Roth v. Nationstar Mortgage LLC (In re Roth)
568 B.R. 139
Bankr. M.D. Fla.2017Background
- Arlene Roth filed Chapter 13 in 2010, surrendered real property in her plan, and received a bankruptcy discharge in June 2014; Nationstar held the mortgage claim after a transfer.
- The discharge order was served on Nationstar; the case was closed and later reopened after Roth alleged post‑discharge communications by Nationstar.
- Nationstar sent an "Informational Statement" (Nov. 18, 2015) that included a bold disclaimer stating it was for informational purposes only and a "Voluntary Payment Coupon."
- Roth moved for sanctions under 11 U.S.C. § 524 for violation of the discharge injunction; the bankruptcy court denied her second sanctions motion without an evidentiary hearing and later issued a memorandum opinion explaining its reasoning.
- Roth appealed, arguing the statement was an attempt to collect a discharged debt and that the bankruptcy court made factual findings without a hearing; she relied in part on a separate district court FDCPA ruling that found her FDCPA claim plausible at the motion‑to‑dismiss stage.
- The district court affirmed the bankruptcy court, holding the Informational Statement was not an attempt to collect a debt under § 524 and that no hearing was required on the undisputed record.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Informational Statement was an attempt to collect a discharged debt under 11 U.S.C. § 524 | Roth: statement was sent to induce payment and thus violated § 524 | Nationstar: statement was informational, contained disclaimers, and any payment would be voluntary | Affirmed: statement was not an attempt to collect a debt under § 524; sanctions denied |
| Whether the bankruptcy court made improper factual determinations without an evidentiary hearing | Roth: court speculated about Nationstar's intent and Roth's perceptions; hearing required | Nationstar: no disputed factual issues in record; intent irrelevant to willfulness once notice exists | Affirmed: no hearing required; any questioned finding was unnecessary or harmless |
| Whether the FDCPA "least‑sophisticated consumer" standard governs § 524 discharge inquiries | Roth: district court's FDCPA analysis supports treating the statement as collection | Nationstar: FDCPA standard different and not controlling for § 524 analysis | Affirmed: FDCPA standard not applied; court uses objective effect test from Eleventh Circuit |
| Standard of review and whether bankruptcy court abused its discretion | Roth: legal conclusion invites de novo review; factual findings challenged | Nationstar: bankruptcy court applied correct law and reasonably interpreted statement | Affirmed: abuse‑of‑discretion standard applies; no abuse found |
Key Cases Cited
- In re McLean, 794 F.3d 1313 (11th Cir. 2015) (objective‑effect test for § 524 discharge violations; contested‑matter/hearing guidance)
- In re Hardy, 97 F.3d 1384 (11th Cir. 1996) (willfulness test for contempt under § 524 and § 105 enforcement power)
- In re Jove Eng’g, Inc., 92 F.3d 1539 (11th Cir. 1996) (two‑part willfulness test applied to contempt findings)
- In re Porto, 645 F.3d 1294 (11th Cir. 2011) (abuse‑of‑discretion standard on sanctions review)
- Cox v. Zale Delaware, Inc., 239 F.3d 910 (7th Cir. 2001) (bankruptcy court is the proper forum for enforcing discharge injunctions)
- Mercer v. Mitchell, 908 F.2d 763 (11th Cir. 1990) (no hearing required when there are no disputed factual matters in the record)