Oliva v. Blatt, Hasenmiller, Leibsker & Moore, LLC
185 F. Supp. 3d 1062
N.D. Ill.2015Background
- Oliva opened an HSBC MasterCard in 2002 and used it while living/working in Chicago; he moved to Orland Park (Cook County suburban district) in August 2013.
- After the account charged off and was sold, Portfolio Recovery Associates, LLC (PRA) sued Oliva on Dec. 10, 2013 in the Cook County Circuit Court’s First District (Daley Center) though Oliva resided in the Fifth District.
- Blatt, Hasenmiller, Leibsker & Moore (BHLM) represented PRA and filed in the Daley Center relying on Newsom v. Friedman, which treated Cook County’s multi-district circuit court as a single judicial district under the FDCPA venue provision.
- While the collection suit was pending, the Seventh Circuit en banc overruled Newsom in Suesz v. Med-1 Solutions, holding venue must be in the smallest relevant judicial subdivision; PRA dismissed its suit shortly after Suesz.
- Oliva sued BHLM under the FDCPA, §1692i(a)(2), claiming improper venue; BHLM invoked the FDCPA’s bona fide error defense based on reliance on controlling precedent.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether filing in Daley Center violated FDCPA §1692i(a)(2) | Oliva: suit was filed outside the district where he resided or signed the contract, so venue violation | BHLM: Oliva had signed card transactions in Chicago or, alternatively, reliance on Newsom made the filing lawful | Court did not decide whether card use equals "signed" for §1692i; disposition rests on bona fide error defense in BHLM's favor |
| Whether reliance on Newsom was a bona fide error precluding liability under §1692k(c) | Oliva: Suesz changed the rule and should apply retroactively; Jerman undermines reliance defense for legal mistakes | BHLM: Newsom was controlling Seventh Circuit precedent permitting its conduct; reliance was reasonable and not a mistaken interpretation of law | Court: Reliance on controlling precedent (Newsom) was not a legal mistake like in Jerman; bona fide error defense applies; summary judgment for defendant |
| Whether Suesz requires prospective-only application to past conduct relying on Newsom | Oliva: Suesz’s retroactivity means past filers can be liable | BHLM: Suesz’s limited retroactivity does not strip reliance protection from those who followed controlling Cook County precedent | Court: Suesz’s retroactivity ruling was limited; Newsom’s prior rule provided a defensible reliance basis here |
| Whether plaintiff suffered cognizable harm or counsel-driven suit affects relief | Oliva: asserted statutory and attorney-fee damages under FDCPA | BHLM: noted Oliva admitted the suit was attorney-driven and that Daley Center was more convenient | Court: Did not hinge on plaintiff’s subjective inconvenience; bona fide error defense resolves case in BHLM’s favor |
Key Cases Cited
- Newsom v. Friedman, 76 F.3d 813 (7th Cir. 1996) (held Cook County Circuit Court’s subdivisions constituted one judicial district for FDCPA venue)
- Suesz v. Med-1 Solutions, LLC, 757 F.3d 636 (7th Cir. 2014) (en banc) (overruled Newsom; venue limited to smallest relevant judicial subdivision; limited retroactivity)
- Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 559 U.S. 573 (2010) (Supreme Court held bona fide error defense does not shield mistaken legal interpretations of FDCPA)
- Kort v. Diversified Collection Servs., Inc., 394 F.3d 530 (7th Cir. 2005) (elements of FDCPA bona fide error defense)
- Ruth v. Triumph Partnerships, 577 F.3d 790 (7th Cir. 2009) (discussing prima facie requirements for invoking the bona fide error defense)
- Portfolio Acquisitions, L.L.C. v. Feltman, 391 Ill. App. 3d 642 (Ill. App. Ct. 2009) (Illinois appellate decision treating each credit-card use as a separate contract)
Result: Defendant’s motion for summary judgment granted; Oliva’s cross-motion denied.