Randolph v. Imbs, Inc.
| Decision Date | 04 February 2003 |
| Docket Number | No. 02 C 6368.,02 C 6368. |
| Citation | 288 B.R. 524 |
| Parties | Jeanette RANDOLPH, Plaintiff, v. IMBS, INC., Defendant. |
| Court | U.S. District Court — Northern District of Illinois |
David J. Philipps, Mary Elizabeth Philipps, Gomolinski & Phillips, Ltd., Hickory Hills, IL, for plaintiff.
David Matthew Schultz, Jennifer Louise Wigington, Hinshaw & Culbertson, Chicago, IL, for defendant.
Plaintiff Jeanette Randolph filed a Chapter 7 bankruptcy petition on May 2, 2002. Among the debts listed on Ms. Randolph's bankruptcy petition was a debt allegedly owed to a creditor called PESI Emergency Physicians ("PESI"). Both PESI and defendant IMBS, Inc. ("IMBS"), a debt collector, were notified of the bankruptcy petition.
On July 30, 2002, IMBS sent Ms. Randolph a form debt collection letter seeking payment on the PESI debt. On August 20, 2002, the PESI debt was discharged in bankruptcy, and on September 9, 2002, Ms. Randolph filed the present suit, alleging that IMBS violated the Fair Debt Collection Practices Act ("FDCPA") by sending the collection letter. IMBS has moved to dismiss the claim on the grounds that the Bankruptcy Code precludes a private action under FDCPA. I grant the motion.
There is no question that the collection activity Ms. Randolph complains of was a violation of the automatic stay issued by the Bankruptcy Court, and that she might have pursued a contempt action in that court. Yet, Ms. Randolph has chosen instead to bring suit under the FDCPA, a federal statute which governs debt collection practices generally. The Seventh Circuit has not specifically ruled on whether FDCPA suits for post-bankruptcy collection activity are allowable, and district court authority in the circuit is strongly divided on the question.
The most informative Seventh Circuit opinion in this area is Cox v. Zale Delaware Inc., 239 F.3d 910 (7th Cir.2001). There, the plaintiff debtor sought relief in district court for alleged violations of section 524(c) of the Bankruptcy Code, which requires debt reaffirmation agreements to be filed with the Bankruptcy Court in order to be enforceable. The court held that "a suit for violation of section 524(c) can be brought only as a contempt action ... since the debtor would be seeking to enforce the order of discharge issued in that [bankruptcy] proceeding." Id. at 917. Thus, the court appeared to express a preference for resolving discharge-related issues in the Bankruptcy Court. However, as the FDCPA is a federal law which appears to independently grant a right of action to debtors who are subjected to inappropriate collection activity, Cox does not provide a definitive answer in the instant case.
Since the Cox decision was issued, at least two district court judges have permitted FDCPA claims where the plaintiff had an available remedy in the Bankruptcy Court, reasoning that where two federal laws appear to cover the same ground, it is preferable to give effect to both. Peeples v. Blatt, No. 00-7028, 2001 WL 921731, at *4, 2001 U.S....
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Randolph v. Imbs, Inc.
...or unconscionable collection tactics). See Cross v. Risk Management Alternatives, Inc., 296 B.R. 758 (N.D.Ill.2003); Randolph v. IMBS, Inc., 288 B.R. 524 (N.D.Ill.2003). We start with the notice-to-counsel theory, because the difference between § 1692c(a)(2) and § 1692k(c) may help us under......
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Necci v. Universal Fidelity Corp.
...with the majority view and held that an FDCPA claim based upon a violation of Section 524 may not go forward. See Randolph v. IMBS, Inc., 288 B.R. 524, 525 (N.D.Ill.2003); Gray-Mapp v. Sherman, 100 F.Supp.2d 810 (N.D.Ill.1999); Baldwin v. McCalla, Raymer, Padrick, Cobb, Nichols & Clark, L.L......
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Cross v. Risk Management Alternatives, Inc.
...v. Nachtrieb, 888 F.2d 1202, 1204 (7th Cir.1989). The facts in this case are virtually identical to those of Randolph v. IMBS, Inc., 288 B.R. 524 (N.D.Ill.2003) (Bucklo, J.). In Randolph, as here, the defendant attempted to collect an unpaid debt which was discharged in a Chapter 7 bankrupt......