Case: 1:18-cv-04678 Document #: 97 Filed: 03/08/21 Page 1 of 10 PageID #:660

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

NIKKI PARHAM, individually and on behalf of
her minor child, B.M.,

Plaintiffs,

Case No. 1:18-cv-04678
V.

Judge Charles R. Norgle
LAKEVIEW LOAN SERVICING, LLC, et al.,

Defendants.

 

 

ORDER
Motions for extension of time [57] [67] are granted. Five Brothers’ motion to dismiss [61] is
denied. Five Brothers’ motion to dismiss [70] is granted in part and denied in part. Masterbuilt’s
motion to dismiss [78] is granted in part and denied in part.
MEMORANDUM OPINION

Pending before the Court are motions to dismiss by Defendants Five Brothers Mortgage
Company Services and Securing, Inc. (“Five Brothers”) and Masterbuilt Construction, Inc.
(“Masterbuilt”) (collectively, “Defendants’”). Specifically, these Defendants move to dismiss
Plaintiffs’ claims regarding the Illinois Consumer Fraud and Deceptive Business Practices Act
(Count III), the Fair Debt Collection Practices Act (Count IV)!, intrusion upon seclusion (Count
V), and intentional infliction of emotional distress (Count VI). While the Court has already
dismissed Count IV as untimely (Dkt. 95), the Court now finds that Plaintiffs have met the notice-

pleading requirements regarding the other counts and discovery should proceed. The Court denies

the motions in part as to Counts III, V, and VI.

 

' The Court has already granted the present motions in part and dismissed Count IV of Plaintiffs’ complaint with
prejudice as to Defendants Five Brothers and Masterbuilt only. Dkt. 95.
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I. Standard

Rule 8(a) of the Federal Rules of Civil Procedure requires that a complaint contain a “short
and plain statement of the claim showing that the plaintiff is entitled to relief.” Bell Atlantic Corp.
v. Twombly, 550 U.S. 544, 554-557 (2007). This statement must provide sufficient plausible facts
to put a defendant on notice of the claims against him. Brooks v. Ross, 578 F. 3d 574, 581 (7th
Cir. 2009). The complaint “must provide enough factual information to ‘state a claim to relief that
is plausible on its face’ and ‘raise a right to relief above a speculative level.’” Doe v. Village of
Arlington Heights, 782 F.3d 911, 914 (7th Cir. 2015) (quoting Twombly, 550 U.S. at 555, 570).
Rule 8 "demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation."
Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009). “A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Id. (citations and quotation marks omitted). The court “must
construe all of the plaintiff's factual allegations as true, and must draw all reasonable inferences
in the plaintiff's favor.” Virnich v. Vorwald, 664 F.3d 206, 212 (7th Cir. 2011).

IL. Facts

This case involves a foreclosure and allegedly illegal intrusion into Plaintiff Nikki
Parham’s (“Parham”) property. According to Parham, she obtained a mortgage loan from Sun
West Mortgage Company, Inc. in 2014. Defendant Lakeview Loan Servicing, LLC. (“Lakeview”)
subsequently acquired the loan. After Parham defaulted on the loan, Lakeview assigned servicing
rights for the loan to Cenlar FSB (“Cenlar”).

On January 13, 2016, Lakeview filed a foreclosure complaint in the Circuit Court of Cook
County seeking to foreclose on the subject property, Case No. 2016-CH-00476. On November 30,
2016, Parham filed a Chapter 13 bankruptcy in the Bankruptcy Court for the Northern District of

Illinois, Case No. 16-37792. On April 3, 2017, the Bankruptcy Court confirmed a Chapter 13 Plan,
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but Parham again fell behind on payments and on June 5, 2017, Lakeview obtained authorization
from the Bankruptcy Court to continue the foreclosure proceeding. The foreclosure proceeding
progressed, and a sale of the subject property was scheduled for July 28, 2017. Parham alleges
that—prior to the sale date—Cenlar sent her a loan modification application, which she submitted
on June 19, 2017. The pleadings are silent as to whether the application was received, but in any
event, no modification was approved. The sale pursuant to the Court order was to proceed.

Plaintiffs allege that in late 2017, Cenlar employed Five Brothers to facilitate the collection
of the subject loan and to perform property preservation services, which in turn employed
Masterbuilt to do the same. On or about July 7, 2017, Cenlar issued a detailed work order to its
agents Five Brothers and/or Masterbuilt to perform property preservation services at the subject
property in an effort to facilitate collection on the subject loan.

Shortly thereafter, Cenlar’s agents went to the property. They banged loudly on the front
door. Parham was at work at the time, but Parham’s 15-year-old minor child, B.M., was home
alone. He did not answer the door. He saw multiple individuals congregating outside, not knowing
who they were. He feared for his safety. B.M. then heard loud bangs coming from the back door,
and then loud booms, so he thought the people were trying to break in. He hid in the basement
furnace closet. He then heard a loud crash, and footsteps on the main level, so he went to a
computer near the furnace closet and sent Parham an email stating that someone broke in and to
come home. Cenlar agents then went to the basement where B.M. was hiding in the closet and
began shining flashlights throughout the basement. They opened the furnace closet and flashed
their flashlights into the closet, but did not see B.M. and left the basement. At no point did the
agents see B.M., nor did they identify themselves. B.M. also never announced his presence.

After B.M. felt he was safe, he left the basement and saw police and his neighbor talking

outside. He discovered that the alleged intruders had forcibly broken into the subject property by
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way of the back door, and had placed a lock on the back door. Parham later arrived home, finding
the door broken with screws and door panel on the floor, and discovered her flat-screen television
missing. Parham asked the police to break the new lock on her door, but they were unable to, so
Parham had to hire a locksmith to break the lock and allow her access to her home.

Parham filed a police report. Defendants did not subsequently communicate with her about
the incident, or explain why they changed the locks. She inquired with Cenlar about whether they
were responsible, and a Cenlar representative acknowledged that Cenlar had sent representatives
to the property to determine if it was vacant. Plaintiffs state that—due to Parham’s submission of
a loan modification application—Defendants should have known, and did in fact know, that the
property was still occupied. She alleges that Defendants did not have the authority or legal right
to enter the subject property, nor a license to change locks as required by the Illinois Locksmith
Act.

III. Discussion
a. Illinois Consumer Fraud and Deceptive Practices Act

Plaintiffs allege that Defendants engaged in illegal, “unfair” conduct by “dispossess[ing]
the Plaintiffs of the subject property without a court order authorizing the same.” Compl. 116.
The elements of a claim under the Illinois Consumer Fraud and Deceptive Business Practices Act
(“ICFA”) are: “(1) a deceptive or unfair act or practice by the defendant; (2) the defendant’s intent
that the plaintiff rely on the deceptive or unfair practice; and (3) the unfair or deceptive practice
occurred during a course of conduct involving trade or commerce.” Wigod v. Wells Fargo Bank

N.A., 673 F.3d 547, 574 (7th Cir. 2012) (internal quotation omitted).
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Defendants here make two arguments. First, Defendants argue that Plaintiffs are not
“consumers” as defined by the ICFA? and so lack standing. Plaintiffs concede that they are not
consumers but argue that they satisfy the “consumer nexus test.” “The courts... have generally
required ICFA plaintiffs to demonstrate either that they are ‘consumers’ under the meaning of the
statute or that they have satisfied the ‘consumer nexus’ test.” Thakkar v. Ocwen Loan Servicing,
LLC, No. 15 CV 10109, 2019 WL 2161544, at *9 (N.D. Ill. May 17, 2019) (test asks in part
whether plaintiffs are akin to consumers and whether defendant’s conduct involves consumer
protection concerns). Plaintiffs assert that their claim “implicates consumer protection concerns.”
Connecticut Gen. Life Ins. Co. v. Sw. Surgery Ctr., LLC, 349 F. Supp. 3d 718, 725 (N.D. Ill.
2018). In their complaint, Plaintiffs allege that Defendants engage in an “industry-wide practice”
to illegally possess properties without consent and cause “substantial injury to consumers
generally.” Compl. 133. At this early stage, that is enough to establish standing to sue under the
ICFA. See Frazier v. U.S. Bank Nat. Ass’n, No. 11 C 8775, 2013 WL 1385612, at *4 (N.D. III.
Apr. 4, 2013) (noting that Plaintiff alleged “that as an established practice Defendants tracked
Plaintiff and other borrowers’ loans en masse and unlawfully ordered property services during
periods when Plaintiff and other borrowers had a right to remain in their homes.”).

Second, Defendants argue that Plaintiffs’ ICFA claim must fail because Plaintiffs do not
allege that there was any contractual relationship or communication—let alone deceptive act—
between Plaintiffs and these Defendants. However, as Plaintiffs point out, they need not plead a
deceptive act to sustain their ICFA claim. “The Illinois Appellate Court has interpreted the [ICFA]
to be disjunctive, allowing separate claims for unfair acts or practices and deceptive acts or

practices.” Sindles v. Saxon Mortg. Servs., Inc., No. 11 C 7224, 2012 WL 1899401, at *4 (N.D.

 

? A consumer is “any person who purchases or contracts for the purchase of merchandise not for resale in the
ordinary course of his trade or business but for his use or that of a member of his household.” 815 ILCS 505/1(e).
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Ill. May 22, 2012). Here, Plaintiffs plausibly plead that Five Brothers and Masterbuilt unfairly and

illegally broke into their property, potentially constituting an unfair business practice. The ICFA

claims survive this motion to dismiss.
b. Intrusion Upon Seclusion

Plaintiffs bring state law claims of intrusion upon seclusion to recover damages for
Defendants’ forcible entry into Plaintiffs’ home without authorization. The Illinois Supreme Court
recognized “the validity of a cause of action for invasion of privacy by intrusion upon seclusion”
in Lawlor v. N. Am. Corp. of Illinois. 2012 IL 112530, 4 35, 983 N.E.2d 414, 425 (“[T]he tort of
intrusion upon seclusion originates from a right of privacy and constitutes one of the four branches
of the tort of invasion of privacy found in the Restatement (Second) of Torts.”).

Defendants assert that Plaintiffs’ intrusion upon seclusion claim is time-barred, because
the alleged intrusion occurred in July 2017, and Plaintiffs filed their amended complaint on March
5, 2020. “Illinois courts have not definitively established the proper statute of limitations
applicable to intrusion upon seclusion claims.” Skiba v. Ill. Cent. R.R. Co., No. 18 C 3381, 2018
WL 6990673, at *2 (N.D. Ill. Dec. 13, 2018). Defendants urge the Court to apply the one-year
limitation that governs defamation and right of privacy claims (735 ILCS 5/13-201), or
alternatively, the two-year limitation for claims for personal injuries (735 ILCS 5/13-202).

Plaintiffs rebut, citing cases from Illinois courts that have declined to apply the one-year limitation.

 

See Skiba, 2018 WL 6990673 at *2 (citing Johnson v. Northshore Univ. Healthsystem Healthport,
Inc., No. 1-10-0399, 2011 WL 10069086, at *4 (Ill. App. Ct. Mar. 31, 2011) which “impllfied] . .

. that the catch-all five-year limitations period applied to intrusion upon seclusion”).
The Court declines to dismiss the claim on statute of limitations grounds at this time.
“Dismissing a complaint as untimely at the pleading stage is an unusual step, since a complaint

need not anticipate and overcome affirmative defenses[.]” Sidney Hillman Health Ctr. of
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Rochester v. Abbott Labs., Inc., 782 F.3d 922, 928 (7th Cir. 2015). “[T]he statute of limitations is
an affirmative defense that need not be anticipated in a complaint.” Skiba v. Ill. Cent. R.R. Co.,
No. 18 C 3381, 2018 WL 6990673, at *2 (N.D. Ill. Dec. 13, 2018) (denying motion to dismiss
given “the uncertain state of the law” and “the procedural posture of the case”).? Defendants may
raise the argument later, after further discovery, but the Court will not dismiss the claim as time-
barred at this time.

Defendants also argue that Plaintiffs do not adequately plead the claim of intrusion upon
seclusion. Specifically, they argue that Plaintiffs have not, and cannot, satisfy the requirement that
the intrusion be “intentional.” Lawlor, 983 N.E.2d at 424 (citing Section 652B of the Restatement
(Second) of Torts, which provides for liability for invasion of privacy if one “intentionally
intrudes, physically or otherwise, upon the solitude or seclusion of another . . .”). Defendants argue
that their entrance into the property was conducted pursuant to a valid foreclosure proceeding after
“[Defendant] Lakeview obtained authorization from the Bankruptcy Court to continue the
foreclosure proceeding” (Compl. 430) and that there is no allegation that they entered with
knowledge that the property was occupied.

Even if this element of intention to intrude is necessary to establish the claim, Plaintiffs’
complaint is sufficient to survive the motion to dismiss on this issue. In their amended complaint,
under a section asserting a claim against all defendants, Plaintiffs allege that “Defendants had

actual knowledge that Nikki owned and occupied the subject property” and entered “without

 

3 Plaintiffs also invoke the “discovery rule” to argue that the limitations period for this claim accrued only when they
gained knowledge that Defendants were the entities that performed the property preservation services. See Doe v.
Hastert, 2019 IL App (2d) 180250, 133 N.E.3d 1249, 1255-56 (applying ‘the general statute of limitations applicable
to personal-injury claims and the common-law discovery rule.”). This underscores for the Court that discovery is
appropriate on this issue. Id. at 1256 (“Whether the discovery rule applies is generally a question of fact[.]”).

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authorization[.]” Compl. 4106; 152. Discovery may show these allegations to be false, but taking
Plaintiffs’ alleged facts as true, the complaint sufficiently alleges knowledge and intent.
c. Intentional Infliction of Emotional Distress

Finally, Defendants move to dismiss Plaintiffs’ claim of intentional infliction of emotional
distress (“ITED”). To state an IIED claim, plaintiffs must demonstrate that (1) the conduct involved
was truly extreme and outrageous; (2) the actor either intended that his conduct inflict severe
emotional distress, or knew that there was at least a high probability that his conduct would cause
severe emotional distress and (3) the conduct in fact caused severe emotional distress. A.J. by
Julka v. Butler Ill. Sch. Dist. #53, No. 17 C 2849, 2020 WL 3960444, at *3 (N.D. Ill. July 13,
2020) (citing Honaker v. Smith, 256 F.3d 477, 490 (7th Cir. 2001)). Defendants assert that
Plaintiffs, as a matter of law, do not satisfy either of the first two elements at this early stage. The
Court disagrees.

Defendants compare this case to Schweihs v. Chase Home Finance, LLC, where a
mortgage loan borrower sued a lender and property preservation servicer for forcibly breaking into
the subject residence. There, the Supreme Court of IIlinois affirmed summary judgment against
plaintiff, finding that the conduct did not rise to the level of extreme and outrageous. 2016 IL
120041, § 32, 77 N.E.3d 50. However, that case was decided on summary judgment and dealt with
facts not alleged here at the motion to dismiss stage, including that: Plaintiff signed a note allowing
Defendant to enter the property to make repairs if Plaintiff fell into default, the actors undertook
efforts to determine the occupancy of the house for over 45 minutes and found the gas turned off,
and the actors removed only one secondary lock. Id. at 64. Here, in contrast, Plaintiffs allege that
Defendants entered the property “shortly” after knocking, changed the lock to the only working
door to the house, and “knew that forcibly entering Plaintiffs’ home and changing the lock would

inflict severe emotional distress[.]” Compl. 9938-47; 9157. In addition, Plaintiffs allege that
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Defendants broke the back door, leaving screws and a door panel on the floor, and stole their
property—specifically, a flat-screen television. Although a close issue, taking Plaintiffs’
allegations together, the Court cannot conclude as a matter of law under Rule 12(b)(6) that
Plaintiffs could not possibly prove outrageous conduct.

Defendants argue that Plaintiffs fail to show that Defendants intended to cause severe
emotional distress, stating, “nowhere in Plaintiff's Amended Complaint is it alleged that Five
Brothers knew the subject property was occupied, or that Five Brothers deliberately entered an
occupied home.” Dkt. mclaughlindaniel@example.net. Defendants are wrong; Plaintiffs allege that “Defendants had
actual knowledge that Nikki owned and occupied the subject property” and entered “without
authorization[.]” Compl. §]106, 152. Plaintiffs support that conclusory allegation with alleged
facts; Cenlar sent representatives—namely, Defendants—to the subject property after Plaintiffs
had recently submitted a loan modification application. Compl. 933. While Defendants may
ultimately refute Plaintiffs’ allegation that they had actual knowledge regarding Plaintiffs’
occupation of the property, the allegation in the amended complaint is enough to state a claim that
Defendants intended to cause severe emotional distress.

Defendants also raise an affirmative defense, asserting that Plaintiffs bring their IIED claim
outside the statute of limitations. IIED claims in Illinois are governed by a two year statute of
limitations. 735 ILCS 5/13-202; Benitez v. KFC Nat. Memt. Co., 305 III. App. 3d 1027, 1032, 714
N.E.2d 1002, 1006 (1999). However, as discussed supra, the Court declines to dismiss the
complaint as time-barred at this stage.

IV. Conclusion

Defendants’ arguments may prove successful at summary judgment or beyond. However,

their motions fail at this early stage. The Court denies the motions in part as to Counts III, V, and

VI, and grants the motions in part as to Count IV. See Dkt. 95.
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The Court notes that certain written documents that are central to this case—like the subject
loan contract and pertinent orders from the foreclosure and bankruptcy cases—have not been filed
with this Court. If the parties have not already produced these documents pursuant to their mutual

disclosure obligations under Fed. R. Civ. P. 26, they shall do so expeditiously.

IT IS SO ORDERED: ENTER: A ff us
Mb Hog

CHARLES RONALD NORGLE“Judge
United States District Court

 

DATE: March 8, 2021

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