United States District Court, E.D. Wisconsin
SHEILA SCHMITZ and ROBERT SCHMITZ, Individually, as Representatives of the Estate of JOANNE SCHMITZ, and on Behalf of All Other Similarly Situated, Plaintiffs,
VALENTINE & KEBARTAS, LLC and LVNV FUNDING, LLC, Defendants.
DECISION AND ORDER ON DEFENDANTS' MOTION FOR
JUDGMENT ON THE PLEADINGS
Joseph United States Magistrate Judge.
and Robert Schmitz (collectively the “Schmitzes”)
filed this putative class action against Valentine &
Kebartas, LLC and LVNV Funding, LLC (“Valentine”
and “LVNV”), alleging violations of the Fair Debt
Collection Practices Act, 15 U.S.C. § 1692 et
seq. (the “FDCPA”) and the Wisconsin
Consumer Act, Wis.Stat. §§ 421-427 (the
“WCA”). The Schmitzes sue both in their
individual capacities and as representatives of their
mother's estate. For the reasons explained below, the
defendants' motion is granted in part and denied in part.
Schmitzes are brother and sister and the adult children of
Joanne Schmitz, who died on April 30, 2017. (Am. Compl.
¶¶ 3-6, Docket # 33.) They allege that prior to
their mother's death, they resided at the same address as
Joanne Schmitz and were appointed as her powers of attorney.
(Id. ¶ 7.) The Schmitzes allege that they are
the representatives of Joanne Schmitz's estate;
specifically, Sheila Schmitz was appointed Special
Administrator of the probate estate and Robert Schmitz was
authorized to review bills, invoices, and other financial
correspondence on behalf of the estate. (Id. ¶
about November 11, 2017, Valentine sent a debt collection
letter to Joanne Schmitz at the address at which Joanne
Schmitz resided with the Schmitzes. (Id. ¶ 33,
Ex. A.) The alleged debt referenced in the letter is a
Citibank credit card account, used only for personal, family,
or household purposes, including but not limited to purchases
of household goods and services. (Id. ¶ 34.)
The Schmitzes allege that as Joanne Schmitz's caregivers,
they received and read the debt collection letter addressed
to Joanne Schmitz from Valentine. (Id. ¶ 36.)
The debt collection letter contained the following:
WISCONSIN RESIDENTS: This
collection agency is licensed by the Division of Banking in
the Wisconsin Department of Financial Institutions,
(Id. ¶ 37.) The Schmitzes allege that this
language is a representation that the debt collector holds a
Wisconsin Collection Agency License pursuant to Wis.Stat.
§ 218.04 and Wis. Admin. Code § DFI-Bkg. 74.
(Id. ¶ 38.) However, the Schmitzes allege that
Valentine does not, in fact, hold a Wisconsin Collection
Agency License and is not licensed by the Division of Banking
or any other Wisconsin government agency. (Id.
¶¶ 39-43.) The Schmitzes allege that this
representation constitutes a materially false statement in
violation of the FDCPA. (Id. ¶ 44.) The
Schmitzes further allege that they were confused by the
collection letter, they had to spend time and money
investigating the collection letter, and an unsophisticated
consumer would be confused by the collection letter.
(Id. ¶¶ 46-49.) The Schmitzes allege that
LVNV is either directly or vicariously liable for
Valentine's alleged violations. (Id. ¶ 45.)
As such, the Schmitzes sue Valentine and LVNV under 15 U.S.C.
§§ 1692e, 1692(e)(1), and 1692(9) and Wis.Stat.
§ 427.104(1)(k). (Id. ¶¶ 52-62.)
defendants move for judgment on the pleadings under Federal
Rule of Civil Procedure 12(c). Rule 12(c) provides that
“After the pleadings are closed--but early enough not
to delay trial--a party may move for judgment on the
pleadings.” Valentine and LVNV allege that the
Schmitzes lack standing to bring their FDCPA and WCA claims.
The defendants' challenge to the Schmitzes' standing
attacks the court's subject-matter jurisdiction and thus
arises under Fed.R.Civ.P. 12(b)(1). See Apex Digital,
Inc. v. Sears, Roebuck & Co., 572 F.3d 440, 443-45
(7th Cir. 2009). In evaluating a challenge to subject matter
jurisdiction, the court must first determine whether a
factual or facial challenge has been raised. Silha v.
ACT, Inc., 807 F.3d 169, 173 (7th Cir. 2015). A factual
challenge contends that even if the pleadings are formally
sufficient there is in fact no subject matter
jurisdiction. Id. A facial challenge argues that the
plaintiff has not sufficiently alleged a basis of subject
matter jurisdiction. Id. When addressing a factual
challenge, the court may look beyond the pleadings; whereas
when addressing a facial challenge, the court must accept all
well-pleaded factual allegations as true and draw all
reasonable inferences in favor of the plaintiffs.
and LVNV argue a facial challenge to the court's
jurisdiction. (Defs.' Br. at 3-4, Docket # 38.) Thus, I
evaluate the amended complaint pursuant to the standard
articulated in Bell Atl. Corp. v. Twombly, 550 U.S.
544 (2007). Silha, 807 F.3d at 173. Factual
allegations in the complaint must be sufficient to raise the
possibility of relief above a speculative level.
Twombly, 550 U.S. at 555. Although detailed
allegations are not required, the Schmitzes must allege facts
that state a claim to relief that is plausible on its face.
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(citing Twombly, 550 U.S. at 570). “A claim
has facial plausibility when the plaintiff pleads factual
content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.” Id. (citing Twombly, 550
U.S. at 556). That said, “threadbare recitals of the
elements of a cause of action, supported by mere conclusory
statements, do not suffice.” Id. I must view
all of the facts in a light most favorable to the Schmitzes
(as the non-moving party) and only grant the motion if it is
beyond doubt that the Schmitzes can plead no facts that would
support their claims for relief. United States v.
Wood, 925 F.2d 1580, 1581 (7th Cir. 1991).
Schmitzes allege that the debt collection letter addressed to
their deceased mother, but received and opened by them,
contained a false statement in violation of the FDCPA and the
WCA. Valentine and LVNV argue that the Schmitzes' amended
complaint must be dismissed because the Schmitzes lack
standing to prosecute their claims both individually and as
representatives of their mother's estate.
Individual Capacity Claims
initial matter, although Valentine and LVNV argue for
judgment on the pleadings as to both the Schmitzes' FDCPA
and WCA claims, they do not separately argue standing or cite
to any legal authority as to the WCA claims. However, given
the fact that Wisconsin courts follow the policies underlying
the FDCPA when interpreting the WCA, see Brunton v.
Nuvell Credit Corp., 2010 WI 50, ¶ 45, 325 Wis.2d
135, 161, 785 N.W.2d 302, 314 (“Our construction is
also in accordance with the policies underlying a federal
consumer credit protection act, policies with which we are