Montgomery v. Huntington Bank

• Decision Date: 09 October 2003
• Docket Number: No. 01-1283.,01-1283.
• Citation: 346 F.3d 693
• Parties: Duane MONTGOMERY, Plaintiff-Appellant, v. HUNTINGTON BANK and Silver Shadow Recovery, Inc., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 693

346 F.3d 693

Duane MONTGOMERY, Plaintiff-Appellant, v. HUNTINGTON BANK and Silver Shadow Recovery, Inc., Defendants-Appellees.

No. 01-1283.

United States Court of Appeals, Sixth Circuit.

Submitted: August 8, 2003.

Decided and Filed: October 9, 2003. Pursuant to Sixth Circuit Rule 206

COPYRIGHT MATERIAL OMITTED

Duane Montgomery (briefed), Livonia, Michigan, pro se.

ON BRIEF:

Daniel E. Best (briefed), WELTMAN, WEINBERG & REIS, Troy, Michigan, Donald R. Dillon, Jr. (briefed), Moffett & DILLON, Birmingham, Michigan, for Defendants-Appellees.

Before: BOGGS, Chief Circuit Judge; SILER, Circuit Judge; RICE, Chief District Judge.^*

OPINION

SILER, Circuit Judge.

Plaintiff Duane Montgomery, proceeding pro se, appeals the district court's judgment dismissing his claims against Huntington Bank and Silver Shadow Recovery, Inc. ("Silver Shadow"), filed under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq. He argues that the district court erred in finding that he was not a party in interest with respect to all his claims, and that Huntington Bank and Silver Shadow (collectively, the "Defendants") were not "debt collectors," as that term is defined in the FDCPA. We AFFIRM.

I. BACKGROUND

In 1998, Montgomery's mother, Helen J. Smith, financed the purchase of a 1998 BMW by entering into a personal loan agreement with Huntington Bank. As collateral for the loan, Huntington Bank took a security interest in the car. As Montgomery has admitted in his complaint, the BMW in question was "owned by Helen Smith." Approximately one year later, Smith allegedly suffered an injury and was apparently unable to work. Despite Montgomery's repeated contention that his mother was covered by credit disability insurance that she had purchased as part of the personal loan agreement to protect her in the event of a disability, Huntington Bank sought to take possession of the BMW. Thus, Huntington Bank retained Silver Shadow to repossess the vehicle pursuant to the terms of the loan agreement.

In 2000, while Montgomery was away from his home, two employees of Silver Shadow repossessed Smith's vehicle, which was parked in Montgomery's garage. Upon returning home, Montgomery discovered his mother's BMW was missing and immediately filed a police report with the West Bloomfield Township Police Department. The police report, which was attached to the complaint, stated that Montgomery had borrowed his mother's BMW in order to transport some personal items.¹ The complaint averred that the vehicle removed from his home was in fact a "borrowed BMW." In the process of repossessing the car, Montgomery asserts that Huntington Bank and Silver Shadow violated numerous Michigan laws. For instance, he insists that in order to repossess the car, Silver Shadow's employees opened his locked garage door without permission, and thereby committed an unlawful breaking and entering.² He also contends that Silver Shadow damaged his driveway, two of his cars that were parked near the BMW, and various other personal effects, including a laptop computer and a digital camera; these latter items were also allegedly confiscated and ultimately returned to Montgomery by Silver Shadow for a small fee. Silver Shadow, however, would not return the BMW to Montgomery, who offered to pay any outstanding towing and storage fees.

Montgomery sued the Defendants in Michigan state court, alleging various violations of state law. See Montgomery v. Huntington Bank, 2002 WL 31296642 (Mich.Ct.App.2002) (per curiam) (unpublished opinion). He also filed suit in federal court, claiming that Huntington Bank and Silver Shadow violated various provisions of the FDCPA. The Defendants moved to dismiss the complaint under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction, arguing that Montgomery was not a "consumer" within the meaning of the statute. Also, the Defendants moved to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), arguing that neither Huntington Bank nor Silver Shadow met the statutory definition of a "debt collector" under the FDCPA. The district court granted the motions by dismissing the complaint as to each of the Defendants. In later ruling on Montgomery's motion for relief from judgment, the court determined that due to "Plaintiff's failure to make a claim upon which relief can be granted, to show that he is party in interest in this suit or that Defendants are `debt collectors' under the Consumer Credit Protection Act, the disposition of the case will not change in anyway [sic] upon rehearing or reconsideration."

II. STANDING

As an initial matter, both Huntington Bank and Silver Shadow contend that Montgomery lacks standing to pursue this litigation because he is not a "consumer" as defined by the FDCPA. As the Defendants see it, it was Smith, not Montgomery, who entered into the personal loan agreement with Huntington Bank for the purchase of the BMW, and, thus, it is Smith who is the real party in interest. Although the Defendants' assertion is correct for one of Montgomery's claims, the Defendants' standing analysis — more precisely its lack thereof — erroneously collapses the entire standing inquiry under the FDCPA into whether a particular plaintiff is a "consumer," completely ignoring that other sections of the FDCPA are either expressly available, or have been interpreted to be available, to "any person" aggrieved under the relevant statutory provision.

Montgomery brought suit under three separate provisions of the FDCPA: 15 U.S.C. §§ 1692c, 1692d and 1692e. Of these three sections, relief is limited to "consumers" only under § 1692c. As we have previously explained, "only a `consumer' has standing to sue for violations under 15 U.S.C. § 1692c." Wright v. Fin Serv. of Norwalk, Inc., 22 F.3d 647, 649 n. 1 (6th Cir.1994) (en banc). However, § 1692c "appears to be the most restrictive of the FDCPA's provisions. The other provisions are not limited to `consumers,' and thus are broader than § 1692c." Id. (citation omitted).

By its express terms, § 1692d provides that "[a] debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt." (Emphasis added). We have interpreted this to mean that "any person who has been harmed by a proscribed debt collection practice under § 1692d ... [may] sue for damages under § 1692k(a)(2)(A)." Wright, 22 F.3d at 649 n. 1 (paraphrasing the court's holding in Whatley v. Universal Collection Bureau, Inc., 525 F.Supp. 1204 (N.D.Ga.1981)). Likewise, § 1692e states that "[a] debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt." 15 U.S.C. § 1692e. When read in conjunction with § 1692k(a),³ this means that "any aggrieved party may bring an action under § 1692e." Wright, 22 F.3d at 649-50 (emphasis added). Accordingly, the Defendants are mistaken to suggest that Montgomery lacks standing to pursue his claims under §§ 1692d and 1692e. However, the Defendants are correct that he lacks standing under § 1692c, as he is not a consumer for purposes of the FDCPA.

Under the FDCPA, a "consumer" is defined as "any natural person obligated or allegedly obligated to pay any debt," 15 U.S.C. § 1692a(3), or "the consumer's spouse, parent (if the consumer is a minor), guardian, executor, or administrator." 15 U.S.C. § 1692c(d). See also Wright, 22 F.3d at 649 n. 1. In the instant case, Montgomery has admitted in his complaint that the personal loan agreement authorized Huntington Bank to "[t]ak[e] possession of the collateral (BMW) ... [held] in the name of Helen J. Smith" in the event of breach. His complaint further states that at the time of the repossession, the BMW was "owned by Helen Smith" and merely "borrowed" by him. Nowhere in his complaint does he allege that he is the legal guardian of his mother or that he is otherwise obligated or allegedly obligated to pay any debt in connection with the purchase of the BMW. Also, contrary to his suggestion, the mere fact that he possessed or borrowed his mother's car, and that the Defendants were aware of this possible arrangement and communicated this information to one another, does not show that he was responsible or allegedly responsible for paying any debt stemming from the purchase of the automobile.⁴ Accordingly, he fails to meet the statutory definition of "consumer," and, hence, lacks standing under § 1692c.

III. STANDARD OF REVIEW

This court reviews de novo a district court's grant of a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). Merriweather v. City of Memphis, 107 F.3d 396, 398 (6th Cir.1997). In reviewing a motion to dismiss, we must "construe the complaint in the light most favorable to the plaintiff ... and determine whether the plaintiff undoubtedly can prove no set of facts in support of the claims that would entitle relief." Grindstaff v. Green, 133 F.3d 416, 421 (6th Cir. 1998) (citation omitted). In the process of applying this standard, we must be cautious to remember that a pro se complaint must be held to "less stringent standards than formal pleadings drafted by lawyers." Haines v. Kerner, 404 U.S. 519, 520, 92 S.Ct. 594, 30 L.Ed.2d 652 (1972) (per curiam). That said, we "need not accept as true legal conclusions or unwarranted factual inferences." Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987).

IV. ANALYSIS

As a matter of law, liability under §§ 1692d and 1692e can only attach to those who meet the statutory definition of a "debt collector." The Defendants assert that they are not debt collectors within the meaning of the FDCPA. Thus, as a threshold matter, we must determine whether either of the Defendants falls within the FDCPA's definition of a "debt collector."

The FDCPA was enacted to "eliminate abusive debt collection practices by debt collectors, to insure that...