A District Court judge in Illinois has denied a motion for default judgment against a defendant in a Fair Debt Collection Practices Act case, ruling that entering judgment against one defendant while claims against a second defendant remain pending would risk contradictory outcomes, in an opinion with considerably more personality than the average ruling.
The background: The plaintiff, a truck driver, alleged that her phone “kept ringing off the hook” with collection calls while she was out on the road, and that calls were placed to her mother as well.
- She sued two defendants under the FDCPA, the company that actually placed the calls and a second company that hired the first to collect on its behalf, alleging the second defendant was vicariously liable for the first’s conduct through their principal-agent relationship.
- The defendant that placed the calls never responded to the lawsuit despite being served months earlier. As the judge put it, that defendant “might be an aggressive debt collector, but it’s a passive litigator. It’s good at making calls, but not so good at answering complaints.”
- The plaintiff moved for a default judgment against the missing defendant, seeking $1,000 in statutory damages and $9,000 in actual damages for emotional distress.
- The other defendant opposed the motion, arguing the court should hold off on pinning down damages since it could ultimately be on the hook for the missing defendant’s conduct.
The ruling: Judge Steven C. Seeger of the District Court for the Northern District of Illinois denied the motion, leaning on a Supreme Court decision from 1872 that, in his words, was issued “when the embers of Chicago were probably still warm from the Great Chicago Fire of 1871.”
- That precedent instructs courts to wait before entering a default judgment against a non-participating defendant when the liability of the defendants is intertwined, to avoid the possibility of two judgments that contradict each other.
- Because the appearing defendant’s liability depends entirely on whether its agent did anything wrong, Judge Seeger reasoned, it is possible the appearing defendant could win the case for a reason that would clear the missing defendant too, such as a finding that the calls never took place.
- In that scenario, an early default judgment would clash with the later ruling. The lower court in the 1872 case made exactly that mistake, and Judge Seeger noted it “put the wagon before the horse.”
- The motion was denied without prejudice, meaning the plaintiff can renew her request once the claims against the appearing defendant are resolved. Until then, the judge wrote, “this Court will sit tight.”
