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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

CARLOS ESCARZA,

 Plaintiff,

 vs.

THE BANK OF NEW YORK MELLON 

f/k/a The Bank of New York, as Trustee for 

CWHEQ Inc., Home Equity Loan Asset 

Backed Certificates, Series 2006-S10;

SPECIALIZED LOAN SERVICING LLC;

and McCALLA RAYMER LEIBERT 

PIERCE, LLC, 

 Defendants.

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Case No. 1:20-cv-02341

JURY TRIAL DEMANDED

COMPLAINT

Plaintiff, Carlos Escarza, through counsel, for his complaint against defendants, The Bank 

of New York Mellon, f/k/a The Bank of New York, as Trustee for CWHEQ Inc., Home Equity 

Loan Asset Backed Certificates, Series 2006-S10; Specialized Loan Servicing LLC, and McCalla 

Raymer Leibert Pierce, LLC, states:

NATURE OF THE CASE

1. Plaintiff’s mortgagee, its servicer and their attorneys, have unlawfully attempted to 

collect a debt barred by Illinois’ statute of limitations, have filed a wrongful foreclosure and have 

engaged in conduct which violates the Fair Debt Collection Practices Act. Plaintiff brings this 

action to seek redress in this Court for defendants’ conduct and to recover actual damages, statutory 

damages, and attorney’s fees and costs.

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BACKGROUND FACTS

2. Plaintiff, Carlos Escarza (“Plaintiff” ), owns the home located at and commonly 

known as 2454 West Foster Ave., Unit 1W, Chicago, Illinois 60625 (the “Home”).

3. In order to obtain money for personal, family and household purposes, on 

November 30, 2006, Plaintiff borrowed money and executed a note in the amount of $77,033.00 

payable to Countrywide Bank, N.A. (the “Note”). To secure payment of that Note, Plaintiff granted 

a contemporaneous mortgage lien on his Home (the “Mortgage”). The Note and Mortgage are 

collectively referred to herein as the “Loan.” A copy of the Loan is attached as Exhibit 1. 

4. Plaintiff occupied the Home as a residence for himself and his family.

5. The Bank of New York Mellon, f/k/a The Bank of New York, as Trustee for

CWHEQ Inc., Home Equity Loan Asset Backed Certificates, Series 2006-S10 (“BONY”), is the 

present owner of the Loan.

6. Defendant Specialized Loan Servicing LLC (“SLS”), is a mortgage loan servicer 

and at all times relevant here serviced the Loan as the mortgage loan servicer and agent for BONY. 

7. Defendant McCalla Raymer Leibert Pierce, LLC (“MRLP”) is an Illinois limited 

liability company whose members are engaged in the practice law in Illinois.

8. At all times relevant here, MLRP acted as the agent and attorney for BONY and 

SLS.

9. Plaintiff is a “consumer” as that term is defined by applicable federal and state 

statutes. Plaintiff is a natural person from whom BONY, SLS and MRLP sought to collect a debt 

incurred for personal, family, or household purposes. Here the debt was alleged to have been a 

note secured by a mortgage and the purpose was to finance debt on a personal residence.

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10. SLS is a “mortgage servicer” and “service provider” as each term is defined by 

applicable statutes and regulations.

11. SLS is a “debt collector” as defined by the FDCA, 15 U.S.C. §1692(a)(6) because 

it regularly collects debts owed to others. SLS became the servicer for the Loan after it was alleged 

to have been in default. SLS is an agent of BONY.

12. MRLP is a “debt collector” as defined by the FDCA, 15 U.S.C. §1692(a)(6), 

because it regularly collects debts owed to others. MRLP is engaged in the business of collecting 

debts on behalf of others. Here, MRLP acted at all relevant times as the debt collector for BONY 

and SLS, attempting to collect the Loan from Plaintiff.

13. SLS and MRLP regularly use the mail to collect debts.

JURISDICTION AND VENUE

14. This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1331 as this 

action arises the Fair Debt Collection Practices Act, 15 U.S.C. §1692 et seq. (“FDCPA”).

15. Venue lies in this District pursuant to 28 U.S.C. §1391(b) as a substantial part of 

the events or omissions giving rise to the claims asserted herein occurred, or a substantial part of 

property that is the subject of the action, is in this District. The Home is in this District and the 

conduct complained of took place in this District.

SUMMARY OF CLAIMS

16. The FDCPA broadly prohibits unfair or unconscionable collection methods, 

conduct which harasses or abuses any debtor, and the use of any false or deceptive statements in 

connection with attempts to collect a debt.

17. Plaintiff asserts claims against each defendant for multiple violations of the FDCPA

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ADDITIONAL FACTS

18. In 2009, Plaintiff encountered financial difficulties and could no longer pay the 

Loan. He defaulted in his obligations as of November 1, 2009. 

19. Plaintiff made no payment on the Loan at any time subsequent to November 1, 

2009.

20. On December 31, 2019, MLRP, acting as attorneys and agents of SLS and BONY, 

filed its Complaint to Foreclose Mortgage (“Foreclosure Complaint”) against Plaintiff in the 

Circuit Court of Cook County, Illinois. A copy of the Foreclosure Complaint is attached as Exhibit 

2.

21. In the Foreclosure Complaint, BONY, SLS and MLRP allege the Loan is in default 

“for November 2009 through present...” Id. at ¶ 3(l).

22. In the Foreclosure Complaint, BONY, SLS and MLRP seek to collect the Loan 

from Plaintiff through foreclosure and seek to sell the Home at public auction.

23. The Foreclosure Complaint and summons were subsequently served on Plaintiff at 

his Home.

ILLINOIS LAW BARS COLLECTION OF THE LOAN

24. Section 13-206 of the Illinois Code of Civil Procedure states in relevant part:

“Except as provided in Section 2-725 of the “Uniform Commercial Code” 

[810 ILCS 5/2-725], actions on bonds, promissory notes, bills of exchange, 

written leases, written contracts, or other evidence of indebtedness in 

writing...shall be commenced within 10 years next after the cause of action 

accrued...An action to enforce a demand promissory note is barred if neither 

principal nor interest on the demand promissory note has been paid for a 

continuous period of 10 years and no demand for payment has been made to 

the maker during that period.”

735 ILCS 5/13-206.

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25. Under [735 ILCS 5/13-206], a plaintiff can commence a suit for breach of contract 

any time within 10 years next after the cause of action accrued. Luminall Paints, Inc. v. La Salle 

Nat’l Bank, 220 Ill. App. 3d 796, 801.

26. A cause of action accrues when facts exist that authorize one party to maintain an 

action against another; thus the moment a creditor may legally demand payment the statute of 

limitations begins to run, because at that moment a cause of action has actually accrued. Beynon 

Bldg. Corp. v. National Guardian Life Ins. Co. 118 Ill. App. 3d 754, 762, citing to Mazur v. Stein 

(1942), 314 Ill. App. 529, 534. “Even when an obligation is payable by installments and the statute 

of limitations runs against each installment when due, an action to determine the existence of the 

right under the contract is distinct as regards the commencement of the period of limitations, and 

the statute of limitations begins to run when the party first has the power to make the demand.” Id. 

citing to Brehm v. Sargent & Lundy (1978), 66 Ill. App. 3d 472, 474. Likewise, a plaintiff cannot 

delay running of the statute of limitations by postponing the time of demand upon the proper party. 

Luminall Paints, Inc. v. La Salle Nat’l Bank, 220 Ill. App. 3d 796, 801-802, citing to Brehm v. 

Sargent & Lundy (1978), 66 Ill. App. 3d 472.

27. The ten year period following the November 1, 2009 default expired before the 

Foreclosure Complaint was filed on December 31, 2019.

DAMAGE TO PLAINTIFF

28. Upon being served with the Foreclosure Complaint, Plaintiff suffered great 

emotional distress. He became angry and was constantly frustrated because he knew that over ten 

years had gone by and that the Loan could no longer be collected. 

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29. Plaintiff was embarrassed that a public record of the Foreclosure Complaint now 

existed and feared that his family, neighbors, friends and colleagues at work would learn of the 

filing and hold him in low esteem. 

30. The Foreclosure complaint is a public record, a scarlet letter if you will, that cannot 

be erased and will forever haunt Plaintiff in his future endeavors.

31. During the weeks following the service of the Foreclosure Complaint, plaintiff 

suffered many sleepless nights, became agitated, could not focus on work and could not enjoy the 

normal comforts of life and his Home.

32. Finally, in February 2020, Plaintiff put aside his anxiety, fear and embarrassment 

and sought the advice of attorneys.

33. Plaintiff retained counsel to represent him in the Foreclosure Case and to help him 

seek redress by filing the instant action.

34. Plaintiff’s counsel appeared in the Foreclosure Case and filed a motion to dismiss 

the case pursuant to 735 ILCS 5/2-619 (“Motion to Dismiss”) asserting that the action was barred 

by Illinois’ ten year statute of limitations for actions on promissory notes, 735 ILCS 5/13-206. 

35. Plaintiff paid counsel a flat fee of $4,750.00 for filing fees and attorney fees and 

costs to consult with him, to review his records regarding the Loan and to have those attorneys 

appear and defend the Foreclosure Case.

36. Additionally, Plaintiff has incurred filing fees and attorney fees and costs to consult 

with attorneys and to have those attorneys bring the instant action.

37. The actions of BONY, SLS and MLRP have further caused Plaintiff to remain in 

foreclosure, which has caused continued damage to Plaintiff’s credit and an unnecessary delay to 

Plaintiff’s rehabilitation of his credit.

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38. The actions of BONY, SLS and MLRP have caused Plaintiff to incur actual 

damages including time off work, travel expenses to and from his attorney’s office, filing fees, 

attorneys’ fees to defend the Foreclosure Case, and the preparation and prosecution of this action.

COUNT ONE

 [MULTIPLE VIOLATIONS OF THE FDCPA]

39. Plaintiff restates and incorporates all of his statements and allegations contained in 

paragraphs 1 through 39.

40. 15 U.S.C. 1692e provides in relevant part:

A debt collector may not use any false, deceptive, or misleading

representation or means in connection with the collection of any debt.

Without limiting the general application of the foregoing, the following

conduct is a violation of this section:

(2) The false representation of–

(A) the character, amount, or legal status of any debt; . . .

(5) The threat to take any action that cannot legally be taken or that is

not intended to be taken.

(10) The use of any false representation or deceptive means to

collect or attempt to collect any debt or to obtain information 

concerning a consumer. . . .

41. 15 U.S.C. 1692f provides in relevant part:

A debt collector may not use unfair or unconscionable means to collect or

attempt to collect any debt. . . .

42. SLS and MLRP violated §1692e(2)(A) by filing the Foreclosure Complaint and 

therein falsely represented the character of the Loan as being a deb that could be collected through 

foreclosure and sale. This allegation falsely represented the legal status of the Loan. 

43. Because the FDCPA prohibits debt collectors from misrepresenting the legal status 

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of a debt and from seeking to collect amounts not permitted by law, courts have held that a debt 

collector violates the Act when it sues a consumer for legally unattainable relief.

44. SLS and MLRP violated §1692e(5) by filing the Foreclosure Complaint and therein 

falsely representing that they could foreclose and sell the Home due to the alleged default. 

Moreover, the “deemed allegations” found in 735 ILCS 5/15-1504(c)(7), (c)(12) and (e)(6) were 

also false and sought legally unobtainable relief. These are actions that cannot legally be taken 

against a borrower on a debt which is barred by the applicable statute of limitations.

45. SLS and MLRP violated §1692e(10) by filing the Foreclosure Complaint and 

therein seeking to collect the Loan and fees and charges which it was not entitled to collect. Filing 

of a foreclosure action to collect a debt which is barred by the statute of limitations is deceptive.

46. Plaintiff suffered actual damages as set forth infra. 

47. BONY is vicariously liable for the actions of SLS and MLRP which were taken 

with its knowledge and at its direction.

WHEREFORE, the Plaintiff prays for the entry of judgment in his favor and against 

BONY, SLS and MLRP, as follows:

A. For Statutory damages of up to $1,000.00 for each violation of the FDCPA;

B. For actual damages, all costs and reasonable attorney fees; and

C. For all other relief this Court may deem just and proper.

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JURY DEMAND

Plaintiff, Carlos Escarza, hereby respectfully demands a trial by jury on all claims.

Respectfully submitted,

CARLOS ESCARZA

/s/ Rusty A. Payton

Rusty A. Payton

PAYTON LEGAL GROUP

20 North Clark Street

Suite 3300

Chicago, Illinois 60602

(773) 682-5210

info@payton.legal

Luke P. Wiley

WILEY LAW GROUP, LLC

55 E. Monroe St. Suite 3800

Chicago, Illinois 60603

(815) 685-4203

lukewiley@wileylaw.net

Counsel for Plaintiff

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