Bjerke, Peter v. Messerli & Kramer, P.A. et al

Brief in Opposition

W.D. Wis.February 15, 2017

-1- UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WISCONSIN COURT FILE NO.: 16-cv-00748 Peter Bjerke, Plaintiff, v. Messerli & Kramer, P.A. Wisconsin CVS Pharmacy, LLC CVS RX Services, Inc. Defendants. PLAINTIFF’S RESPONSE TO DEFENDANT MESSERLI’S MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT Plaintiff submits this memorandum in response to Defendant Messerli’s Motion to Dismiss Plaintiff’s Second Amended Complaint (“Amended Complaint”), alleging violations of the Wisconsin Consumer Act (“WCA”), Wis. Stat. Chapter 427, and Fair Debt Collection Practices Act, 15 U.S.C. §1692 et seq. INTRODUCTION Plaintiff brought the above titled action against Messerli & Kramer, P.A., (“Messerli”), Wisconsin CVS Pharmacy, LLC and CVS RX Services, Inc. (collectively “CVS”) for numerous and multiple violations of the FDCPA and WCA. Both Messerli and CVS filed motions to dismiss. Messerli, notwithstanding the fact that it knew the Plaintiff had paid sufficient funds to satisfy the judgement at issue to his employer, CVS, continued to attempt to collect by coercing him to retrieve the funds from CVS, when Plaintiff no longer was liable for said debt. Messerli continued to make numerous and multiple telephone calls to Plaintiff which were communications under the FDCPA and violated numerous and multiple provisions of the FDCPA and WCA. Plaintiff, for the following reasons, asks that Messerli’s Motion to Dismiss Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 1 of 47 -2- be denied. FACTUAL BACKGROUND 1. Messerli is a “debt collector” as that term is defined by §427.103(2) and 15 U.S.C. § 1692a(6). (Amend. Comp., Dkt. 15, ¶¶ 74, 66.) 2. Plaintiff, Peter Bjerke, is a “consumer” as that term is defined by 15 U.S.C. § 1692a(3). (Amend. Comp., Dkt. 15, ¶ 65.) 3. Before March 18, 2014, the Plaintiff incurred a credit card debt with Citibank USA, N.A. for an amount less than $25,000. (Amend. Comp., Dkt. 15, ¶ 10.) This credit card debt is a “debt” as it is defined by 15 U.S.C. § 1692a(5) and a “claim” as it is defined by §427.103(2). (Amend. Comp., Dkt. 15, ¶¶ 67, 73.) 4. Sometime thereafter, the debt was consigned, placed or otherwise transferred to Messerli for collection from Plaintiff. (Amend. Comp., Dkt. 15, ¶ 11.) 5. At the time the debt was consigned, placed or otherwise transferred to Messerli for collection from Plaintiff, the debt was in default. (Amend. Comp., Dkt. 15, ¶ 12.) 6. On April 2, 2014, Midland Funding LLC (“Midland”) as successor in interest to Citibank USA, N.A., through its attorneys at Messerli received a judgment in the amount of $4,091.20 against the Plaintiff in Dunn County Case No. 2014SC000167. (Amend. Comp., Dkt. 15, ¶ 13.) 7. Messerli assigned reference number 14-102645 to said debt. (Amend. Comp., Dkt. 15, ¶ 14.) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 2 of 47 -3- 8. Upon information and belief, on November 10, 2014, the first of two garnishment notices were filed with the Dunn County court on behalf of Midland by Messerli. As such, the respective parties and their designations (Debtor, Garnishee, Creditor, and Creditor’s Attorney) were as follows: (Amend. Comp., Dkt. 15, ¶ 15.) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 3 of 47 -4- Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 4 of 47 -5- 9. Upon information and belief, RX processes the payroll for CVS. (Amend. Comp., Dkt. 15, ¶ 16.) 10. Upon information and belief, Defendant CVS and/or RX answered said garnishment notice. (Amend. Comp., Dkt. 15, ¶ 17.) 11. All monies necessary to satisfy the debt were garnished from the Plaintiff’s paychecks and the monies remained in the possession of Defendants CVS and/or RX by March 10, 2015. Plaintiff did not owe anything more for the debt – the Plaintiff fulfilled his responsibility. (Amend. Comp., Dkt. 15, ¶ 18.) 12. Defendant CVS or RX failed to forward the garnished funds to either Midland or Messerli. (Amend. Comp., Dkt. 15, ¶ 19.) 13. Pursuant to Wis. Stat. §812.18(1), Messerli should have known CVS and/or RX was liable to it: From the time of service upon the garnishee, the garnishee shall be liable to the creditor for the property then in the garnishee's possession or under his or her control belonging to the debtor or in which the debtor is interested to the extent of his or her right or interest therein and for all the garnishee's debts due or to become due to the debtor, except such as are exempt from execution, or are required by a court to be paid by the debtor as restitution under s. 973.20, but not in excess of the amount of the creditor's claim. (Amend. Comp., Dkt. 15, ¶ 20.) 14. Aware that a garnishment notice had been sent to the Plaintiff’s employer and knowing that it had not received any money from Plaintiff’s employer or the entity responsible for CVS’s payroll, Messerli contacted CVS on February 27, 2015 and was given a ticket number concerning the issue. The ticket number was X-XXX-XXX-7851. (Amend. Comp., Dkt. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 5 of 47 -6- 15, ¶ 21.) 15. Messerli sent letters regarding the garnished funds on at least two occasions: August 10, 2015 and September 1, 2015. (Amend. Comp., Dkt. 15, ¶ 22.) Each letter said: 16. Knowing that CVS and/or RX was not responsive, Messerli started a second garnishment notice with the Dunn County court to collect on the same debt even though the funds to pay the debt were with CVS and/or RX. Again, Messerli denoted respective parties and their designations (Debtor, Garnishee, Creditor, and Creditor’s Attorney) were as follows: Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 6 of 47 -7- (Amend. Comp., Dkt. 15, ¶ 23.) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 7 of 47 -8- 17. If Messerli would have had its way, Plaintiff would have paid more than what was owed for the debt. (Amend. Comp., Dkt. 15, ¶ 24.) 18. On November 4, 2015, Plaintiff did so by filing with the Dunn County Clerk of Court an “Earnings Garnishment Answer – Debtor’s Answer”. In it, Plaintiff noted the “…judgment [had been] paid via previous garnishment: payment dates 12/26/2014 through 2/20/2016.” (Amend. Comp., Dkt. 15, ¶ 25.) This was more than sufficient information for Messerli to know that Plaintiff had paid said debt via the garnishment. 19. Additionally on November 4, 2015, Messerli had notice from the Plaintiff the funds necessary to satisfy the judgment had been garnished from the Plaintiff’s paychecks. (Amend. Comp., Dkt. 15, ¶ 26.) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 8 of 47 -9- 20. Notwithstanding the fact that Messerli clearly knew the funds that would be used to satisfy the debt were in the possession of CVS and/or RX, Messerli unlawfully continued to attempt to collect money from the Plaintiff for a debt no longer owed by the Plaintiff. (Amend. Comp., Dkt. 15, ¶ 27.) i. Despite all funds necessary to satisfy the debt were taken from Plaintiff and there was NO reason why Messerli needed to continue to Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 9 of 47 -10- communicate with the Plaintiff regarding the collection of the debt, Messerli’s agents continued to do so. ii. Messerli, through its agent(s) left the following messages on the Plaintiff’s cell phone asserting a right it did not have in connection to obtaining payment of the debt1: 1. On or about, December 14, 2015: “Hi, my name is Nicole from Messerli and Kramer. I'm trying to reach Peter. If you could please return my phone call at 763-548-7746, and please reference your file number 14102645. Again, my name is Nicole from Messerli and Kramer, 763-548-7746. Thank you.” This telephone call was a was a “communication” in an attempt to collect a debt as that term is defined by 15 U.S.C. § 1692a(2). 2. On or about, December 23, 2015: “Hi Peter, it's Nicole at Messerli and Kramer. I really need you to call me back regarding the payroll, or else we're going to have to schedule a hearing with a judge, and that's fine. I don't mind doing that, but I would think that you would prefer not to [inaudible 00:00:41] in court. If she could ... I need to get this money from CVS. If you could please answer my phone call at 763-548-7746. Please reference file number 14-102645. I will be out of the office Thursday and Friday, back on Monday, December 28. Again, please give me a call as soon as possible because we have got to get this money from CVS. If I can't contact you and contact them, I'm going to have a judge get it resolved. Again, 763-548-7746. Thank you. Bye.” This telephone call was a was a “communication” in an attempt to collect a debt as that term is defined by 15 U.S.C. § 1692a(2). 3. On or about, January 5, 2016: “Hi Peter, it's Nicole with Messerli and Kramer. I still haven't heard back from you the past 6 weeks. I'm going to have to proceed accordingly2. Give me a call back at 763-548-7746, and watch your mail for other information if I don't hear back from you. Thank you.” This telephone call was a was a “communication” in an attempt to collect a debt as that term is defined by 15 U.S.C. § 1692a(2). 1 Each call was a separate and distinct communication pursuant to 15 U.S.C. § 1692a(2) and therefore constituted a separate violation. 2 Upon information and belief, “proceed accordingly” meant continuing with the hearing in relation to the second garnishment. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 10 of 47 -11- 4. On or about, March 1, 20163: “Hi [Peter]4, this is Paula at Messerli and Kramer. I'm canceling that hearing tomorrow, but I need you to keep in touch with me because this is not over, and I don't want to have to involve you with going to court again. I want to try to [inaudible 00:00:36], but I need you to keep in touch with me, and we've got to get this resolved. My number is 723-548-7746. Thank you.” This telephone call was a was a “communication” in an attempt to collect a debt as that term is defined by 15 U.S.C. § 1692a(2). 21. Messerli’s agent(s) filed the second garnishment and made the above phone calls either to actually follow through with the unlawful garnishment or use it as a tool to unlawfully coerce payment from the Plaintiff with no intent of actually garnishing the Plaintiff’s wages after funds to pay said debt were being held by CVS and/or RX. (Amend. Comp., Dkt. 15, ¶ 28.) 22. Despite knowing the funds sufficient to satisfy the debt at issue, Messerli objected to the Plaintiff’s answer to the garnishment and demanded a hearing and asked the Dunn County court to deny the Plaintiff’s answer and claimed exemption. (See Midland Funding LLC vs. Peter Bjerke, No. 2014SC000167 (Dunn Cnty. Cir. Ct.).) Clearly, Messerli still intended to garnish the wages of the Plaintiff for SECOND time or take the Plaintiff to court in relation to debt collection activities. 3 Messerli’s agent(s), one day before the hearing for the second garnishment was scheduled to be heard, cancelled the hearing. 4 The speaker on the telephone, upon information and belief, intended to say Peter, but instead said “Janet’. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 11 of 47 -12- 5 5 Messerli clearly, at the time the above objection was filed, did not sufficiently believe wages sufficient to satisfy the judgment had been taken from Plaintiff’s wages. (Dec. Matthew C. Lein) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 12 of 47 -13- 6 6 Messerli clearly, at the time the above objection was filed, did not sufficiently believe wages sufficient to satisfy the judgment had been taken from Plaintiff’s wages. (Dec. Matthew C. Lein) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 13 of 47 -14- 23. Eventually, CVS or RX paid the funds to Messerli or Midland and the judgment was satisfied, but not until Plaintiff was forced to unnecessarily spend his time, money, and other limited resources to fix the problem caused by CVS or RX. This error was propagated by Messerli when Messerli knew Plaintiff did not have to pay any more on the debt at issue. (Amend. Comp., Dkt. 15, ¶ 29.) 24. Upon information and belief, based on the August 10, 2015 and September 1, 2015 letters noted above, Messerli has on more than one occasion not received funds that were garnished from employee or employees of CVS by either CVS and/or RX. (Amend. Comp., Dkt. 15, ¶ 30.) 25. Either CVS or RX failed to forward the garnished funds in question to Messerli. (Amend. Comp., Dkt. 15, ¶ 31.) 26. Even after several prompts from an agent of Messerli to CVS, neither CVS nor RX released said funds. (Amend. Comp., Dkt. 15, ¶ 32.) 27. Upon information and belief, until the funds were forwarded to the correct party, CVS and/or RX unlawfully asserted a right to the monies meant to go to Messerli. ( Amend. Comp., Dkt. 15, ¶ 33.) 28. Upon information and belief, CVS and/or RX intended not to forward the funds at issue to the correct party. (Amend. Comp., Dkt. 15, ¶ 34.) 29. Further, Defendant Messerli’s calls harmed Plaintiff by depleting the battery life on his cellular phone, which cost Plaintiff time and expense to recharge, and by using minutes allocated to Plaintiff by his cellular telephone service provider. (Amend. Comp., Dkt. 15, ¶ Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 14 of 47 -15- 35.) 30. Defendants have failed to implement any effective procedure to review the Plaintiff’s file to confirm the garnished funds were forwarded to the correct party. (Amend. Comp., Dkt. 15, ¶ 36.) 31. Defendants have willfully failed to implement any system to properly identify accounts involved in a garnishment proceeding notwithstanding the fact that it knows the present system has no discernible impact on whether or not it continues collection activities. (Amend. Comp., Dkt. 15, ¶ 37.) 32. The failure of the Defendants to correct the gross irregularities with its consumer credit collection systems is designed, upon information and belief, to prevent debtors from seeking redress through the courts due to their inability to afford and/or find competent legal counsel. The Defendants, by ignoring their obligations under Wisconsin law and State consumer protection statutes, have attempted to create for themselves a virtual immunity from civil liability by unlawfully collecting millions of dollars while paying only thousands of dollars for the very few cases where its illegal acts are subject to affirmative debtor enforcement cases. The Defendants have essentially granted to themselves a license to push the boundaries of responsible business practices beyond their furthest limits, fully aware that relatively few, if any, consumer debtors will be able to seek appropriate legal remedies. Plaintiff, therefore, alleges that these grossly negligent and intentional acts of misconduct violate fundamental notions of fairness and are procedurally and substantively unconscionable. (Amend. Comp., Dkt. 15, ¶ 38.) 33. Plaintiff has been severely agitated, annoyed, traumatized, emotionally damaged and has Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 15 of 47 -16- otherwise been unduly inconvenienced by the actions of the Defendants. (Amend. Comp., Dkt. 15, ¶ 39.) 34. Upon information and belief, as a result of the distress and preoccupation, Plaintiff’s job performance at work suffered. (Amend. Comp., Dkt. 15, ¶ 40.) 35. Plaintiff expended months of personal time and incurred personal expenses in having to attempt to resolve this matter on his own. (Amend. Comp., Dkt. 15, ¶ 41.) PURPOSE OF THE FDCPA The FDCPA states that its purpose, in part, is "to eliminate abusive debt collection practices by debt collectors." 15 U.S.C. §1692(e). It is designed to protect consumers from unscrupulous collectors, whether or not there is a valid debt. Mace v. Van Ru Credit Corp., 109 F.3d 338 (7th Cir. 1997). The FDCPA broadly prohibits unfair or unconscionable collection methods including: conduct which harasses, oppresses or abuses any debtor; and any false, deceptive or misleading statements, in connection with the collection of a debt. It also requires specified disclosures. 15 U.S.C. §§1692e(11), 1692g. Debt collectors are liable if they fail to provide the specified disclosures. Chauncey v. JDR Recovery Corp., 118 F.3d 516 (7th Cir. 1997). Congress desired to enforce the FDCPA through private actions. Tolentino v. Friedman, 46 F.3d 645 (7th Cir. 1995). It is a strict liability statute. Ross v. RJM Acquisitions Funding LLC, 480 F.3d 493, 495 (7th Cir. 2007). Because the FDCPA is designed to protect consumers, the FDCPA is generally liberally construed in favor of consumers to affect its purpose, Cirkot v. Diversified Financial Systems, Inc., 839 F.Supp. 941 (D.Conn.1993), and whether a communication or other conduct violates the FDCPA is determined by analyzing it from the prospective of an “unsophisticated Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 16 of 47 -17- consumer.” Gammon v. GC Services Limited Partnership, 27 F.3d 1254, 1257 (7th Cir.1994). “The unsophisticated consumer standard protects the consumer who is uninformed, naive, or trusting, yet it admits an objective element of reasonableness.” Id. That objective element protects debt collectors from liability for “unrealistic or peculiar interpretations of collection letters.” Id. ARGUMENT I. Standard In his amended complaint, Plaintiff has alleged “enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). Plaintiff has alleged that all verbal and written correspondence between him and Messerli were made in an attempt to collect on a debt. (AC, ¶¶27(ii)(1)-4, 68) Because this is a Motion to Dismiss, all facts as plead are construed in favor of the Plaintiff. Lavalais v. Vill. of Melrose Park, 734 F.3d 629, 632 (7th Cir. 2013). II. Messerli may not bring things outside of the pleadings else it converts the motion into one for summary judgment. Messerli cites to Venture Assocs. Corp. v. Zenith Data Sys. Corp., 987 F.2d 429 (7th Cir. 1993), to support their assertion that this Court must not convert their Motion to Dismiss into a Motion for Summary Judgment. Venture held that “[d]ocuments that a defendant attaches to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to her claim.” Id. at 431. Here, Plaintiff mentioned the phone calls between Plaintiff and Messerli on December 14, 2015, December 23, 2015, January 5, 2016, and March 1, 2016 only – not the additional calls mentioned by Messerli. Here Defendant uses its internal information (solely in its custody and control) to try to dismiss Plaintiff’s case without Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 17 of 47 -18- giving Plaintiff a chance to explore the veracity of Messerli’s information or the intent of the call given Messerli’s policies and procedures and other debt collection materials related to this case only in the possession of Messerli. After Venture, the court found that the exception preventing a motion to dismiss from conversion to Summary Judgment is “a narrow exception aimed at cases interpreting, for example, a contract. It is not intended to grant litigants license to ignore the distinction between motions to dismiss and motions for summary judgment.” Levenstein v. Salafsky, 164 F.3d 345, 347 (7th Cir. 1998). Here, Messerli is asking the court to review additional transcripts of communications between the Plaintiff and Messerli’s agent(s) that the Plaintiff saw for the first time at the dismissal stage without allowing the Plaintiff to depose all parties involved in the phone call or allow the Plaintiff discovery to ascertain other relevant materials that will show the true intent of Messerli which was to collect the debt. This should hardly qualify as a “narrow exception.” Additionally, the transcripts are not “concededly authentic documents referred to in a complaint.” Albany Bank & Trust Co. v. Exxon Mobil Corp., 310 F.3d 969, 971 (7th Cir. 2002). After Levenstein, the Seventh Circuit took a different approach: Under Rule 12(b), when “matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56, and all parties shall be given reasonable opportunity to present all material made pertinent to such a motion by Rule 56.” So the judge should have treated Adobe's motion as one for summary judgment... Our point is not that a motion styled as one to dismiss is a motion for summary judgment at the instant of its filing just because the movant attaches extra documents. It is, rather, that once the district court actually considers additional documents, the motion must be treated as one for summary judgment, with multiple procedural consequences… Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 18 of 47 -19- Berthold Types Ltd. v. Adobe Sys., 242 F.3d 772, 775 (7th Cir. 2001) (internal cites omitted) (emphasis in original). Since Plaintiff has not conducted discovery, and, therefore, has not been given a reasonable opportunity to respond to Defendant’s unilateral documentation. In 2002, the Tierney Court reviewed their previous decision on this issue and found: The exception to Rule 12(b) that these cases carve (whatever its precise breadth) has been thought to follow from Rule 10(c); the concern is that, were it not for the exception, the plaintiff could evade dismissal under Rule 12(b)(6) simply by failing to attach to his complaint a document that proved that his claim had no merit. The cases therefore allow the defendant to submit the document to the court, and the court to consider it, without need for conversion to Rule 56. Tierney v. Vahle, 304 F.3d 734, 738 (7th Cir. 2002) (internal cite omitted). Here, Messerli is attaching a transcript of a recording that Plaintiff had not seen prior to it being filed in this case. This is not the “usual example [of] a contract” signed by both parties. Id. The Seventh Circuit found the exception allowing the Court to consider a document “perhaps” is or should be limited to cases in which the suit is on a contract or the plaintiff, if he has not attached, has at least quoted from, the document later submitted by the defendant. Id. at 739. Obviously the Plaintiff does not agree with Defendant’s assertion of the intent of the telephone calls without first going through the discovery process to ascertain the actual intent of such calls (e.g. do Messerli’s agents routinely continue to try to collect from debtors in the manner described in the complaint) – additional documentation will show the true intent of Messerli which was to collect the debt with the aide of telephone calls to the Plaintiff. This is a situation where discovery is needed, converting the case to a Motion for Summary Judgment if the Court were to consider the documents: Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 19 of 47 -20- What would not be cricket would be for the defendant to submit a document in support of his Rule 12(b)(6) motion that required discovery to authenticate or disambiguate; in such a case the judge would be required to convert the defendant's motion to a Rule 56 motion if he were minded to consider the document in deciding whether to grant the motion. Id. To the extent that the Court relies on the transcript filed by Messerli, this motion has been converted into a Motion for Summary Judgment. Under Fed. R. Civ. P. 56(d), the Plaintiff needs time to conduct discovery on items such as what Messerli’s policies and procedures are with regard to using a garnishment action in instances where the garnishee has garnished sufficient funds to satisfy a debt but refuses to forward the funds to the creditor.7 On summary judgment, the facts are viewed in the light most favorable to the non-moving party. Schultz v. Gen. Elec. Capital Corp., 37 F.3d 329, 333 (7th Cir. 1994). Here, there is a genuine issue of fact of what the intent the Messerli was in its phone calls – Plaintiff has stated that phone calls were 7 Defendants have failed to implement any effective procedure to review the Plaintiff’s file to confirm the garnished funds were forwarded to the correct party. (Amend. Comp., Dkt. 15, ¶36) Defendants have willfully failed to implement any system to properly identify accounts involved in a garnishment proceeding notwithstanding the fact that it knows the present system has no discernible impact on whether or not it continues collection activities. (Amend. Comp., Dkt. 15, ¶37) The failure of the Defendants to correct the gross irregularities with its consumer credit collection systems is designed, upon information and belief, to prevent debtors from seeking redress through the courts due to their inability to afford and/or find competent legal counsel. The Defendants, by ignoring their obligations under Wisconsin law and State consumer protection statutes, have attempted to create for themselves a virtual immunity from civil liability by unlawfully collecting millions of dollars while paying only thousands of dollars for the very few cases where its illegal acts are subject to affirmative debtor enforcement cases. The Defendants have essentially granted to themselves a license to push the boundaries of responsible business practices beyond their furthest limits, fully aware that relatively few, if any, consumer debtors will be able to seek appropriate legal remedies. Plaintiff, therefore, alleges that these grossly negligent and intentional acts of misconduct violate fundamental notions of fairness and are procedurally and substantively unconscionable. (Amend. Comp., Dkt. 15, ¶38.) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 20 of 47 -21- collection attempts and therefore communications under the FDCPA (Amend. Comp., Dkt. 15, ¶¶27(ii)(1)-(4), 28, 68.), while Messerli has stated the phone calls were informational only. Further, there is an issue of whether Messerli regularly abuses the garnishment system in instances like this. (Amend. Comp., Dkt. 15, ¶¶36-38) Since this fact must be viewed in light most favorable to the Plaintiff, Messerli’s Motion to Dismiss on this issue should be denied to allow the parties to conduct actual discovery. III. The Plaintiff was no longer responsible for the debt once funds sufficient to satisfy the judgment were garnished from his paycheck. Messerli mislead the Plaintiff into believing he would have to pay the garnishment twice unless the Plaintiff got CVS to turn over the funds to Messerli. Common sense and the law clear: Once funds sufficient to satisfy the judgment are garnished from the Plaintiff’s paycheck, Plaintiff’s liability to Messerli and debt owners is satisfied – Plaintiff does not need to pay on the debt again, nor is he needed to retrieve the funds from CVS – only CVS is liable for the debt. This principal is outlined in Wis. Stat. §812.18(1) and Wis. Stat. §812.18(3), and Wisconsin case law. From the time of service upon the garnishee, the garnishee shall be liable to the creditor for the property then in the garnishee's possession or under his or her control belonging to the debtor or in which the debtor is interested to the extent of his or her right or interest therein and for all the garnishee's debts due or to become due to the debtor, except such as are exempt from execution, or are required by a court to be paid by the debtor as restitution under s. 973.20, but not in excess of the amount of the creditor's claim. Wis. Stat. §812.18(1) Further, once funds sufficient to pay a judgment have been garnished, any excess funds must be returned to the Plaintiff. Wis. Stat. §812.18(3) In O'Neil v. Russell, the court held that the bank retaining money knowing it was subject to garnishment was liable for interest on money Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 21 of 47 -22- from service of garnishee process on bank. 198 Wis. 11, 11 (Wis., 1929) In Davis v. Pawlette, because the loan at issue was no longer the property of the debtor and endorsee purchased the loan in good faith, both the maker of a loan and the endorsee were found not to be liable to the creditor. 3 Wis 300, 300 (Wis., 1854) By applying the plain text of Wis. Stat. §812.18(1) and Wis. Stat. §812.18(3) and the same reasoning as in O'Neil v. Russell and Davis v. Pawlette, it is obvious the Plaintiff was no longer liable for the debt at issue when funds sufficient to satisfy the judgment were no longer in his possession but in the possession of the garnishee, CVS. Since Messerli knew the funds were in the possession of CVS through the Plaintiff’s answer to Messerli’s second garnishment notice, Messerli has no excuse for not dismissing the second garnishment action and threatening to take the Plaintiff to court. The Plaintiff was not a necessary party to recover funds being unlawfully held by CVS. A garnishee who fails to pay funds over to the creditor within the time period prescribed may be held liable directly to the creditor. Wis. Stat. §812.39(1) If payment is not made, the creditor may move the court for judgment against the garnishee for the amount of the unsatisfied judgment, plus interests and fees. Wis. Stat. §812.41. Further, this is exactly a scenario that the State of Wisconsin provides a form for - when the garnishee fails to forward funds to the creditor the creditor should use Form SC-519 – “Notice of Motion and Motion for Judgment Against Garnishee”.8 8 To aide the Court, I have completed Form SC-519 – “Notice of Motion and Motion for Judgment Against Garnishee” showing how Messerli should have retrieved the funds from CVS without coercing the Plaintiff to do so and that Plaintiff was NOT required to be at any hearing in front of a judge. (Dec. Matthew C. Lein) Once Plaintiff notified Messerli (via the garnishment answer) that the garnished funds were in the possession of CVS, Messerli no longer needed the Plaintiff as the law provides a remedy for just this scenario. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 22 of 47 -23- Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 23 of 47 -24- Wisconsin Circuit Court, Notice of Motion and Motion for Judgment Against Garnishee, Circuit Court Forms – Small Claims (February 6, 2017), https://www.wicourts.gov/formdisplay/SC- 519.pdf?formNumber=SC-519&formType=Form&formatId=2&language=en (Dec. Matthew C. Lein) In no way was Plaintiff required to be involved. Messerli tried to unlawfully coerce Plaintiff into helping it when Plaintiff was NO longer responsible. Again, the debt was satisfied when payments sufficient to satisfy the debt were taken by CVS from the Plaintiff’s paycheck. All communications with Plaintiff were done with the intent by Messerli to get the Plaintiff to believe he would have to comply with Messerli’s requests or be forced to pay back the same debt twice. (Amend. Comp., Dkt. 15, ¶¶27(ii)(1)-(4), 28, 68.) Messerli’s agent(s) filed the second garnishment and made the above phone calls either to actually follow through with the unlawful garnishment or use it as a tool to unlawfully coerce payment from the Plaintiff with no intent of actually garnishing the Plaintiff’s wages after funds to pay said debt were being held by CVS and/or RX. (Amend. Comp., Dkt. 15, ¶ 28.) Again, Messerli mislead Plaintiff into thinking he was responsible for the monies already garnished from his paycheck. Instead, Messerli should have followed the proper procedure for getting a judgment against CVS, not threatening further legal action against Plaintiff. IV. All calls to the Plaintiff regarding the debt were a “communication” as that term is defined by defined by 15 U.S.C. § 1692a(2). No circuit has established a bright-line rule to determine if a communication from a debt collector was made in an attempt to collect a debt; however the Seventh Circuit has provided instruction. Gburek v. Litton Loan Servicing LP, 614 F.3d 380 (7th Cir. 2010), Ruth v. Triumph P'Ships, 577 F.3d 790 (7th Cir. 2009), Horkey v. J.V.D.B. & Assocs., 333 F.3d 769, and Bailey v. Sec. Nat'l Servicing Corp., 154 F.3d 384. These cases provide the overall framework for this court to make a finding that the communications from Messerli to Plaintiff were made in Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 24 of 47 -25- connection with the collection of a debt and contrary to 15 U.S.C. §§ 1692e, 1692e(2), 1692e(5), 1692e(7), 1692e(10), 1692e(11), 1692f, 1692f(1), and 1692f(6). A “communication” is broadly defined in §1692a(2) as “the conveying of information regarding a debt directly or indirectly to any person through any medium.” In Gburek v. Little Loan Servicing LP, the Seventh Circuit synthesized three prior decisions to determine whether a letter sent was “made in connection with” any debt collection efforts. 614 F.3d 380, 381 (7th Cir., 2010) In Gburek, the debtor was in default on a mortgage loan serviced by Litton Loan Servicing. Gburek v. Litton Loan Servicing LP, 614 F.3d 380, 382 (7th Cir. 2010) As part of its servicing activities, Litton sent out monthly statements, collected and monitored mortgage payments, addressed late payments and other delinquencies and notified homeowners of their account status. Id. In December 2007, Litton sent the debtor a letter informing her that she could avoid foreclosure if she submitted certain financial information. Id. A few days later, a third party working with Litton sent the debtor another letter reiterating Litton’s offer and requesting the she provide her financial information. Id. The Seventh Court of Appeals indicated that for the FDCPA to apply, two criteria must be met. Id. at 384 First, the defendant must qualify as a “debt collector” under the FDCPA. Id. The parties in Gburek agreed that Litton was a “debt collector.” Id. Second, the communications under consideration must be made “in connection with the collection of a debt” as provided by the statute. Id. According to the Court, Bailey does not establish a bright line explicit demand for payment test, but rather provides that a demand for payment is just one of several factors that come into play in determining whether a communication is “in connection with the collection of Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 25 of 47 -26- a debt.” Id. Other factors to consider are (i) the nature of the parties’ relationship and (ii) the purpose and context of the communications. Id.at 385 The Court found that the context and content of Litton’s letters to the debtor were sufficient to bring them within the scope of the FDCPA. Id.at 386 The Court pointed out that Litton’s first letter was the opening communication in an attempt to collect a defaulted home loan by settlement or otherwise as it contained an offer to discuss repayment options. Id.at 386 The Court also pointed out that the purpose of the second letter was to encourage the debtor to contact Litton to discuss settlement options and thus induce the debtor to settle a debt. Id. The Court found that Litton’s sharing of debtor information with the third party who sent the second letter likewise was “in connection with the collection of a debt” because the sharing was in furtherance of collecting financial information from the debtor for the purpose of evaluating her foreclosure alternatives and collecting the debt. Id. In summary, the Gburek court considered the following factors deduced from prior decisions: • Bailey Factors: (1) Are the Plaintiffs current on said debt; (2) Did the letter list prospective payment dates, and indicate the consequences of missing a payment or payments for which the Plaintiffs should pay; and, (3) Did the letter demand payment or set forth the Plaintiffs’ current account status? Id. at 384 • Horkey Factor: (1) Was a communication made specifically to induce the Plaintiffs to settle their debt? Id. at 384-5 • Ruth Factors: (1) Is the only relationship between the parties one for collection of an account in Defendant’s possession; and, (2) was there some other material within a mailing that would lead the Plaintiffs to believe Defendant was Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 26 of 47 -27- attempting to collect the account in Defendant’s possession. Id. at 385-6 In the current case, like the plaintiff in Gburek, the Plaintiff was not current on the debt; in fact, he was being garnished for a second time by Messerli, and Messerli is a debt collector. (Amend. Comp., Dkt. 15, ¶¶ 28, 66.) Further, like Gbruek, Messerli continued to attempt to gather financial information from the Plaintiff. As seen below, Messerli continued to communicate with Plaintiff noting Messerli’s account reference number for the debt at issue attempting to gather information from the Plaintiff regarding said account. As seen below, Messerli wanted to know the location of the money it was trying to collect: On or about, December 14, 2015: “Hi, my name is Nicole from Messerli and Kramer. I'm trying to reach Peter. If you could please return my phone call at 763-548-7746, and please reference your file number 14102645. Again, my name is Nicole from Messerli and Kramer, 763- 548-7746. Thank you.” On or about, December 23, 2015: “Hi Peter, it's Nicole at Messerli and Kramer. I really need you to call me back regarding the payroll, or else we're going to have to schedule a hearing with a judge, and that's fine. I don't mind doing that, but I would think that you would prefer not to [inaudible 00:00:41] in court. If she could ... I need to get this money from CVS. If you could please answer my phone call at 763-548-7746. Please reference file number 14-102645. I will be out of the office Thursday and Friday, back on Monday, December 28. Again, please give me a call as soon as possible because we have got to get this money from CVS. If I can't contact you and contact them, I'm going to have a judge get it resolved. Again, 763-548-7746. Thank you. Bye.” On or about, January 5, 2016: “Hi Peter, it's Nicole with Messerli and Kramer. I still haven't heard back from you the past 6 weeks. I'm going to have to proceed accordingly9. Give me a call back at 763-548- 7746, and watch your mail for other information if I don't hear back from you. Thank you.” 9 Upon information and belief, “proceed accordingly” meant continuing with the hearing in relation to the second garnishment. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 27 of 47 -28- On or about, March 1, 201610: “Hi [Peter]11, this is Paula at Messerli and Kramer. I'm canceling that hearing tomorrow, but I need you to keep in touch with me because this is not over, and I don't want to have to involve you with going to court again. I want to try to [inaudible 00:00:36], but I need you to keep in touch with me, and we've got to get this resolved. My number is 723-548-7746. Thank you.” (Amend. Comp., Dkt. 15, ¶¶27(ii)(1)-(4), 28, 68.) Summarizing the above voicemails to the Plaintiff, Messerli stated to Plaintiff: If you could please return my phone call …and please reference your file number 14102645…. I really need you to call me back regarding the payroll, or else we're going to have to schedule a hearing with a judge…. I need to get this money from CVS…. we have got to get this money from CVS… I still haven't heard back from you the past 6 weeks. I'm going to have to proceed accordingly. (Amend. Comp., Dkt. 15, ¶¶27(ii)(1)-(4), 28, 68.) Then when Messerli seems to have resolved its issues with CVS, it threatened the Plaintiff with the following: “I'm canceling that hearing tomorrow, but I need you to keep in touch with me because this is not over, and I don't want to have to involve you with going to court again.” Id. The filings with the Dunn County circuit court show the intent of Messerli was to collect from the Plaintiff for the debt. Messerli continued trying to collect from the Plaintiff using the Dunn County circuit court as Messerli believed the Plaintiff was still responsible for the debt even though funds sufficient to satisfy the debt were already taken from Plaintiff’s wages – this is clear as there is no other reason why the Plaintiff would need to have been called by Messerli. In Messerli February 3, 2016 objection to Plaintiff’s garnishment answer, Messerli stated in its objection: 10 Messerli’s agent(s), one day before the hearing for the second garnishment was scheduled to be heard, cancelled the hearing. 11 The speaker on the telephone, upon information and belief, intended to say Peter, but instead said “Janet’. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 28 of 47 -29- 2. I object to the debtor's answer and demand a hearing to resolve the issues in controversy. By statute, this hearing must be held as soon as practicable after this objection and demand are filed. I object to the debtor's answer for the following reasons (explain briefly): Defendant claims to receive an exemption under Wisconsin Statute section 812.34, however, failed to provide documentation to support the validity of this claim. Plaintiff continues to make a good-faith effort to investigate the claim of Defendant including letters and calls to Garnishee and phone calls to Defendant neither parties have responded. Therefore, Plaintiff objects to the unsupported claim and respectfully requests a judicial hearing pursuant to Wisconsin Statute section 812.38 as the claim of Defendant is unsupported by any verifiable documentation. 3.Please schedule this hearing and notify all parties. Further, upon information and belief, Messerli, when it filed the proposed order along with its objection, asked the court to order the following (once the garnishment hearing was to be held): Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 29 of 47 -30- Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 30 of 47 -31- Wis. Stat. §812.38 pertains to exemptions which requires Messerli to gain financial information from the Plaintiff so that Messerli could garnish the wages from Plaintiff again. Obtaining financial information from a debt in order for a debt collector to collect money from the Plaintiff is similar to the financial information the debt collector in Gburek sought: 812.34 Exemptions (1) The exemptions provided in this section do not apply if the judgment debt meets one of the following conditions: (a) Was ordered by a court under s. 128.21 or by any court of the United States under 11 USC 1301 to 1330. (b) Is for the support of any person. (c) Is for unpaid taxes. (2) (a) Unless the court grants relief under s. 812.38 (2) or par. (b) or (c) applies, 80 percent of the debtor's disposable earnings are exempt from garnishment under this subchapter. (b) The debtor's earnings are totally exempt from garnishment under this subchapter if: 1. The debtor's household income is below the poverty line. 2. The debtor receives need-based public assistance, has received such assistance within 6 months prior to service of the earnings garnishment forms upon the garnishee or has been determined eligible to receive need-based assistance although actual receipt of benefits has not commenced. (c) If the garnishment of 20 percent of the debtor's disposable income under this subchapter would result in the debtor's household income being below the poverty line, the amount of the garnishment is limited to the debtor's household income in excess of the poverty line before the garnishment is in effect. (3) The judicial conference shall adopt and make available schedules and worksheets to assist debtors in computing their eligibility for exemption under sub. (2) (b) 1. The schedules shall divide the annual poverty line for families of various sizes by 12, rounding to the nearest dollar, and the worksheets shall assist debtors to compute their household incomes. The judicial conference shall develop separate schedules for debtors paid on a weekly, biweekly, semimonthly and monthly basis by dividing the annual poverty line by 52, 26, 24 and 12, respectively, and rounding to the nearest dollar. The judicial conference shall revise those schedules annually to reflect changes in the poverty line. The revised schedules shall take Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 31 of 47 -32- effect July 1 for earnings garnishments or extensions commencing thereafter. Information commonly received to garnish a debtor’s wages is found on Wisconsin’s Financial Disclosure Statement. (Dec. of Matthew C. Lein) (Wisconsin Circuit Court, Financial Disclosure Statement, Circuit Court Forms – Small Claims (February 14, 2017), https://wicourts.gov/formdisplay/SC-506B.pdf?formNumber=SC- 506B&formType=Form&formatId=2&language=en) Below is some of the information sought in the Financial Disclosure Statement: Clearly, asking the Plaintiff for his financial information constitutes a communication under the FDCPA. The three Bailey factors weigh in favor of the Plaintiff. Plaintiff was not current with the debt; and, Messerli continued to indicate to Plaintiff that if he did not keep in contact with Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 32 of 47 -33- Messerli, then he was somehow responsible for the debt when funds sufficient to satisfy said debt were taken from him and that if he did not keep in contact with Messerli that Plaintiff would face the consequence of going to court in front of a judge. (Amend. Comp., Dkt. 15, ¶¶27(ii)(1)- (4), 28, 68.) The Horkey factor also weighs in favor of the Plaintiff. Messerli called Plaintiff with no reason other than to induce Plaintiff to either pay on the debt or help Messerli receive the money from CVS. Both scenarios would constitute a communication made specifically to induce the Plaintiff to settle Plaintiff’s debt. The Ruth factors weigh in favor of the Plaintiff. The only relationship between the Plaintiff and Messerli was one for the collection of the debt12 in Defendant’s possession; and, there was nothing in the communications noted in the complaint that would not lead the Plaintiff to believe Messerli was attempting to collect the account in its possession. Lastly, if this Court allows Messerli to rely on the transcripts of the alleged phone calls between the Plaintiff and Messerli, then each of those telephone calls should be considered a “communication” under §1692a(2) as well. (Amend. Comp., Dkt. 15, ¶ 68.) In fact, in each of the additional calls (November 25, 2015, February 24, 2016, and February 26, 2016, and March 1, 2016) from Messerli warned, through both a pre-recorded message13 and orally from individual 12 Messerli’s file number 14102645 which was the subject of both garnishments and all communications between Plaintiff and Messerli. 13 Plaintiff, based on information and belief, believes the following text is likely a pre-recorded message played at the beginning of each call” Thank you for calling Messerli & Kramer if your call is regarding a collection account this firm is considered a debt collector and our conversation is deemed an attempt to collect a debt any information obtained will be used for that purpose all calls are recorded and may be monitored if you know your party's extension you can enter it at any time. If you calling in reference to an account in collections press llf you are calling in reference to a bankruptcy press 2 if you are calling about a probate matter press 3 if you are calling from a client press 4(number pressed) If you are calling regarding a garnishment press 1 Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 33 of 47 -34- debt collectors that the conversations between the Plaintiff and any of Messerli’s agent were “…an attempt to collect a debt by a debt collector.” (Dec. Derrick N. Weber. Dkt. 21) Further, Messerli’s agent, Nicole Kiefer, who was familiar with the Plaintiff’s file regarding the debt at issue in this lawsuit, indicated to the Plaintiff that she was attempting to collect a debt. This statement was made by debt collector Nicole Kiefer (allegedly a lead debt collector concerning the Messerli the debt at issue in this lawsuit) on February 26, 2016, who after realizing that Peter had called her and notifying him that she had just reviewed Plaintiff’s file (“Hi, I was just looking at your file actually…”) confirmed the Plaintiff’s identity by having the Plaintiff verify his address (“Hi, I was just looking at your file actually. Would you please just verify your address?”) and then chose to inform Plaintiff that “[t]hank you I have to let you know this is an attempt by a debt collector to collect a debt and any information obtained is used for that purpose. Midland Funding and Citibank. Have you talked to ADP lately?” Clearly, Messerli’s agent was attempting to gather financial information with the hope of recovery the moneys garnished and retained by CVS. This pattern (indicating to the consumer via a pre-recorded message and then once again orally by Nicole Kiefer when she realized Plaintiff was on the phone stated “…an attempt to collect a debt by a debt collector.”) occurred on the February 26, 2016 and March 7, 2016 calls. Finally, the Plaintiff only called Messerli because of the voicemails left on his cellular phone. Messerli’s calls to Plaintiff prompted Plaintiff to call Messerli. Since, Plaintiff’s only relationship with Messerli was in relation to a debt, Messerli, for the reasons described earlier, was attempting to collect the debt from Plaintiff. Plaintiff clearly believed Messerli was trying to collect funds from him again, after he had already paid through the first garnishment. (number pressed) If you reside in Nebraska or Wisconsin press 1 otherwise press 2 (number pressed) Please hold while I transfer your call.” Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 34 of 47 -35- February 24, 2016 Call: … M&K Employee: Thank you, and it is an attempt by a debt collector to collect a debt and any information obtained will be used for that purpose. And I am looking at a Citibank credit card file with a current balance of $4,311.20 and what is your question with us today? Consumer: Well, umm you may notice on my file that garnishment was done in November of 2014 through February of 2015 through my employer CVS health. They collected the money out of my check but were umm some reason either your office didn't report it or they didn't pay it or something and I have been working with CVS health to determine where the money went. In other word they collected it and you [meaning Messerli] are trying to recollect it umm from me and there is a court hearing on I believe it is March 2nd or 3rd and so I have been working with CVS health to try to uhh try to reconcile or figure out where this issue is and umm I wanted to confirm that you got my faxes of the umm paystubs that showed the garnishment number 1 and number 2 umm I understand Jillian Walker has been assigned to the case and I was wondering if she was available to speak with. … (Dec. Derrick N. Weber. Dkt. 21) Clearly, the contacts between the Plaintiff and Messerli were “communications” under §1692a(2) as Messerli was doing all it could to collect the money for the judgment either from the Plaintiff or by coercing the Plaintiff to retrieve or located the money for Messerli from CVS. Messerli cannot deny that all calls between it and the Plaintiff were anything other than collection attempts. Messerli also cannot deny it was using the legal system to collect from the Plaintiff again. V. The statute of limitations did not run prior to the filing of this complaint. The statute of limitations has not run as to Plaintiff’s claims under the Wisconsin Consumer Act nor the Fair Debt Collections Practices Act. The facts underlying this action support the interpretation of either a continuing violation (2nd garnishment in combination with Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 35 of 47 -36- all phone calls) and each phone call can be viewed as a discrete violation. a. Each phone call to the Plaintiff and subsequent legal action related to the unlawful garnishment constitute a continuing violation (2nd garnishment and each phone call). Courts in the Seventh Circuit have held that continuous collection attempts will bring the first wrongful act within the applicable one year statute of limitations. In Beal v. Wyndham Vacation Resorts, Inc., the plaintiff brought numerous claims relating to unlawful phone calls – some of which occurred beyond the statute of limitations without considering the doctrine of continuing violation. 956 F. Supp. 2d 962, 966-967 (W.D. Wis., 2013) The court concluded: The continuing violation doctrine acts as a defense to the statute of limitations, delaying its accrual or start date.” Kovacs v. United States, 614 F.3d 666, 676 (7th Cir.2010) (citation omitted). The doctrine applies in situations in which a claim is premised on the cumulative effect of individual, repeated acts, with the last event being timely. National Railroad Passenger Corp. v. Morgan, 536 U.S. 101, 115–16, 122 S.Ct. 2061, 153 L.Ed.2d 106 (2002) (applying doctrine to hostile work environment claim and distinguishing unlawful conduct “occur [ring] over a series of days or perhaps years” from “discrete acts” actionable on their own). See also Heard v. Sheahan, 253 F.3d 316, 319 (7th Cir.2001) (“A violation is ‘continuing,’ signifying that a plaintiff can reach back to its beginning even if the beginning lies outside the statutory limitations period, when it would be unreasonable to require or even permit him to sue separately over every incident of the defendant's unlawful conduct.”). In such situations, courts may consider actions taken outside the statutory time period, so long as an act contributing to the claim takes place within the statutory time period. Morgan, 536 U.S. at 117, 122 S.Ct. 2061. Beal v. Wyndham Vacation Resorts, Inc., 956 F. Supp. 2d 962, 973 (W.D. Wis., 2013) Further, in Hoang v. Worldwide Asset Purchasing, LLC and Freemand, Anselmo, Lindberg & Rappe, LLC, the court indicated that claims filed outside of the one year statute of limitations are barred “…unless the alleged actions of [d]efendants constitute a continuing wrong, or the dismissal of the [legal proceeding] constituted a separate and new violation of the Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 36 of 47 -37- FDCPA.” No. 09–185–DRH, 2009 WL 3669883, at *2 (S.D. Ill. Nov. 2, 2009) The continuing violation doctrine provides that the statute of limitations does not begin to run on a continuing wrong until the wrong has been concluded. Id. In Hoang, a lawsuit was dismissed within one year, that was the final act in the course of a state court lawsuit. Id. Under the continuing violation theory, the FDCPA was timely. Id. In the current case, Messerli like those defendants in Beal and Hoang continued to attempt to collect a debt when it clearly knew or should have known the Plaintiff no longer owed the debt and, even if Plaintiff did not owe the debt, communicated with the Plaintiff in an attempt to collect the debt. Accordingly, the unlawful garnishment in combination with the continued collection attempts via telephone calls brings the unlawful garnishment action within the one year statute of limitations as Messerli objected to Plaintiff’s answer14 and demanded a garnishment hearing as of February 2, 2016 and the garnishment hearing was not cancelled until March 1, 2016. If Messerli believed the Plaintiff in that sufficient funds had been garnished from his wages to satisfy the judgment, then there would be no reason to have him appear at a hearing regarding the garnishment or to NOT dismiss the second garnishment. Messerli cannot dispute this reasoning. b. Each telephone call and each continued attempt by Messerli to collect the debt through the Plaintiff meets the criteria of discrete collection attempts, all of which are within the one year statute of limitations. In Kovacs v. United States, the Internal Revenue Service (IRS) attempted to collect for taxes discharged through bankruptcy by sending separate collection letters. 614 F.3d 666, 14 On February 3, 2016, Messerli objected to Plaintiff’s answer to said garnishment and demanded a hearing even though Plaintiff indicated to Messerli that the funds to satisfy the judgment had been taken from his paycheck. (See Midland Funding LLC vs. Peter Bjerke, No. 2014SC000167 (Dunn Cnty. Cir. Ct.).) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 37 of 47 -38- 675 (7th Cir., 2010) In Solomon v. HSBC Mortg. Corp., the plaintiff asserted in an amended complaint that the defendant violated the FDCPA in numerous was within the one year statute of limitations. 395 Fed. Appx, 494, 497 (10th Cir. 2010) The court stated: For statute-of-limitations purposes, discrete violations of the FDCPA should be analyzed on an individual basis. Mr. Solomon's complaint may be read to allege at least three kinds of violations within the one-year statutory period: (1) falsely representing the amount of the debt or compensation for collection of a debt, see 15 U.S.C. § 1692e(2)(A); (2) generally engaging in false, deceptive, or misleading practices, see id., § 1692f; and (3) failing to provide debt validation or to cease collection efforts within thirty days after he disputed the debt, see § 1692g. On the face of the amended complaint, it is not at all evident that these claims are barred by the statute of limitations. Id. at 497-8 Like Solomon, the Plaintiff has alleged numerous and multiple violations that occurred within one year of the filing of this complaint. Plaintiff has asserted violations of 15 U.S.C. §§ 1692e, 1692e(2), 1692e(5), 1692e(7), 1692e(10), 1692e(11), 1692f, 1692f(1), and 1692f(6) based on the numerous collection attempts of Messerli. As discussed previously, the violations occurred because each phone call was a discrete attempt to collect the debt at issue – this was amongst the ways Messerli coerced the Plaintiff into retrieving the garnished funds from CVS. In summation, Messerli had not been paid from CVS, and chose to call the Plaintiff to retrieve the money Messerli sought. Each call was clearly intended to be a debt collection attempt which were contrary to the FDCPA for the reasons stated below. VI. Messerli made false, deceptive, and misleading representations and means in connection with the collection the debt contrary to 15 U.S.C. 1692e. False statements, by themselves, do not violate the FDCPA; the consumer must also establish that these false statements (1) are confusing or misleading and (2) are material. Hale v. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 38 of 47 -39- AFNI, Inc., 2010 WL 380906, *5 (N.D. Ill. Jan. 26, 2010). By taking advantage and leading the Plaintiff to believe that either Plaintiff had to help Messerli collect the funds from CVS or Plaintiff would be garnished again, Messerli mislead the Plaintiff in a way contrary to 15 U.S.C. §1692e. The assertions made by Messerli are not those an unsophisticated consumer would understand. Pursuant to 15 U.S.C. §1692e, Messerli or its agents may not “use any false, deceptive, or misleading representation or means in connection with the collection of any debt.” When determining whether statements by Messerli are of those contemplated in 15 USC 1692, the Seventh Circuit has adopted the “unsophisticated consumer standard”. Lox v. CDA, Ltd., 689 F.3d 818, 821-822 (7th Cir. 2012) The Lox court described the “unsophisticated consumer standard” as follows: As stated above, the FDCPA prohibits the use of “false, deceptive, or misleading representation or means in connection with the collection of any debt.” 15 U.S.C. § 1692e. This is a broad prohibition, and while § 1692e has 16 subsections describing ways by which a debt collector could violate the FDCPA, that list is non[-]exhaustive, Nielsen v. Dickerson, 307 F.3d 623, 634 (7th Cir.2002), and a plaintiff need not allege a violation of a specific subsection in order to succeed in a § 1692e case, Ruth v. Triumph P'ships, 577 F.3d 790, 794 n. 2 (7th Cir.2009). Despite the breadth of § 1692e's coverage, however, there are limits to its reach. As we made clear in Wahl v. Midland Credit Mgmt., a statement made by a debt collector that is technically false but in no way misleading does not run afoul of § 1692e. 556 F.3d 643, 645–46 (7th Cir.2009). Instead, we use the “unsophisticated consumer” standard, as we do with all claims under § 1692e, and “[f]or purposes of § 1692e ... a statement isn't ‘false’ unless it would confuse the unsophisticated consumer.” Id. at 646. The unsophisticated consumer may be “uninformed, naïve, [and] trusting,” Veach v. Sheeks, 316 F.3d 690, 693 (7th Cir.2003), but is not a dimwit, has “rudimentary knowledge about the financial world,” and is “capable of making basic logical deductions and inferences,” Wahl, 556 F.3d at 645 (quoting Pettit v. Retrieval Masters Creditors Bureau, Inc., 211 F.3d 1057, 1060 (7th Cir.2000)). Furthermore, because we have rejected the “least sophisticated consumer” standard, a letter must be confusing to “a significant fraction of the population.” Taylor v. Cavalry Inv., L.L.C., 365 F.3d 572, 574 (7th Cir.2004). Id. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 39 of 47 -40- Id. In the current case, for the reasons described above and contrary to the statements made to him by Messerli, the Plaintiff was NOT necessary for Messerli to bring a claim against CVS nor was he still liable for the debt at issue after the funds were garnished from his wages. This determination concerning Plaintiff’s liability for the debt and whether he was a necessary party to obtain the garnished funds from CVS requires an analysis not contemplated within “unsophisticated consumer standard” for it requires an understanding of the applicable Wisconsin statutes which was information not readily available to the Plaintiff at the time he was required to make basic logical deductions and inferences. Having in-depth knowledge of the applicable nuanced statutes that govern garnishments in Wisconsin is not what was contemplated to be understood by the “unsophisticated consumer standard” in Lox v. CDA, Ltd and exceeded what was determined to be unlawful in Lox v. CDA, Ltd.15 a. Messerli made materially deceptive statements to Plaintiff. Messerli indicated to the Plaintiff he may need to go to court to resolve the debt at issue when he was neither liable for it nor was he a necessary party to obtain the garnished funds from CVS16. (Amend. Comp., Dkt. 15, ¶¶27(ii)(1)-(4), 28, 68.) In Green v. Monarch Recovery Mgmt., Inc., the debt buyer’s letter listed the prior debt buyer, not Bank One as the creditor, there could be no question that the unsophisticated consumer would find the letter misleading and 15 Lox held that a statement to debtor in debt collector's dunning letter, that “court could allow ... attorney fees,” when underlying service agreement did not provide for award of attorney fees in event of nonpayment, was misleading on its face, and thus extrinsic evidence was not necessary on claim under FDCPA. Id. The Lox court concluded there was only one reasonable interpretation: that a lawsuit was a possible outcome of nonpayment, and attorney fees were a possible outcome of a lawsuit, and a naive, trusting, unsophisticated consumer likely would believe a debt collector when it said that attorney fees were potential consequence of nonpayment. Id. Here, SLS brings a zombie debt back to life. Lox v. CDA, Ltd., 689 F.3d 818, 821-2 (7th Cir. 2012)(internal citations omitted). 16 See Plaintiff’s discussion of liability of the debtor during garnishment action. Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 40 of 47 -41- deceptive. 2015 WL 4599480, *5 (S.D. Ind. July 29, 2015) The identity of the creditor is material information to a consumer. Id. Similar to Green v. Monarch Recovery Mgmt., Inc., telling the Plaintiff that “…this is not over..” and indicating to the Plaintiff that he may have to go to court to resolve the debt he was no longer liable for or needed to recover garnished from CVS is clearly misleading. b. 15 USC §1692e(2) Messerli, by continuing to threaten the Plaintiff with a mandatory court appearance, implied Plaintiff was still liable for the debt at issue and his presence was necessary to obtain the garnished funds from CVS – again, both assertions were false for the reasons stated previously. Further, Messerli continues to argue in its Motion to Dismiss that it was still owed the money from the Plaintiff even after the Plaintiff’s money had been garnished by CVS which is false contrary to Wisconsin law. (Def. Motion to Dismiss, Pg. 18) c. 15 USC §1692e(5): In Aitken v. Debt Mgmt. Partners, L.L.C. a payday loan collection agency violated §§ 1692e(4), 1692e(5), 1692e(7), and 1692e(10) by accusing the consumer of criminal activity and making a threat to file suit with no actual intention to do so. 2015 WL 1810345,*4 (C.D. Ill. Apr. 17, 2015) Like Aitken v. Debt Mgmt. Partners, L.L.C., Messerli indicated to Plaintiff that he would have to comply with Messerli else Plaintiff would face the consequence of having to go before a judge to resolve the matter thereby implying the Plaintiff was still liable for the debt at issue. Further, the actions taken against the Plaintiff violated 15 USC §§1692e(7) and 15 USC 1692e(10) as the debt collector in Aitkin did. Id. d. 15 USC §1692e(11) – Foti Claim The law is clear that Messerli was obligated, pursuant to 15 U.S.C. §1692(11), to let Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 41 of 47 -42- the Plaintiff know it is a debt collector17; however, Messerli failed to do so in its messages left for the Plaintiff on December 14, 2015, December 23, 2015, January 5, 2016, and March 1, 2016. (Amend. Comp., Dkt. 15, ¶¶27(ii)(1)-(4), 28, 68.) Collector’s prerecorded phone message left on the consumer’s voicemail only requesting the debtor to return the call regarding an important personal “business matter” was a “communication” as defined by the FDCPA, and thus the allegation that the collector failed to provide the § 1692e(11) disclosure in that message stated a claim for relief. Foti v. NCO Fin. Sys., Inc., 424 F. Supp. 2d 643, 654 (S.D.N.Y. 2006). The statute expressly requires debt collectors “to disclose in subsequent communications that the communication is from a debt collector.” The disclosure that the communication is from a debt collector must be made in all subsequent communications. The Second, Fourth, Sixth, and Seventh Circuits reached this conclusion ….by holding that subsection 1692e(11) applies to all communications, including follow-up notices. … [T]he Sixth Circuit remarked that (1) “the plain language of the statute applies to ‘all communications,’ “without providing an exception for follow-up notices; (2) the requirement that all communications contain the disclosures serves the purpose of the statute by providing the necessary information in the event that the first communication was not received by the consumer; and (3) even if repetition of the disclosures failed to serve a discernible purpose, Congress is permitted to adopt a margin of safety in order to meet its remedial goal. Thus, a voicemail must state that the speaker is a debt collector, regardless of whether it follows the receipt of an initial letter.” National Consumer Law Center, Fair Debt Collection 5.5.14.1, 8th ed. 2014, updated at www.nclc.org/library. Materiality is not a requirement under, 15 U.S.C. §1692e(11). Warren v. Sessoms & Rogers, P.A., 676 F.3d 365, 373 (4th Cir., 2012) Materiality is not element of a FDCPA claim about debt collector's conduct that involved “failure to disclose” “that the communication” was “from a debt collector,” since debt collectors were required to disclose their status in every 17 …the failure to disclose in subsequent communications that the communication is from a debt collector, except that this paragraph shall not apply to a formal pleading made in connection with a legal action. 15 U.S.C. §1692(11) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 42 of 47 -43- communication with consumer. Id. at 373 Making the disclosures required by § 1692e(11) in an initial communication does not relieve a debt collector from making § 1692e(11) disclosures in subsequent communications. Smith v. Greystone Alliance L.L.C., 2011 WL 1303377, *4 (N.D. Ill. Mar. 29, 2011). Failing to identify itself as a debt collector, as § 1692e(11) requires, cannot be anything but misleading as the collector’s name contains no indication that it is a debt collector. Id. As a debt collector, Messerli failed to provide the legally required notice under 15 U.S.C. 1692(11). VII. Messerli’s practices were unfair and unconscionable in its attempt to collect the debt contrary to 15 U.S.C. §1692f. Section 1692f does not contain the element of knowledge or intent. Turner v. J.V.D.B. & Assocs., Inc., 330 F.3d 991 (7th Cir. 2003). Messerli attempted to collect an amount not allowed by law pursuant to 15 U.S.C §1692f. “A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt…not permitted by law.” 15 U.S.C. §§1692f-f(1). See Seeger v. AFNI, Inc., 548 F.3d 1107, 1113 (7th Cir. 2008)(demand for an additional 15% collection fee violated §1692f(1) since the charge was not authorized by law or the underlying contract). Consumers’ allegations that the debt collector filed a garnishment action when the consumers were current in their payments was sufficient to state a claim for unfair or unconscionable collection practices under § 1692f. Fox v. Citicorp Credit Servs., Inc., 15 F.3d 1507, 1517 (9th Cir. 1994).Like Seeger and Fox, Messerli was attempting to collect an amount not allowed as, for the reasons stated previously, and through misleading means from the Plaintiff as the Plaintiff had already satisfied the debt and was not a necessary party to retrieve the funds from CVS. a. 15 USC §1692f(1) Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 43 of 47 -44- Further Messerli’s assertions to the Plaintiff defy common sense and were contrary to 15 USC §1692f(1). Debt collector’s letter to a consumer requesting payment after being on notice that the plaintiff’s debt had been discharged in bankruptcy could be actionable § 1692d harassment, as well as an effort to collect a debt not permitted by law, § 1692f(1), and a misrepresentation of legal status. Church v. Accretive Health, Inc., 2014 WL 7184340, *7 (S.D. Ala. Dec. 16, 2014). “It defies logic, common sense, and abundant case authorities to assert, as defendant does, that sending a collection letter to a consumer for a non-existent, discharged debt could not plausibly be misleading to the consumer as to the legal status of such debt.” Id. Again there was no reason Messerli needed the Plaintiff as the Plaintiff’s wages were sufficiently garnished to satisfy the debt at issue and was no longer responsible for the debt at issue. b. 15 USC §1692f(6) 15 USC §1692f(6) precludes Messerli from “[t]aking or threatening to take any nonjudicial action to effect dispossession or disablement of property if— (A) there is no present right to possession of the property claimed as collateral through an enforceable security interest; (B) there is no present intention to take possession of the property; or (C) the property is exempt by law from such dispossession or disablement.” In Bonfiglio v. Citifinancial Servicing, L.L.C., the court denied dismissal of the § 1692f(6) claim where the complaint alleged that the mortgage servicer had no right to enforce the subject security interest: “Whether Green Tree had a right to enforce Citi’s interest in the property and the propriety of Citi’s claimed interest are fact questions more appropriate for the summary judgment stage.” 2015 WL 5612194, *12 (N.D. Ill. Sept. 23, 2015). In Blum v. Fisher & Fisher, the claim that collection attorney’s letter concerning mortgage foreclosure, which stated that the consumer owed attorney fees when none would be due until a foreclosure Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 44 of 47 -45- judgment was obtained, presented questions of fact precluding grant of summary judgment on alleged FDCPA violations of misrepresentation and unfairness. 961 F. Supp. 1218 (N.D. Ill. 1997). In Riess v. Messerli & Kramer, P.A., a debt collector’s misuse of state statutory garnishment procedures may constitute a violation of the FDCPA. 2011 WL 5506290, *6 (D. Minn. Nov. 10, 2011). In the current case, Plaintiff had paid the debt and Messerli by threatening further legal action has stated a claim. VIII. Messerli can be liable for the negligent misdeeds of its employees. Plaintiff has alleged sufficient facts to put Messerli on notice that the acts of its agents were done so negligently. “Again, nothing more is needed about just what the defendant did or why those actions amounted to negligence. This also seems quite “conclusory,” but it is sufficient under Rule 84.” McCauley v. City of Chicago, 671 F.3d 611, 625 (7th Cir., 2011) In the current case, a negligence per se claim has been stated against Messerli. Plaintiff alleged the violation of numerous and multiple violations of the FDCPA and Wisconsin Consumer Act (Amend. Comp., Dkt. 15, ¶¶41-47, 52-58 59-62, 64-70, and 71-77) based on allegations of fact (Amend. Comp., Dkt. 15, ¶¶9-45) Plaintiff is not required to show more to survive a motion to dismiss. IX. Paragraph 38 of the Plaintiff’s complaint does state a claim for which relief can be granted. This paragraph is based on information and belief, that may be supported by evidence showing pattern and practice. X. Plaintiff has stated a claim under Wis. Stats. 427.104(h) and (l) Either Messerli inadvertently coerced the Plaintiff into helping it collect the garnished funds from CVS and did not understand the garnishment system, OR Messerli intentionally Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 45 of 47 -46- used the garnishment process and subsequent phone calls as a scare tactic to coerce the Plaintiff, who is a non-lawyer, into helping it recover the garnished funds from CVS; however, under either scenario, Messerli’s actions were contrary to Wis. Stat. 427.104(h) and (l). Pursuant to Wis. Stat. 427.104(h) and (l): In attempting to collect an alleged debt arising from a consumer credit transaction or other consumer transaction, including a transaction primarily for an agricultural purpose, where there is an agreement to defer payment, a debt collector may not: (h) Engage in other conduct which can reasonably be expected to threaten or harass the customer or a person related to the customer; … (l) Threaten action against the customer unless like action is taken in regular course or is intended with respect to the particular debt; Based on Messerli’s advertising, it is a professional debt collector that is well versed in many forms of debt collection, it is hard to believe the unlawful acts of Messerli anything but intentional.18 a. Messerli’s attempts to collect the debt at issue after sufficient funds were garnished from Plaintiff’s paycheck and Defendant knew of this through the Plaintiff’s Answer to the second garnishment, were contrary to Wis. Stat. 18 “Messerli & Kramer's Collection Department provides comprehensive, attorney-managed debt recovery services to our clients, which include some of the nation's largest businesses and financial institutions. Our thorough understanding of the law, business and the collections process makes us more than litigators. We are negotiators, investigators, collectors and, above all, partners with our clients” and “Our attorneys selectively employ a range of collections tools to effectively achieve the desired outcome, including demand letters, pre-suit collections, credit bureau reviews, litigation, garnishment, skip tracing, asset searches, post-judgment collections and collateral recovery.” Messerli & Kramer, P.A., Collections & Creditors' Remedies (February 12, 2017), https://www.messerlikramer.com/practice-areas/collections-creditors-remedies Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 46 of 47 -47- 427.104(h). Defendant Messerli clearly threatened the Plaintiff by continually contacting the Plaintiff and telling him if he does not help Messerli that Plaintiff will be brought in front of the judge as Messerli implied even though by November 4, 2015, Messerli knew funds sufficient to satisfy the judgment were paid by the Plaintiff. Knowingly attempting to collect amounts from the Plaintiff after he had already paid funds sufficient to satisfy the debt at issue and had no liability anymore is clearly against Wis. Stat. 427.104(h) and (l). CONCLUSION For the reasons stated above, Plaintiff asks this Court deny Messerli’s Motion to Dismiss as all communications between Messerli and Plaintiff were the type contemplated by 15 U.S.C. § 1692a(2), and Messerli violated the numerous and multiple provisions of the FDCPA and WCA as outlined in his complaint. Dated: February 15, 2017 s/Matthew C. Lein Matthew C. Lein, 1084028 15692 Hwy 63 North PO Box 761 Hayward, Wisconsin 54843 Telephone: (715) 634-4273; Fax: (715) 634-5051 Email: mlein@leinlawoffices.com ATTORNEY FOR PLAINTIFF Case: 3:16-cv-00748-bbc Document #: 32 Filed: 02/15/17 Page 47 of 47