District Court (Fla.) Circumvents Class Certification Problems in FDCPA Case Arising from Factual Questions Whether the Debts Were Commercial or Consumer by Simply Excluding Commercial Debts from the Class Definition

In Roundtree v. Bush Ross, P.A., — F.R.D. —-, 2014 WL 6969570 (M.D.Fla. 2015), Judge Whittemore found that an FDCPA class action could still be certified despite questions of whether the obligation was consumer or commercial merely by excluding commercial debts from the class definition.  The case arose from a purported “overshadowing” collection letter sent to collect delinquent condominium association obligations and threatening to file a claim of lien and foreclose on the lien. Judge Whittemore adopted the magistrate’s finding that a class could be certified:

The FDCPA only applies to debts that are “primarily for personal, family, or household purposes.” Oppenheim v. I.C. System, Inc., 627 F.3d 833, 837 (11th Cir.2010) (quoting 15 U.S.C. § 1692a(5). Bush Ross argues, correctly, that proof that the debt satisfies those criteria is an essential element of the FDCPA. Some of the letters and notices may have been sent to landlords who lease their condominiums, rather than use them for “personal, family, or household purposes.” Bush Ross contends that whether the debts are primarily for personal, family, or household purposes is not capable of proof at trial through common, rather than individual, evidence, and therefore, individual questions predominate over common questions. ¶ Plaintiff does not, and cannot, dispute that whether the debts are primarily for personal, family, or household purposes is an essential element of a FDCPA claim. Plaintiff instead argues that common questions predominate, namely whether Bush Ross’s collection letter, attempt to charge consumers with its fees, and notice attached to the state court foreclosure complaints, violate the FDCPA. Plaintiff contends that the necessity of individualized determinations and minor differences among class members do not preclude class certification, citing a number of district court cases that have certified FDCPA class actions based on similar debt collection letters and conduct. Plaintiff also argues that it can easily be determined whether a debt is subject to the FDCPA, either on the claims form or from public records.  ¶  Determining whether common issues predominate over individual issues, as required by Rule 23(b)(3), requires an analysis of the elements of the underlying claim. Erica P. John Fund, Inc. v. Halliburton Co., –––U.S. ––––, ––––, 131 S.Ct. 2179, 2184, 180 L.Ed.2d 24 (2011); Klay v. Humana, Inc., 382 F.3d 1241, 1254 (11th Cir.2004). Although Roundtree need not show that each element of her claim is subject to common proof, whether common issues predominate over individual issues “can only be determined after considering what value resolution of the class-wide issue will have in each class member’s underlying cause of action.” Rutstein v. Avis Rent–A–Car Systems, Inc., 211 F.3d 1228, 1234 (11th Cir.2000). ¶  While several courts have certified FDCPA classes despite objections that individual issues related to classification of the debt preclude predominance, in most of those cases, the class definition excluded non-consumer debts. See Walker v. Greenspoon Marder, P.A., No. 2:13–cv–14487–KAM, Dkt. 78 at 8 (S.D.Fla. Jan. 6, 2015) (certifying FDCPA class of persons with “debt incurred for personal, family, or household purposes”); Collins v. Erin Capital Management, LLC, 290 F.R.D. 689, 700 (S.D.Fla.2013) (certifying FDCPA class where the “proposed class definition limits the class to persons against whom attempts to collect debts incurred for personal, family, or household purposes”); Hicks v. Client Services, Inc., No. 07–61822–CIV, 2008 WL 5479111 (S.D.Fla. Dec.11, 2008), at *10 (certifying FDCPA class of consumers who received a communication “to collect a debt incurred for personal, family, or household purposes”); Marcarz v. Transworld Systems, Inc., 193 F.R.D. 46, 58 (D.Conn.2000) (certifying FDCPA class of consumers who received communications that “concerned a non-business debt”); Swanson v. Mid Am, Inc., 186 F.R.D. 665, 669 (M.D.Fla.1999) (certifying FDCPA class of consumers with debts “shown by Defendants’ records to be primarily for personal, family, or household purposes, e.g.—medical services”). ¶  The class definitions recommended by Judge Porcelli, with the possible exception of the Overshadowing Class, do not limit class members to those whose debts were incurred for personal, family, or household purposes. Accordingly, the class definitions will be revised to include only debts incurred for personal, family, or household purposes. Bush Ross’s argument that “mini-trials” would be necessary to determine whether the debts incurred were primarily for personal, family, or household purposes is no longer a concern. ¶  After the exclusion of non-consumer debts from the class, Bush Ross’s remaining objections relating to common proof are unavailing. Roundtree’s contentions, including that Bush Ross is a debt collector within the meaning of the FDCPA, that Bush Ross engaged in collection activity, and that its actions violated the FDCPA, are now “capable of classwide resolution—which means that determination of [their] truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.” Wal–Mart Stores, Inc. v. Dukes, ––– U.S. ––––, ––––, 131 S.Ct. 2541, 2551, 180 L.Ed.2d 374 (2011). ¶  Bush Ross cites two cases denying class certification for FDCPA claims based on predominance, but these cases are distinguishable.  In Neves v. Nationwide Credit, Inc., No. 1:95–cv–1532–GET, 1996 U.S. Dist. LEXIS 22241 (N.D.Ga. Mar. 20, 1996), the court rested its decision not to certify a FDCPA class partly on the plaintiff’s adequacy of representation, including her “alarming lack of knowledge” about the lawsuit, not an issue here. Id. at *6–8. The court also found a lack of “predominant commonality,” based on the “uniquely individual task of determining whether the debt … was incurred primarily for personal or business purposes.” Id. at *10. And the proposed class in Neves applied to “consumer debts,” rather than the more specific and easily determinable test of whether the debts were for personal, family, or household purposes. Id. at *3. Here, individual inquiries about the nature of the debt will not predominate over common questions, as non-consumer debts will be excluded from the class. Bush Ross also cites Lewis v. Jesse L. Riddle, P.C., No. 97–0542, 1998 U.S. Dist. LEXIS 20465 (W.D.La. Nov. 18, 1998), in which the court denied certification based in part on the difficulty of determining whether debts were incurred by consumers or businesses. Id. at *13–14. Lewis, however, is at odds with the weight of authority certifying FDCPA class actions in similar situations. ( See Dkt. 58 at 19–20 (collecting cases)).