Anthony Kressel and Jennifer Kressel v. NewRez LLC d/b/a Shellpoint and Wilmington Savings Fund Society, FSB, not in its individual capacity but solely as Owner Trustee of FIGRE Trust 2023-HE3

Summary

The United States District Court for the Northern District of Illinois addresses defendants’ motion to dismiss claims arising from alleged noncompliance with a bankruptcy reaffirmation agreement concerning a secured line of credit. The court holds that Anthony Kressel plausibly alleged standing under the FDCPA and for breach of contract, but lacks standing under RESPA and the Illinois Consumer Fraud Act. The court also concludes that the amended complaint adequately pleads the FDCPA and breach-of-contract claims, granting the motion in part and denying it in part.

Holdings

1. Anthony plausibly alleged standing to assert the FDCPA claims because the provisions invoked protect persons beyond consumers and he alleged an injury from threats to foreclose on his home and demands for additional payments.
2. Anthony plausibly alleged standing to sue for breach of the reaffirmation agreement even though he did not sign the line-of-credit agreement or reaffirmation agreement.
3. Anthony lacked standing to assert a RESPA claim because he signed the mortgage but did not sign or assume the line-of-credit agreement and was not alleged to be personally obligated to repay the debt.
4. Anthony lacked standing to assert an ICFA claim because he did not allege that he was a consumer or that defendants' conduct had a sufficient consumer nexus.
5. The FDCPA claims plausibly alleged that Shellpoint was a debt collector because the debt was allegedly treated as being in default when Shellpoint acquired the servicing rights.
6. The breach-of-contract claim plausibly alleged that Shellpoint could be bound by the reaffirmation agreement and that plaintiffs suffered damages from the alleged difference between the required and demanded monthly payments.
7. Jennifer plausibly alleged a RESPA violation by alleging that Shellpoint failed to respond to a qualified written request within thirty business days and took actions concerning the account before responding.
8. Jennifer plausibly alleged deceptive and unfair practices under the ICFA by alleging that defendants demanded excessive payments, misallocated payments, threatened harmful consequences, imposed an excessive lien, and ignored attempts to resolve the dispute.

Questions Presented

1. Whether Anthony Kressel had statutory and Article III standing to assert FDCPA claims despite not signing the line-of-credit agreement.
2. Whether Anthony Kressel had standing to assert a breach-of-contract claim based on the mortgage, line-of-credit agreement, and reaffirmation agreement.
3. Whether Anthony Kressel was a borrower under RESPA when he signed the mortgage but not the line-of-credit agreement.
4. Whether Anthony Kressel had standing to assert an ICFA claim absent allegations that he was a consumer or that the defendants' conduct satisfied the consumer-nexus test.
5. Whether the amended complaint plausibly alleged FDCPA, breach-of-contract, RESPA, and ICFA claims against the defendants.

Disposition

other