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Divided 7th Circuit revives Marion County Small Claims suit

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More than eight months after Judge Richard Posner argued in a dissent that Newsom v. Friedman needs to be overruled, the 7th Circuit Court of Appeals did just that in an en banc decision involving Marion County’s Township courts.

Posner and Judge David Hamilton authored the majority opinion in Mark Suesz v. Med-1 Solutions LLC, 13-1821, in which the court decided the correct interpretation of “judicial district or similar legal entity” under Section 1692i of the Fair Debt Collection Practices Act is the smallest geographic area that is relevant for determining venue in the court system where the case is filed. For Marion County Small Claims courts, the smallest area is the township.

This is opposite of what the 7th Circuit decided in Newsom, 76 F.3d 813 (7th Cir. 1996), in which a panel adopted a test based on details of court administration rather than on the applicable venue rules. The Circuit Court in Suesz not only reversed the court’s previous ruling which held that small claims cases could be brought in any Marion County Township Court, but it also overruled Newsom.

Med-1 Solutions filed a collection lawsuit against Mark Suesz in Pike Township, seeking to recover medical debt Suesz incurred from treatment in Lawrence Township. Suesz does not live in Pike Township. Suesz sued, seeking damages under the FDCPA, which requires debt collectors to bring the suit in the judicial district where the contract was signed or where the consumer resides.  District Court Judge William Lawerence, citing Newsom, tossed Suesz’s lawsuit in March 2013.

“[I]n Newsom we relied on what was said to be the plain language of the statute, though the language is not plain at all when applied to the Marion County township courts,” Posner and Hamilton wrote in Mark Suesz v. Med-1 Solutions LLC, 13-1821. Wednesday they adopted an approach that focuses on the state court venue rules faced by parties and lawyers, and the relevant geographic unit for applying those rules.

“This interpretation of the statutory term discourages abusive forum-shopping by debt collectors rather than enabling it,” the majority writes. They remanded for further proceedings on class certification and the merits of Suesz’s claim. The majority declined Med-1 Solutions request that Newsom be overruled only on a prospective basis.  

Judge Diane Sykes concurred with Posner and Hamilton’s opinion, including the decision to overrule Newsom, but she noted she shares some of the concerns expressed by Judge Joel Flaum in his dissent, to which Judge Michael Kanne joined. They do not believe Newsom should be overturned.

“But instead of deferring to the state’s definition of its districts, the majority replaces congressional silence in §1692i with a purposive definition of judicial district that is of the majority’s own design. In doing so, the court federalizes the term “judicial district” for the purposes of the FDCPA. I decline to join this decision because I believe the court’s rule seizes upon a general congressional purpose behind the FDCPA – protecting debtors from abusive collection practices – to craft a rule more exacting than Congress intended. A high-level statutory purpose is simply an insufficient justification for this stringent new rule,” Flaum wrote.

Kane also wrote a separate dissent, “While I am of the opinion that the judicial circuits themselves, and not any specific court within them, are the relevant ‘judicial districts’ in Indiana, I find Judge Flaum’s reasoned approach and his adherence to our Newsom decision much more persuasive than put forward by the majority.”
 

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  1. I just wanted to point out that Congressman Jim Sensenbrenner, Senator Feinstein, former Senate majority leader Bill Frist, and former attorney general John Ashcroft are responsible for this rubbish. We need to keep a eye on these corrupt, arrogant, and incompetent fools.

  2. Well I guess our politicians have decided to give these idiot federal prosecutors unlimited power. Now if I guy bounces a fifty-dollar check, the U.S. attorney can intentionally wait for twenty-five years or so and have the check swabbed for DNA and file charges. These power hungry federal prosecutors now have unlimited power to mess with people. we can thank Wisconsin's Jim Sensenbrenner and Diane Feinstein, John Achcroft and Bill Frist for this one. Way to go, idiots.

  3. I wonder if the USSR had electronic voting machines that changed the ballot after it was cast? Oh well, at least we have a free media serving as vicious watchdog and exposing all of the rot in the system! (Insert rimshot)

  4. Jose, you are assuming those in power do not wish to be totalitarian. My experience has convinced me otherwise. Constitutionalists are nearly as rare as hens teeth among the powerbrokers "managing" us for The Glorious State. Oh, and your point is dead on, el correcta mundo. Keep the Founders’ (1791 & 1851) vision alive, my friend, even if most all others, and especially the ruling junta, chase only power and money (i.e. mammon)

  5. Hypocrisy in high places, absolute immunity handed out like Halloween treats (it is the stuff of which tyranny is made) and the belief that government agents are above the constitutions and cannot be held responsible for mere citizen is killing, perhaps has killed, The Republic. And yet those same power drunk statists just reel on down the hallway toward bureaucratic fascism.

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