Ajasa v. WELLS FARGO BANK, N.A., 627 B.R. 6

Background

Plaintiffs Olufunmilayo Ajasa and Joseph Lopez (Chapter 7 debtors) allege Wells Fargo willfully failed to update credit-report tradelines to show debts were discharged, harming debtors’ credit and coercing payment.
Plaintiffs seek to represent a nationwide Rule 23 class of Chapter 7 debtors (claims dating back to May 3, 2007) for violations of the §524(a)(2) discharge injunction, and seek declaratory, injunctive, and damages relief.
Wells Fargo moved to strike the nationwide class allegations under Fed. R. Civ. P. 12(f) and 23(d), arguing the bankruptcy court lacks subject-matter jurisdiction to enforce discharge injunctions issued by other districts (i.e., only the issuing court can enforce its discharge).
Key legal dispute: whether the bankruptcy court can consider certification of a nationwide class asserting violations of statutory discharge injunctions entered in other districts, and whether the motion to strike is premature.
The court held the motion was not premature (jurisdictional question appropriate to resolve early) but denied Wells Fargo’s request to strike the nationwide class allegations, reserving class certification for a later motion.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
1. Is the motion to strike class allegations premature?	Defer class-scope challenges to Rule 23 certification; motions to strike are disfavored.	Question of law (jurisdiction) appropriate to decide early; discovery won’t change outcome.	Not premature: jurisdictional question is separable and appropriately addressed now.
2. Does the bankruptcy court have subject-matter jurisdiction under 28 U.S.C. §1334(b) to adjudicate discharge-injunction claims generally?	Yes; enforcement of §524(a) is a core bankruptcy matter arising under Title 11 and Rule 7023 permits class actions.	N/A (Wells Fargo conceded core jurisdiction over named plaintiffs but challenged nationwide scope).	Court: core jurisdiction exists over the named plaintiffs and the court can entertain class claims under §1334(b) and Rule 7023.
3. May a bankruptcy court other than the issuing court enforce a discharge injunction (and thus entertain a nationwide class)?	Statutory discharge is a uniform, form injunction; §105(a) and core jurisdiction permit enforcement beyond issuing district.	Relying on In re Debs/All Writs Act and circuits holding only the issuing court should adjudicate contempt for its injunction, defendant says only issuing court can enforce.	Court: statutory discharge differs from judge-crafted injunctions; §105(a) and §1334(b) permit consideration of class claims here—Wells Fargo did not show jurisdictional bar to nationwide class as a matter of law.
4. Should the nationwide class allegations be stricken as impossible to certify?	N/A (Plaintiffs oppose striking; certification merits to be decided later).	Because courts lack power to enforce other courts’ injunctions, nationwide class must be stricken.	Denied: defendant failed to demonstrate it is impossible to certify a nationwide class regardless of discovery/evidence; class certification reserved for later.

Key Cases Cited

In re Debs, 158 U.S. 564 (1895) (longstanding principle that courts generally enforce their own injunctions).
Thomas v. Gen. Motors Corp., 522 U.S. 222 (1998) (injunctions ordinarily enforced by the enjoining court).
Taggart v. Lorenzen, 139 S. Ct. 1795 (2019) (standard for civil contempt for violating a discharge: no fair ground of doubt).
Anderson v. Credit One Bank, N.A. (In re Anderson), 884 F.3d 390 (2d Cir. 2018) (bankruptcy courts uniquely suited to enforce discharge injunctions; arbitration inappropriate).
Crocker v. Navient Solutions, LLC (In re Crocker), 941 F.3d 206 (5th Cir. 2019) (interpreting Anderson to require return to issuing bankruptcy court to enforce discharge injunction).
Alderwoods Group, Inc. v. Garcia, 682 F.3d 958 (11th Cir. 2012) (enjoining court retains jurisdiction to enforce its orders; discussion of All Writs Act).
Key Mechanical Inc. v. BDC 56 LLC (In re BDC 56 LLC), 330 F.3d 111 (2d Cir. 2003) (jurisdiction is a threshold issue to be decided early).
FDIC v. Colonial Realty Co., 966 F.2d 57 (2d Cir. 1992) (limits on §105 equitable powers; must be exercised within Bankruptcy Code).
New England Dairies, Inc. v. Dairy Mart Convenience Stores, Inc., 351 F.3d 86 (2d Cir. 2003) (section 105 powers tied to carrying out Bankruptcy Code).
New York v. Shinnecock Indian Nation, 686 F.3d 133 (2d Cir. 2012) (jurisdiction cannot be created by parties’ consent).