United States District Court, E.D. Wisconsin
STEVEN J. RUSSELL and NANCY J. RUSSELL, Plaintiffs,
SANTANDER CONSUMER USA, INC., ASSETSBIZ-WISCONSIN, LLC, and MICHAEL A. SANCINATI, Defendants.
DECISION AND ORDER ON DEFENDANTS' MOTION FOR
SUMMARY JUDGMENT AS TO PLAINTIFFS' WISCONSIN CONSUMER ACT
JOSEPH UNITED STATES MAGISTRATE JUDGE
and Nancy Russell bought a 2013 Dodge Journey from a
dealership in Illinois. Santander Consumer USA, Inc.
purchased the Russells' retail installment contract for
the vehicle. After falling behind on their payments,
Santander obtained a judgment of replevin and enlisted
AssetsBiz-Wisconsin, LLC, and its repossession agent, Michael
Sancinati, to repossess the Russells' vehicle. The
Russells sue AssetsBiz and Sancinati for violations of the
Fair Debt Collection Practices Act (“FDCPA”), 15
U.S.C. § 1692 et seq. and sue all three
defendants for violations of the Wisconsin Consumer Act
(“WCA”), Wis.Stat. 421 et seq., stemming
from the repossession.
and Sancinati moved for summary judgment as to the FDCPA
claim on the grounds that neither are “debt
collectors” pursuant to the statute. They further moved
for summary judgment as to the WCA claims on the grounds that
the Russells entered into their retail installment contract
in Illinois and the WCA only applies to consumer transactions
made in Wisconsin. In a decision dated September 20, 2019, I
denied the defendants' motion for summary judgment as to
the plaintiffs' FDCPA claim. (Docket # 42.) I allowed the
parties to file supplemental briefing as to the
plaintiffs' WCA claims. The parties have filed
supplemental briefs on this issue. (Docket # 43 and Docket #
44.) I will refer to the facts as cited in the September 20,
2019 decision and will not repeat them here.
Russells sued AssetsBiz and Sancinati under Wis.Stat.
§§ 425.206(2), 427.104(1)(h), and 427.104(1)(j).
The parties do not dispute that the territorial scope of the
WCA is governed by Wis.Stat. § 421.201 and that the WCA
generally applies to consumer transactions made in Wisconsin.
The Russells do not dispute that the contract was executed in
Illinois. (Defs.' Proposed Findings of Fact
(“DPFOF”) ¶ 3, Docket # 32 and Pls.'
Resp. to DPFOF (“Pls.' Resp.”) ¶ 3,
Docket # 36.) As I previously discussed, however, the law is
not without exceptions. Again, the Wisconsin Court of Appeals
in Credit Acceptance Corp. v. Kong, 2012 WI.App. 98,
344 Wis.2d 259, 822 N.W.2d 506 found that the WCA “may
come to govern a transaction even if the transaction is not
made in this state. For example, certain portions of the WCA
apply to actions or other proceedings ‘brought in this
state to enforce rights arising from consumer transactions .
. . wherever made.'” Id. ¶ 11
(quoting Wis.Stat. § 421.201(5)). The court of appeals
explained: “In other words, a creditor must comply with
certain portions of the WCA (namely, subchapters I and II of
Wis.Stat. ch. 425) if it wishes to bring suit in Wisconsin.
Thus, when [the creditor] filed the present action, it
essentially consented to be governed by subchapters I and II
of ch. 425.” Id.
previously noted, Santander brought a replevin action against
the Russells in Wisconsin; thus, Santander consented to be
governed by subchapters I and II of chapter 425 of the WCA.
(Docket # 42 at 12.) What was unclear, however, was whether
the Kong holding extended to AssetsBiz and
Sancinati, the repossession agents acting on the
and Sancinati argue that Kong is distinguishable. In
Kong, a creditor brought a deficiency action against
the debtor in Wisconsin and the court of appeals found that
in doing so, the creditor consented to be governed by the
WCA. AssetsBiz and Sancinati argue that Kong's
holding does not extend to them because they never filed a
lawsuit in Wisconsin-they were only acting on Santander's
behalf. (Docket # 43 at 2-3.) The Russells cite Gable v.
Universal Acceptance Corp. (WI), 338 F.Supp.3d 943 (E.D.
Wis. 2018) for the proposition that because AssetsBiz and
Sancinati were Santander's agents, they were subject to
the same limitations as the principal that sent them. (Docket
# 44 at 2.) In Gable, the plaintiffs similarly sued
the creditor and the repossession agents under Wis.Stat.
§ 425.206(2)(a) and §§ 427.104(1)(g) and (j).
The creditor argued that it could not be held liable for the
repossessor's actions because the repossessor was an
independent contractor. Id. at 953. Wis.Stat. §
425.206(2)(a) states that “[i]n taking possession of
collateral or leased goods, no merchant may . . . [c]ommit a
breach of the peace.” The Gable court noted
that the WCA defines merchant as:
a person who regularly advertises, distributes, offers,
supplies or deals in real or personal property, services,
money or credit in a manner which directly or indirectly
results in or is intended or designed to result in, lead to
or induce a consumer transaction. The term includes but is
not limited to a seller, lessor, manufacturer, creditor,
arranger of credit and any assignee of or successor to such
person. The term also includes a person who by his or her
occupation holds himself or herself out as having knowledge
or skill peculiar to such practices or to whom such knowledge
or skill may be attributed by his or her employment as an
agent, broker or other intermediary.
Id. (quoting Wis.Stat. § 421.301(25)). The
Gable court further noted that the creditor, not
its repossessors, falls within the definition
of “merchant” and thus is covered by the WCA.
Id. at 954-55. However, the court found that the
creditor cannot avoid liability for actions taken on its
behalf and at its request by using a third-party.
Id. at 955.
raises an additional issue-if repossessors do not fall under
the definition of “merchant, ” are they subject
to the WCA? I have not found a clear answer to this question.
This issue was not brought before the Gable court
and despite making the above statement regarding repossessors
not falling under the definition of “merchant, ”
the Gable court simply assumes repossessors
do fall under the WCA. However, just as the FDCPA
generally excludes repossessors from its definition of
“debt collector” but allows a cause of action
against a repossessor for a violation of 15 U.S.C. §
1692f(6), Nadalin v. Auto. Recovery Bureau, Inc.,
169 F.3d 1084, 1085 (7th Cir. 1999), it seemingly follows
that a repossessor who allegedly violates Wis.Stat. §
425.206(2)(a) should not escape liability simply because he
was acting on the creditor's behalf. This reading of the
statute is in line with the WCA's general directive to
liberally construe the law to promote its underlying purpose
of protecting consumers, see Wis. Stat. §
421.102, as well as the Wisconsin courts' instruction to
coordinate its interpretations of the WCA with the FDCPA,
see Brunton v. Nuvell Credit Corp., 2010 WI 50,
¶ 45, 325 Wis.2d 135, 161, 785 N.W.2d 302, 314.
entire repossession effort-from the replevin action to the
dispatching of AssetsBiz and Sancinati to collect the
collateral-occurred in Wisconsin. If Santander consented to
be governed by subchapters I and II of ch. 425 by beginning
this process in Wisconsin, it defies logic that
Santander's repossession agents would have free reign to
violate Wisconsin law in their collection efforts simply
because the original agreement was signed in Illinois.
the Russells' Wis.Stat. §§ 427.104(1)(h) and
427.104(1)(j) claims, Wis.Stat. § 421.201(4)
specifically states that “Chapter 427 applies to any
debt collection activity in this state.” In
Gable, the court found that repossession agents fell
within the WCA's definition of “debt collector,
” Wis.Stat. § 427.103(3), because they were
“indirectly assisting [the creditor] in the collection
of its debt.” 338 F.Supp.3d at 956. Thus, the court
found that the repossession agents could be liable for
violations of chapter 427. Given that the debt collection
activities occurred in Wisconsin and AssetsBiz and Sancinati
were engaged in debt collection activity, they could be
liable to the Russells if the alleged violations are
these reasons, the defendants' motion for summary
judgment as to the plaintiffs' WCA claims is denied.
THEREFORE, IT IS ORDERED that the defendants' motion for
summary judgment (Docket # 29) is DENIED as to ...