835 F. Supp. 2d 362
E.D. Mich.2011Background
- Plaintiff sued Ocwen and Randall S. Miller & Associates, P.C. under the FDCPA; Ocwen was dismissed after settlement.
- The FDCPA claims at issue are §1692d, §1692e, §1692f, and §1692g; Plaintiff seeks a jury trial.
- Key communications: Ocwen’s August 3, 2010 Notice of Default regarding the Niles Property; Plaintiff denied ownership and any mortgage debt relating to the Niles Property.
- Plaintiff responded on August 21, 2010 asserting no debt owed by him and requesting records corrections; subsequent Ocwen letters (Aug 31, Sept 2, Sept 17, Sept 28) referenced debt collection and potential options.
- On October 6, 2010, Randall S. Miller & Associates sent a foreclosure-related notice to Plaintiff regarding the Niles Property; the notice identified Ocwen as servicer and described potential modification options.
- Plaintiff filed suit on November 11, 2010; the court later addressed standing, the “in connection with” requirement, and the bona fide error defense; the court denied reconsideration on related issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Oct. 6, 2010 letter was a communication in connection with debt collection | Miller & Associates’s letter facilitates collection of debt. | Letter was not a collection communication; not in connection with collection. | Yes; letter is in connection with collection |
| Whether plaintiff’s knowledge that the debt was not his defeats FDCPA claims under 1692e/f | Plaintiff knew the debt was not his, so claims fail under 1692e/f. | Kujawa/Kaniewski/Kane show lack of standing or viability when debtor knows debt isn’t his. | 1692e and 1692f dismissed; 1692d and 1692g survive |
| Whether the bona fide error defense applies | Defendant bears burden to prove defense with procedures to avoid errors. | Entitled to defense if it proves unintentional error and reasonable procedures. | Genuine issue of material fact; denial of summary judgment on defense |
| Whether plaintiff has standing under 1692g | Plaintiff is a consumer; §1692g applies if debt allegedly owed. | Standing is lacking because Plaintiff may not be the consumer in question. | Plaintiff has standing as a consumer at the time of the communication |
| Whether Miller & Associates is a debt collector under the FDCPA given Montgomery v. Huntington Bank | Plaintiff alleges firm regularly collects/demands debt; subject to FDCPA. | Montgomery controls; enforcement of security interests excludes FDCPA except §1692f(6). | Montgomery does not compel dismissal; plaintiff pleads facts showing debt-collection activity beyond security-enforcement |
Key Cases Cited
- Grden v. Leikin Ingber & Winters, PC, 643 F.3d 169 (6th Cir. 2011) (explicit demand not required; line between communications and collection actions depends on animating purpose)
- Gburek v. Litton Loan Serv. LP, 614 F.3d 380 (7th Cir. 2010) (balance statements may trigger FDCPA if aimed to induce payment; no bright-line rule)
- Montgomery v. Huntington Bank, 346 F.3d 693 (6th Cir. 2003) (repossession/enforcement of security interests; not a debt collector for most FDCPA provisions)