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Heroux v. Callidus Portfolio Management Inc.

United States District Court, D. Minnesota

May 1, 2018

Jason Heroux, Plaintiff
Callidus Portfolio Management Inc. and Messerli & Kramer, P.A., Defendants.

          Darren B. Schwiebert, Esq. and DBS Law LLC, counsel for plaintiff.

          Derrick N. Weber, Esq., Stephanie Shawn Lamphere, Esq. and Messerli & Kramer, P.A., counsel for defendants.


          David S. Doty, Judge United States District Court

         This matter is before the court upon the motion for judgment on the pleadings by defendants Callidus Portfolio Management Inc. and Messerli & Kramer, P.A. Based on a review of the file, record, and proceedings herein, and for the following reasons, the court grants the motion in part.


         This debt-collection dispute arises out of defendants' attempts, through a state court action, to collect on credit card debt allegedly owed by plaintiff Jason Heroux. After Heroux defaulted on the debt, it was charged off and sold to Callidus. Callidus retained Messerli to collect the debt. Compl. ¶ 8. On April 12, 2016, defendants served Heroux with a state court complaint seeking $1, 665.11 plus accrued and continuing interest. Answer Ex. A at 4. Defendants did not file the complaint at that time. Heroux answered the complaint on March 16, 2017, denying any liability and asserting various affirmative defenses. Id. at 12-13. Defendants served Heroux with their first set of “interlocking discovery” on April 4, 2017, and filed the case in Hennepin County the following day. Id. at 6, 17, 20-29. Defendants then moved for summary judgment. Heroux did not respond to the discovery, oppose the summary judgment motion, or appear for the summary judgment hearing. Id. at 56-57. The court determined that, based on the evidence and Heroux's failure to respond, defendants were entitled to judgment and an award of $2, 881.57. Id. at 56-59.

         On November 16, 2017, Heroux commenced this suit against defendants alleging that the state-court action violated the Fair Debt Collections Practices Act (FDCPA), 15 U.S.C. § 1692, et seq, in several respects. Heroux specifically alleges that defendants violated the FDCPA by (1) serving misleading discovery; (2) seeking false admissions through discovery; (3) misrepresenting the identity of the creditors; (4) impermissibly seeking to collect post charge-off interest; and (5) seeking to collect affidavit costs. Defendants now move to dismiss arguing that the court lacks jurisdiction and, alternatively, that the complaint fails to state a claim.


         I. Standard of Review

         The same standard of review applies to motions under Federal Rules of Civil Procedure 12(c) and 12(b)(6). Ashley Cty., Ark. v. Pfizer, Inc., 552 F.3d 659, 665 (8th Cir. 2009). Thus, to survive a motion for judgment on the pleadings, “a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir. 2009) (citation and internal quotation marks omitted). “A claim has facial plausibility when the plaintiff [has pleaded] factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Although a complaint need not contain detailed factual allegations, it must raise a right to relief above the speculative level. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). “[L]abels and conclusions or a formulaic recitation of the elements of a cause of action” are not sufficient to state a claim. Iqbal, 556 U.S. at 678 (citation and internal quotation marks omitted).

         II. Rooker-Feldman Doctrine

         Defendants argue that the court is precluded from hearing this matter under the Rooker-Feldman doctrine because Heroux is effectively appealing the state court's judgment. The court disagrees.

         The Rooker-Feldman doctrine is implicated when a federal action is commenced by “state-court losers complaining of injuries caused by state-court judgments rendered before the district court proceedings commenced and inviting district court review and rejection of those judgments.” Exxon Mobile Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005). Under the doctrine, federal district courts are without jurisdiction to review state-court judgments or to address federal claims with allegations that are inextricably intertwined with a state-court decision. Prince v. Ark. Bd. of Exam'rs in Psychology, 380 F.3d 337, 340 (8th Cir. 2004). However, if a federal plaintiff presents an independent claim, even “one that denies a legal conclusion that a state court has reached in a case to which he was a party, then there is jurisdiction and state law determines whether the defendant prevails under principles of preclusion.” Exxon, 544 U.S. at 293 (citation omitted); see also Hageman v. Barton, 817 F.3d 611, 614 (8th Cir. 2016) (“The doctrine is limited in scope and does not bar jurisdiction over actions alleging independent claims arising from conduct in underlying state proceedings.”).

         The Rooker-Feldman doctrine “bars both straightforward and indirect attempts by a plaintiff to ‘undermine state court decisions.'” Prince, 380 F.3d at 340 (quoting Lemonds v. St. Louis Cty., 222 F.3d 488, 492 (8th Cir. 2000)). A claim is inextricably intertwined under Rooker-Feldman if it “succeeds only to the extent that the state court wrongly decided the issues before it [or] if the relief requested ... would effectively reverse the state court decision or void its ruling.” Fielder v. Credit Acceptance Corp., 188 F.3d 1031, 1035 (8th Cir. 1999) (citation omitted). The fact that a judgment was entered on a party's default does not alter the applicability of the Rooker-Feldman doctrine and renders the court without jurisdiction over defenses to the state ...

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