John Burton v. Kohn Law Firm, S.C.
934 F.3d 572
7th Cir.2019Background
- Kohn Law Firm sued John H. Burton in Wisconsin state court on behalf of Unifund CCR, LLC to collect a Citibank credit-card debt; Burton denied any association with the account and claimed possible fraud/identity theft.
- While the state action was pending Burton filed a federal suit alleging Kohn violated the FDCPA and Wisconsin Consumer Act by suing without first giving required pre-suit notice of a right to cure.
- The state court dismissed the collection suit after Burton (in state proceedings) testified under oath he was not the person who incurred the account; Burton then amended his federal complaint to add Unifund.
- At summary judgment Burton tried to show the debt was a "consumer debt" by pointing to collection letters, billing statements (small-dollar charges at gas stations, convenience stores, some office-supply/auto parts transactions), an email from a Citibank employee calling it a "consumer account," and defendants’ consumer-debt marketing.
- The district court excluded the Citibank employee email as hearsay, found Burton’s own inconsistent sworn statements and lack of admissible evidence insufficient to show the debt was incurred for personal, family, or household purposes, and granted defendants summary judgment on FDCPA and WCA claims.
- The Seventh Circuit affirmed, holding Burton failed to present admissible evidence creating a triable issue that the debt was a consumer debt.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the debt is a "consumer debt" under the FDCPA/WCA | Burton: the debt was incurred for personal, family, or household purposes (billing statements, collection letters, Citi email, defendants’ marketing) | Kohn/Unifund: plaintiff bore the burden and produced no admissible evidence tying transactions to personal use; state-court sworn denials undermine his claim | Held: Burton failed to produce admissible evidence creating a genuine dispute that the debt was consumer debt; summary judgment for defendants affirmed |
| Admissibility of Citibank employee email | Burton: email is an opposing-party admission or fits residual hearsay exception | Defendants: email is hearsay from non-party Citibank and not within exceptions; plaintiff could have deposed a Citibank witness | Held: Email is inadmissible hearsay; not an opposing-party admission and fails Rule 807 requirements |
| Whether inclusion of FDCPA disclaimers/collection to home address shows consumer debt | Burton: defendants treated the obligation as consumer debt (disclaimers, sued personally, mailed to home) | Defendants: such practices are routine and do not prove the nature of the underlying debt | Held: These factors are insufficient to establish the debt was consumer in nature |
| Whether billing statements alone create triable issue about purpose of transactions | Burton: merchant names and low-dollar consumer-style purchases indicate consumer use | Defendants: statements do not show why purchases were made and plaintiff cannot explain them | Held: Statements do not show purpose; without explanation they cannot create a genuine factual dispute |
Key Cases Cited
- Bass v. Stolper, Koritzinsky, Brewster & Neider, S.C., 111 F.3d 1322 (7th Cir.) (FDCPA protects consumer debts)
- Miller v. McCalla, Raymer, Padrick, Cobb, Nichols & Clark, L.L.C., 214 F.3d 872 (7th Cir.) (business debts fall outside FDCPA scope)
- Suesz v. Med-1 Sols., LLC, 757 F.3d 636 (7th Cir.) (FDCPA’s consumer-protection purpose)
- Loja v. Main St. Acquisition Corp., 906 F.3d 680 (7th Cir.) (a person who denies owing a debt may still claim FDCPA protection if treated as a consumer by collector)
- Gburek v. Litton Loan Serv. LP, 614 F.3d 380 (7th Cir.) (inclusion of debt-collection disclaimers does not by itself establish a debt is consumer in nature)
- Lewis v. CITGO Petroleum Corp., 561 F.3d 698 (7th Cir.) (standard of review for summary judgment)