MOUNT VERNON – Chief Circuit Judge Andrew Gleeson improperly defined a debt buyer as a debt collector, according to Fifth District appellate judges who shut down a class action on Dec. 23.
They issued a binding decision distinguishing collectors from buyers, and added that they would reverse Gleeson even if the law applied to debt buyers.
Justice Randy Moore delivered the decision, with Justices Mark Boie and John Barberis concurring.
Attorney Sean Cronin of Belleville and David Cates of Swansea represent plaintiff Casey Davis as estate administrator for the late Guillermo Macia.
The defendant, LVNV Funding, started out as plaintiff.
It sued Macia in St. Clair County circuit court in 2013, for payment on his Chase Bank credit card.
The complaint stated that the bank assigned its rights to LVNV “for value.”
Cronin turned the table by filing a counterclaim that proposed a class action.
He claimed the assignment form didn’t comply with Illinois debt collection law.
He further claimed LVNV failed to attach the form to its complaint.
Cronin asserted other claims but in 2018, he decided to seek class certification only on the claims about the assignment form.
Macia had died by then, and estate administrator Casey Davis substituted for him.
Gleeson certified a class action in 2019.
He defined the class as all individuals sued in Illinois courts since 2008, where debt collectors didn’t possess a valid assignment or failed to attach it.
He defined debt collectors as LVNV and entities associated with it.
LVNV appealed and prevailed.
Moore wrote that assignment for collection is a specific concept referring only to transfer of legal title for the sole purpose of collection on a creditor’s behalf.
He quoted a First District decision that assignment for collection is distinct from a sale, which refers to transfer of both legal and equitable title.
He adopted the First District position that legislators didn’t intend for the law to apply where a debt buyer litigates on its own behalf.
He wrote that legislators amended the law in 2013, to explicitly exempt assignments to debt buyers from the provisions Davis relied upon.
He also wrote that the amendment clarified the original intent to apply the provisions only to assignments for collection and not to debt buyers.
“A subsequent amendment to a statute may be an appropriate source for discerning legislative intent,” Moore wrote.
“If the circumstances surrounding an amendment to a statute indicate that the legislature only intended to interpret the original act, the presumption of an intention to change the law is rebutted.”
He wrote that Sen. Kirk Dillard described the bill as an effort to improve debt collection law “by clarifying the definition and regulation of debt buyers.”
He wrote that even if the law applied to debt buyers pursuing litigation on their own behalf, the class Gleeson certified would be improper.
He wrote that the class definition encompassed all cases where defendants were not in possession of a valid assignment or failed to attach it to the complaint.
He wrote that while failure to attach might violate civil procedure, it doesn’t violate debt collection law.
The Justices remanded the action to Gleeson for further proceedings.
Nabil Foster and Louis Manetti of Chicago represented LVNV.
Campaign contributions
Cates’s firm, Cates Mahoney in Swansea, contributed $1,450 to Gleeson’s retention campaign in 2018.
Cronin gave Gleeson $450.
Cates’s firm gave $2,000 each to Democratic judicial candidates Christopher Kolker, John O’Gara, and Heinz Rudolf in 2018.
Cronin gave $250 each to Kolker, O’Gara, and Rudolf.
Cates’s mother, Fifth District appellate judge Judy Cates, gave $250 each to Kolker, O’Gara, and Rudolf.
Cates himself gave $1,000 to Democratic Fifth District candidate Garrett Hoerner, who lost the race but gained appointment as associate judge.
Cronin gave Hoerner $500.