Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 11 of 19 PagelD #:125

predominate over any questions, which affect only individual
members of the class within the meaning of Federal Rule of Civil
Procedure 23(a)(2). These common questions of law and fact
include, without limitation:

i. Whether defendant engaged in violations of laws as alleged
herein;

ii. Whether defendant by nature of its wrongful conduct is
liable for damages and losses resulting from the conduct
alleged herein; and

iii. Whether the defendant had a policy and uniform practice
with respect to harassing consumer, family members,
friends, and/or references, misleading consumers, and
charging and collecting unauthorized fees.

c. The plaintiffs’ claims are typical of the claims of the members of
the class under Federal Rule of Civil Procedure 23(a)(3). The
representative plaintiffs and all members of the class sustained
damages arising out of defendant’s common course of conduct in
violation of the law as complained herein. The losses of each
member of the class were caused directly by defendant’s wrongful

conduct in violation of law as alleged herein.

11


EXHIBIT C


Not Reported in F.Supp.2d, 2008 WL 1848142 (N.D.IIL}
(Cite as: 2008 WL 1848142 (N.D.IIL))

tions, Global Patent, as the moving party, bears the
burden of indicating “the extent to which the condi-
tions required by section (b) will be met if the cases
are found to be related.” LR 40.4(c)(2). On the
second factor, Global Patent states that duplicative
treatment of claim construction will result in unne-
cessary consumption of judicial time, effort, and
cost. In addition, it asserts that extra time and ex-
pense can be avoided by a single resolution of in-
validity and inequitable conduct defenses, Accord-
ing to Global Patent, reassignment will also likely
result in judicial efficiency in that only one round
of depositions will take place for the parties, third
party inventors, the prosecuting attorneys, and any
potential prior art witnesses or companies. These
assertions do not shed much light on how the hand-
ling of both cases by the same judge is likely to res-
ult in a substantial saving of judicial time and ef-
fort, Rather, the content of Global Patent's argu-
ment focuses on the potential for duplication in ne-
cessary work and resource expenditure by the
parties, which may have little impact on the amount
of court resources that will be required, For ex-
ample, with respect to claim construction, a de-
cision construing the claims in either case could be
applied to the case in which claims had not yet been
construed.

With regard to the fourth condition, Global Pat-
ent highlights the likely number of summary judg-
ment motions and evidence provided in support
thereof, such as graphical designs or testimony re-
lated to the background of the patented invention.
Though there is more to a consideration of the
fourth prong than Global Patent's narrow focus
would imply, a review of the pleadings in conjunc-
tion with the parties’ submissions on this motion
convinces this court that both actions involve prima
facie fundamentally similar claims and defenses
that will likely be amenable to dispositive treatment
in unified proceedings, whether in claim construc-
tion, summary judgment, or trial.

CDW argues that Global Patent provided only
conclusory statements as to how reassignment will

Page 4

result in savings of judicial time and effort, which
is true with respect to the initial filing in support of
the motion. Many of the points discussed above ap-
pear only in Global Patent's reply, and the consider-
ations Global Patent has offered bear more upon
time and cost savings to the parties than the impact
on the court. We emphatically do not endorse a
practice of filing underdeveloped motions or saving
the bulk of a party's arguments for presentation in a
reply brief. It is well settled that parties engaging in
either practice run a very real risk of forfeiting oth-
erwise meritorious arguments. However, as the re-
assignment mechanism is primarily concerned with
judicial efficiency, we will not force the parties to
engage in the same exercise in the form of a re-
newed, better presented motion. We are convinced
based on our own examination of the two cases,
combined with the information the parties have
supplied, that the cases are fundamentally similar,
and the motion to reassign case no. 07 C 4476 is
therefore granted.

1. Motion to Stay

*5 The second motion under consideration asks
us to stay the proceedings in this case, and ostens-
ibly those in the reassigned case, pending the out-
come of the reexamination proceeding for claim 17
of the '34] patent. District courts have broad discre-
tion to control their dockets using techniques such
as stays of proceedings, provided a stay is not in-
definite or otherwise excessive, Gould v. Control
Laser Corp, 105 F.2d 1340, 1341 (Fed.Cir.1983).

Global Patent contends that the PTO has
already contributed its expertise to this matter via
the first reexamination proceeding and thus there is
little to be gained from waiting for the second to
run its course. However, as Defendants point out,
claim 17 was not in the original patent but was ad-
ded by amendment during the previous reexamina-
tion, The previous reexamination thus functioned as
an original examination of that claim rather than a
reexamination of a previous stamp of approval, as
was the case with the original 16 claims. Moreover,
because the reexamination was conducted ex parte,

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 5 of 29

where the prior express consent to call was withdrawn prior to the call
being placed.

Id, at | 155.
On August 7, 2012, Lorenzie Humphreys amended his complaint to allege a
putative class action and to add Yvette Rheanes as an additional class

representative. See generally Humphreys v. Santander Consumer USA, Inc., No.

1:12-cv-04671, PI's Am. Compl. (Doc, 12) (Ex. "B" hereto) [hereinafter
"Humphreys Am. Compl."] Humphreys’ individual claims are unchanged, and
Rheanes' claims are substantially the same as Humphreys’ except that she alleges
that she was contacted regarding another's debt. See id. at §§ 16-48. Humphreys
and Rheanes allege that their claims are typical of a class consisting of

(1) All persons in the United States who are current or former
customers of [SCUSA] within the previous six years and all other
persons to whom [SCUSA] made telephone calls for the collection of
debts from its customers, and (2) all persons that were called by
[SCUSA] using an automatic telephone dialing service and/or an
artificial or prerecorded voice where the evidence shows that the
person received at last one phone call placed by the automatic
telephone dialing service and/or an artificial or prerecorded voice and
(i) where there is no evidence of prior express consent to call that
person's cellular telephone number by the automatic telephone dialing
service and/or an artificial or prerecorded voice for a time period
consistent with the statute of limitations for TCPA claims or (ii)
where the prior express consent to call was withdrawn prior to the call
being placed.

Id, at 10 (unnumbered paragraph).

On August 8, 2012, Henry Espejo was substituted as the class representative

in the Pereria action. See Espejo v. Santander Consumer USA, Inc., No. 1:11-cv-

2043096 v2 5


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 5 of 19 PagelD #:119

but Santander routinely goes back and retroactively assesses unlawful fees
pertaining to time periods long before it had anything to do with the loans, adding
those fees to the then current bill. In some cases this occurs years after the
purported event, which never in fact even occurred.

14.  Defendant’s routine business practices also include the use of
prerecorded automatic telephone dialing systems and artificial or voice systems
willfully and knowingly directed to cell phones without the express prior consent
of the person being called. The persons called without express permission using
automatic telephone dialing systems, artificial and prerecorded voice systems
include not only the debtors but the friends, family and references of the debtors.

15. | Santander’s business practices are so outrageous that it has a rare “F”
rating with the Better Business Bureau in Dallas, its headquarters’ city.

FACTUAL ALLEGATIONS AS TO PLAINTIFF HUMPHREYS

16. In 2005, Mr. Humphreys purchased a 2005 Mitsubishi Outlander (“the
vehicle”) from Webb Chevrolet in Chicago, Illinois.

17. Mr. Humphreys originally financed the vehicle through an entity other
than Santander.

18. In approximately 2010, Mr. Humphreys began receiving telephone
calls from Santander attempting to collect an alleged outstanding balance on the

vehicle note.


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 15 of 29

In doing so, it would permit those other defendants to potentially settle those later-
filed class actions and thereby undermine the earlier-filed class action. See id.
Avoiding those types of conflicting rulings is one of the primary purposes of the

first-to-file rule. See Manuel, 430 F.3d at 1135; Rudolph & Me, Ine., 2011 WL

3919711, at *1.

B. This Court Should Decline To Exercise Jurisdiction And Dismiss
The Plaintiffs' Claims,

If a district court concludes that the first-to-file rule applies, it may decline
jurisdiction and dismiss the case, transfer the case to the forum of first-filed case,
or it may stay the litigation pending the outcome in the first-filed case. See Merial
Ltd., 681 F.3d at 1299. Here, the best resolution would be dismissal. All of the
named plaintiffs and the class they seek to represent are currently represented by
the class representatives in the Espejo and Humphreys actions. Counsel for the
Bonner class is also counsel in the Humphreys action. Thus, dismissal would not
prejudice the rights of any plaintiff in this case. Further, dismissal avoids
unnecessary duplication of litigation and conserves the judicial resources of the
foram to which this would be transferred -- the Northern District of Illinois.
Moreover, staying the litigation until resolution of the Humphreys action only
postpones an inevitable dismissal. Because the claims and parties in Humphreys

are identical, resolution of the Humphreys action will probably bar this case under

2043096 v2 1S


Case 2:12-cv-02183-RDP Document 32. Filed 11/01/12 Page 13 of 29

circumstances” exception to the first-to-file rule is narrow. See Mun. Gas. Auth.,
2012 WL 1038649, at *3. When examining whether there are compelling
circumstances, courts have considered evidence of forum shopping by the plaintiff,
interests of judicial economy, convenience to the parties and witnesses, and

superiority of the second-filed forum. See, e.g., Ins. Co. of Pa. v. Centerline

Homes, Inc., No. 10-61707-Civ., 2011 WL 1595058, at *1 (S.D. Fla. Apr. 27,

2011) (concluding that the plaintiff had not shown compelling circumstances
because the second action was not filed "in apparent anticipation of another

pending proceeding"); Derma Med Tech. Corp. v. Passmore Labs, No. 10-00483-

CG-B, 2011 WL 1753196, at *7 (S.D. Ala. Apr. 21, 2011) ("The first filed action
is preferred ... 'unless consideration of judicial and litigant economy, and the just
and effective disposition of disputes requires otherwise.'") (quoting Serco Servs.

Co., L.P. v. Kelly Co., 51 F.3d 1037, 1039 (Fed. Cir. 1995))); Polyform A.G.P.

Ing, v. Airlite Plastics Co., No. 4:10-CF-43 (CDL), 2010 WL 4068603, at *7 (M.D.
Ga. Oct. 15, 2010) (concluding that the defendant had shown compelling
circumstances by showing that the second court was a superior forum based on its

"extensive familiarity ... with [the] issues"); Nat'l Union Fire Ins. Co. of

Pittsburgh, Pa. v. Beta Constr. LLC, No. 8:10-cv-1541-T-26TBM, 2010 WL

3789042, at *3 (M.D. Fla. Sept. 24, 2010) (stating that whether there are

compelling circumstances involves many factors, including "forum shopping by

2043096 ¥2 13


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 19 of 29

statement of the claim showing that the pleader is entitled to relief." Feb. R. Civ, P.
8(a)(2). The Supreme Court originally explained that the purpose of the rule was to
"give the defendant fair notice of what the plaintiff's claim is and the grounds upon
which it rests." Conley_v. Gibson, 355 U.S. 41, 47 (1957). While factual
allegations do not have to be detailed, they must contain more than "labels and
conclusions;" a "formulaic recitation of the elements of a cause will not do." Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citing Papasan v. Allain, 478
U.S. 265, 286 (1986)).

The Supreme Court has also recently stated that Fed. R. Civ. P. 8 demands
more than an unadorned, "the-defendant-unlawfully-harmed-me accusation."
Ashcroft _v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 555).
Instead, "[fJactual allegations must be enough to raise a right to relief above the
speculative level." Twombly, 550 U.S. at 555, "Facts that are merely consistent
with the Plaintiff's legal theory will not suffice when, without some further factual

enhancement, [they] stop short of the line between possibility and plausibility of

entitle[ment] to relief." Weissman _v. Nat'l Ass'n of Sec. Dealers, Inc., 500 F.3d

1293, 1310 (11th Cir. 2007) (internal quotations omitted) (quoting Twombly, 550

U.S. at 557) (quoting DM Research, Inc. v. Coll. of Am. Pathologists, 170 F. 3d

53, 56 (Ist Cir. 1999)), Should Plaintiffs fail to "nudge[] their claims across the

2043096 v2 19


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 23 of 29

at issue, which correspond to the attached documents and demonstrate that the
documents are not "challenged."

A review of the retail installment contracts of Plaintiffs Levins and Cook,
attached hereto as Exhibits C and D, each demonstrate the Contracts were
immediately assigned, at origination, to Drive Financial Services, a d/b/a for
SCUSA. Additionally, a review of the retail installment contract of Plaintiff
Williams, attached hereto as Exhibit E, demonstrates that the contract was
immediately assigned, at origination, to SCUSA. The fact that these contracts were
assigned at origination, before any payments were due on Plaintiffs' loans, is
indisputable evidence that SCUSA did not obtain Plaintiffs' accounts when they
were in default. As a result, it is clear that SCUSA is merely an assignee of the
contracts that, under the FDCPA, is permitted to stand in the shoes of the creditor.
In other words, by obtaining immediate assignment of the contracts at origination,
SCUSA is a creditor under the FDCPA and is exempt from liability under the

statute. See 15 U.S.C. § 1692a(6)(F)(iii);. see also Wadlington, 76 F.3d at 106-07

(assignee of retail installment sales contract was not a "debt collector" under the
FDCPA); Janke, 805 F. Supp. 2d at 1281-82 (dismissing FDCPA claim absent
allegation that debt was in default at time of transfer).

As Plaintiffs! Complaint and the retail installment contracts attached hereto

make clear, SCUSA was the assignee of the accounts of Plaintiffs Levins, Cook

2043096 v2 23


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 11 of 29

made in an attempt to collect a debt. See Humphreys Am. Compl. 4, 9-12, 26-32,
34, 41-43, 45-48. The Humphreys plaintiffs contend those alleged actions by
SCUSA violated the FDCPA. Further, the Humphreys action contends that
SCUSA violated Illinois contract law by allegedly charging fees not authorized by
the plaintiffs' loan contracts. See id. at J] 13, 33, 72.

This case, the last filed, involves the same FDCPA allegations as does the
Humphreys action: allegations that SCUSA engaged in unlawful harassment and
unlawful collection methods by allegedly making harassing, abusive, and
threatening calls that misled the plaintiffs as to the balance owed to SCUSA and
that allegedly failed to disclose that the calls were made in an attempt to collect a
debt. See Pls' Second Am. Compl. (Doc. 29, # 13-16, 23-26, 29-34, 38-41, 44~
49, 52-56, 59-64, 73-81, 85-91). It also involves the same breach-of-contract
allegations as does the Humphreys action: SCUSA allegedly charged fees not
authorized by the plaintiffs' loan contracts. See id. at §§ 17, 34, 49, 64, 80-81, 115-
16.

As should be clear, the three actions involve substantially overlapping
issues. All three cases involve the alleged collection activities of SCUSA. All three
cases involve the same factual dispute over whether SCUSA made calls to cellular
phones using pre-recorded messages, automatic dialers, and predictive dialers

without the consent of the person called; and, if SCUSA is determined to have

2043096 v2 11


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 15 of 19 PagelD #:129

60. Santander violated 15 U.S.C. §1692e(11) by failing to make the
required disclosures in the initial written communications from Santander.

61. Santander violated 15 U.S.C. §1692f(1) by collecting money from
plaintiffs and the class (interest, fees, charges and expenses) not expressly
authorized by the contract or permitted by law.

62. Santander failed to provide the notice required by 15 U.S.C.
§1692g(a).

63. As a proximate result of Santander’s actions, plaintiffs and the class
were caused to suffer harm.

64. Plaintiffs and the class are entitled to an award of statutory damages
or actual damages, whichever is higher, plus costs and attorneys’ fees for
Santander’s violations of the FDCPA.

Wherefore, premises considered, plaintiffs and the class demand judgment
against Santander for statutory or actual damages, whichever is higher, plus costs,
attorneys’ fees and such additional relief as the Court may deem appropriate or to
which plaintiffs and the class may be entitled.

SECOND CLAIM FOR RELIEF

VIOLATION OF THE TELEPHONE CONSUMER
PROTECTION ACT

65. Plaintiffs re-allege and incorporate the preceding paragraphs and

subsequent factual averments of this complaint as if fully set forth herein.

15


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 1 of 29 FILED

2012 Nov-01 PM 02:44
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION
ARICA BONNER, )
)
Plaintiff, } CIVIL ACTION NO.
v. )
; 2:12-cv-02183-RDP
SANTANDER CONSUMER USA, INC., UNOPPOSED
Defendant, ; AS TO TRANSFER
)

DEFENDANT'S MOTION TO DISMISS, TRANSFER, OR STAY, OR,
ALTERNATIVELY, MOTION FOR JUDGMENT ON THE PLEADINGS

COMES NOW defendant Santander Consumer USA, Inc. ("SCUSA" or
"Defendant"), by and through its undersigned counsel, specifically reserving its
right to seek arbitration of Plaintiffs' claims pursuant to 9 U.S.C. § 1 ef seq., and
pursuant to the Federal Rules of Civil Procedure 12(b)(1), 12(c), and 28 U.S.C.
§ 1404 files this motion to dismiss, or in the alternative to transfer this litigation to
the United States District Court for the Northern District of Illinois, or in the
further alternative to stay this litigation pending the outcome of Espejo _v.

Santander Consumer USA, Inc., No. 1:11-cv-8987 (N.D. Ill) and Humphreys v.

Santander Consumer USA, Inc., No. 1:12-cv-04671 (N.D. II].). In support hereof,

Defendant states as follows:

2043096 v2


Humphreys “No Consent TCPA Class”: (1) All persons in the United States who are
current or former customers of Santander within the previous six years and al! other
persons to whom Santander made telephone calls for the collection of debts from its
customers, and (2) all persons that were called by Santander using an automatic telephone
dialing service and/or an artificial or prerecorded voice where the evidence shows that the
person received at least one phone call placed by the automatic telephone dialing service
and/or an artificial or prerecorded voice and (i) where there is no evidence of prior
express consent to call that person’s cellular telephone number by the automatic
telephone dialing service and/or an artificial or prerecorded voice for a time period
consistent with the statute of limitations for TCPA claims or (ii) where the prior express
consent to call was withdrawn prior to the call being placed. (Humphreys Compl. p. 10.)

12. While the wording of the two putative class definitions is different, the persons
captured by these definitions will be the same. Accordingly, since the issues of law are the same
on both matters, and the TCPA classes in both matters are the same, the two actions are related
under Rule 40.4(a).

The Conditions For Reassignment Based On
Relatedness Are Satisfied Under Local Rule 40.4(b)

13, Once a court has found two cases to be ‘related’ under LR 40.4(a), the Court can
reassign the latter-filed case if the following criteria of Rule 40.4(b) are then met:

(68) both cases are pending in this Court;

(2) the handling of both cases by the same judge is likely to result ina
substantial saving of judicial time and effort;

(3) the earlier case has not progressed to the point where designating a later
filed case as related would be likely to delay the proceedings in the earlier
case substantially; and
(4) the cases are susceptible of disposition in a single proceeding.
14. As mentioned about, the requirements of Rule 40.4(a) have been satisfied. The
requirements for relatedness under Rule 40.4(b) are also met. As this Court has remarked, “the

reassignment mechanism is primarily concerned with judicial efficiency.” Global Patent

Holdings, LLC, 2008 WL 1848142, at *4. Examining the Rule 40.4(b) factors, when measured


Not Reported in F.Supp.2d, 2008 WL 1848142 (N.D.IIL.)
(Cite as: 2008 WL 1848142 (N.D.IL.))

ary 25, 2005, Techsearch assigned the patent to
Global Patent, its parent company. On August 8,
2007, Global Patent sued CDW Corporation and
Motorola, Inc., in Global Patent Holdings v. CDW
Corp., case No. 07 C 4476, As Techsearch had as-
serted in the complaint in this case, Global Patent
claimed CDW and Motorola infringed the '341 pat-
ent by downloading responsive data, including
compressed audio/visual and graphical data, on
their respective websites. The downloading method
utilized both an EUS and a server, with asymmetric
processing power capacities and involving com-
pression and inverse decompression techniques re-
quiring less processing power. Furthermore, the
complaint argued that these two defendants had
knowingly and intentionally induced third parties to
infringe the ‘341 patent. The case was assigned to
Judge Norgle. Thus far, CDW and Motorola have
answered the complaint and moved to stay the pro-
ceedings pending the reexamination that has also
prompted the pending motion to stay in this case.
No discovery has yet been conducted in the case
before Judge Norgle.

*2 On September 10, 2007, Techsearch moved
to reinstate the case before this court. We granted
Techsearch's motion on October 11 and permitted it
to file an amended complaint that substituted Glob-
al Patent as the plaintiff, dropped Defendants
Aharonian and Internet Entertainment, and added
six new defendants. Global Patent then moved to
reassign case no. 07 C 4476 to this court on the
ground that it is related to this case. Shortly there-
after, Defendants moved to stay the proceedings in
this case pending the outcome of the second reex-
amination procedure before the PTO.

DISCUSSION

1. Motion to Reassign

In the Northern District of Illinois, cases are as-
signed to a district judge at random. LR 40.1. This
system can lead to situations in which two or more
cases that are closely related will be assigned to dif-
ferent judges, In such an instance, LR 40.4 provides
a mechanism whereby parties can request that the

Page 2

later-filed case be reassigned to the judge who is
presiding over the lower-numbered, and thus earli-
er-filed, case. The rule promotes efficient use of ju-
dicial resources by minimizing duplication of effort
on cases that have a great deal in common. To ob-
tain reassignment of a case, 4 movant must first
show that the case to be reassigned is related to a
previously filed case and then demonstrate that re-
assignment would promote efficient use of judicial
resources. Global Patent invokes LR 40.4 in sup-
port of its request for reassignment. CDW is the
only defendant to oppose the reassignment.

As a threshold matter, CDW challenges the
premise that this case is properly considered earli-
er-numbered and thus first-filed. In the 2003 dis-
missal, we granted Techsearch leave to reinstate
this case if it prevailed in the patent reexamination.
According to CDW, Global Patent previously dis-
avowed any connection to Techsearch, and CDW
insists that only a case with Techsearch as the
plaintiff can have the benefit of the 2000 filing
date.

To support its contention that Global Patent is
a stranger to this case, CDW points to a declaratory
judgment action filed in the District of Nevada in
2007. In a declaration filed to dispute personal jur-
isdiction in Nevada, Anthony O. Brown, president
of Global Patent, stated that Global Patent had no
“current ownership or other interest in, or an affili-
ation with, TechSearch.” Contrary to CDW's posi-
tion, the declaration also states that in January
2000, Techsearch was both a subsidiary_of Global
Patent and the owner of the '341 patent.” In ad-
dition, on January 25, 2005, Techsearch LLC, at the
time still a subsidiary of Global Patent, assigned the
'34] patent to its parent Global Patent, The owner-
ship of the patent resulting from the assignment
would make Global Patent the real party in interest
for purposes of this case as it is presently postured.
Fed.R.Civ.P. 17(a), Furthermore, CDW's argument
ignores the fact that Techsearch, not Global Patent,
moved to reinstate the case on September 10, 2007.
Global Patent was substituted as the plaintiff only

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works,


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 12 of 19 PagelD #:126

d. The representative plaintiffs will fairly and adequately protect the
interests of the class as required by Federal Rule of Civil
Procedure 23(a)(4). Plaintiffs have no interests, which are adverse
to the interests of the class members. Plaintiffs were harassed,
mislead, and/or charged unauthorized fees by defendant. Plaintiffs
have retained counsel, who have substantial experience and
success in the prosecution of class action and consumer litigation.

e. Defendant’s scheme affected all class members similarly. Plaintiffs
and all members of the class were treated the same. As a result, the
issues which affect the plaintiffs and the class members in common
predominate over those which affect only the interest of any
particular class member. Thus, common questions of law and fact
greatly predominate over questions of law or fact affecting only
individual members of the class.

f. A class action is superior to other available methods for the fair
and efficient adjudication of this controversy under Federal Rule of
Civil Procedure 23(b) since individual joinder of all members of
the class is impracticable, Furthermore, as the damages suffered by
each individual member of the class may be relatively small, the

expense and burden of individual litigation would make it difficult

12


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 18 of 19 PagelD #:132

a) Following appropriate discovery, an order certifying this cause as a
nationwide class action pursuant to Federal Rule of Civil Procedure 23, with
appropriate subclasses as the Court deems appropriate, and notice as applicable to
the absent class members, and appointing plaintiffs as class representatives;

b) A declaration that Santander’s nationwide pattern and practice of
conduct as alleged herein constitutes a violation of the FDCPA, the TCPA, and
breach of contract with respect to plaintiffs and the class;

c) Statutory damages of One Thousand Dollars ($1,000.00) from
Santander for violations of the FDCPA pursuant to 15 U.S.C. § 1692k;

d) Statutory damages of One Thousand Five Hundred Dollars
($1,500.00) per call for Santander’s willful and knowing violations of the TCPA
pursuant to 47 U.S.C. § 227(b)(3) or in the alternative at least Five Hundred
Dollars ($500.00) per call;

e) Costs and reasonable attorneys’ fees from Santander for violations of
the FDCPA pursuant to 15 U.S.C. § 1692k;

f) Appropriate injunctive relief requiring Santander to stop violating the
FDCPA and the TCPA;

g) Actual and compensatory damages;

h) Interest, costs, and attorneys’ fees; and

18


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 14 of 19 PagelD #:128

53. Santander violated 15 U.S.C. §1692b(3) by repeatedly communicating
with persons other than the consumer without reasonable belief that the earlier
response was erroneous or incomplete or that such person now has complete or
correct information.

54. Santander violated 15 U.S.C. §1692c(a)(3) by contacting plaintiffs
and the class at their place of employment after Santander had reason to know the
employer prohibited the consumer from receiving such communication.

55. Santander violated 15 U.S.C. §1692c(b) by communication with third
parties other than those permitted by that paragraph except as provided in 15
U.S.C, §1692b.

56. Santander used language that was obscene, profane, or had the natural
consequence of abusing the consumer in violation of 15 U.S.C. §1692d(1).

57. Santander caused telephones to ring and engaged persons in telephone
conversations repeatedly or continuously with intent to annoy, abuse, or harass in
violation of 15 U.S.C, §1692d(5).

58. Santander violated 15 U.S.C. §1692d(6) by placing telephone calls
without meaningful disclosure of the callers’ identity.

59. Santander violated 15 U.S.C. §1692e(2) by falsely representing the

amount of debt.

14


Not Reported in F.Supp.2d, 2008 WL 1848142 (N.DJIL.)
(Cite as: 2008 WL 1848142 (N.D.IIL))

after the case had been reinstated by the originally
filing plaintiff. Thus, this case is the earlier filed,
and if the requirements of LR 40.4 are satisfied, the
case before Judge Norgle should be reassigned to
this court.

FN1. Declaration of Anthony O, Brown,
Doc. 15, Ex. A, Zappos.com, Inc., v. Glob-
al Patent Holdings, L.L.C., case no.
2:07-cv-01726-RCJ-GWF (D.Nev.).

A. Factors Pertaining to Relatedness

*3 To be deemed related, two cases must satis-
fy at least one of the four criteria laid out in Rule
40.4(a)}: the cases share some issues of fact or law;
they involve the same property; each grows out of
the same transaction or occurrence; or they involve
one or more of the same classes if the motion is
made in the context of multiple class action suits.
Here, Global Patent contends that the first two cri-
teria are present.

To counter Global! Patent's position that the two
cases satisfy the first criterion, CDW emphasizes
differences between the various defendants, such as
the nature of their respective businesses. However,
two cases need not be absolutely identical to be re-
lated for purposes of LR 40.4. Fairbanks Capital
Corp. v. Jenkins, 2002 WL 31655277, *2 (N.DAML
Nov.25, 2002). If some of the same issues of fact or
law are common, that can be sufficient to establish
relatedness. Here, Global Patent's two complaints
share a factual foundation in the form of the asser-
tions that the various Defendants’ websites down-
loaded or induced others to download responsive
data, including JPEG images and other compressed
audio/video and graphical data. Furthermore,
CDW's answer and asserted affirmative defenses
are almost indistinguishable from those of the
Green Bay Packers, who are already a defendant in
the case before us. Consequently, we conclude that
this case and case no. 07 C 4476 are related within
the meaning of LR 40.4(a).

Global Patent also contends that the cases satis-
fy the second criterion in that they both involve the

Page 3

same property. CDW hotly contests the argument
that the word “property” as used in this portion of
the rule necessarily applies to intellectual property
with the same force that it would to tangible items.
Cases in this district have found that a claim that
infringement cases are not necessarily related
simply because the same patent is alleged to have
been infringed in both cases. See, e.g., Magnavox
Co. v. Electronics, Inc, 31 F.Supp.2d 620, 623
(N.D.11. 1998); Androphy v. Smith & Nephew, Inc.,
31 F.Supp. 29, 34 (N.D.HEL1980). However, our
conclusion as to the similarity of facts and law
within the two cases distinguishes this case from
those upon which CDW relies to contend that the
assertion of common property is not enough in this
case,

Accordingly, we turn our attention to the four
factors contained in LR 40.4(b).

B. Factors Pertaining to Judicial Efficiency

Even if two cases are found to be related, the
moving party must also meet each of four criteria
specified in LR 40.4(b) before a case will be reas-
signed, First, both cases must be pending in this
district. Second, a substantial savings of judicial
time and effort must be likely to result from the re-
assignment of the cases to a single judge. Third, the
earlier-filed case must be at a point where designat-
ing a later-filed case would not be likely to substan-
tially delay the proceedings in the earlier case. Fi-
nally, the cases must be susceptible to disposition
in a single proceeding.

*4 We need look no further than to the respect-
ive dockets to conclude that the first and third con-
ditions of LR 40.4(b) are satisfied. Both cases are
pending in the Northern District of Illinois. Further-
more, thanks to the 2003 dismissal, this case has
not progressed to the point where treating the two
cases as related would be likely to substantially
delay the proceedings; no discovery has been con-
ducted and little judicial effort has been expended
thus far.

With respect to the second and fourth condi-

© 2012 Thomson Reuters. No Claim to Orig. US Goy. Works.


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 9 of 19 PagelD #:123

41. Santander was calling Ms. Rheames’ telephone number for the
purpose of collecting an alleged debt owed by another person to a lender other than
Santander,

42, Santander intended to contact Ms. Rheames regarding another
person’s alleged debt.

43, Prior to receiving calls from Santander, Ms, Rheames had no contact
or communications with Santander, and did not authorize Santander to contact her.

44, Ms. Rheames did not authorize the automated placement of calls to
her cellular telephone.

45. Santander’s agents have repeatedly threatened Ms. Rheames in an
attempt to collect upon the alleged debt.

46. Santander’s agents have attempted to belittle, abuse, and oppress Ms.
Rheames in their attempts to collect upon the alleged debt.

47. Santander’s agents have left numerous messages on Ms. Rheames’
cellular voicemail service failing to disclose that the purpose of their
communications was an attempt to collect upon the alleged debt and using
automated or predictive dialers.

48. In short, Ms. Rheames has been harassed, misled, deceived, coerced,

and threatened in violation of the FDCPA and the TCPA.


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 21 of 29

must allege, among other things, (1) that the defendant is a 'debt collector’ and (2)
that the challenged conduct is related to debt collection."). The FDCPA defines a
"debt collector" as

(6) ... any person who uses any instrumentality of interstate
commerce or the mails in any business the principal purpose of which
is the collection of any debts, or who regularly collects or attempts to
collect, directly or indirectly, debts owed or due or asserted to be
owed or due another.... The term does not include --

(F) any person collecting or attempting to collect any debt owed or
due or asserted to be owed or due another to the extent such activity
... (iii) concerns a debt which was not in default at the time it was

obtained by such person.
15 U.S.C. § 1692a(6) and § 1692a(6)(F) (emphasis added). In other words, one of

the requirements under the FDCPA for a creditor to be a "debt collector" is the
debt sought to be collected was in default when it was acquired by the creditor. See

Wadlington v. Credit Acceptance Corp., 76 F.3d 103, 106-07 (6th Cir. 1996)

(finding assignee of retail installment sales contract that was not in default at time

of assignment is not a "debt collector" under the FDCPA); see also Janke v. Wells

Fargo & Co., 805 F. Supp. 2d 1278, 1281 (M.D. Ala. 2011) (stating that the term
“debt collector does not include the consumer's creditors, a mortgage servicing
company, or an assignee of a debt, as long as the debt was not in default at the time
it was assigned") (quoting Perry v. Stewart Title Co., 756 F.2d 1197, 1208 (Sth

Cir, 1985).

2043096 v2 21


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 1 of 19 PagelD #:115

‘IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

JURY TRIAL DEMANDED
SANTANDER CONSUMER USA, INC.,

LORENZIE HUMPHREYS, and )
YVETTE RHEAMES, on behalf of )
themselves and all others similarly )
situated, )
) CIVIL ACTION NO.:
Plaintiffs, ) 1:12-cv-04671
)
v. )
)
)
)
)

Defendant.

AMENDED NATIONWIDE CLASS ACTION COMPLAINT

This is a nationwide class action complaint pursuant to Rule 23 of the
Federal Rules of Civil Procedure against defendant Santander Consumer USA, Inc.
(“Santander” or “defendant”). Lorenzie Humphreys (“Humphreys”) Yvette
Rheames (“Rheames”), on behalf of themselves and all others similarly situated
(collectively with Humphreys and Rheames, “plaintiffs”), seek redress for
violations of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq.
(“FDCPA”), the Telephone Consumer Protection Act, 47 U.S.C. § 227 ef seq.

(“TCPA”), and breach of contract as set forth herein.


Page 4
Not Reported in F.Supp,2d, 2002 WL 31655277 (N.D.IIL.)
(Cite as: 2002 WL 31655277 (N.D.1IL))

Not Reported in F.Supp.2d, 2002 WL 31655277
(NDI)

END OF DOCUMENT

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works,


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 28 of 29

Court for the Northern District of Illinois. In the further alternative, the Defendant
respectfully requests the Court to enter an Order staying this litigation pending the

outcome of Espejo v. Santander Consumer USA, Inc., No. 1-11-cv-08987 (N.D.

Ill) and Humphreys v. Santander Consumer USA, Inc., No. 1:12-cv-04671 (N.D.

Ill). In the event this Court refuses to dismiss, transfer or stay this case, Defendant
respectfully requests that this Court dismiss Plaintiffs' FDCPA and breach of

contract claims.

s/ Robert H. Rutherford

John R. Chiles (CHI006)
Robert H. Rutherford (RUT002)
R. Frank Springfield (SPR024)
Daniel B. Snyder (SNY010)

Attorneys for Defendant
Santander Consumer USA, Inc.

OF COUNSEL:

BURR & FORMAN LLP

420 North 20th Street, Suite 3400
Birmingham, AL 35203
Telephone: (205) 251-3000
Facsimile: (204) 458-5100
jchiles@burr.com
rrutherf@burr.com
fspringf@burr.com
dsnyder@burr.com

2043096 v2 28


EXHIBIT D


Case 2:12-cv-02183-RDP Document 33 Filed 11/05/12 Page 1 of 1 FILED

2012 Nov-05 AM 09:46
U.S, DISTRICT COURT
ND. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

ARICA BONNER, et al., }
}
Plaintiffs, }
}

ve } Case No.: 2:12-CV-2183-RDP
}
SANTANDER CONSUMER USA, }
INC.,, }
}
Defendant. }

ORDER TRANSFERRING CASE

Before the court is Defendant’s Motion to Dismiss, Transfer, or Stay, or Alternatively,
Motion for Judgment on the Pleadings (Doc. #32), filed on November 1, 2012.

Plaintiffs have advised the court that they consent to a transfer of this case to the Northern
District of Illinois, where two other cases involving similar claims and putative classes are pending
against Defendant. Defendant has advised the court that once the case is transferred, it will seek to
consolidate this case with one or both of the actions in the Northern District of Ilinois.

The court has reviewed Defendant’s motion, together with Plaintiffs’ consent to the transfer,
and concludes that the motion is well-taken and should be GRANTED. The court hereby
TRANSFERS this action to the United States District Court for the Northern District of Illinois.

DONE and ORDERED this 5th day of November, 201

P©7

R. DAVID PROCTOR
UNITED STATES DISTRICT JUDGE



Westlaw.

Not Reported in F.Supp.2d, 2002 WL 31655277 (N.D.fL.)
{Cite as: 2002 WL 31655277 (N.D.IL))

Pp

Only the Westlaw citation is currently available.

United States District Court,
N.D, Illinois, Eastern Division.
FAIRBANKS CAPITAL CORP., Plaintiff,
v.
Johnny JENKINS and Annie J. Wesson-Jenkins,
Defendants.
Johnny JENKINS and Annie J. Wesson-Jenkins,
Counterclaimants,
v
FAIRBANKS CAPITAL CORP. and Nationscredit
Financial Services Corp., d/b/a EquiCredit Corpora-
tion of Hlinois, Counterdefendants.

No. 02 C 3930.
Nov, 25, 2002.

MEMORANDUM OPINION AND ORDER
KENNELLY, J.

*1 Fairbanks Capital Corp., the assignee of a
mortgage of real estate given to secure payment of
a promissory note, sued the mortgagors, Johnny
Jenkins and Annie Wesson-Jenkins, seeking to
foreclose on the mortgage. ‘The case was filed in
this Court based on diversity of citizenship. In their
answer, the defendants asserted as an affirmative
defense that they were entitled under the Truth in
Lending Act to rescind the transaction and were ex-
ercising that right. They also counterclaimed
against Fairbanks and Nationscredit Financial Ser-
vices Corp. (which does business as EquiCredit
Corp. of Illinois), the original mortgagee, for dam-
ages under the TILA. The Court previously denied
Fairbanks’ motion to strike the affirmative defense
and dismiss the counterclaim, Fairbanks Capital
Corp. vy. Jenkins, 225 P.Supp.2d 910, 2002 WL
31260011 (N.D-HL Oct. 9, 2002).

The defendants have now moved this Court
pursuant to Northern District of (Minois Local Rule
40.4(c} to find that three later-filed cases pending
before other judges of the Court are related to this

Page |

one and for that reason to request reassignment of
those cases to this Court's docket. Fairbanks and
EquiCredit have objected to the motion. For the
reasons stated below, the Court grants defendants’
motion.

The defendants’ TILA claim involves
EquiCredit’s alleged violation of TILA provisions
requiring that they be given notice of their right to
rescind the transaction within three business days.
See 15 U.S.C. § 1635; 12 C.P.R. § 226.23. Defend-
ants contend that a document they were asked to
sign at closing purportedly “confirming” that they
were not rescinding was invalid because it improp-
erly negated their right to rescind. This TILA viola-
tion, defendants contend, had the effect of giving
them an extended three-year period in which to res-
cind, see 1S USC. § 1635(); 12 CPR. §
226.23(a), which they contend can be asserted
against an assignee like Fairbanks, See 15 U.S.C. §
1641(c}). As noted earlier, they seek rescission of
the transaction as well as damages and attorney's
fees.

MecWethy v. Nationscredit Financial Services
Corp., Case No. 02 C 7262, pending before Judge
Robert Gettleman, is a putative class action brought
on behalf of eight named plaintiffs (two individual
mortgagors and three groups of dual mortgagor)
who are parties to mortgage loans made by
EquiCredit and assigned to Fairbanks. The defend-
ants are Nationscredit d/b/a EquiCredit Corp. of
IHinois, EquiCredit Corp. of Missouri; EquiCredit
Corp. of America; and Fairbanks. The plaintiffs’
complaint asserts claims under TILA and the
Illinois Fraud Act arising from
EquiCredit's alleged practice of requiring borrowers
to sign confirmation forms effectively giving up
their right to rescind.

Consumer

Brown v. Nationscredit Financial Services
Corp., Case No. 02 C 5023, pending before Judge
William Hibbler, is a putative class action brought
by a single plaintiff against Nationscredit d/b/a

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.


single judge, rather than have an expensive and time-consuming judicial matter repeated before
another judge.'

18. Third, given that plaintiff Humphreys’ claims will now be arbitrated, only
plaintiff Rheames remains in the Related Action. Significantly, plaintiff Rheames’ claims under
the TCPA are virtually identical to those asserted by Espejo in the instant matter. (Compare,
Humphreys Compl., {{ 34-48; with Espejo Compl., {§ 14-18.) Given the very limited nature of
the legal and factual issues presented, neither case presents a discovery-heavy matter. Thus, the
consolidation of the Humphreys case would not likely cause substantial delay to either matter to
reach final disposition. Santander has already produced written discovery to plaintiffs in the
instant action, and that same discovery would be equally available to counsel in the Related
Action. And, as to depositions, counsel for both actions would be equally entitled to participate
in such depositions so that no undue prejudice would result from having not had the opportunity
to examine any deposed witnesses.

19, Finally, the key issue of Rule 23 certification of the TCPA classes — which are
virtually identical in both matters — is susceptible of disposition in a single proceeding on
account of the substantial overlap of the legal and factual issues under that claim. The issues of

fact and law are virtually identical with one another between the instant and Related Actions in

' Another related matter, Arka Bonner vy. Santander Consumer USA, Inc., Case Number 2:12-cv-02183-
RDP, was recently filed in the United States District Court for the Northern District of Alabama. On
October 30, 2012 Santander moved, inter alia, to transfer the Borner Alabama case to the Northern
District of Hlinois because Bonner involves substantially similar and overlapping issues of law and fact
when compared to this action, and is almost identical to the Related Action. See Ex. C, Santander’s
“Motion to Dismiss, Transfer, or Stay, or Alternatively, Motion for Judgment on the Pleadings” in Bonner
vy. Santander, On November 1, 2012, the plaintiff in the Bonner case consented to the transfer to the
Northern District of Illinois. On November 5, 2012, the District Court For The Northern District of
Alabama entered an Order granting Santander’s Motion, transferring Bonner to the Northern District of
Illinois. See Ex. D, As referenced in that Order, Santander intends to seek consolidation and reassignment
of the Bonner case with the currently pending actions in this District that are now the subject of the
present LR 40.4 Motion. (U/d.) Like in Humphreys, the plaintiff in the Bonner action has agreed to dismiss
the FDCPA and contract claims, and the only remaining claims are under the TCPA.

-7-


against the circumstances presented, demonstrates that reassignment for relatedness will further
the goal of judicial efficiency.

15. First, itis undisputed that this case and the Related Action are both pending in the
Northern District of Illinois, Eastern Division.

16. Second, handling these cases together before a single judge will save substantial
judicial resources. Nationwide class certification issues under the TCPA (which inevitably will
be one of the key contested matters in both cases) will only have to be briefed and decided once,
instead of twice, by two judges in this District, if these matters were to proceed along parallel
routes. Similarly, only one court will have to decide the issue of whether Santander’s telephone
system used to call the plaintiffs in both matters constitutes an “auto dialer” as defined by the
TCPA. Having only a single judge decide these critical issues is a highly significant factor in the
reassignment calculus. See Fairbanks Capital Corp, 2002 WL 31655277, at *2 (“Reassignment
of all of the cases to this Court’s calendar will permit these issues to be briefed and determined
once; rather than four separate times, which will result in a substantial saving of judicial time and
effort....”).

17. Equally significant from a judicial efficiency standpoint is that the parties in the
instant and Related Actions are in the process of attempting to both agree and promptly schedule
a mediation in an effort to try to resolve these matters on a global basis. Such a potential
resolution militates in favor of consolidating the matters together before a single judge in the
event the parties reach a settlement of the class actions, which settlement would then be subject
to judicial approval. It would be more efficient and save judicial resources to have that judicial

approval process pursuant to Fed.R.Civ. Pro, 23(e) encompass a single proceeding, before a


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 10 of 19 PagelD #:124

CLASS ACTION ALLEGATIONS

Plaintiffs seek to represent a nationwide class pursuant to Rule 23 of the Federal
Rules of Civil Procedure. The class which plaintiffs seek to represent is composed
of and defined as:

(1) All persons in the United States who are current or former
customers of Santander within the previous six years and all other
persons to whom Santander made telephone calls for the collection of
debts from its customers, and (2) all persons that were called by
Santander using an automatic telephone dialing service and/or an
artificial or prerecorded voice where the evidence shows that the
person received at least one phone call placed by the automatic
telephone dialing service and/or an artificial or prerecorded voice and
(i) where there is no evidence of prior express consent to call that
person’s cellular telephone number by the automatic telephone dialing
service and/or an artificial or prerecorded voice for a time period
consistent with the statute of limitations for TCPA claims or (ii)
where the prior express consent to call was withdrawn prior to the call
being placed.

49, This action has been brought and may properly be maintained as a
class action pursuant to the provisions of Rule 23(a)(1)-(4) and Rule 23(b) of the
Federal Rules of Civil Procedure, and satisfies the numerosity, commonality,
typicality, adequacy, predominance and superiority requirements thereof because:

a. The plaintiff class is so numerous that the individual joinder of all
members is impracticable under the standard of Federal Rule of
Civil Procedure 23(a)(1).

b. Common questions of law and fact exist as to all members of the

class, as required by Federal Rule of Civil Procedure 23(a)(2), and

10


EXHIBIT A


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 16 of 19 PagelD #:130

66. Santander violated the TCPA by the calls made to plaintiffs and the
class. The violations include the use of automatic telephone dialing systems and
artificial and prerecorded voice messages directed to cell numbers without
plaintiffs’ and the class’s express permission.

67. Santander’s actions were done willfully or knowingly.

68. Plaintiffs and the class are entitled to an award of statutory damages
for Santander’s violations of the TCPA.

69. Each call is a separate violation and entitles plaintiffs and the class to
statutory damages against Santander in the amount of at least Five Hundred
Dollars ($500.00) per call. Because the violations by Santander were committed
willfully and knowingly, plaintiffs and the class request that a statutory damage of
One Thousand Five Hundred Dollars ($1,500.00) per call be assessed pursuant to
47 U.S.C, § 227(b)(3).

Wherefore, premises considered, plaintiff demands judgment against
Santander for statutory or actual damages, whichever is higher, plus costs and such
additional relief as the Court may deem appropriate or to which plaintiff and the

class may be entitled.

16


IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

HENRY ESPEJO, individually and on behalf of
all others similarly situated,

Plaintiff,
Case No.: 1:11-cv-08987
ve

Honorable Charles P. Kocoras
SANTANDER CONSUMER USA, INC., an
Illinois corporation,

Defendant.

DEFENDANT’S MOTION FOR REASSIGNMENT OF CASE
BASED UPON RELATEDNESS PURSUANT TO LOCAL RULE 40.4

Defendant Santander Consumer, USA, Inc. hereby moves for an order finding that the
subsequently filed putative nationwide class action — Lorenzie Humphreys and Yvette Rheames,
on behalf of themselves and ail others similarly situated vs. Santander Consumer, USA, Inc.,
No. 1: 12-cv-04671 pending in the Northern District of Illinois, Eastern Division (the “Related
Action” or the “Humphreys case”) — is related to the instant putative nationwide class action
matter within the meaning of Local Rule 40.4, Santander respectfully requests that this Court:
(i) find the Related Action satisfies Local Rule 40.4, and (ii) forward that finding and this
Request to the Executive Committee to reassign the Related Action to this Court for all further
proceedings.

Pertinent Background Of Both Matters

1. On December 19, 2011, the original Plaintiff, Tercia Pereira, filed a nationwide
putative class action against Santander alleging that Santander had violated the Telephone

Consumer Protection Act (“TCPA”) 47 U.S. C. § 227(b)(1), by using automative dialing

US_ACTIVE-111085602.1


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 7 of 29

involving substantially similar parties and issues. See Merial Ltd. v. Cipla Ltd.

681 F.3d 1283, 1299 (11th Cir. 2012). The rule permits the district court to either

transfer, stay, or dismiss the action. See id.; see_also Mann Mfg., Inc. v. Hortex.

Inc., 439 F.2d 403, 408 (Sth Cir. 1971)' (concluding the appropriate course was
either to decline jurisdiction and dismiss or to transfer the case to the first-filed

forum); In re Checking Account Overdraft Litig., 859 F. Supp. 2d 1313, 1325

(S.D. Fla. 2012) (concluding the appropriate course was to transfer to the first-filed

forum); Mun. Gas. Auth. of Ga. v. Town of Smyrna, Tenn., No. 1:11-cv-2476-

JEC, 2012 WL 1038649, at *4 (N.D. Ga. Mar, 27, 2012) (staying litigation
pending the outcome of the first-filed case). Absent compelling circumstances, the
party that filed first should be able to proceed without fearing a conflicting order in

a later-filed action. See Manuel v. Convergys Corp., 430 F.3d 1132, 1135 (11th

Cir. 2005) ("Where two actions involving overlapping issues and parties are
pending in two federal courts, there is a strong presumption across the federal
circuits that favors the forum of the first-filed under the first-filed rule."). The
purpose of the rule is to "conserve judicial resources and avoid conflicting rulings.”

Rudolph & Me, Inc. v. Ornament Cent.. LLC., No. 9:11-cv-670-T-33EAJ, 2011

WL 3919711, at *1 (M.D. Fla. Sept. 7, 2011).

' Under Bonner vy. City of Prichard, 661 F.2d 1206, 1209 (Lith Cir. 1981)
(en banc), decisions of the former Fifth Circuit decided before October 1, 1981 are
binding precedent in the Eleventh Circuit.

2043096 v2 7


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 3 of 19 PagelD #:117

supplemental jurisdiction exists pursuant to 28 U.S.C. §1367. This Court,
additionally, should exercise supplemental jurisdiction over plaintiffs’ state law
claims in order to avoid an unnecessary duplication of judicial resources.

5. Venue is proper under 28 U.S.C, §1391, since a substantial part of the
events giving rise to the claims occurred within this judicial district and division
and since the defendant is subject to the personal and general jurisdiction of this
Court.

6. Defendant’s wrongful activities were directed to this jurisdiction.
Plaintiffs’ rights were damaged or impaired in this jurisdiction, and significant
damages and losses were suffered in this jurisdiction.

7. Santander regularly, continuously, and systematically conducts
business in the state of Illinois and is an Illinois corporation.

NATURE OF THE CASE

8. Santander is one of the largest subprime automobile servicing
companies in the world. As of 2010, its debt collection portfolio was
approximately $15 billion. Although the debts it collects are in fact owned by
others, Santander collects the debts in its own name without disclosing that it is not
the owner of the debt. Therefore, it functions as an undisclosed agent for the true

owner.


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 2 of 19 PagelD #:116

PARTIES

1. Plaintiff Lorenzie Humphreys is an adult resident citizen of Cook
County, Illinois. Mr. Humphreys currently resides in the City of Chicago in Cook
County, [Llinois.

2. Plaintiff Yvette Rheames is an adult resident citizen of Cook County,
Illinois. Ms. Rheames currently resides in the City of Chicago in Cook County,
Illinois.

3. Santander is an Illinois corporation with its principal office located in
Dallas, Texas. Santander has conducted business in Cook County in Illinois during
the time period pertinent to the allegations in this complaint. Santander is a “debt
collector” as that term is defined by 15 U.S.C. § 1692a(6).

JURISDICTION AND VENUE

4, This class action is based on the FDCPA, the TCPA, and breach of
contract, Plaintiffs’ complaint asserts numerous state and federal claims against
defendant. Plaintiffs’ state law claims are related to the same collection activity
that forms the basis for plaintiffs’ FDCPA and TCPA claims. It is therefore evident
that plaintiffs’ state law claims in this case are so related to claims in the action
within this Court’s original jurisdiction that they form part of the same case or
controversy and, thus, fall squarely within this Court’s supplemental jurisdiction.

Accordingly, federal question jurisdiction exists pursuant to 28 U.S.C. §1331, and


Case 2:12-cv-02183-RDP Document 32. Filed 11/01/12 Page 20 of 29

line from conceivable to plausible, their complaint must be dismissed." Twombly,
550 USS. at 570.

2. SCUSA Cannot Be Considered To Be A "Debt Collector."

As the allegations in Plaintiffs' Complaint make clear -- as well as the
contracts that are specifically referenced in Plaintiffs' Complaint -- SCUSA did not
obtain the accounts of named Plaintiffs Levins, Cook, or Williams while they were
in default and, thus, their claims under the Fair Debt Collection Practices Act
("FDCPA") fail as SCUSA is not a "debt collector" subject to liability under the
Act. As shown below, the retail installment contracts at issue are indisputable
evidence that Plaintiffs cannot assert claims against SCUSA for a violation of the
FDCPA.

The FDCPA applies where there is evidence that: (1) the plaintiff is
objecting to a collection activity arising from consumer debt; (2) the defendant
who is attempting to collect debt qualifies as a "debt collector;" and (3) the
defendant engaged in a prohibited act or failed to perform certain requirements

under the statute. See Jenkins v. BAC Home Loan Servicing, LP, 822 F. Supp. 2d

1369, 1374 (M.D. Ga. 2011) (setting forth three factors listed above); see also

Bentley _v. Bank of Am.. N.A., 773 F. Supp. 2d 1367, 1371 (S.D. Fla. 2011)

(same); see also Reese y. Ellis, Painter, Ratterree & Adams, LLP, 678 F.3d 1211,

1216 (11th Cir. 2012) ("[I]n order to state a plausible FDCPA claim ..., a plaintiff

2043096 v2. 20


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 3 of 29

seq. ("FDCPA"), and Hlinois contract law. See generally Humphreys v. Santander

Consumer USA, Inc., No. 1:12-cv-04671, Compl. (Doc. 1) [herein after

"Humphreys Compl."]. In that complaint, Humphreys alleged that SCUSA had
violated the TCPA by making unsolicited telephone calls to his cellular phone
without his consent using pre-recorded messages, automatic dialers, and predictive
dialers. See id. at §§ 15, 19-25, 31, 45-48. He also alleged that SCUSA had
violated the FDCPA by making "harassing or misleading telephone
communications," calling him at his place of employment, and failing to disclose
that communications were attempts to collect a debt. See id. at 4§ 9-12, 26-43.
Further, he alleged that SCUSA had violated Illinois contract law by charging him
unauthorized fees. Id. at 4 51.

On June 15, 2012, Arica Bonner filed a complaint in this Court, alleging that
SCUSA had violated the TCPA, the FDCPA, and Alabama contract law. See
generally PI's Compl. (Doc. 1). In that complaint, Bonner alleged that SCUSA had
violated the TCPA by making unsolicited telephone calls to her cellular phone
without her consent using pre-recorded messages, automatic dialers, and predictive
dialers. See id. at {4 13, 22-23. She also alleged that SCUSA had violated the
FDCPA by making “harassing or misleading telephone communications," calling
her at her place of employment, and failing to disclose that communications were

attempts to collect a debt. See id, at | 8-11, 18-28, 31-44. Further, she alleged

2043096 v2 3


Not Reported in F.Supp.2d, 2002 WL 31655277 (N.D.IIL,)

(Cite as: 2002 WL 31655277 (N.D.HL))

loan” companies to proceed along different tracks
before different judges, resulting in numerous and
disparate decisions, as well as multiple appeals.
Smith y Check-N-Go of Illinois, Inc., 200 F.3d S11,
513 n. (7th Cir.1999). The criticism was not en-
tirely justified, as none of the parties in any of those
cases had sought reassignment under Local Rule
40.4 or on any other basis. But the same, of course,
cannot be said here.

*3 Finally, all of the cases are reasonably sub-
ject to disposition in a single proceeding. EquiCred-
it and Fairbanks argue strenuously that the fact that
the case already pending on this Court's docket is,
unlike the other cases, a mortgage foreclosure case,
requires denial of defendants’ motion for reassign-
ment. They contend that a mortgagee is “the master
of his complaint” and is entitled to proceed with the
foreclosure without the annoyance of extraneous
matters. But even though Fairbanks is entitled to
prosecute its foreclosure claim against the Jenkins
defendants, that claim cannot be determined
without addressing the TILA issue raised as part of
defendants’ affirmative defense of rescission, Thus
the Court will be required to consider that issue in
Fairbanks v. Jenkins whether or not the other cases
are reassigned to this Court. Determination of that
same issue in four cases simultaneously is not
likely to prolong the time needed to consider it; the
same lawyers appear in all the cases, which can and
will be briefed jointly on the comimon issues. The
HOEPA issue raised in one of the Brown cases
likely can be determined at the same time and thus
likewise does not undercut the Court's ability to re-
solve all of the cases simultaneously.

Fairbanks and Nationscredit also argue that
Tinois' mortgage foreclosure laws preclude the as-
sertion of a class action as part of a counterclaim by
the mortgagor/defendant. But that is not a necessary
result of reassignment; the Jenkins defendants have
not asserted a class claim, and reassignment of
cases as related does not inexorably lead to their
consolidation for all purposes. And although Rule
40.4(b) requires a showing that the cases to be reas-

Page 3

signed be susceptible of determination in a single
proceeding with the earlier case already pending on
the judge's docket, it does not require proof that the
cases can or should be consolidated. Rather, the
Rule requires only a finding that the cases are
“susceptible” (that is, capable) of determination in a
single proceeding. The Court finds that this is so.
Determination of the common TILA / ICFA issues
raised in all four cases, whatever the outcome, will
be outcome-determinative of McWethy and both
Brown cases as well as in Fairbanks v. Jenkins
(in which the primary defense to foreclosure is the
alleged TILA violation). Moreover, as defendants
argue, the evidence regarding the manner in which
each of the borrowers allegedly was required to
sign the non-rescission confirmation is likely to be
admissible in the other cases pursuant to Federal
Rule of Evidence 404(b) to show modus operandi
and/or the absence of mistake or accident.

FN1. One of the Brown cases also involves
a HOEPA claim, but this involves the same
evidence as the TILA claim, and it likely
can and will be determined together with
that claim. The presence of the HOEPA
claim thus does not suggest that the cases
are not susceptible of being determined in
a single proceeding.

Conclusion

For the reasons stated above, the Court finds
that Case Nos, 02 C 5023, 02 C 6059, and 02 C
7262 are related to the present case within the
meaning of Local Rule 40.4(a) and that reassign-
ment of those cases to this Court's docket is appro-
priate under Local Rule 40.4(b) and therefore
grants defendants' motion and second motion to
designate those cases as related to this one [docket
items 22-1, 25-1]. The appropriate request will be
submitted to the Executive Committee. This case
(as well as the others, assuming they are reassigned
by then) is set for a status hearing on December 19,
2002 at 9:30 a.m.

N.D.TH.,2002
Fairbanks Capital Corp. v. Jenkins

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 8 of 29

L The Espejo Action And The Humphreys Action Are Earlier
Pending Cases.

"The filing of an action derives from the filing of the complaint.” Merial
Ltd., 681 F.3d at 1299. Merial makes clear that "what matters is the initiation of the
suit." Id. Thus, the Espejo action was filed on December 19, 2011, and the
Humphreys action was filed on June 14, 2012. Bonner filed this case on June 15,
2012, making it the last of the three filed cases. As a result, both the Espejo and the
Humphreys actions are earlier pending cases for the purposes of the first-to-file
tule.

2 The Three Actions Involve Overlapping Parties.

The three (3) actions clearly involve the same defendant, SCUSA. The three
actions also involve the same plaintiffs because there is substantial overlap
between the members of the putative classes. See Manuel, 430 F.3d at 1135. The
Espejo class includes everyone who received a call from SCUSA on their cellular
phone but who did not give SCUSA their cellular phone number. See Espejo
Compl. 4 19. The Humphreys class and the putative class in this case more broadly
include all persons who Santander called on a cellular phone using an automatic
dialer or a pre-recorded voice and who did not consent to receive such a call or
withdrew consent to receive such a call. See Humphreys Am. Compl. at 10
(unnumbered paragraph); Pls' Second Am. Compl. (Doc. 29, § 92). Without a
doubt, some members of the Humphreys class and the putative class in this case

2043096 v2 8


Not Reported in F.Supp.2d, 2002 WL 31655277 (N.D.IL.)
(Cite as: 2002 WL 31655277 (N.D.UIL.))

EquiCredit Corp. of Illinois; EquiCredit Corp. of
America; and Fairbanks. The plaintiff, a homeown-
er who obtained a mortgage loan from EquiCredit
(and assigned to Fairbanks) in order to finance im-
provements to his home, alleges TILA and ICFA
violations based on the practice of requiring bor-
rowers to “confirm” their non-rescission at the time
of the transaction. He also alleges that the loan was
subject to the Home Ownership and Equity Protec-
tion Act, which he says EquiCredit violated by fail-
ing to make certain HOEPA-required disclosures,

*2 Finally, Brown v. Nationseredit Financial
Services Corp., Case No. 02 C 6059, pending be-
fore Judge Charles Norgle, is brought on behalf of
two plaintiffs against Nationscredit d/b/a EquiCred-
it Corp. of Ilinois; EquiCredit Corp. of America;
and Fairbanks. The plaintiffs, who obtained a mort-
gage loan from EquiCredit which was assigned to
Fairbanks, alleges violations of TILA and ICFA
arising from the previously-mentioned practice of
requiring borrowers to “confirm” non-rescission at
the time of the transaction.

The plaintiffs in all of the cases that are subject
to this motion are represented by the same law firm.
As best we can tell, all of the Nationscredit /
EquiCredit entities in all of the cases are represen-
ted by a single law firm, and Fairbanks is likewise
represented by the same law firm in all of the cases.

Local Rule 40.4(a) states that two or more civil
cases may be related if they involve the same prop-
erty, the same issues of fact or law, arise from the
same transaction or occurrence, or, in the case of
class action suits, involve the same classes, N.D.
fll, LR 40.4(a)(1)-(4). EquiCredit and Fairbanks do
not argue that the cases are not related within the
meaning of Rule 40.4(a), and even if they had done
so, the Court would find that the criteria of Rule
40.4(a)(2) have been met, as the cases involve the
same issues of law. There is no question that each
of these cases will involve the issue of the legality,
under TILA and ICFA, of EquiCredit’s alleged
practice of requiring borrowers to sign non-
rescission “confirmations.” The Rule does not re-

Page 2

quire complete identity of issues in order for cases
to be considered related.

EquiCredit and Fairbanks' challenge to defend-
ants’ motion turns on the application of Local Rule
40.4(b), which provides the criteria for determining
whether assignment of related cases to the judge
with the lowest-numbered case is appropriate. Un-
der Rule 40.4(b), reassignment may be ordered if
four criteria are met as to all of the cases in ques-
tion: they are pending in this Court; the handling of
all the cases by the same judge is Jikely to result in
a substantial saving of judicial time and effort; the
earliest case has not progressed to far that designat-
ing later cases as related would likely delay sub-
stantially the proceedings in the earliest case; and
the cases are susceptible of disposition in a single
proceeding. N.D, I. LR 40.4(b)(1)}-(4). There is no
question that the first and third of these criteria are
met here; all of the cases are pending in this Court,
and Fairbanks Capital Corp. v. Jenkins, the first of
the cases to be filed, has not progressed all that far:
the Court has ruled on a motion to dismiss the
counterclaim, and discovery has just gotten started.

The Court likewise believes that significant ju-
dicial efficiency wil] result from having one judge
handle all four of the cases. None of the cases can
be disposed of without determining the legality of
EquiCredit's alleged practice regarding non-
rescission “confirmation” at the time of the loan, as
well as the consequences of that practice vis-a-vis
Fairbanks as assignee. Reassignment of all of the
cases to this Court's calendar will permit these is-
sues to be briefed and determined once, rather than
four separate times, which will result in a substan-
tial saving of judicial time and effort-not to mention
a substantial saving of the parties’ and their coun-
sels' time and effort. The overall administration of
justice will likewise be enhanced by having a single
judge determine this issue in all four of the cases.
Indeed, the Court of Appeals for the Seventh Cir-
cuit recently criticized the judges of this Court for
permitting numerous lawsuits involving TILA and
ICFA-related challenges to the practices of “payday

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 27 of 29

a plausible case for breach of contract in their complaint, plaintiffs decide to ignore
the written contracts giving SCUSA broad powers in charging fees and made
vague conclusory allegations regarding improper fees, presumably in hopes of
opening up the door for a fishing expedition.

"While a court, at this stage of the litigation, must consider the allegations
contained in the plaintiffs complaint as true, this rule 'is inapplicable to legal

conclusions." Costa v. Celebrity Cruises, Inc., 768 F. Supp. 2d 1237, 1239 (S.D.

Fla. 2011) (quoting Iqbal, 556 U.S. at 678) (emphasis added), aff'd, 470 F. App'x
726 (11th Cir. 2012). "Thus, 'threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not suffice." Costa, 768 F.
Supp. 2d at 1240 (quoting Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at
555)). Simply stating that the fees charged were improper or not due does not make
them so, Such statements are legal conclusions, not factual allegations creating a
plausible cause of action. Plaintiffs have therefore failed to meet the pleading
standards set out by Fed. R. Civ. P. 8 and clarified by the United States Supreme
Court in Twombly and Iqbal. Their breach of contract claims must be dismissed.
WHEREFORE, PREMISES CONSIDERED, Defendant respectfully
requests the Court to enter an Order dismissing Plaintiffs' Amended Nationwide
Class Action Complaint. In the alternative, the Defendant respectfully requests the

Court to enter an Order transferring this litigation to the United States District

2083096 «2 27


connection with the TCPA claims. Thus, the two matters are “fundamentally similar” to one
another, thereby entitling a finding of relatedness. Global Patent Holdings, LLC, 2008 WL
1848142, at *4.7

WHEREFORE, Defendant Santander Consumer USA, Inc. respectfully moves this
Court for an order finding that Humphreys, et al. y. Santander Consumers USA, Inc., No. 12-cv-
0467, is related to the instant action under Local Rule 40.4, and that the case be reassigned to this
Court for all further proceedings.
Dated: November 7, 2012

Respectfully Submitted,

SANTANDER CONSUMER USA, INC.,
Defendant

By: /s Gary S. Caplan
One of Its Attorneys

Gary S. Caplan

Michael D. Richman

REED SMITH LLP

10 South Wacker Drive, Suite 4000
Chicago, Illinois 60606

(312) 207-1000

> Santander is aware of this Court’s decision in Martin v. Midland Funding, LLC, No. 11 C 3104, 2011
WL 3876965 (Aug. 30, 2011) (Kocoras. J.), in which this Court denied a Local Rule 40.4 Motion for
Relatedness in connection with TCPA and FDCPA putative class actions. However, this matter is
materially distinguishable from Midland Funding. First, unlike the situation in Midland Funding where
there were different defendants in each of the pending actions, here, Santander is the solely named
defendant in both Humphreys and this matter. (/d., 2011 WL 3876965 at *2.) Second, the claims asserted
in the instant action and the Related Action are virtually the same. Third, in Midland Funding, the
putative classes and definitions in each action were substantially different. Jd. Not true here. In the instant
action, by contrast, the putative nationwide class definition proposed in each case here is virtually the
same: focusing on the TCPA components of being composed of all persons called by Santander (i) using
an automatic telephone dialing service, and (ii) where there was no evidence of the recipient of the
cellular phone number not having provided Santander with prior express consent to call, Fourth, unlike in
Midland Funding, here, the class discovery will substantially overlap in both cases, as the TCPA issues of
consent and whether Santander called the cellular numbers with an automatic telephone dialing service
are the same.


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 13 of 19 PagelD #:127

or impossible for individual members of the class to redress the
wrongs done to them. The cost to the court system of adjudication
of such individualized litigation would be — substantial.
Individualized litigation would also present the potential for
inconsistent or contradictory judgments and would magnify the
delay and expense to all parties and the court system in multiple
trials of the factual issues of the case. By contrast, the conduct of
this action as a class action presents far fewer management
difficulties, conserves the resources of the parties and the court
system, and protects the rights of each class member.

FIRST CLAIM FOR RELIEF

VIOLATION OF THE FAIR DEBT COLLECTION
PRACTICES ACT

50. Plaintiffs re-allege and incorporate the preceding paragraphs and
subsequent factual averments in this complaint as if fully set forth herein.

51. Santander violated 15 U.S.C. §1692b(1) because its agents
communicated with persons other than the consumer and failed to provide their
identity and state that they are confirming or correcting location information.

52. Santander violated 15 U.S.C. §1692b(2) by telling persons other than

the consumer that the consumer owed a debt.

13


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 18 of 29

I. Standard Of Review.
The Eleventh Circuit treats Rule 12(c) and Rule 12(b)(6) motions

identically. See Agricredit Acceptance, LLC vy. Hendrix, 32 F. Supp. 2d 1361,

1364 (S.D. Ga. 1998) (citing Hawthorne v, Mac Adjustment, Inc., 140 F.3d 1367,
1370 (11th Cir. 1998)). This means that the standard of review for each motion is

the same. See Dorsey v. Ga. Dep't of State Road & Tollway Auth. SRTA, No.

1:09-CV-1182-TWT, 2009 WL 2477565, at *5 n.6 (N.D. Ga. Aug. 10, 2009)
("Since a motion for judgment on the pleadings is governed by the same standard
as a motion to dismiss for failure to state a claim, courts have noted that the
standard in Twombly is applicable to motions for judgment on the pleadings."); see
also Boyd v. Peet, 249 F. App'x 155, 157 (11th Cir. 2007) (citing to Twombly in
reviewing a Rule 12(c) motion).

"When considering a motion to dismiss, all facts set forth in the [Plaintiffs']
complaint ‘are to be accepted as true and the court limits its consideration to the

pleadings and exhibits attached thereto." Grossman _v, Nationsbank, N.A., 225

F.3d 1228, 1231 (11th Cir. 2000) (quoting GSW, Inc. vy. Long County, Ga., 999

F.2d 1508, 1510 (11th Cir. 1993)). In order to state a claim for relief, the Federal

Rules of Civil Procedure state that a pleading must contain "a short and plain

SCUSA's pending motion to compel arbitration and, therefore, are not
contemplated by this section.

2043096 v2 18


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 25 of 29

555). Recently, when deciding whether a complaint alleging FDCPA violations
was sufficient under Fed. R. Civ. P. 8 and 12(b)(6), the court in Tucker v. Malcolm
S. Gerald & Assoc., Inc, stated the following:
The Iqbal Court further explained that a court need not accept legal
conclusions couched as factual recitations as true and that determining
whether a complaint states a plausible claim for relief is a context-
specific task requiring the reviewing court to draw on its judicial
experience and common sense. A complaint has alleged but has not

shown entitlement to relief, where the well-pleaded facts do not
permit the court to infer more than the mere possibility of misconduct.

No. 3:09-cv-1183-J-12JRK, 2010 WL 1223912, at *2 (M.D. Fla. Mar. 24, 2010)
(citation omitted).

Plaintiffs' complaint, as amended, fails to provide SCUSA with sufficient
notice of the allegations and claims against it in relation to their breach of contract
claim. Indeed, the complaint is devoid of any specific factual allegations regarding
the provisions of the contract they rely upon and instances when SCUSA charged
fees that were improper. Plaintiffs, rather, simply make the generic allegation that
SCUSA breached the contract "by imposing unauthorized fees, including but not
limited to late fees, which were not due." (Doc. 4, § 179). Plaintiffs’ contracts all
authorize SCUSA to collect late fees. See Exs. C-E. Without explanation or
identification of any specific fees charged that were not due, Plaintiffs' threadbare

allegations are insufficient to put SCUSA on notice of a plausible claim against it.

2043096 v2 25


Westlaw.

Not Reported in F.Supp.2d, 2011 WL 3876965 (N.D.IIL.)
(Cite as: 2011 WL 3876965 (N.D.IIL.))

Cc

Only the Westlaw citation is currently available.

United States District Court,
N.D. Hlinois,
Eastern Division.
Nicholas MARTIN, individually and on behalf of a
class, Plaintiff,
v. .
MIDLAND FUNDING LLC, Defendant.

No, 11 € 3104
Aug. 31, 2011.

Alexander Holmes Burke, Burke Law Offices,
LLC, Chicago, IL, for Plaintiff.

Theodore Wilson Seitz, Dykema Gossett, PLLC,
Lansing, MI, James Michael Golden, Renee Lynn
Zipprich, Dykema Gossett PLLC, Chicago, IL, for
Defendant.

ORDER
CHARLES P, KOCORAS, District Judge.

*1 This case comes before the Court on De-
fendant Midland Funding, LLC's (“Midland”) mo-
tion to reassign and consolidate a later-filed matter
pursuant to Northern District of Hlinois Local Rule
40.4(c). For the reasons stated below, the motion is
denied.

Midland asks the Court to reassign and consol-
idate Scardina v. Midland Credit Management, No.
I1-cv~3149 (N.D.UL) (Lindberg, J.) (“Scardina” ),
with the instant matter before this Court, Martin v.
Midland Funding, LLC, No. 11-ev-3104 (N.D.HL)
(Kocoras, J.) (“Martin” ), Plaintiff Dave Scardina
(“Scardina”) objects. To resolve the pending mo-
tion, a summary of the two cases is necessary.

On May 10, 2011, Plaintiff Nicholas Martin
(‘Martin’) filed a purported class action against
Midland. The amended complaint asserts class
claims under the Telephone Consumer Protection

Page 1

Act, 47 U.S. 227 (“TCPA”), and the Fair Debt
Collection Practices Act, 15 U.S.C. § 1692
(*FDCPA”). Martin seeks to hold Midland liable
for calling class members’ cellular telephones using
an automatic telephone dialing system or prerecor-
ded or artificial voice. Martin purports to represent
individuals who resided in Illinois between January
1, 2008, and November 24, 2008, received calls
during that same time period, and had an alleged
debt obtained by Midland during that same time
period. The Martin action is currently pending be-
fore this Court.

One day later, on May 1], 2011, Scardina filed
a purported class action against Midland, as well as
Midland Credit Management, Inc. (“MCM”) and
Encore Capital Group, Inc. (“Encore”), Scardina as-
serts a class claim under the TCPA and seeks to
hold all three defendants liable. Scardina seeks to
hold MCM liable for calling class members’ cellular
telephones using an automatic telephone dialing
service or an artificial or prerecorded voice without
their prior express consent. Scardina also seeks to
hold Midland, the owner of the debt, vicariously li-
able. Finally, Scardina seeks to hold Midland's par-
ent, Encore, liable for raising the capital for the pre-
dictive dialing equipment and directing MCM to
use the equipment. Scardina purports to represent
individuals with Illinois cellular telephone numbers
who received automated calls between May 11,
2007, and May 31, 2011. The Scardina action is
currently pending before Judge Lindberg.

Any party may file a motion for reassignment
based on the relatedness of two or more cases. N.D,
Tl. L.R. 40.4{c). The party moving for reassign-
ment must show that the standards in Local Rule
40.4(a) and 40.4(b) are satisfied. According to Loc-
al Rule 40.4ta), two or more civil cases may be re-
lated if one or more of the following conditions are
met: (1) the cases involve the same property; (2)
the cases involve some of the same issues of fact or
law; (3) the cases grow out of the same transaction
or occurrence; or (4) in class action suits, the

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.


Not Reported in F.Supp.2d, 201] WL 3876965 (N.D.IIL)
(Cite as: 2011 WL 3876965 (N.D.IH.))

classes are the same. Pursuant to Local Rule
40.4(b), the court may reassign a case related to an
earlier-numbered case if: (1) both cases are pending
in this Court; (2) the handling of both cases by the
same judge is likely to result in a substantial saving
of judicial time and effort; (3) the earlier case has
not progressed to a point where designating a later-
filed case as related would likely substantially
delay the proceedings in the earlier case; and (4)
the cases are susceptible of disposition in a single
proceeding.

“2 Midland argues that the cases are related un-
der Local Rule 40.4(a) because the cases involve
some of the same issues of fact or law and the
classes are the same. Because Martin and Scardina
both assert class claims under the TCPA against
Midland, some common issues of fact and law ex-
ist. However, aside from a single cause of action
against the same defendant, the cases are very dif-
ferent. First, Scardina, unlike Martin, asserts a
TCPA claim against two additional defendants,
MCM and Encore, and has a different theory re-
garding each defendant's liability. Martin did not
sue MCM, the licensed debt collector, or Encore,
the parent allegedly directing MCM's use of pre-
dictive dialing equipment. Thus, some discovery re-
lating to MCM's and Encore's involvement in Scar-
dina will not be relevant in Martin.

Second, unlike Scardina, Martin asserts an ad-
ditional class claim under the FDCPA, The FOCPA
claim involves factual issues wholly unrelated to
the TCPA claim. In particular, Martin's FDCPA
claim deals with false representations Midland al-
legedly made to consumer reporting agencies re-
garding the character, amount, or legal status of
Martin's purported debt. Martin's FDCPA claim
thus varies the scope of discovery in Martin,

Finally, the class definitions substantially dif-
fer. The class in Martin includes individuals who:
(1) resided in Hlinois between January 1, 2008, and
November 24, 2008; (2) received calls during that
same time period; and (3) had an alleged debt ob-
tained by Midland during that same time period.

Page 2

Thus, class discovery in Martin will focus on the
purported class members’ residences, the time of
the calls, and the time Midland obtained the alleged
debts. Different from Martin, the class in Scardina
includes individuals with Hlinois cellular telephone
numbers who received automated calls between
May 11, 2007, and May 31, 2011. Thus, class dis-
covery in Scardina will focus on the purported
class members' cellular telephone numbers, not
their residences, and whether they received calls
between May 11, 2007, and May 31, 2011, a much
broader time frame. Further, inclusion in the Sear-
dina class, unlike the Martin class, does not depend
on when Midland obtained the alleged debt. For
these reasons, Martin and Scardina are not suffi-
ciently related for reassignment under Local Rule
40.4(a),

Even if the cases were sufficiently related un-
der Local Rule 40.4(a), Midland has not shown that
the cases satisfy the standard in Local Rule 40.4(b).
For the reasons stated above, the handling of both
cases by the same judge will not likely result in a
substantial saving of judicial time and effort and the
cases are not susceptible to disposition in a single
proceeding. Moreover, reassignment would likely
delay the proceedings in Scardina, since the dead-
line for the close of discovery is approximately one
month away, September 28, 2011.

For the foregoing reasons, the Court denies
Midland's motion to reassign and consolidate Scar-
dina with Martin,

N.D.HL,2011,

* Martin v. Midland Funding LLC

Not Reported in F.Supp.2d, 2011 WL 3876965
(N.D.IL.)

END OF DOCUMENT.

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.


Case 2:12-cv-02183-RDP Document32 Filed 11/01/12 Page 14 of 29

the plaintiff in the first-filed action, superiority of the second-filed action's forum
in resolving the issues, and the convenience to the parties and witnesses in the
second-filed forum").

Here, there is nothing to indicate that the plaintiffs in the Espejo action
engaged in forum shopping or filed their case to preclude a later filing of this case.
Judicial economy weighs heavily in favor of litigating these three (3) actions
together, and Northern District of Illinois is likely to be more familiar with the
issues because two of the three cases are already pending there. Further, the Espejo
action has been pending in that court for a longer time than this case has been
pending in this Court. There is nothing that indicates that this Court is a
significantly more convenient forum for the parties and witnesses involved in the
three actions, nor is there anything indicating that this Court is a superior forum for
resolving these issues.’

Instead, permitting these cases to move forward separately would implicate

the dangers noted by the court in In re Checking Account Overdraft Litig., 839 F.

Supp. 2d at 1325. It would encourage other plaintiffs to file actions involving
substantially similar (but perhaps not identical) plaintiffs and substantially similar

(but perhaps not identical) issues outside an already pending class action. See id.

> In fact, although they have not formally appeared in the Humphreys case,
Plaintiffs counsel are also involved in that case as additional counsel for the
plaintiffs and the putative class.

2043096 v2 14


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 19 of 19 PagelD #:133

i) Such further and different relief as the Court may deem appropriate or
as plaintiffs and the class are entitled to under the law.
JURY DEMAND

Plaintiffs demand trial by struck jury of all issues.

/s/ §, Jerome Levy
S. Jerome Levy
One of the Attorneys for Plaintiff

S. Jerome Levy

Karin A. Olson

S. Jerome Levy & Associates, P.C.
33 North Dearborn Street, Suite 1617
Chicago, Illinois 60601

Telephone: 312.832.1616

Facsimile: 312.832.0270
sijlevy@jeromelevylaw.com
kaolson@jeromelevylaw.com

19


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/42 Page 17 of 29

pending the outcome of the other two cases, Transfer would also avoid duplication
of litigation and also conserves judicial resources.

Finally, and as a third alternative, this Court should, at a minimum, stay this
case pending an outcome in the Espejo and Humphreys actions. A stay would at
least prevent concurrent litigation of the same issues involving the same parties in
two different jurisdictions. It would also reduce or eliminate the possibility of
inconsistent judgments. It would not, however, as effectively protect the rights of
the plaintiffs to potentially participate in the cases already pending in the Northern
District of Illinois. Nor would it as effectively conserve judicial resources; once the
Espejo and Humphreys actions have been resolved, this Court would have to then
decide whether this case is barred by collateral estoppel or other preclusion
principles.

Cc. Plaintiffs'_FDCPA and Breach of Contract Claims Cannot
Proceed In This Court.

Should this Court determine that it will retain jurisdiction over this action
and will not issue a stay, Plaintiffs’ FDCPA and breach of contract claims must be
dismissed pursuant to Fed. R. Civ. P. 12(c) because they fail to state a claim

against SCUSA upon which relief may be granted>

> This portion of SCUSA's motion only addresses the claims of plaintiffs
Levins, Cook and Williams. Plaintiff Jones is the only other named plaintiff in this
action. Her claims, however, are due to be dispatched to arbitration based on

2043096 ¥2 17


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 26 of 29

Plaintiffs also claim that SCUSA had a pattern of charging improper
repossession fees. But they do not allege that any repossession fees were actually
charged to the named Plaintiffs, or that SCUSA charged Plaintiffs any improper
repossession fees, or that SCUSA repossessed a car from any of them. See
generally Pls' Second Am. Compl. (Doc. 29). Indeed, Plaintiffs' complaint is
devoid of any allegations related to repossession fees sufficient to plead a plausible
claim for breach of contract against SCUSA.

Moreover, the contracts governing Plaintiffs' claims permit SCUSA to
charge Plaintiffs for all of their costs related to repossessing and storing their
vehicles. See Exs. C-E. Consequently, even if SCUSA did charge repossession-
related fees, and even if those fees covered its own costs in ordering repossessions
and dealing with recovery companies related to those repossessions (as well as the
fees charged by the recovery companies themselves), those fees are specifically
authorized by the contracts.

By alleging in their breach of contract claim that fees were charged which
were "not due" or were "improper," Plaintiffs simply make conclusory statements
that contain no real allegations regarding how the contracts with these specific
Plaintiffs were breached. Plaintiffs allegations are essentially circular. Why did the
fees constitute a breach of the contract? Because they were improper. Why were

they improper? Because they breached the contract. Instead of sufficiently pleading

2043096 v2 26


8. The cases need not be absolutely identical to be related for purposes of satisfying
Local Rule 40.4. See Fairbanks Capital Corp, v. Jenkins, No. 12 C 3930, 2002 WL 31655277, at
*2 (N.D. Ill. Nov, 25, 2002) (granting reassignment based on Relatedness). Indeed, as this Court
has noted, following Fairbanks: “Two cases need not be absolutely identical to be related for
purposes of LR 40.4. If some of the same issues of fact or law are common, that can be sufficient
to establish relatedness.” Global Patent Holdings, LLC y. Green Bay Packers, Inc., No, 00 C
4623, 2008 WL 1848142, at *3 (N.D. Ill. April 23, 2008) (Kocoras, J.). Thus, this Court held
that when “the cases are fundamentally similar,” motions to reassign based on relatedness are
proper. Global Patent Holdings, 2008 WL 1848142, at *4 (granting motion under LR 40.4)
(copies of all slip opinions are attached hereto as Group Exhibit B).

9. The Related Action is related to the instant action under Local Rule 40.4(a)
because of at least two key components: (i) the issues of law involving the TCPA claims are the
same in both matters; and (ii) the TCPA putative classes are the same in both matters.

10. First, both actions assert violations of the TCPA based upon Santander having
allegedly called cell phones without consent of the named plaintiff. Both cases involve the
identical legal issues of, inter alia, whether (i) a customer's consent to receive calls to a cell
phone also authorizes calls to a spouse; (ii) the putative class is ascertainable; and (iii)
Santander’s telephone system constitutes an “automatic dialer” as defined by the TCPA.

11. Second, plaintiffs in both cases seek to certify virtually identical nationwide
classes under the TCPA for calls allegedly made without their consent:

Espejo “No Consent TCPA Class”: Any person in the United States to whom

Defendant (1) placed a call in connection with the collection of debt; (2) toa

cellular telephone number; and (3) which was never provided to Defendant or to

any other entity associated with the origination or collection of the debt by the
person called. (Am. Compl. { 19.)



Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 6 of 29

08987, First Am. Compl. (Doc. 30) [hereinafter "Espejo Compl."]. Other than the
substitution of a new named class representative, the allegations in the First
Amended Class Action Complaint are nearly identical to the allegations in the
initial Class Action Complaint. Compare Pereira Compl. with Espejo Compl.

On October 23, 2012, the Plaintiffs in this case amended their complaint a
second time. See generally Pls' Second Am. Compl. (Doc. 29). This second
amended complaint reduces the number of named plaintiffs to five, see id. at (| 1—
5, but it makes substantially the same allegations. Compare Pls' Second Am.
Compl. (Doe. 29), with Pls. First Am. Compl. (Doc. 4).

As a result, there are currently three pending cases, two in the Northern
District of Illinois and one in this Court, all of which deal with substantially the
same issues and parties. Of those cases, the Espejo action was the first filed. See
Pereira Compl. (filed Dec. 19, 2011). The last of these cases to be filed is the one
currently before this Court. SCUSA avers that it will be filing this week a motion
to consolidate the Espejo and Humphreys lawsuits.

Tl.

ARGUMENT

A. Plaintiffs' Claims Are Subject To The First-To-File Rule.

The first-to-file rule is a rule of federal comity that permits a district court to

decline jurisdiction when there is an earlier-filed case pending in another court

2043096 v2 6


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 4 of 29

that SCUSA had breached a contract with her by charging her unauthorized fees.
Id, at § 52.

On June 26, 2012, Bonner amended her complaint to allege a putative
nationwide class action and to add eight (8) additional Plaintiffs. See generally Pls'
First Am. Compl. (Doc. 4). Bonner's allegations are substantially unchanged from
her initial complaint, and seven (7) of the eight (8) additional Plaintiffs make
nearly identical allegations. See id. at #4 24-38, 39-53 (Harper); id. at §§ 54-68
(Levins); id. at §§ 69-83 (Cook); id. at §{ 84-98 (Stevenson); id. at §§ 99-113
(Wallace); id. at §¥ 114-130 (Williams); id. at {§ 131-141, 147-154 (Shelby). The
eighth additional Plaintiff, Maude Jones, also alleges TCPA and FDCPA violations
based on the same alleged conduct by SCUSA; her claim is different only in that
SCUSA allegedly contacted her in an attempt to collect another's debt. See id. at
4 142-146, 148-149, 154. The Plaintiffs allege that their individual claims are
representative of a class of Plaintiffs consisting of:

(1) All persons in the United States who are current or former

customers of [SCUSA] within the previous six years and all other

persons to whom [SCUSA] made telephone calls for the collection of

debts from its customers, and (2) all persons that were called by

[SCUSA] using an automatic telephone dialing service and/or an

artificial or prerecorded voice where the evidence shows that the

person received at last one phone call placed by the automatic
telephone dialing service and/or an artificial or prerecorded voice and

(i) where there is no evidence of prior express consent to cal! that

person's cellular telephone number by the automatic telephone dialing

service and/or an artificial or prerecorded voice for a time period
consistent with the statute of limitations for TCPA claims or (ii)

2043096 v2 4


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 29 of 29

CERTIFICATE OF SERVICE

I hereby certify that | have served a copy of the foregoing document by
Notice of Electronic Filing, or, if the party served does not participate in Notice of
Electronic Filing, by U.S. First Class Mail on this the 1st day of November, 2012:

D. Frank Davis
John E. Norris
Wesley W. Barnett
Courtney L, Peinhardt
Andrew S. Herring
DAVIS & NORRIS, LLP
The Bradshaw House
2154 Highland Avenue South
Birmingham, Alabama 35205
Telephone: (205) 930-9900
Facsimile: (205) 930-9989

s/ Robert H, Rutherford
OF COUNSEL

2083096 v2 29


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 6 of 19 PagelD #:120

19, Mr. Humphreys has a cellular telephone with an assigned telephone
number ending in 5157.

20. Beginning in 2010, Santander telephoned the 5157 cellular number
more than 100 times using an automated telephone dialing system and left
numerous pre-recorded messages in Mr. Humphreys’ voice mailbox.

21. Mr. Humphreys began receiving these telephone calls from Santander
attempting to collect an alleged outstanding balance on the vehicle note.

22. Santander’s calls to Mr. Humphreys were initiated by an autodialer or
a predictive dialer.

23. An autodialer or predictive dialer places calls without human
intervention until a person answers the call, in which case the dialer attempts to
connect the person answering the call with a human debt collector.

24, Mr. Humphreys did not authorize the automated placement of calls to
his cellular telephone.

25. Mr. Humphreys told Santander to stop calling his cell phone;
however, Santander persisted in calling Mr. Humphreys’ cellular phone.

26. Since that time, Mr. Humphreys received numerous harassing and
misleading telephonic communications from Santander’s agents attempting to
collect upon the alleged debt on his cell phone and on his home phone number.

Santander called these lines multiple times per day.


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 16 of 29

collateral estoppel principles, See RF Delaware, Inc. v. Pac. Keystone Techs., Inc.,

326 F.3d 1255, 1261 (11th Cir. 2003) (reciting the elements of collateral estoppel).

In the event this Court is not willing to dismiss this action, SCUSA requests
that this Court transfer this case to the Northern District of Illinois, the first-filed
forum, and let that court determine whether the case should proceed, Indeed, the
first-to-file rule not only makes the first-filed forum the appropriate forum to
litigate the issues, it also makes the first-filed forum the appropriate court to decide

which case should be permitted to go forward. See, e.g., Travel Spike, LLC v.

Travel Ad Network, Inc., No. 1:11-cv-3199-RWS, 2012 WL 887591, at *2 (N.D.

Ga. Mar. 15, 2012) (‘"[T]he ‘first to file rule’ not only determines which court may
decide the merits of substantially similar issues, but also establishes which court
may decide whether the second suit filed must be dismissed, stayed or transferred

and consolidated." (quoting Cadle Co. vy. Whataburger of Alice, Inc., 174 F.3d

599, 604 (Sth Cir. 1999)).

Applying that reasoning here, transfer can accomplish many of the same
goals as dismissal and will also not prejudice the rights of any of the plaintiffs. The
United States District Court for the Northern District of Illinois would be able to
determine whether to dismiss this case, consolidate it with the Espejo action,

consolidate it with both the Humphreys and Espejo actions, or stay this case

2043096 ¥2 16


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 22 of 29

In the instant case, SCUSA cannot be a "debt collector" subject to FDCPA
liability with regard to the accounts of Levins, Cook and Williams, because
SCUSA was assigned the accounts at the origination of the loan, before any
possibility of default.’ As evidence to demonstrate that it was the assignee of
contracts of Plaintiffs Levins, Cook, and Williams, SCUSA has attached each of
their retail installment contracts to this Motion as Exhibits C, D, and E
respectively. In Plaintiffs' Complaint, they describe each of the transactions that
gave rise to the debt at issue in the lawsuit. See Pls' Second Am. Compl. (Doc. 29,
{§| 35-36, 50-51, 65-66). Under the "incorporation by reference" doctrine, "'a
document attached to a motion to dismiss may be considered by the court without
converting the motion into one for summary judgment" as long as the attached
document is (1) central to the plaintiff's claim; and (2) .... the authenticity of the

document is not challenged."". Bamert v. Pulte Home Corp., 445 F. App'x 256, 267

(11th Cir. 2011) (quoting Horsley v. Feldt, 304 F.3d 1125, 1134 (11th Cir. 2002)).
Here, the basis for Plaintiffs’ claims is the collection of debt that was originated by
the subject contracts and, thus, there is no question they are central to Plaintiffs’

claims. Additionally, Plaintiffs Complaint provides descriptions of the transactions

* Although not raised in this current Motion, because it would require the
submission of extrinsic evidence outside of the pleadings, SCUSA cannot be
considered a debt collector for the additional reason that the principal purpose of
its business is not the collection of debts owed or due or asserted to be owed or due
to another. See 15 U.S.C. § 1692a(6).

204309612 22


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 8 of 19 PagelD #:122

FACTUAL ALLEGATIONS AS TO PLAINTIFF RHEAMES

34. Ms. Rheames was harassed and received numerous phone calls from
Santander regarding another person’s alleged debt.

35. Ms. Rheames has a cellular telephone with an assigned telephone
number ending in 3624.

36. Ms. Rheames told Santander to stop calling her cell phone; however,
Santander persisted in calling Ms. Rheames’ cellular phone.

37. Beginning in approximately 2011, Santander telephoned the 3624
cellular number several times using an automated telephone dialing system and left
numerous pre-recorded messages in Ms. Rheames’ voice mailbox.

38. Santander’s calls to Ms. Rheames were initiated by an autodialer or a
predictive dialer.

39. An autodialer or predictive dialer places calls without human
intervention until a person answers the call, in which case the dialer attempts to
connect the person answering the call with a human debt collector.

40. Ms. Rheames repeatedly told Santander to stop calling her regarding
the other person’s alleged debt; however, Santander persisted in contacting Ms.

Rheames and left numerous voicemails on her message service.


Claim For Relief; with Espejo Am. Compl., at 919.) While the plaintiffs in the Related Action
asserted three claims —- TCPA, FDCPA and breach of contract — fundamentally, the most
significant and the claim with the greatest potential for relief is, like the present case, brought
under the TCPA. (/d.)

6. On October 26, 2012, Santander filed its responsive pleadings to the complaint in
the Related Action: a motion to compel arbitration as to one plaintiff (Humphreys); with regard
to the second plaintiff (Rheames), an answer and a companion motion for expedited discovery on
the issue of arbitrability. (Humphreys case Dkt. Nos. 25, 26, 29.) On November 1, 2012, the
Court granted the motion to compel arbitration of Humphreys’ claims, and entered and continued
the motion for expedited discovery as to plaintiff Rheames. (Humphreys case Dkt. No. 32.) At
this time, no discovery cut-off has been set in the Related Action. The sole defendant in both
actions, Santander, is represented by the same law firm, ReedSmith, LLP.

Just today, the remaining plaintiff in the Humphreys action agreed to dismiss, without
prejudice, the asserted claims for alleged FDCPA violations and breach of contract. The only
claims that remain in the Humphreys case are the TCPA no consent claims.

The Related Action is “Related” To The Present Action Under Local Rule 40.4(a)

7. Local Rule 40,4(a) provides, in pertinent part, as follows:

Two or more civil cases may be related if one or more of the following conditions
are met:

qd) the cases involve the same property;
(2) the cases involve some of the same issues of fact or law;
GB) the cases grow out of the same transaction or occurrence; or

(4) in class action suits, one or more of the classes involved in the cases is or
are the same.


Page 5
Not Reported in F.Supp.2d, 2008 WL 1848142 (N.D.ILL.)
(Cite as; 2008 WL 1848142 (N.D.IIL))

there could be no participation from anyone other
than GPH when claim 17 was being examined, Ac-
cordingly, the association of claim 17 with the prior
reexamination did not result in the same application
of the PTO's expertise on patentability that is avail-
able for the original 16 claims that were rejected,

No discovery has been conducted and little ju-
dicial effort has been expended in either of the
cases now before us. Though we are mindful that
four years was consumed in waiting for the result of
the reexamination of the original 16 claims, a signi-
ficant amount of time and effort in claim construc-
tion and other litigation would have been wasted if
we had forged ahead without the benefit of the
PTO's examination (and subsequent rejection) of
those claims. Also, the fact that this examination
will focus on a single claim makes it unlikely that a
similar amount of time will be spent in reaching
resolution of the new reexamination. The questions
of validity, patentability, and claim content are
common to the issues before this court and before
the PTO, so the more prudent course of action is to
stay these cases while the reexamination proceeds.
Defendants' motion requesting that relief is there-
fore granted.

CONCLUSION
Based on the foregoing analysis, Global Pat-
ent's motion to reassign is granted, as is the De-
fendants' motion to stay.

N.D.TIL,2008.

Global Patent Holdings, LLC v. Green Bay Pack-
ers, Inc.

Not Reported in F.Supp.2d, 2008 WL 1848142
€N.D.HL)

END OF DOCUMENT

© 2012 Thomson Reuters, No Claim to Orig. US Gov. Works.


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 17 of 19 PagelD #:131

THIRD CLAIM FOR RELIEF

BREACH OF CONTRACT

70. Plaintiffs re-allege and incorporate the preceding paragraphs and
subsequent factual averments of this complaint as if fully set forth herein.

71. Defendant had a contract with plaintiffs and the class or was acting as
an agent on behalf of an undisclosed principal. Santander in either event is liable
for the breach.

72. Defendant breached the contract with plaintiffs and the class by
imposing unauthorized fees, including but not limited to late fees, which were not
due, and repossession fees not authorized by the contract.

73. Asa consequence of defendant’s breach of contract, plaintiffs and the
class suffered damages.

Wherefore, premises considered, plaintiffs and the class demand judgment
against Santander for actual and compensatory damages, plus interest, costs, and
such additional relief as the Court may deem appropriate or to which plaintiffs and
the class may be entitled.

PRAYER FOR RELIEF
WHEREFORE, premises considered, plaintiffs and the class seek the following

relief:

17


equipment to call plaintiffs cell phone without her consent in connection with collection of a
debt relating to plaintiffs husband, a Santander account holder.

2. On August 8, 2012, this Court granted plaintiff leave to file an amended
complaint and substitute the class representative. On that same date, plaintiff filed the amended
complaint and Henry Espejo (“Espejo”) was substituted in as the new putative plaintiff class
representative. The substantive allegations of the amended complaint remained similar to the
original complaint — new plaintiff Espejo alleged that he received calls on his cellular phone
seeking to collect a debt belonging to his wife, but that he had not consented to Santander calling
him. (Am. Compl., ff 14-18.) Espejo seeks certification of a nationwide class.

3. Santander has answered the amended complaint and the parties have propounded
written discovery and exchanged documents. Oral discovery is currently underway, with
depositions scheduled throughout November. On October 18, 2012, this Court set a discovery
cut-off of December 4, 2012.

4, On or about August 7, 2012, plaintiff Humphreys filed the Related Action in the
Northern District of Illinois. The Related Action was assigned to the Honorable Virginia M.
Kendall. A copy of the currently operative complaint in the Related Action, the Amended
Nationwide Class Action Complaint, is attached as Exhibit A. Like the action before this Court,
plaintiffs Humphreys and Rheames in the Related Action assert, inter alia, a putative nationwide
TCPA “no consent” class action directed against Santander. (Humphreys Compl, at p. 10;
Second Claim For Relief.)

5. The Related Action, like the instant case, seeks to certify a nationwide class of
persons under the TCPA who did not consent to receiving calls from Santander on their cell

phones in connection with collection of a debt. (Compare, Humphreys Compl. at p. 10; Second


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 9 of 29

are also members of the Espejo class. In fact, the Espejo complaint also alleges that
SCUSA used automatic dialers and pre-recorded messages. See Espejo Compl.
911, 16. Further, members of the Espejo class are also members of the
Humphreys class and the class proposed here; if they did not provide their cellular
phone numbers they would certainly assert that they did not consent to be called on
their cellular phones.

Moreover, the Humphreys class and class proposed by the Plaintiffs in this
action are absolutely identical because they define the class identically. Compare
Humphreys Am. Compl. at 10 (unnumbered paragraph), with Pls' Second Am.
Compl. (Doc. 29, § 92). As a result, anyone who is a member of the class proposed
in Humphreys is also a member of the class proposed in this case and vice versa.
Even the proposed class representatives in each case would also be members of the
putative class in the other case. See, e.g., Pls' Second Am Compl. " 27-28
(alleging that Bonner received repeated calls to her cellular phone that involved
pre-recorded messages, automatic dialers, and predictive dialers); Humphreys Am.
Compl. at 10 (unnumbered paragraph) (defining the class to include those who
received calls on their cellular phones that involved pre-recorded voices or that
used automatic dialers). In the interests of judicial economy and to avoid
conflicting rulings, this Court should conclude that the first-to-file rule applies to

this case.

2043096 v2 9


Westlaw.

Not Reported in F.Supp.2d, 2008 WL 1848142 (N.D.IIL)
(Cite as: 2008 WL 1848142 (N.D.IIL.))

Only the Westlaw citation is currently available.

United States District Court,
N.D. Hlinois,
Eastern Division.
GLOBAL PATENT HOLDINGS, LLC, Plaintiff,
v.

GREEN BAY PACKERS, INC., Napleton Elmhurst
Imports, Inc., d/b/a Ed Napleton Acura, Orbitz
Worldwide, Inc., Peapod, LLC, Officemax Inc. and
Caterpillar Inc., Defendants.

No. 00 C 4623.
April 23, 2008.

Paul Christopher Gibbons, Arthur Anthony Gasey,
Niro, Seavone, Haller & Niro, Ltd., Chicago, IL,
for Plaintiff,

Sheri J. Engetken, Gonzaga University School of
Law, Spokane, WA, Christian Chadd Taylor, Gi-
anni L. Cutri, Kirkland & Ellis LLP, Michael P.
Padden, Howrey, LLP, John Sheldon Letchinger,
Robert Loren Wagner, Wildman, Harrold, Allen &
Dixon, LLP, Timothy J. Vezeau, Breighanne Aileen
Eggert, Michael Adam Dorfman, Katten Muchin
Rosenman LLP, Brad Richard Bertoglio, Dean A
Monco, Wood, Phillips, Vansanten, Hoffman & Er-
tel, Chicago, IL, Jonathan F. Putnam, Kirkland and
Ellis, New York, NY, Gregory L. Baker, Robert G
Abrams, Howrey LLP, Washington, DC, William
C. Rooklidge, Howrey LLP, Irvine, CA, Harvey
Freedenberg, Shawn K. Leppo, William Patrick
Smith, McNees Wallace & Nurick LLC, Harris-
burg, PA, for Defendants.

MEMORANDUM OPINION
CHARLES P. KOCORAS, District Judge.

*1 This matter comes before the court on two
motions filed by the parties. In the first, Plaintiff
Global Patent Holdings, LLC (“Global Patent”)
seeks reassignment of another case to this court
pursuant to Local Rule 40.4 on the basis that it is

Page |

related to the instant case, The second is a motion
by Defendants Green Bay Packers, Inc.; Napleton
Elmhurst Imports, Inc.; Orbitz Worldwide, Inc.;
Peapod, LLC; OfficeMax, Inc.; and Caterpillar, Inc.
to stay this litigation during the pendency of a reex-
amination proceeding before the Patent and Trade-
mark Office (“PTO”). For the following reasons,
both motions are granted.

BACKGROUND

This case was initially filed by a company
called Techsearch, LLC, on July 28, 2000. The
complaint contained a claim of patent infringement
against Defendants Internet Entertainment Group
Inc., Ed Napleton Acura, Gregory Aharonian, and
the Green Bay Packers in violation of 35 U.S.C. §
27) {a). At that time, Techsearch owned US. patent
No. 5,253,341], which claimed an improved method
and apparatus for downloading compressed audio
and visual data as well as other graphical informa-
tion from a remote server to an end user station
(“EUS”) for the purpose of decompressing and dis-
playing the data. In its complaint, Techsearch asser-
ted that Defendants infringed its patent by down-
loading responsive data, including compressed au-
dio/visual and graphical data, on their respective
websites. Defendants were also accused of know-
ingly and intentionally inducing third parties to in-
fringe Techsearch's patent in violation of 35 U.S.C.
§ 271¢b) and (c).

Subsequently, an anonymous requester initiated
a reexamination procedure of the patent before the
PTO. Rather than keeping the case open while the
reexamination ran its course, Techsearch requested
and obtained dismissal of its complaint with leave
to reinstate the case if the reexamination was re-
solved in its favor. Eventually, the Board of Patent
Appeals cancelled the 16 claims of the original pat-
ent and declared a new claim, claim 17, patentable (
US, Patent No. 5,253,341
to “the ’341 patent”),

Cl, hereinafter referred

According to the motion to reinstate, on Janu-

© 2012 Thomson Reuters. No Claim to Orig, US Gov. Works.


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 2 of 29

1.
INTRODUCTION

On December 19, 2011, Tercia Pereira filed a putative class action complaint
in the United States District Court for the Northern District of Illinois alleging that
SCUSA had violated the Telephone Consumer Protection Act, 47 U.S.C. § 227, et
seg. ("TCPA"), by making unsolicited telephone calls to cellular phones. See

generally Espejo v. Santander Consumer USA, Inc., No. 1:11-cv-08987, Compl.

(Doc. 1) (Ex. "A" hereto) [hereinafter "Pereira Compl."]. Specifically, Pereira
alleged that SCUSA made unsolicited telephone calls to tens of thousands of
consumers' cellular phones without their consent using "skip tracing," "number
trapping," "equipment that had the capacity to store or produce telephone numbers
to be called," "a random or sequential number generator," and "a predictive dialer."
See id. at §§ 11, 13-15. She alleged that her claim was typical of a class consisting
of:

Any person in the United States to whom [SCUSA] (1) placed a call

in connection with the collection of a debt; (2) to a cellular telephone

number; and (3) which was never provided to [SCUSA] or to any

other entity with the origination or collection of a debt by the person
called.

Id. at 418.

On June 14, 2012, Lorenzie Humphreys filed a complaint in the United
States District Court for the Northern District of Illinois alleging that SCUSA had

violated the TCPA, the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et

2043096 v2 2


EXHIBIT B


Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 4 of 19 PagelD #:118

9. Defendant’s routine business practices involve taking over the
collection of debts previously collected by others and then: (a) engaging in
unlawful harassment and unlawful collection methods, and (b) imposing improper
fees never agreed to and not authorized by the contracts they are servicing. It is a
very lucrative but unlawful business plan.

10. Santander is so eager to harass, abuse, and annoy its customers that its
repeated and continuous calls each day are from multiple Santander telephone
numbers. It calls cell numbers without prior authorization.

11. Santander also begins its calls long before the grace period for the
payment in question runs. For example, for loans due on the 1st with a 10 day
grace period through the 10th, Santander’s harassing calls begin on or about the
2nd,

12. Furthermore, it employs the same methods to abuse, annoy, and
harass the friends, family and references of the debtors all in an unlawful attempt
to intentionally harass, abuse and annoy its customers and their family and friends.

13. Defendant willfully, knowingly, regularly, and routinely charges and
collects fees not authorized by the contracts with debtors, including collecting late
fees when payments were not late and “repo fees” unrelated to any expense of
repossession. Santander’s conduct in assessing undue fees is so enthusiastic that

upon acquiring accounts to collect it not only charges unlawful fees in the future,


Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 24 of 29

and Williams at the time of origination. Therefore, SCUSA is not a "debt collector"
with regard to those accounts, and Plaintiffs' FDCPA claims against SCUSA must
be dismissed.

3. Plaintiffs Fail To Adequately Plead A Breach Of Contract
Claim Against SCUSA.

Plaintiffs' breach of contract claims must be dismissed for failing to meet the
pleading floor set by the Federal Rules of Civil Procedure. Specifically, Plaintiffs
fail to plead specific facts that could support any of their breach of contract claims.
As discussed above, Rule 8(a)(2) of the Federal Rules of Civil Procedure provides
that a complaint must contain a "short and plain statement of the claim showing
that the pleader is entitled to relief." Fep. R. Crv. P. 8(a)(2). As previously
mentioned, the Supreme Court has stated that Rule 8 demands more than an
unadorned, "the-defendant-unlawfully-harmed-me accusation." Iqbal, 556 U.S. at
678 (citing Twombly, 550 U.S, at 555).

The Eleventh Circuit has also recognized these pleading standards. See

Davis v. Coca Cola Bottling Co. Consol., 516 F.3d 955 (11th Cir. 2008). In Davis,

the Eleventh Circuit stated that the purpose of Rule 8(a)(2) of the Federal Rules of
Civil Procedure is to "give the defendant fair notice of what the claim is and the
grounds upon which it rests." Davis, 516 F.3d at 973 (quoting Twombly, 550 U.S.
at 555), "To that end, a complaint's '[fJactual allegations must be enough to raise a

right of relief above the speculative level'." Id. (quoting Twombly, 550 U.S. at

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Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 10 of 29

3. The Three Actions Involve Overlapping Issues.

The first-filed Espejo action involves alleged calls from SCUSA to the
plaintiffs’ cellular phones made using pre-recorded messages, automatic dialers,
and predictive dialers and made without the plaintiffs’ consent. See Espejo Compl.
§| 11-17. The Espejo plaintiffs contend that those alleged actions by SCUSA
violated the TCPA. The second-filed Humphreys action involve those very same
allegations: alleged calls from SCUSA to the plaintiffs' cellular phones made using
pre-recorded messages, automatic dialers, and predictive dialers and made without
the plaintiffs' consent. See Humphreys Am. Compl. 9 14, 19-25, 32, 35-40, 44,
48. The Humphreys plaintiffs also contend that those same alleged actions by
SCUSA violated the TCPA. This case, the last filed, also involves those very same
allegations: alleged calls from SCUSA to the Plaintiffs' cellular phones made using
pre-recorded messages, automatic dialers, and predictive dialers and made without
the Plaintiffs’ consent. See Pls' Second Am. Compl. (Doc. 29, ¥§ 14, 18, 27-28,
42-43, 57-58, 67, 69-72). The Plaintiffs in this case also contend that those same
alleged actions by SCUSA violated the TCPA.

The second-filed Humphreys action also involves allegations that SCUSA
engaged in unlawful harassment and unlawful collection methods by allegedly
making harassing, abusive, and threatening calls that misled the plaintiffs as to the

balance owed to SCUSA and that allegedly failed to disclose that the calls were

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Case 2:12-cv-02183-RDP Document 32 Filed 11/01/12 Page 12 of 29

taken those actions, all three cases will require the Courts to decide whether those
actions violated the TCPA. Further, both the Humphreys action and this case
involve the same factual dispute over whether SCUSA made harassing, abusive,
threatening, and misleading calls, and if it did, both cases will require the Courts to
decide whether those calls violated the FDCPA. Moreover, both the Humphreys
action and this case involve the same factual dispute over whether SCUSA charged
the plaintiffs unauthorized fees, and if it did, both cases will require the Courts to
decide whether doing so was a breach of contract.

Particularly in light of SCUSA's intent to seek consolidation of the Espejo
and Humphreys actions in the Northern District of Illinois, the three cases involve
substantially similar and overlapping issues of fact and law, which are all based on
the alleged collection practices of SCUSA. In the interests of judicial economy and
to avoid conflicting rulings, this Court should conclude that the first-to-file rule
applies to this case.

4, There Are No Compelling Circumstances That Preclude
Applying The First-To File Rule.

The party seeking jurisdiction in a later-filed forum bears the burden of
proving "compelling circumstances" that warrant an exception to the first-to-file

rule. See Manuel, 430 F.3d at 1135; Merrill Lynch, Pierce, Fenner & Smith, Inc. v.

Haydu, 675 F.2d 1169, 1174 (11th Cir. 1982); Jones v. Cont'l Motors, Inc., No, 12-

0188-WS-C, 2012 WL 2733670, at *1 (S.D. Ala. July 06, 2012). The "compelling

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Case: 1:12-cv-04671 Document #: 18 Filed: 09/27/12 Page 7 of 19 PagelD #:121

27. When he spoke with a live person, Santander repeatedly misled and
deceived Mr. Humphreys as to the actual balance owed on the vehicle note.

28. Santander attempted to coerce and embarrass Mr. Humphreys into
making additional payments by repeatedly calling Mr. Humphreys an excessive
number of times with the intent to harass.

29. Santander’s agents have repeatedly threatened Mr. Humphreys in an
attempt to collect upon the alleged debt.

30. Santander’s agents have attempted to belittle, abuse, and oppress Mr.
Humphreys in their attempts to collect upon the alleged debt.

31. Santander’s agents have left numerous messages on Mr. Humphreys’
cellular and home voicemail services failing to disclose that the purpose of their
communications was an attempt to collect upon the alleged debt and using
automated or predictive dialers.

32. In short, Mr. Humphreys has been harassed, misled, deceived,
coerced, and threatened in violation of the FDCPA and TCPA.

33. Santander furthermore repeatedly misrepresented the loan balance and
breached its contract with Mr. Humphreys by charging fees not authorized in the

contract.