The opinion of the court was delivered by: Dalzell, J.
Plaintiff Richard Clavell sued defendant Midland Funding LLC ("Midland") in this putative class action for allegedly forwarding Clavell's debt to a law firm in Pennsylvania to file an action in court against him, which the law firm did. As it turned out, the statute of limitations for that action had run. Clavell now moves for certification of a class of similarly situated debtors.
A. The Fair Debt Collection Practices Act
A central purpose of the Fair Debt Collection Practices Act ("FDCPA") is to eliminate debt collectors' abusive practices. In relevant part, 15 U.S.C. § 1692e prohibits a debt collector from using "any false, deceptive, or misleading representation or means in connection with the collection of any debt" and lists as examples of prohibited conduct: false representation of "the character, amount, or legal status of any debt," a "threat to take any action that cannot legally be taken or that is not intended to be taken," and "[t]he use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer." 15 U.S.C. §§ 1692e(2), (5) and (10). Similarly, the FDCPA prohibits debt collectors from using "unfair or unconscionable means to collect or attempt to collect any debt." 15 U.S.C. § 1692f. Such "unconscionable and unfair" conduct includes collecting any amount (e.g., interest, fees, and other charges) unless the amount is "expressly authorized by the agreement creating the debt or permitted by law." 15 U.S.C. § 1692f(1). Courts view FDCPA claims "through the eyes of an 'unsophisticated debtor.'" McMillan v. Collection Professionals Inc., 455 F.3d 754, 758 (7th Cir. 2006) (citation omitted).
On October 19, 2008, Midland forwarded Clavell's debt to the now-defunct dedicated collection law firm Mann Bracken to file a collection action in court against Clavell. Pl. Mot., Ex. A. Over nine months later, on July 24, 2009, Mann Bracken brought that suit in Philadelphia Municipal Court on behalf of
defendant Midland. Compl. ¶ 6.*fn1 That collection lawsuit alleged Midland to be the purchaser of a credit card debt Clavell owed with an alleged default date of "6/15/05." Id. ¶ 7. On August 20, 2009, Clavell, through his counsel, sent a letter to Midland demanding that it dismiss the action immediately because the four-year statute of limitations on the claim had expired. Id. ¶ 8. The next day Midland dismissed the action without prejudice. Id. ¶ 9. On October 3, 2009, Clavell petitioned the Municipal Court to dismiss the collection action with prejudice and vacate the prior disposition of the dismissal without prejudice. Id. ¶ 10. On November 20, 2009, the Municipal Court granted that petition and dismissed the action with prejudice. Id. ¶ 11.
Clavell avers upon information and belief that Midland regularly engages in the practice of suing on time-barred debt without reasonable inquiry into whether the statute of limitations for the given state in which they are bringing suit had been or should have been tolled. Id. ¶ 13. He alleges that on September 16, 2009, the State of Maryland Office of the Commissioner of Financial Regulation entered a cease and desist Order against Midland based on its collection activities violating various state and federal laws, including the FDCPA, by its actions in seeking to collect time-barred debt through litigation. Id. ¶ 14.
Plaintiff avers that defendant files hundreds, if not thousands, of lawsuits on time-barred debt against consumers throughout the United States -- lawsuits that are virtually identical to the one that defendant filed against plaintiff. Id. ¶ 19. Plaintiff's complaint alleges that defendant has violated the FDCPA (Count I) and seeks to certify a class of
All persons against whom Defendant sued since July 21, 2009, on time barred debt based on written instruments, such as credit card agreements, as calculated from the last payment due date available in Defendant's records.
A. Legal Standard for Class ...