Submitted: March 15, 2016
from United States District Court for the Eastern District of
Missouri - St. Louis
WOLLMAN, BENTON, and SHEPHERD, Circuit Judges.
BENTON, Circuit Judge.
November 2006, Domick R. Nelson defaulted on a consumer debt
of $751.87. On February 25, 2015, she filed a Chapter 13
petition in bankruptcy court. Midland Credit Management,
Inc., as agent for the creditor, filed a proof of claim in
bankruptcy court for the amount of the debt. According to the
proof of claim, Nelson made no payment on the debt after
November 2006. Nelson objected to the proof of claim, arguing
it was time-barred. See § 516.120(1) RSMo 2000;
Discovery Grp. LLC v. Chapel Dev., LLC, 574 F.3d
986, 990 (8th Cir. 2009) (recognizing that Missouri statutes
of limitations are procedural, not substantive, and merely
suspend the remedy without extinguishing the right). The
bankruptcy court agreed, disallowing Midland's claim.
See 11 U.S.C. § 558 (including statutes of
limitation as a defense for a bankruptcy estate).
then sued Midland, alleging that, by filing the proof of
claim on the time-barred debt, Midland violated the Fair Debt
Collection Practices Act (FDCPA). The district
court dismissed for failure to state a claim,
holding that the FDCPA is not implicated by a debt collector
filing an accurate and complete claim on a time-barred debt.
Nelson appeals. Having jurisdiction under 28 U.S.C. §
1291, this court affirms.
court reviews de novo the Rule 12(b)(6) dismissal of
Nelson's claims. Cox v. Mortgage Elec. Registration
Sys., Inc., 685 F.3d 663, 668 (8th Cir. 2012). This
court assumes as true all factual allegations in the
pleadings, interpreting them most favorably to Nelson, the
nonmoving party. Bell v. Pfizer, Inc., 716 F.3d
1087, 1091 (8th Cir. 2013). "[A] complaint must contain
sufficient factual matter, accepted as true, to state a claim
to relief that is plausible on its face." Ashcroft
v. Iqbal, 556 U.S. 662, 678 (2009).
to eliminate abusive debt collection practices, the FDCPA
imposes civil liability on debt collector[s] for certain
prohibited debt collection practices." Hemmingsen v.
Messerli & Kramer, P.A., 674 F.3d 814, 817 (8th Cir.
2012) (alteration in original). Nelson alleges that
Midland's claim violated three prohibitions in the FDCPA:
"engag[ing] in any conduct the natural consequence of
which is to harass, oppress, or abuse any person in
connection with the collection of a debt, " 15 U.S.C.
§ 1692d; "us[ing] any false, deceptive, or
misleading representation or means in connection with the
collection of any debt, " § 1692e; and
"us[ing] unfair or unconscionable means to collect or
attempt to collect any debt, " § 1692f. Because
each of these allegations stem from the same conduct-the
filing of the proof of claim-this court may consider the
provisions together. See Hemmingsen, 674 F.3d at
specifically, under the FDCPA, a debt collector may neither
falsely represent "the character, amount, or legal
status of any debt, " 15 U.S.C. § 1692e(2)(A), nor
threaten "to take any action that cannot legally be
taken or that is not intended to be taken, "
id. § 1692e(5). Nelson argues that Midland, by
submitting its claim, represented that the claim was valid
and enforceable. See 11 U.S.C. § 502(a)
("A claim or interest . . . is deemed allowed, unless a
party in interest . . . objects."). Even if-as here-the
debt collector does not make express misrepresentations, the
FDCPA bars a debt collector from filing or threatening a
lawsuit to collect a time-barred debt. See Freyermuth v.
Credit Bureau Servs., Inc., 248 F.3d 767, 771 (8th Cir.
2001) ("[I]n the absence of a threat of litigation or
actual litigation, no violation of the FDCPA has occurred
when a debt collector attempts to collect on a potentially
time-barred debt that is otherwise valid.").
urges this court to follow the Eleventh Circuit and extend to
bankruptcy claims the rule against actual or threatened
litigation on time-barred debts. See Crawford v. LVNV
Funding, LLC, 758 F.3d 1254 (11th Cir. 2014); see
also Johnson v. Midland Funding, LLC, 2016 WL 2996372,
at *3 (11th Cir. May 24, 2016) (clarifying Crawford
by holding that the Bankruptcy Code does not preempt the
FDCPA). In Crawford, the Eleventh Circuit held that
knowingly filing a time-barred proof of claim violated the
FDCPA's prohibitions against unfair, unconscionable,
deceptive, or misleading conduct. 758 F.3d at 1261. The
Crawford court reasoned that the same concerns
underlying the rule against litigating or threatening to
litigate time-barred debts-the debtor's faded memory and
lost records, possible ignorance of the statute of
limitations, and expense to contest the stale debt-apply
equally to a debt collector filing a claim on a stale debt.
however, ignores the differences between a bankruptcy claim
and actual or threatened litigation. In Freyermuth,
this court held that a defendant's FDCPA liability turns
on "whether an unsophisticated consumer would be
harassed, misled or deceived by" the debt
collector's acts. Freyermuth, 248 F.3d at 771.
The bankruptcy process protects against such harassment and
deception. Unlike defendants facing a collection lawsuit, a
bankruptcy debtor is aided by "trustees who owe
fiduciary duties to all parties and have a statutory
obligation to object to unenforceable claims." In re
Gatewood, 533 B.R. 905, 909 (8th Cir. B.A.P. 2015);
see 11 U.S.C. §§ 704(a)(5), 1302 (b)(1)
(outlining trustees' duties, including objecting "to
the allowance of any claim that is improper").
a lawsuit to recover a time-barred debt is more burdensome
than objecting to a time-barred proof of claim. "[T]he
Bankruptcy Code provides for a claims resolution process
involving an objection and a hearing to assess the amount and
validity of the claim . . . [that] is generally a more
streamlined and less unnerving prospect for a debtor than
facing a collection lawsuit." In re Gatewood,
533 B.R. at 909. Because a proof of claim does not
expand the pool of available funds in bankruptcy, debtors
have less at stake than a collection defendant. Rather, an
unsecured creditor likely shares only "pro rata in the
distribution of the pool of available funds and see[s] the
unpaid portion of its claim discharged." Id.
protections against harassment and deception satisfy the
relevant concerns of the FDCPA. "There is no need to
protect debtors who are already under the protection of the
bankruptcy court, and there is no need to supplement the
remedies afforded by bankruptcy itself." Simmons v.
Roundup Funding, LLC, 622 F.3d 93, 96 (2d Cir. 2010) (so
stating while rejecting an FDCPA suit even where the proof of
claim was inaccurate and inflated).
court rejects extending the FDCPA to time-barred proofs of
claim. An accurate and complete proof of claim on a
time-barred debt is not false, deceptive, misleading, unfair,
or unconscionable under the FDCPA. ...