Oliva v. Blatt, Hasenmiller, Leibsker & Moore, LLC
825 F.3d 788
7th Cir.2016Background
- In Dec. 2013 Blatt, Hasenmiller, Leibsker & Moore, LLC filed a debt-collection suit against Ronald Oliva in the first municipal district of the Cook County Circuit Court on behalf of Portfolio Recovery Associates.
- At the time Blatt filed suit, Seventh Circuit precedent (Newsom) treated the entire Circuit Court of Cook County as a single “judicial district” under the FDCPA venue provision, 15 U.S.C. § 1692i(a)(2).
- While Blatt’s suit was pending, the en banc Seventh Circuit overruled Newsom in Suesz, holding the relevant “judicial district” is the smallest relevant geographic unit, so suits must be filed in the municipal district where the debtor resides or the contract was signed.
- Suesz was applied retroactively (or at least assumed to apply retroactively here), which made Blatt’s choice of the first municipal district a violation under the newly articulated rule.
- Oliva sued Blatt under the FDCPA; the district court granted summary judgment for Blatt, finding Blatt entitled to the FDCPA’s bona fide error defense because it relied in good faith on Newsom.
- This appeal asks whether the FDCPA bona fide error defense shields a collector who acted consistently with controlling circuit precedent later retroactively overruled.
Issues
| Issue | Oliva's Argument | Blatt's Argument | Held |
|---|---|---|---|
| Whether the FDCPA bona fide error defense applies when a collector followed controlling circuit law later overruled retroactively | Jerman bars the defense for mistakes of law; Blatt’s filing violated §1692i under Suesz, so no defense | Blatt relied in good faith on controlling precedent (Newsom); its conduct was not a mistaken legal interpretation but compliance with binding law | Defense applies: following prior controlling precedent is a bona fide error when the law is later changed retroactively |
| Whether Blatt’s conduct amounted to a “mistaken interpretation of the law” under Jerman | Blatt misinterpreted venue requirements and so cannot invoke the defense | Blatt did not interpret the FDCPA; it applied Newsom, the settled law | Jerman inapplicable because Blatt followed controlling precedent rather than making its own legal interpretation |
| Whether the district court’s summary judgment (bona fide error) was proper given undisputed facts | N/A (argued that legal error precludes defense) | Blatt showed violation was unintentional and it maintained reasonable procedures; no genuine fact dispute | Summary judgment for Blatt affirmed |
| Whether retroactive overruling of precedent removes availability of the bona fide error defense | Retroactive change means violation occurred, so defense should not protect | Retroactive change does not retroactively eliminate the defense for conduct taken under prior controlling law | Retroactive overruling does not bar bona fide error defense where collector relied on prior controlling precedent |
Key Cases Cited
- Jerman v. Carlisle, 559 U.S. 573 (2010) (bona fide error defense does not apply to violations resulting from a debt collector's mistaken interpretation of legal requirements)
- Suesz v. Med-1 Solutions, LLC, 757 F.3d 636 (7th Cir. 2014) (en banc) ("judicial district" is the smallest relevant geographic area; overruling Newsom and applied retroactively)
- Newsom v. Friedman, 76 F.3d 813 (7th Cir. 1996) (treated Circuit Court of Cook County as a single judicial district for §1692i venue purposes)