Greene v. CCDN, LLC
853 F. Supp. 2d 739
N.D. Ill.2011Background
- Plaintiffs Greene sue for CROA and ICSOA violations against CCDN, RKLA, Lock, and Manger; 15 defendants were dismissed, leaving four.
- Defendants participated in CCDN’s program but there is no proof of formal service on the operative complaint; defendants actively litigated.
- CCDN, Lock, and Manger are co-founders/owners; RKLA is a sole proprietorship owned by Lock; CCDN’s program marketed credit restoration as its core service.
- Plaintiffs paid approximately $1,433.33 upfront for CCDN’s program beginning in July 2006; they stopped paying creditors following CCDN’s advice.
- CCDN’s enrollment materials, manual, and website touted significant credit improvement and debt resolution, describing a three-phase program: Credit Restoration, Reconciliation, and Federal Lawsuit.
- CCDN did not actually perform credit repair; instead, third-party partners allegedly provided such services; CCDN claimed its role was education and referral.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CCDN, Lock, and Manger are CROAs and RKLA is a CSO | Greene argues CCDN, Lock, and Manger offer credit repair; RKLA acts as a CSO/agent. | Defendants contend RKLA not a CROA/CSO; CCDN/Lock/Manger rely on others for services. | CCDN, Lock, and Manger are CROAs and CSOs; RKLA is not a CROA/CSO. |
| Whether defendants violated CROA/ICSOA by taking payments in advance | Greene alleges payment before full performance violated CROA §1679b(b) and ICSOA §605/5(1). | Defendants argue payment structure may not render liability; need service completion. | CCDN violated CROA/ICSOA; Lock and Manger not conclusively liable at summary judgment; RKLA excluded. |
| Whether defendants made false or misleading statements about the services | Greene contends CCDN, Lock, and Manger falsely promised credit restoration and debt relief. | Defendants contend statements were opinions or actions not constituting fraud. | CCDN, Lock, and Manger liable for false/deceptive statements; RKLA not implicated. |
| Damages and punitive damages | Greene seeks $1,433.33 back and $100,000 punitive damages. | Defendants oppose punitive damages at summary judgment stage; question of damages for trial. | Plaintiffs awarded $1,433.33; punitive damages reserved for trial. |
Key Cases Cited
- Suzanne Surowitz v. Hilton Hotels Corp., 383 U.S. 363 (Supreme Court 1966) (plaintiff need not understand complaint to maintain action)
- Fraudulent Credit Services v. Gill, 265 F.3d 944 (9th Cir. 2001) (CROA aims to curb deceptive credit repair practices)
- Lorillard Tobacco Co. v. A & E Oil, Inc., 503 F.3d 588 (7th Cir. 2007) (state of mind questions often fact-bound for punitive issues)