Carter v. AMC, LLC
2011 U.S. App. LEXIS 9753
| 7th Cir. | 2011Background
- Carter leased Riverstone Apartments in Bolingbrook; AMC, LLC acted as manager/agent for the building's owner, Jackson Square Properties.
- AMC filed state-court eviction; trial court granted, but the Illinois appellate court reversed for failure to give statutorily required notice.
- One judge on the state panel suggested a FDCPA violation, but others did not join that portion of the opinion.
- Carter filed a federal suit alleging two FDCPA violations: reporting a disputed rent to a credit bureau without disclosing the dispute, and misrepresenting the debt during state proceedings.
- The district court assumed AMC owned Riverstone and treated it as a debt-collector defendant; it dismissed the FDCPA claim, later questioned on whether AMC could be a debt collector.
- The Seventh Circuit held AMC was not a debt collector because it was a servicing/agent for the lessor, and thus not liable under the FDCPA; attorneys were not parties to the suit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is AMC a 'debt collector' under the FDCPA when it is the managing agent for the lessor? | Carter argues AMC 'obtains' the debt as agent and thus is a debt collector. | AMC contends it is not a debt collector because it merely serves as agent, not the party attempting to collect on behalf of another. | AMC is not a debt collector under §1692a(6); agency status means it does not owe FDCPA duties. |
| Can the FDCPA claim lie against AMC's attorneys in this suit? | Attorneys could be liable as debt collectors under the FDCPA. | The FDCPA claims target AMC, not necessarily its counsel; attorneys are not parties to the suit. | Attorneys are not parties to this suit; the FDCPA claim against them is not addressed. |
Key Cases Cited
- Thomas v. Law Firm of Simpson & Cybak, 392 F.3d 914 (7th Cir. 2004) (FDCPA applicability to some state-court filings; issued later affected by amendments)
- Schiavone v. Fortune, 477 U.S. 21 (1986) (scant ability to sue 'Riverstone Apartments' as a party; clarifies corporate identity)
- Bailey v. Security National Servicing Corp., 154 F.3d 384 (7th Cir. 1998) (servicing agent may 'obtain' debt even if bank owns the note)
- Alibrandi v. Financial Outsourcing Services, Inc., 333 F.3d 82 (2d Cir. 2003) (alternative view on debt collection and assignment concepts)
- Wadlington v. Credit Acceptance Corp., 76 F.3d 103 (6th Cir. 1996) (debt-collection status of servicing entities)
- Heintz v. Jenkins, 514 U.S. 291 (1995) (attorneys can be debt collectors under FDCPA in some contexts)