Marshall Spiegel v. Michael Kim, 952 F.3d 844

Marshall Spiegel was a condominium association board member removed in December 2015; the 1618 Sheridan Road Condominium Association sued him alleging unauthorized actions and sought injunctive relief, damages, costs, and attorneys’ fees under the association’s Restated Declaration.
Spiegel filed hundreds of filings in Cook County court (385), which the state court found baseless, enjoined him from interfering with the board, dismissed his claims with prejudice, and ordered over $700,000 in fees and sanctions.
Association counsel Michael Kim sought attorneys’ fees in the state litigation; Spiegel filed a federal suit accusing Kim of violating the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692e, 1692f, by requesting those fees.
The district court granted Kim’s Rule 12(c) motion, concluding the requested attorneys’ fees were not a “debt” under the FDCPA because they did not arise out of a consumer transaction, and denied Spiegel’s motions to vacate and to amend as futile.
The Seventh Circuit affirmed: Spiegel failed to plead that the state-court fee demand arose from a consumer transaction and therefore could not bring an FDCPA claim; the proposed amendment was futile.
The court also took judicial notice of public state-court orders attached to Kim’s brief and denied Spiegel’s motion to strike and sanction.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether attorneys’ fees sought in state court are a “debt” under the FDCPA	Spiegel: Fees are a debt because they trace back to his condominium purchase and the Restated Declaration (chain of causation)	Kim: Fees arise from Spiegel’s alleged board misconduct, not from a consumer transaction	Fees are not a “debt” under the FDCPA; claim fails
Whether Spiegel should be allowed to amend his complaint	Spiegel: Leave to amend should be granted to cure pleading defects	Kim: Amendment would be futile because fees cannot be recharacterized as a consumer debt	Amendment denied as futile
Whether the appellate court could consider state-court orders attached to Kim’s brief	Spiegel: Attachments were improper; should be struck and sanctions imposed	Kim: Appellate court may take judicial notice of public state-court records attached in a brief	Court took judicial notice and denied Spiegel’s motions

Heintz v. Jenkins, [citation="514 U.S. 291"] (1995) (FDCPA limits on debt-collection practices and coverage of attorneys’ communications)
Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, [citation="559 U.S. 573"] (2010) (FDCPA’s consumer protection objectives and reach)
Bass v. Stolper, Koritzinsky, Brewster & Neider, S.C., [citation="111 F.3d 1322"] (7th Cir. 1997) (FDCPA limited to obligations arising from consensual consumer transactions)
Franklin v. Parking Revenue Recovery Servs., Inc., [citation="832 F.3d 741"] (7th Cir. 2016) (focus on legal source of obligation when assessing FDCPA coverage)
Newman v. Boehm, Pearlstein & Bright, Ltd., [citation="119 F.3d 477"] (7th Cir. 1997) (homeowners’ association assessments as debts under FDCPA where obligations arise directly from association documents)
Gburek v. Litton Loan Servicing LP, [citation="614 F.3d 380"] (7th Cir. 2010) (FDCPA standing and scope analysis)
Heng v. Heavner, Beyers & Mihlar, LLC, [citation="849 F.3d 348"] (7th Cir. 2017) (denial of leave to amend where amendment would be futile)
Tobey v. Chibucos, [citation="890 F.3d 634"] (7th Cir. 2018) (courts may take judicial notice of public records)
Matter of Lisse, [citation="905 F.3d 495"] (7th Cir. 2018) (procedure for invoking judicial notice on appeal)
Colorado River Water Conservation Dist. v. United States, [citation="424 U.S. 800"] (1976) (circumstances permitting stay or dismissal due to parallel state proceedings)