to create the tradelines was provided by
Access, and Access warranted to ACS that the information was accurate.
On March 3, 2016, Plaintiff sent letters to the CRAs disputing the
entries regarding her student loans. She claimed that the debts should not
be reported as delinquent because the statute of limitations applicable to
them had expired. See, e.g., (Docket #136-5). She ended up submitting nine
such disputes. Plaintiff’s disputes were sent to ACS, as it was the entity that
had been reporting the debts. When ACS responded to Plaintiff’s disputes,
it used the information in its records which had been supplied by Access.
ACS responded that its reporting activity was accurate, and the tradelines
were not deleted.
Access itself did not receive the notices from the CRAs and did not
otherwise know about the disputes.4 The parties dispute whether Access is

Plaintiff alleges that Access should be held responsible for the handling of
the disputes because it could enter ACS’ computer system, and ACS was its agent.
(Docket #140 ¶ 60). Even if true, this is not evidence that Access itself received the
disputes, had any actual notice that they existed, or that it had any role in
responding to them.
4

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nonetheless responsible for ACS’s reporting activity. Plaintiff claims that
ACS acted largely at Access’ direction, such that ACS should be considered
Access’ agent. Access counters that although it initially hired ACS to service
Plaintiff’s loans, any reporting activity and dispute resolution was
conducted entirely by ACS with reference to its own internal policies and
procedures. As discussed below, the Court must address this disagreement.
See infra Part 2.3.3.
From January to May 2016, Access called Plaintiff approximately five
times. Plaintiff does not describe the conversations except to say that Access
“stated I owed them money.” (Docket #136 at 2). In August 2016, Access
hired WWR to assist its collection efforts. As part of opening Plaintiff’s file,
WWR obtained Plaintiff’s credit score. Plaintiff says that WWR’s credit
inquiry damaged her credit rating. WWR sent a number of collection letters
to Plaintiff’s attorneys (she had previously told Access that all contact
should go through them). Soon afterward, Access told WWR to cease its
collection activity.
2.3

Analysis

Plaintiff asserts six causes of action in her operative pleading, the
Second Amended Complaint. (Docket #68). As of the date of this Order, the
claims are as follows:
Count One – Access violated the FCRA by providing
inaccurate information to the CRAs and by failing to conduct
a reasonable investigation into Plaintiff’s dispute regarding
that information. Plaintiff alleges these acts were done
willfully, thereby entitling her to increased damages. Id. ¶¶
43-48.

Page 6 of 23

Count Two – Access violated the Wisconsin Consumer Act
(“WCA”) by attempting “to collect on paid bills.” Id. ¶¶ 4951, 53-54.5
Count Three – WWR violated the FDCPA by attempting
“collection on paid bills.” Id. ¶¶ 55-60.
Count Four – WWR violated the WCA by “attempt[ing] to
collect on paid bills.” Id. ¶¶ 61-65.
Count Five – WWR violated the FCRA by obtaining a copy of
Plaintiff’s credit report, an act which can depress the target’s
credit score, without justification. Id. ¶¶ 66-70.
Count Six – WWR violated Plaintiff’s right to privacy,
codified in Wis. Stat § 995.50, by pulling Plaintiff’s credit
report. Id. ¶¶ 71-75.
The other relevant pleading is Access’ Answer to the Second Amended
Complaint. Therein, Access alleges a cross-claim against WWR, stating that
WWR should bear sole liability for any violations of Plaintiff’s rights.
(Docket #77 at 10). WWR denies this. (Docket #79).
Plaintiff seeks partial summary judgment not on any particular
claim, but on an overarching legal issue. Each Defendant seeks dismissal of
all of the claims arrayed against them. The Court will address the parties’
motions separately below.
2.3.1

Plaintiff’s Motion

Plaintiff seeks partial summary judgment on the issue which
underlies each of her claims: has the statute of limitations run on her loans,
thereby extinguishing the debts and rendering Defendants’ collection

In her Second Amended Complaint, Plaintiff pleads that Access’ WCA
violation also included “lying about [Plaintiff] on her credit file[.]” (Docket #68 ¶
52). She has withdrawn that portion of the WCA claim in response to Access’
motion for summary judgment. (Docket #139 at 24 n.10).
5

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activity is improper?6 The applicable statute of limitations in Wisconsin is
six years. Wis. Stat. § 893.43. Unlike most states, the expiration of the statute
of limitations in Wisconsin means that not only is the creditor barred from
filing suit to recover the debt, the debt itself is treated as eliminated. Id. §
893.05; First Nat’l Bank of Madison v. Kolbeck, 19 N.W.2d 909 (Wis. 1945);
Pantoja v. Portfolio Recovery Assoc., LLC, 852 F.3d 679, 684 (7th Cir. 2017)
(“We recognize that most states (though not Wisconsin, in this circuit) treat
a debt as a debt even after the statute of limitations has run so that it cannot
be legally enforced, at least if the defendant appears and asserts the
affirmative defense. See, e.g., Buchanan [v. Northland Group, Inc.], 776 F.3d
[393,] 396–97 [(7th Cir. 2015)] (recognizing general rule); cf. Wis. Stat. §
893.05 (when statute of limitations expires, “the right is extinguished as well
as the remedy”).”). A Wisconsin breach of contract action becomes viable,
and thus starts the clock on the statute of limitations, at the time of breach,
not at the time the breach is discovered. CLL Assoc. Ltd. P’ship v. Arrowhead
Pac. Corp., 497 N.W.2d 115, 117 (Wis. 1993).
Applying these principles to the facts of this case, Plaintiff argues
that her debts were eliminated prior to Defendants’ complained-of
collection activity beginning in January 2016. The Court follows her line of

As hinted in the Court’s recitation of the facts, Plaintiff’s complaint was
initially premised on two underlying facts which could independently support her
claims. First, Plaintiff asserted that she paid off her loans entirely in 2007, and thus
owed Access nothing during Defendants’ complained-of collection activity. Id. ¶¶
14, 31. Second, even if Plaintiff did actually owe Access money, she breached the
loan agreements long ago, and therefore the statute of limitations has expired on
the debts. Id. ¶ 32. Plaintiff appeared to abandon the first theory during summary
judgment briefing, and confirmed that fact after briefing was complete by filing a
separate notice to that effect. (Docket #149). She now proceeds only on the second
theory.
6

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reasoning. For the three remaining loans with balances, each loan
agreement is materially identical. The parties agreed that Plaintiff was
required to pay consecutive monthly payments, which were calculated
from the remaining principal and any accrued interest or fees, until the
loans were paid. Plaintiff also had the option to prepay her loans, but the
agreements provide that she would always owe at least $50 per month (if
there was any balance at all, of course).
Plaintiff’s first monthly payment was due in April 2007. Instead of
making any monthly payments, Plaintiff made the Consolidation Payment.
This was her first and last payment towards the loans. Even though the
Consolidation Payment paid off two of the loans entirely, and the bulk of
the remaining three, there were still balances due. Though these balances
would likely result in an exceedingly small monthly payment (as calculated
from the remaining principal and interest), the agreements provided that
Plaintiff must pay no less that $50 per month. When Plaintiff failed to make
a payment in May 2007, she contends that she breached the loan
agreements. After six years—approximately May 2013—the statute of
limitations expired on the debts. According to Plaintiff, this means that
Defendants have sought to recover non-existent debts.
Plaintiff’s motion, then, requests the Court’s interpretation of the
loan agreement. Such matters are appropriate for disposition on summary
judgment. Tufail v. Midwest Hospitality, LLC, 833 N.W.2d 586, 592 (Wis.
2013). Plaintiff’s position is persuasive and is grounded in the unambiguous
terms of the agreements. Id. (“[U]nambiguous contract language controls
contract interpretation. Where the terms of a contract are clear and
unambiguous, we construe the contract according to its literal terms.”)
(citation and quotation omitted). She is entitled to summary judgment that
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she was in breach as of May 2007, and that any right to recover the debt
expired in May 2013.
Defendants’ arguments to the contrary are unavailing. First, Access
contends that Plaintiff did not breach the loan agreements until January
2016. When it received the Consolidation Payment, KHESLC applied its
prepayment policy, functionally similar to Access’ policy, which ultimately
postponed Plaintiff’s next monthly payment due date until January 2016.
(hereinafter referred to as the “advancing due date” policy). As a result,
Plaintiff did not breach the loan agreements until she failed to make a
payment in 2016. From 2007 to 2016, KHESLC, Access, and ACS each sent
Plaintiff monthly statements reflecting that her total amount due each
month was zero or that she was in “pre-paid” status.
WWR joins Access’ position and offers an additional related
argument. The loan agreements provide that Plaintiff has “the right to
prepay all or any part of [her] loan at any time without penalty.” See, e.g.,
(Docket #93-3 at 4). The agreements do not define “prepay” or explain how
a prepayment would be applied. According to Webster’s, the definition of
“prepay” is to “pay in advance.” (Docket #125 at 6). The advancing due date
policy, in WWR’s view, is consistent with the dictionary definition of
“prepay.”
Defendants’ position fails to harmonize all relevant provisions of the
agreements. Md. Arms Ltd. P’ship v. Connell, 786 N.W.2d 15, (Wis. 2010)
(“When possible, contract language should be construed to give meaning
to every word, avoiding constructions which render portions of a contract
meaningless, inexplicable or mere surplusage.”) (quotation omitted).
Defendants ignore the express $50 per month minimum payment
provision, and seek to imply an advancing due date provision which is not
Page 10 of 23

found in the loan agreements. The Court will not read such a provision into
the agreements when one could have easily been included. Further, the
servicers’ internal advancing due date policies, their written materials
explaining those policies, and their letters to Plaintiff could not change this
fact. See, e.g., (Docket #93-3 at 4) (the agreements can only be modified by a
joint writing). The agreements clearly provide that Plaintiff will always owe
at least $50 per month, notwithstanding the amount due reflected on her
monthly statements. The servicers’ misinterpretation of the agreements,
and their belief that Plaintiff owed nothing in May 2007, lies solely with
them, as does their poor draftsmanship.7
Defendants’

secondary

argument

is

even

less

persuasive.

Defendants maintain that because the loan agreements chose Ohio law to
govern them, and Ohio’s applicable statute of limitations is fifteen years,
Plaintiff’s debts are still ripe. R.C. § 2305.06 (Ohio’s current limitations
period on contracts is eight years, but prior to 2012, it was fifteen); Rudolph
v. Viking Int’l Res. Co., Inc., No. 15-CA-26, 2017 WL 3701170, at *13-14 (Ohio
Ct. App. Aug. 11, 2017) (applying the fifteen-year period to cause of action

7

WWR claims that Plaintiff’s position “lacks basic logic:”

Under Plaintiff’s theory, nearly anyone who owes money
under a loan agreement could avoid payment responsibilities by
making a pre-payment large enough to cover just over six years of
payments. Then, when the six-year period since the last payment
lapsed, the debtor could claim to be free and clear of the debt
because of the statute of limitations. If such a scenario had any
grounding in reality, creditors would not permit large lump sum
pre-payments on loans.
(Docket #99 at 12). WWR’s position relies on an assumption that other creditors
will 1) write contracts which lack an advancing due date provision, or 2) fail to
understand the terms of the contracts they drafted. The Court is not terribly
concerned with either scenario.

Page 11 of 23

which accrued prior to 2012). Plaintiff’s student loans, however, are
considered consumer transactions which are afforded certain protections
by the Wisconsin Consumer Act (“WCA”). As relevant here, the WCA
invalidates any attempt to choose non-Wisconsin law to govern a consumer
transaction. Wis. Stat. § 421.201(10)(a).
Access counters that the WCA does not apply to consumer credit
transactions exceeding $25,000. Id. § 421.202(6). Plaintiff’s total loan
disbursement was $60,000. Plaintiff responds that each of her five loans,
none exceeding $25,000, was a separate transaction. She is correct for two
reasons. First, as a factual matter, Plaintiff’s loans were disbursed at
different times, in different amounts, and under separate promissory notes.
Indeed, Access itself treated the loans as separate. Second, Access provides
no precedent to convince the Court otherwise. Its only citation is to an
unpublished, per curiam decision of the Wisconsin Court of Appeals, which
according to Wisconsin law means that it is not precedent and does not even
hold persuasive value. Wis. Stat. § 809.23(3); Riverside Fin., Inc. v. Rogers, No.
2013-AP-2388, 2015 WL 4578903 (Wis. Ct. App. July 31, 2015).8

Access misreads Riverside, in any event. There, the parties agreed that
twelve separate loans, each less than $25,000 and spaced out over eight years,
constituted one transaction. Riverside, 2015 WL 4578903, at *3. This was, of course,
a poor strategy on the consumer’s part. Connecting the series of loans into a
unified whole was the only way the Court could (and in fact, did) find that the
entire value of the transaction exceeded $25,000 ($34,332.06, to be exact), and thus
fell outside the WCA’s purview. Id. at *3-4. The court specifically noted that
8

[o]ur acceptance of the parties’ agreement that all twelve loans
constituted a single transaction should not be considered an
endorsement of that position. However, because no argument was
made to the contrary in the circuit court or this court, we will not
interfere with Rogers’s chosen strategy.
Id. at *3 n.9. The remaining discussion in Riverside, however it might seem to apply
to the instant case, is clearly distinguishable because it rests on the court’s

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Access’ final argument contests one of the legal propositions the
Court earlier stated: that the expiration of the statute of limitations in
Wisconsin extinguishes the debt entirely. As support, Access cites to one
opinion: Judge Griesbach’s summary judgment order in Herrell v. Chase
Bank USA, N.A., issued on October 24, 2016. 218 F. Supp. 3d 768. Upon a
close reading of Kolbeck, Judge Griesbach concluded that continuing to
report a stale debt to the CRAs did not violate the FCRA. Id. at 792. He
found that this accorded with the purpose of credit reporting, which is
focused on providing insight to potential creditors; listing an unpaid debt
provides useful information, whether or not the debt is actually collectable.
Id. No matter whether this Court would agree with Judge Griesbach’s
reasoning, it is constrained to follow the Seventh Circuit’s command. As
stated in Pantoja, a decision not available to Judge Griesbach when he issued
Herrell, Wisconsin does not treat “a debt as a debt even after the statute of
limitations has run[.]” 852 F.3d at 684. This Court is not at liberty to
disagree.
Plaintiff’s motion for summary judgment must, therefore, be
granted. Again, she did not seek a ruling in her favor as to any particular
claim or count, so the Court will not issue one. Nonetheless, the invalidity
of her debts is now finally established.
2.3.2

WWR’s Motion

WWR seeks summary judgment on all claims pending against it.
This includes Counts Three, Four, Five, and Six of the Second Amended
Complaint, as well as Access’ cross-claim. The only grounds asserted for

acceptance of the parties’ agreement. In our case, the parties have made
abundantly clear that they agree on nothing, much less on this issue.

Page 13 of 23

dismissing Plaintiff’s claims are 1) the loans were not paid off, and 2) the
statute of limitations has not run on them. (Docket #99 at 9-12). The first has
already been conceded by Plaintiff, but the second has been conclusively
established in Plaintiff’s favor. Thus, the Court must deny WWR’s motion
as it relates to Plaintiff’s claims. As to Access’ cross-claim, Access failed to
respond to WWR’s motion in any way. Without opposition from Access, its
cross-claim against WWR will stand dismissed. (Docket #77 at 10).9
2.3.3

Access’ Motion

Like WWR, Access seeks dismissal of all outstanding claims against
it. For Access, these are Counts One and Two of the Second Amended
Complaint. With the granting of Plaintiff’s motion, a portion of Access’
arguments are rendered moot. Unlike WWR, Access presents some
arguments which are independent of the validity of the underlying debts.
These are meritorious and require dismissal of Counts One and Two.
Recall that Count One alleges that Access violated the FCRA “by
failing to conduct a reasonable investigation with respect to the disputed
information, by failing to review all relevant information available, and by
failing to update [Plaintiff]’s credit report to accurately reflect that she did
not owe a balance.” (Docket #68 ¶ 45). Plaintiff cites 15 U.S.C. § 1681s-2(b)
as the particular FCRA provision violated by this conduct. Id. Section 1681s2 is titled “Responsibilities of furnishers of information to consumer
reporting agencies.” A “furnisher” of credit information is one who
provides the actual credit information to a CRA, generally a creditor,
servicer, or collection agency. Subpart (b) establishes certain duties for

For what it is worth, Plaintiff agrees that the cross-claim should be
dismissed. (Docket #137 at 13-14).
9

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furnishers when they receive notice that a consumer disputes information
the furnisher provided to a CRA. It states, in pertinent part:
After receiving notice pursuant to section 1681i(a)(2) of
this title [from a CRA] of a dispute with regard to the
completeness or accuracy of any information provided by a
person to a consumer reporting agency, the [furnisher]
shall—
(A) conduct an investigation with respect to the
disputed information;
(B) review all relevant information provided by the
[CRA] pursuant to section 1681i(a)(2) of this title;
(C) report the results of the investigation to the [CRA];
(D) if the investigation finds that the information is
incomplete or inaccurate, report those results to all other
[CRAs] to which the person furnished the information and
that compile and maintain files on consumers on a nationwide
basis[.]
15 U.S.C. § 1681s-2(b)(1).
The parties assume that ACS and Access qualify as “furnishers.” It
is undisputed that from March 2012 onward, ACS alone was actually
communicating Plaintiff’s credit information on the student loans to the
CRAs; that is what Access hired ACS to do. Plaintiff also does not contest
that her disputes to the CRAs were communicated only to ACS, which was
the only entity to respond to the disputes.
Under the plain language of Subpart (b), Access cannot be liable with
respect to Plaintiff’s disputes. A duty to investigate the accuracy of credit
information is only triggered when a furnisher receives notice of a dispute
from a CRA. Westra v. Credit Control of Pinellas, 409 F.3d 825, 827 (7th Cir.
2005). Access did not directly furnish the information Plaintiff sought to
dispute. Access also never received any notice of Plaintiff’s disputes from a

Page 15 of 23

CRA. Rather, those went directly to the furnisher, ACS. Access thus had no
duty to comply with Subpart (b) because such a duty never arose.
Plaintiff acknowledges as much, but argues that FCRA liability
should nonetheless be imposed on Access via an agency theory. However,
Plaintiff supplies no direct support for such a theory. The FCRA itself does
not impose additional dispute resolution duties beyond the furnisher itself
or otherwise provide for vicarious liability. Plaintiff’s only citations are to
cases which conclude that vicarious liability should be imposed on a
furnisher when one of its own employees violates the FCRA in some
manner, usually by obtaining someone’s credit information for an improper
purpose. See Jones v. Federated Fin. Reserve Corp., 144 F.3d 961, 965-66 (6th
Cir. 1998); Smith v. Sears, Roebuck & Co., 276 F. Supp. 2d 603, 606 (S.D. Miss.
2003); Owens v. Dixie Motor Co., No. 5:12-CV-389, 2014 WL 12703392, at *911 (E.D. N.C. Mar. 31, 2014).
Neither party cites a case imposing vicarious liability running from
a third-party loan servicer back to the creditor for violation of Subpart (b)
duties. The Court itself has been unable to locate helpful precedent on the
issue. In the absence of controlling, contrary authority, and based on the
plain language of Subpart (b), the Court concludes that Access should not
be subject to Subpart (b) liability based on ACS’ conduct.10 Access is entitled
to summary judgment on Count One.11

The parties’ factual disputes about whether ACS was indeed Access’
agent are thus irrelevant. In other words, the Court cannot weigh the factual
propriety of Plaintiff’s agency theory without first determining that vicarious
liability is even cognizable for her Subpart (b) claim. Plaintiff has not made the
latter showing, and so the Court cannot reach the former.
10

Plaintiff cannot complain that this result is unjust. In July, Plaintiff
attempted to amend her complaint to add a claim against ACS. (Docket #57). The
11

Page 16 of 23

Access also seeks dismissal of the WCA claim in Count Two. Count
Two invokes Wis. Stat. § 427.104(1)(h) of the WCA, which prohibits
harassing conduct in the collection of a consumer debt. As stated in the
Second Amended Complaint, Plaintiff alleges that Access harassed her by
both “continu[ing] to collect on paid bills,” and by “[l]ying about [Plaintiff]
on her credit file[.]” (Docket #68 ¶¶ 51-52). In response to Access’ motion,
Plaintiff has withdrawn the second allegation regarding credit reporting.
(Docket #139 at 24 n.10). Thus, the only claim remaining in Count Two is
that Access harassed Plaintiff by attempting to collect on a debt which was
eliminated by operation of the statute of limitations.
Access contends that Plaintiff has not offered sufficient evidence of
harassment. Courts have had little occasion to discuss Section 427.104(1)(h),
and those which do give it only passing treatment. Andersen v. State
Collection Serv., Inc., 822 N.W.2d 737, 2012 WL 4094271, at *4 (Wis. Ct. App.
Sept, 19, 2012) (three sentences to address pro se litigants generalized
allegations of harassment); Weber v. Great Lakes Educ. Loan Servs., Inc., No.
13-CV-291, 2013 WL 3943507, at *5 (W.D. Wis. July 30, 2013) (contacting a
consumer’s attorney after being notified that the consumer was represented

Court denied her request because it came too late to keep the current trial date.
(Docket #62). The Court noted that “Plaintiff remains free to pursue Access for
[ACS]’s conduct, as she insists that [ACS] was at all times acting as Access’s agent,
. . . or she may simply file a separate action against [ACS].” Id. at 2. The first clause
of that sentence was not a stamp of approval on Plaintiff’s agency theory, but
merely an acknowledgment that she advanced it. Now that the parties have
marshalled all of the applicable law and evidence they could muster, the Court
can now conclude that the first option is not viable. Even if Plaintiff could have
reasonably relied on the Court’s earlier statement, it specifically referenced
another option, namely a separate lawsuit against ACS. Given the arguments in
this case, the Court assumes that one was not pursued, but that was Plaintiff’s
choice to make.

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“appears an appropriate if not laudable step for a collection agent to take
and is certainly not ‘harassing conduct.’”). The Court can be sure, however,
that harassment must be assessed objectively. Wis. Stat. § 427.104(1)(h)
(collector cannot “[e]ngage in other conduct which can reasonably be
expected” to harass) (emphasis added); Assoc. Fin. Servs. Co. of Wis. v.
Hornik, 336 N.W.2d 395, 397 (Wis. Ct. App. 1983).12
The only helpful analogy, and a marginal one at that, comes from
Hornik. There, the Court of Appeals assessed whether a collector’s conduct
was harassing under a different subpart of Section 427.104, which
proscribes “[c]ommunicat[ing] with the customer . . . with such frequency
or at such unusual hours or in such a manner as can reasonably be expected
to threaten or harass the customer.” Wis. Stat. § 427.104(1)(g); Hornik, 336
N.W.2d at 397-99. At a bench trial, the trial court found that a collector
making four to five calls per month to a delinquent debtor was not
harassment. Hornik, 336 N.W.2d at 398. Hornik held that this finding was
not clearly erroneous. Id. at 399.
In her brief, Plaintiff claims that the following conduct could be
considered harassing:
The record shows that Ms. Strohbehn retained counsel
to ask Access Group to cease their collection efforts; and that
Access Group wouldn’t even bother to have someone from
their legal department contact her attorney. She talked to
collection employees on the phone and was subjected to the
actions of a debt collector hired by Access Group.

Plaintiff suggests that the harassment should be assessed from the
perspective of “a person in Plaintiff’s position and career[.]” (Docket #139 at 24).
She cites only Hornik for this proposition, which says nothing of the sort. Rather,
any alleged harassment must be viewed from the perspective of an average,
reasonable consumer—the person protected by the WCA—and not modified to fit
Plaintiff’s “position [or] career.”
12

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(Docket #139 at 24-25). This is the entirety of the allegedly harassing
conduct.13 There are two problems with Plaintiff’s argument. First,
Plaintiff’s brief does not cite where the facts supporting the first sentence
may be found, and the Court cannot locate them. See generally (Docket #140
and #146).
Second, taking the second sentence at face value, it does not amount
to harassment. Access made far fewer calls than the collector in Hornik, and
WWR’s letters were sent to Plaintiff’s lawyers in accordance with her
wishes.14 Plaintiff does not explain how this generic debt collection activity
rose to the level of harassment, beyond her belief that the debts were not
owed. However, Access genuinely disagreed, and only as of this ruling has
the issue been definitively resolved. Access cannot be faulted for
maintaining its position on the hotly-disputed validity of Plaintiff’s debts
prior to this point. On the facts marshalled by Plaintiff, no reasonable jury
could find that a reasonable person would have been harassed by Access’
conduct. Access is, therefore, entitled to summary judgment on Count Two.
3.

MOTIONS TO STRIKE
Two weeks before filing her motion for summary judgment, Plaintiff

moved to strike certain affirmative defenses from Access’ answer. (Docket

The remainder of Plaintiff’s factual references in this section of her brief
go to her damages on the harassment claim, not liability. See (Docket #139 at 25).
Plaintiff also suggests that more support for the harassment claim can be found
“though this entire brief.” Id. She cannot send the Court on a scavenger hunt to
find evidence and argument favorable to her. United States v. Dunkel, 927 F.2d 955,
956 (7th Cir. 1991) (“Judges are not like pigs, hunting for truffles buried in briefs.”).
13

This generously assumes that WWR’s collection activity can be attributed
to Access. Plaintiff has not shown that an agency theory is available under Section
427.104(1)(h).
14

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#84). She submitted a similar motion directed at WWR’s answer a few days
later. (Docket #85). The motion directed to Access must be denied as moot
in light of the Court’s rulings on summary judgment.
As to WWR, Plaintiff seeks to strike Defendants’ affirmative
defenses pursuant to FRCP 12(f). The Rule provides that “an insufficient
defense or any redundant, immaterial, impertinent, or scandalous matter”
may be stricken from a pleading. Fed. R. Civ. P. 12(f). The standard of
review applied to such motions is incredibly deferential. Motions to strike
answers and affirmative defenses are not favored “and will not be granted
unless it appears to a certainty that plaintiffs would succeed despite any
state of the facts which could be proved in support of the defense.” Williams
v. Jader Fuel Co., Inc., 944 F.3d 1388, 1400 (7th Cir. 1991). In considering a
motion to strike, the Court “views the challenged pleadings in the light
most favorable to the non-moving party. Moreover, motions to strike will
generally be denied unless the portion of the pleading at issue is
prejudicial.” McGinn v. J.B. Hunt Transport, Inc., No. 10-CV-610-JPS, 2010
WL 4363419, at *1 (E.D. Wis. Oct. 27, 2010) (citation omitted).15
These standards dictate that WWR’s true affirmative defenses must
remain. These are its first (damages caused by independent third parties),
second (failure to mitigate damages), third (contributory negligence), and
fifth (bona fide error). (Docket #78 at 13). Though Plaintiff chides WWR for
not including additional factual allegations along with the defenses, she

Plaintiff appears to believe that the plausibility standard announced in
Iqbal applies to an assessment of affirmative defenses. (Docket #85 at 2-4). The
Seventh Circuit has not so held, and the Court is not free to ignore Williams, which
is on-point and has not been overruled. See Gatx Corp. v. Assoc. Energy Servs., LP,
16-C-340, 2016 WL 4378971, at *3 (N.D. Ill. Aug. 17, 2016).
15

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does not address the Williams standard at all. Plaintiff’s failure to do so
means that the Court must deny her motion with respect to those defenses;
she has not even attempted to establish that there are no provable facts
which could support them. Further, Plaintiff alleges no prejudice arising
from the defenses, other than a general desire to remove “clutter” from the
case. (Docket #122 at 2). Plaintiff can dispute the merits of any of these
defenses should they be raised at trial, and if they are indeed completely
without a factual basis, sanctions offer her a remedy. Fed. R. Civ. P. 11(b).
Plaintiff is correct, however, that WWR’s sixth and seventh
“affirmative defenses” are not true defenses at all. The sixth alleges that
Plaintiff’s claims are frivolous if the Consolidation Payment did not
extinguish the loans. Id. The seventh says that Plaintiff “fails to meet the
statutory requirements . . . to recover punitive damages” under the FCRA
and WCA. Id. at 14. Neither of these assertions qualify as affirmative
defenses because they attack, rather than admit, certain elements of
Plaintiff’s prima facie case. See Riemer v. Chase Bank USA, N.A., 274 F.R.D.
637, 639 (N.D. Ill. 2011) (“An affirmative defense is one that admits the
allegations in the complaint, but avoids liability, in whole or in part, by new
allegations of excuse, justification or other negating matters.”). Both of these
defenses are stricken.
4.

CONCLUSION
Plaintiff has shown that her student loans debts were extinguished,

in accordance with the terms of the loan agreements and the applicable
statute of limitations, in 2013. Thus, Defendants’ complained-of collection
activity was directed at non-existent debts. However, Plaintiff can no longer
proceed against Access on any claim for reasons independent of the validity
of the debts. Thus, the only claims remaining for trial are those against
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WWR. Though Access is entitled to dismissal from this matter, its motion
for sanctions will remain pending. As the Court stated in its November 8,
2017 order, that motion will be addressed at the conclusion of the trial.
(Docket #161).
Accordingly,
IT IS ORDERED that Plaintiff’s motion to strike Defendant Access
Group, Inc.’s affirmative defenses (Docket #84) be and the same is hereby
DENIED as moot;
IT IS ORDERED that Plaintiff’s motion to strike Defendant
Weltman, Weinberg & Reis Co., L.P.A.’s affirmative defenses (Docket #85)
be and the same is hereby GRANTED IN PART and DENIED IN PART;
IT IS FURTHER ORDERED that Defendant Weltman, Weinberg &
Reis Co., L.P.A.’s sixth and seventh affirmative defenses (Docket #78 at 1314) be and the same are hereby STRICKEN;
IT IS FURTHER ORDERED that Plaintiff’s motions to seal (Docket
#90 and #134) be and the same are hereby GRANTED;
IT IS FURTHER ORDERED that Plaintiff’s expedited motion for an
extension of time (Docket #124) be and the same is hereby DENIED as
moot;
IT IS FURTHER ORDERED that Plaintiff’s motion for partial
summary judgment (Docket #87) be and the same is hereby GRANTED;
IT IS FURTHER ORDERED that Defendant Weltman, Weinberg &
Reis Co., L.P.A.’s motion for summary judgment (Docket #94) be and the
same is hereby GRANTED IN PART and DENIED IN PART in accordance
with the terms of this Order;

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IT IS FURTHER ORDERED that Defendant Access Group, Inc.’s
motion for summary judgment (Docket #100) be and the same is hereby
GRANTED IN PART in accordance with the terms of this Order; and
IT IS FURTHER ORDERED that Defendant Access Group, Inc. be
and the same is hereby DISMISSED from this action.
Dated at Milwaukee, Wisconsin, this 14th day of November, 2017.
BY THE COURT:

____________________________
J. P. Stadtmueller
U.S. District Judge

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