there everybody an opportunity to get the counsel table good morning honors you may begin may please the court a debtor discharged in bankruptcy has a right to be free from creditors efforts designed to coerce pressure or otherwise attempt to collect discharge my name is david feynman along with my associate joseph tempe oh have counsel table represent miss arlene ross in appeal of the nile for motion for sanctions against nation star mortgage for violations of her bankruptcy discharge by attempting to course her to pay a discharge debt is miss ross position of the bankruptcy court erred in denying her motion without first requiring an evidentiary evidence or any type of it evidence you're hearing to the contrary of her search and in the motion in the motion for sanctions affectively the bankruptcy court treated this response that was filed as a as a motion to dismiss or a motion for summary judgment if we look at the motion for sanctions a complaint of the case well the bankruptcy judge looked at the disclaimer on the information statement the disclaimer is that this information this is just for informational purposes only i'm reading for it and it is not an attempt to collect a debt it's pretty conspicuous and unambiguous well how much weight should be given to the fact that the disclaimer is this is not an attempt to collect the debt how do we say that the bankruptcy judge erred when the information conspicuous and unambiguous thank you are and to not completely disagree with you i i would argue that it is in fact ambiguous language i would in fact argue that it was likely intentionally ambiguous by nation motion there was no if we look at ninety four ninety at least ninety fourteen of the bankruptcy rules they treat these motions of bankruptcy court as contested matters which then follow the rules it's our position that we have assertions against the one party representations of counsel not not sworn not verified no affidavits in their response and the court makes factual findings but that's not the flies those facts that's up and he's specifically be requested that's just the way our system works she effectively just denied the motion and that was it the going back to the a discharge debt from you or as a demand for payment from any individual protected by the united states bankruptcy code that's pretty unambiguous but the paragraph continues and it begins with the first bankruptcy but she's not supposed to be getting any type of communications that would have the effect of course in her to pay a debt and let's not look at miss roth in particular let's look at any bankruptcy debtor in the world of bankruptcy they may not know whether the this is not the way the anchor see debtors think they see these bills come they see these debts come they think they have resolved and don't anticipate receiving them anymore after bankruptcy and they just keep coming this thing that seems to me to be the most persuasive fact against your position is the fact that this disclaimer is so close to that fashion by the persons against deceptive practices in this kind of area and they suggest almost this exact thing recognizing that a mole gauge holder has a right to  send notices to the data even a discharge data is long as it's not deceptive with respect to the collection of the de against the data as opposed to the property in other words the most g is entitled to remind the person that if he wants to keep this property in this case she can resume the payments and retain the property understood your honor and i me address both of us actually two points that i want to address in my argument here the first is again going back to the ambiguity position that i was addressing with honorable wilson with respect to what you stated as well you believe that it's very close to the language of the c s a call that for purposes of speed but again this paragraph by nation star begins the next sentence in that with if this account is active it's not telling that there that your account is not definitive it's not unequivocal  nation star reserves the right to exercise its legal rights as a debtor as a bankruptcy debtor council the or what what legal rights are they referring to what's going on in the debtor's minds they don't know what that means including but not limited to foreclosure including the rightful clothes including maine's other rights for other it's actually the same thing but it's not and the devil is always in the details it does not say but limited to what it says and this is this is the see if he sample our records show that either you are a debtor in bankruptcy or discharge your personal liability for mortgage for your mortgage loan in bankruptcy unequivocal this exist in fact reference that this is we have similar language in our in our in our just going but it's not similar nations are tries to make it more confusing and leave it open in case you're not discharged we're not going to we're not going to put our foot down and say that we're taking a position on your loan we're just going to say if your loan has been discharged relieve us of the debt the person is supposed to be protected by the discharge to figure all this out so the presence of what you're reading through now what you're arguing is is ambiguous it's not as definitive as the c f p be is going to undercut the fact that this is labeled an informational statement that that it has that it does have disclaimer language that it has a voluntary payment coupon so so for you even though these are pretty clearly labeled informational statement because there is a box under there that does not comply exactly with the c p and you pull this thing up what does it look like it looks like a bill it quacks like a bill it talks like a bill but you still have dispute that nation star could have sent some communication to your client alerting her that she could in fact get this property back if she voluntarily resumed these payments correct so it's not you're not disputing any communication correct what i would venture to say is that nations are any creditor can send correspondence that would inform a debtor about something that they needed to have information about but they can't design in a way that would co payment or make an otherwise voluntary pain which the debtors can voluntarily repay that that's under five twenty four f that's any debts not just mortgages i mean if we were here today on a credit card debt and these informational statements were coming i don't think we'd be at this court i think the banks the judge would have just scoured the credit card company but why are we treating mortgage companies different now they're going to say that you're right that the c p p regs allowed them to do this but they really don't see if he  says if the property was surrendered in bankruptcy is not exempt from from these from these regulation doesn't need to comply if the prop if they were questioned writing they don't need to send that yet nations are what's to call what happens on these phone calls do you pressure the better more on the phone i don't know we had an opportunity for evidence to find that out so i think nations start with respect to going outside of clear language direct language bankruptcy proceedings itself she said she was going to surrender that was in the plan one quit claim date executed as part of the crapsey proceeding and even more so know what i can say is that there is case law that says you cannot force a secured creditors to take back the property the debtors basically just have to walk away and i hope it gets done and the problems can arise from that which we don't need to get things why didn't you say in that first it least when we're in the first sanctions game a look we don't have any interest in this property in a mo his a quit claim deed we did your honor and we got an agreement they would no longer involved in negotiations so i can't say i know there was not one that was given whether that was discussed i can't say but my time is up that's that's a question i don't have an answer to so i apologize  discretion in concluding that nation star's nov eighteenth two thousand and fifteen mortgage loan statement was not going to tempt to collect the debt did not violate the discharge injunction of five twenty test there was a third factor there's a third factor that the first circuit applies and it's and that's whether or not the communication was cool worse or are while the test in the eleventh circuit is a factual level you take those two first two elements where you want knowledge of the discharge injunction we don't notice of it and did you intend the act that violated the injunction those were factual determinations neither of which was disputed those were conced an objective test to pressure a payment and the court applied that standard looking at this case look at the disclaimers look at lower court decisions in hellman the court did not at that time have the benefit of this court subsequent decision and help and made the determination that objectively this was not an attempt to pressure a payment given to the clear and prominent disclaimers that were contained in this mortgage loan statement which were analogous to the ones that this court bless the images you know that's a disc let's discretionary with the bankruptcy court the bankruptcy court can abuse its discretion if it's coercive attempt to collect the crime the bankruptcy court can abuse its discretion but that's a pretty high has laid out that standard previously in amman and in other cases where the abuse of discretion standard recognizes that there's a range of possible outcomes here on the spectrum of statements with disclaimers in the varying decisions have been reached by courts this statement and this disclaimer are among the most prominent that this court could possibly look at what it would if the what if the statement the information communication says you can make voluntary payments in fact it even has it indicates an amount due and that is something that existed in the hellmann case that this court decided it had an amount due and payment instructions right in the face that the bottom line here is that and they argue why are mortgage loans different mortgage loans are different because you have a lien that survives the discharge and because of that mean there are a series of communications that are necessarily going to occur for example mortgage paragraph twenty two requires a default letter go out in order to prosecute a foreclosure which the servicer retains the right to do post discharge that letter has to include demands for payment amount due dates post discharge you must send a notice with five different elements the amount due to cure the default a date by which you must pay at the consequence of your failure to pay all of the things that appear to be done in letter you cannot go into default into florida for bankruptcy is there a number is there a limit on the number of those statements that you consume there's no there's no expressed limit the i mean were sent to the debtor in this case for the purposes of this motion a single statement there were no other ever statements sent to the debtor post bankruptcy there were a couple of statements that were the basis of a prior claim that the record reflect was settled with no admission of liability and released this motion before this judge was predicated on the sending of a single nov eighteenth two thousand and fifteen statement that had about the most prominent disclaimers you could possibly include in these things that disclaimer first of all that informational only at the top  bold printed language is the very first paragraph of that statement and it says not only is it informational it says pacifically this is not a demand for payment this is not an attempt to collect a debt if you perceive a discharge in bankruptcy and this court said quite clearly in helmand that even the list at least sophisticated consumer and that's not the standard here but even the least sophisticated consumer is charged with certain basic knowledge and that knowledge tell me again why you have to have the amount d why do you have to have the amount due because that's information that could be relevant to a debtor that's information that even the c f p b says should go to a debtor including debtors who are not the bankruptcy so that you want to make payments voluntary so if the information the statement has on it this is the amount that's due yes that's not an attempt to collect the data no and it's not attempt to collect the debt because it provides quite clearly in front of it that it did not intend to collect the debt and because the c f p be so why is that on there why do you say this is how much is due why do you need that on the information because every day in this court knows it from decisions like the feel of decisions this court reached at the spite the fact that a debtor goes through bankruptcy and even in those cases where a debtor might have purported to surrender bankruptcy they emerge from bankruptcy in title to properties and very often either contest a foreclosure or reach out for property retention alternatives and the c f p b has said we think people should get information and so servicers are put into this position of walking a tightrope between having to avoid potential liability under five twenty four and the f t c p a while simultaneously having this mortgage mean that still has to be serviced and enforced and has guidelines and regulations were regulators are saying we prefer more information unless the reason that i asked the question is because that appears to be dispositive fact in the first circuit and bates the first circuit was persuaded by the fact that language in the court deemed those in the best case to not be debt collection in violation of five twenty four and this court in helmand under the a lesser standard under the f t c p a standard which compared to five twenty four in the f t c p s a it's least sophisticated consumer not just a straight objective test it's a ponder and so the evidence not a clear and convincing it doesn't tell us to see enter element like five twenty four yet so if on the information statement you got this is the amount due that's not a demand for payment not when you know it's informational not when its predecessor but it's preceded by it and this is proceed it with a clear and conspicuous and prominent informational only disclaimer that says this is not a demand for payment this is not an attempt to collect a debt we are just providing you with information regarding the amounts due on this loan if you are interested in reinstatement if you are interested in property retention in lieu of foreclosure because guess what we still have only mean you still have title and we're going to have to sue you in foreclose so here's the info we are not trying to collect this debt from you we are not demanding payment and so if including amounts is going to be deemed debt collection the can be a real problem because now you have the c a p b prescribing forms of statements to go out to people  are in active bankruptcy or who have received additional and certain circumstances the c a p the mandates of those statements still go and their statements are actually less have less disclosure that our statement in this case did those statements don't say informational in the top those statements don't have a payment coupon but they don't say it's a voluntary their disclaimer in form and substance is no different than ours if you received a discharge which this court has said even th decatur consumer would understand that they receive a discharge and know what that discharge met and it's as if you received that discharge this is not an attempt to collect your debt this is not a demand for payment it's just to provide you with information should the opportunity to do so the record reflects that this issue was fully briefed and there was a motion a response and a reply the factual allegations that were contained in the motion were not refuted or disputed in any of that briefing the fundamental key facts were not disputed at all which is that mission star was on notice of the discharge and mission star and gauged in the act that was alleged to violate five twenty four nobody disputed that all that was left at that stage was  court to apply the law and determine under the subjective test whether this statement with this disclaimer that everybody acknowledges was sent constituted an act of debt collection within the ambit of five twenty four as the way the case of the find it but the other thing is required hearing first of all the not even addition raised in their initial briefing only raised it in the reply and not an issue raised at all below but the answer to that is no local rules like to the extent that they applied the rules that would apply to a traditional adversary two of the two traditional piece of litigation have summary judgment other things in them only exist where you have disputed issues of fact where there are competing at the davids or other issues raised that are competing the fundamental facts here were never disputed and i would just note that the briefing was completed on this in february the court held a feb twenty fifth hearing in which the court announced from the bench that it would rule based on the papers the court then set that hearing three months later in a notice that said i will now make my announcement of that ruling based in the papers at the end of mad in all that time appellants never once argued wait a second we have disputed facts here we need to say they never sought discovery they never asked discovery they never filed an affidavit they never raised a single issue about a disputed fact that mandated never entered hearing and this court has has held in other cases that were evidential hearings are not necessarily required in every case you need to have disputed fact and somebody has to actually give raises the issue and requested one in which they didn't and i see my time is almost up i just want to come back to the fundamental question here which is abuse of discretion if this court act within the range of four claims were informational statements with similar disclaimers were sent and that's the bankruptcy appellate panel in the best case that's the district of new hampshire in the bates case is the northern district of bankruptcy a georgia bankruptcy court in the wendy mortgage holder has an interest but the dead on his discharge and bankruptcy yes there are that's all dictated by c f people it's regulations see it's ten twenty six point four one and those regulations recently changed in two thousand and fifteen i would say it was spectacularly unclear as to whether there was an obligation to continue to send these statements post discharge and many servicers believe that that obligation existed there was an exemption sending statements was required in the form and content of the statement as dictated by the regulations there was an exemption at that time but the exemption only extended to people who were in active bankruptcy the directives were arguably that following up this charge discharge were you need to send statements and in those instances they prescribe before and that form says put an amount in there put a payment coupon on there and put this disclaimer on there and if you do all that you will be insulated from liability under five twenty four and the f t c people should we recognize the tension between providing information and running afoul of those statues and this information these disclaimers sent in this formal insulate you was unclear whether there was a requirement to continue periodic state months when the person had gone in bankruptcy but that was a huge and then in two thousand and eighteen do i gather that there's still an obligation or not there is an obligation but they've defined the circumstances so for example i think now if you've indicated intent to surrender in your bankruptcy then post discharge those statements don't need to continue if you specifically requested good enough to insulate you from liability into the statue i got you one last question should there be a difference when we're talking about two thousand and fifteen not the two thousand and eighteen law which is a little clearer should there be a difference between a case where you have one statement and a case where there are a continuous state months over a period of a long time like some of these cases involve years after a cease and desist letter has been sent should there be a difference in those cases if the statements all have the same exact language them arguably not but i can see where a court would act within its discretion to make that determination that the continued state over many years sending of those statements and it's often accompanied by other conduct like phone calls and other things would take this to injunction that would certainly be a better argument there would be no reason once somebody was out of title to do that here and that's one distinction that was drawn for example and in one of the cases that they cite to the v in the bankruptcy the person had given up title so they had no interest at all to be in communication post discharge i don't know why whether or not the bankruptcy judge used her discretion or not we're going to have to conference on that but i'm looking at the information informational statement itself and if it's truly informational it could be better construct that that is the language of disclaimer at languages and very small print in the middle of the form and at the top it's got a mt dew and at the bottom it's got a voluntary payment coupon with another amount but you think this information of this truly for informational purposes only and i mean you can you can go but you're looking at all these facts and figures on here and it's just a very small print and you can miss it also two things number one it can always be better i'm sure that in any case you can always make it clearer and more conspicuous this disclaimer is on par with what the c f p prescribe and it's on par with what this court blast under a lower bar in the helmand case i encourage instructions and a coupon at the bottom it was the same thing it's similar to the c f p before and again it's abuse of discretion was it within the range of possible outcomes could any court reading helmond and and reading the c p be guidelines reasonably the wrong legal standard was certainly applied here if you look at the statement it clearly appears to be a statement that is a billing statement looking at the same exact billing statement judge of the middle district in the case on this very statement stated it is true that the informational statement does not expressly state that it is a communication sent for the purpose of collection collected debt but is just discussed this absence is not  positive of the statement list the total amount due contains a payment due date states a late fee will be charged for untimely payment gives six possible payment methods separates out from the total amount due all of the these and cost previously assessed that is not all the statement contains a quote important message box advising mr off that her escrow account has a negative balance expressly recommending that she make additional payments to avoid an increase your monthly escrow payment this is there is also the cash will payment coupon which they say total amount due and recalculates the amount due for a late payment mr gottlieb if he had another shot he would say yeah but were interpreted in a different statute there were interpreted in the federal debt collection practices and not the bankruptcy or understanding that those were the objective factors that are that are being looked at with what the statement is with respect to saying it's a voluntary payment coupon again that's ambiguous is a voluntary to send the payment n or the voluntary use the payment coupon because just above it says you can make a payment online at my nation star dot com there's ambiguity there as to what they mean by voluntary payment but presumably that payment coupon has changed from before she went through bankruptcy for people who have mortgage statements i don't think it says voluntary payment well we don't have any evidence to support that in the record there was no adventure in to present to me that or defend on nations or school grounds with respect to why no request for evidence or here is made and we had this previous year in which she said she was going to announce ruling and then the debtor's position was that ok going to announce ruling we assumed was going to be on a deferential motion to dismiss stand where all inferences that could be gleaned from the motion argued in light most favorable to the debtor and therefore clearly that if you're going to draw inferences they should be drawn that they're trying to collect a debt i think everybody's talking here today that it could be this could be that  a motion to dismiss when you look at a motion to dismiss all inferences are drawn in light of the nonmoving part which effectively would be the complaint that so under those standards she used the wrong standard in evaluating specifically state that you're i can say that a lot of cases that were briefed in the in the on the issue here resulted after evidentiary hearings were held and not on a summarily so merrill decision based on those prior cases but nothing that specifically holt to that effect  that's that's our position that she has used the wrong standard as it should have been done with respect to hellman decision they keep and they start keep citing that as a similar case but again the same position of the  language compared to nation stars chosen language here's the language from helmer our records indicate that in the past you receive discharge of this debt in bank in a bankruptcy case section five twenty four the bankruptcy code tells us the discharge of this debt means you have no personal obligation to repay it the discharge also protects you from any efforts by anyone to collect this discharge it as a personal liability of the debtor you cannot be pressured to repay this debt on the other hand the security agreement allows for closure if the requirements under the loan are not met that is at clear unequivocal and synod nations or chose to be very ambiguous in their statement likely to cover any possible scenario that could arise but that's not the proper method the bankruptcy is the discharge meant to protect the debtor not to make it easier or harder on nations start to try to send statements that the debtor doesn't even want they took how many more ways can this debtor tell they should start  stop and they continue to do it anyway finally with respect to the notice of default issue i don't believe that has any merit that they have to send this no should default property was surrendered this court florida courts have held that the debtor can take no action to stand in the way of a diff foreclosing plaintiff when they surrender the property in bankruptcy and in florida a condition precedent contractual condition precedent defense is a wave a ball firm of defense so bottom line is they can't they can't wait raise the firm a defense of notice of default if they surrender this property so to say they have to send this letter is again disingenuous  i thank you for your time thank you