Civil Procedure — class actions

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United States Court of Appeals For the Seventh Circuit

Civil

Civil Procedure — class actions

It was error to deny a plaintiff who had been sued after the statute of limitations on a debt, status as class representative under the FDCPA on behalf of all persons sued by the defendant after the statute of limitations had run.

“To conclude: all 343 Illinois residents appear to be proper class members, adequately represented by plaintiff Phillips because the applicable statute of limitations is four years, so that all the debt collection suits against the class members were time-barred and hence violated the Fair Debt Collection Practices Act (and perhaps Illinois law as well, though we do not opine on that question)—unless it should turn out that the defendant can dock in the safe harbor of 15 U.S.C. § 1692k(c) (‘a debt collector may not be held liable in any action brought under this subchapter if the debt collector shows by a preponderance of evidence that the violation was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error’); or that the defendant has defenses, such as equitable tolling or equitable estoppel, to the bar of the statute of limitations. But all that remains for the district judge to do regarding certification is to determine the proper scope of the class. It need not be limited to Illinois residents or to claims under the Fair Debt Collection Practices Act. But how far it extends (and whether subclasses should be created for residents of different states because of differences among state laws) remains to be determined. The denial of class certification is reversed and the case returned to the district court for further proceedings consistent with this opinion.”

Reversed and Remanded.

13-2251 Phillips v. Asset Acceptance, LLC

Appeal from the United States District Court for the Northern District of Illinois, Feinerman, J., Posner, J.