Lawrence Glazer v. Chase Home Finance, LLC
2013 U.S. App. LEXIS 845
| 6th Cir. | 2013Background
- Glazer sues Chase Home Finance and RACJ under FDCPA and Ohio law over foreclosure of Klie property in Ohio.
- Chase serviced the loan before default; ownership remained with Fannie Mae, not Chase.
- Chase obtained servicing rights in 2007 and handled defaulted loan; Glazer disputed debt ownership and demanded verification.
- Foreclosure action was filed in state court alleging Chase owned note; Glazer challenged accuracy of ownership and requested debt verification.
- District court dismissed federal claims under Rule 12(b)(6) and declined supplemental jurisdiction over state-law claims; Glazer appealed.
- Court holds that mortgage foreclosure is debt collection under the FDCPA and reverses in part accordingly.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is mortgage foreclosure debt collection under the FDCPA? | Glazer argues foreclosure procedures target collecting debt. | Chase contends foreclosure is enforcement of security interests, not debt collection. | Yes; mortgage foreclosure is debt collection under the FDCPA. |
| Is Chase a debt collector under the FDCPA given pre-default servicing? | Glazer argues exception does not apply to Chase as a debt collector. | Chase contends exception applies since loan was current when serviced. | Chase not a debt collector under the relevant exception; exception applies when debt is current when obtained. |
| Was the district court’s denial of leave to amend an abuse of discretion? | Glazer sought to amend based on new deposition evidence. | Chase argued amendment would be futile and delayed proceedings. | No abuse of discretion; denial was proper given delay and prejudice. |
| Should RACJ’s foreclosure-related FDCPA claims be revived? | Foreclosure actions constitute debt collection by RACJ. | Foreclosure activities not debt collection under the Act. | Mortgage foreclosure is debt collection; RACJ liable; reverse as to RACJ. |
| What is the scope of supplemental jurisdiction over state-law claims on remand? | Remand to address state-law claims. | State-law claims reinstated and remanded for further proceedings. |
Key Cases Cited
- Piper v. Portnoff Law Assocs., Ltd., 396 F.3d 227 (3d Cir. 2005) (foreclosure-related actions may be debt collection under FDCPA)
- Wilson v. Draper & Goldberg, P.L.L.C., 443 F.3d 373 (4th Cir. 2006) (foreclosure activities can constitute debt collection under the FDCPA)
- Perry v. Stewart Title Co., 756 F.2d 1197 (5th Cir. 1985) (exception for debt collectors when debt was current when obtained)
- Wadlington v. Credit Acceptance Corp., 76 F.3d 103 (6th Cir. 1996) (servicing a loan not owned may avoid FDCPA liability under certain conditions)
- Heintz v. Jenkins, 514 U.S. 291 (1995) (lawyer who regularly attempts to collect debts is a debt collector under FDCPA)