In re Roth

          Appeal from the United States District Court for the Middle District of Florida D.C. Docket Nos. 2:16-cv-00510-SPC; 9:10-bkc-30383-FMD

          Before WILSON, BRANCH, and ANDERSON, Circuit Judges.

          BRANCH, CIRCUIT JUDGE.

         Arlene Roth appeals the bankruptcy court's denial of her second motion for sanctions against Nationstar Mortgage, LLC ("Nationstar"). The basis of the motion was Nationstar's conduct of sending a monthly statement to Roth, which she alleges sought to collect discharged mortgage debt in violation of the bankruptcy code's prohibition on collection of such debt, 11 U.S.C. § 524. She raises two issues on appeal: (1) whether the bankruptcy court improperly made factual determinations without the benefit of an evidentiary hearing; and (2) whether Nationstar's mortgage statement was an improper attempt to collect a debt in violation of 11 U.S.C. § 524 and justifies sanctions against Nationstar. For the following reasons, we affirm the bankruptcy court's decision.

         I.

         On December 22, 2010, Roth filed a voluntary petition for bankruptcy under Chapter 13 of the bankruptcy code. On her bankruptcy schedule, Roth listed a mortgage on non-homestead property, which is at issue here. On this schedule, she indicated she would surrender the property. The Chapter 13 plan provided that "[s]ecured creditors, whether or not dealt with under the Plan, shall retain the liens securing such claims." On October 3, 2011, the bankruptcy court entered an order confirming her Chapter 13 bankruptcy plan. Subsequently, the mortgage at issue here (which was subject to the Chapter 13 plan) was transferred to Nationstar. She completed her payments under her Chapter 13 plan, and the bankruptcy court discharged her debt on June 27, 2014. Nationstar was notified of the discharge.

         In the discharge order, the bankruptcy court ordered that "the discharge prohibits any attempt to collect from the debtor a debt that has been discharged. For example, a creditor is not permitted to contact a debtor by mail, phone, or otherwise, to file or continue a lawsuit, to attach wages or other property, or to take any other action to collect a discharged debt from the debtor." The order, however, also stated that "a creditor may have the right to enforce a valid lien, such as a mortgage or security interest, against the debtor's property after the bankruptcy, if that lien was not avoided or eliminated in the bankruptcy case. Also, a debtor may voluntarily pay any debt that has been discharged." But even after the discharge of the mortgage debt, Nationstar did not foreclose on the property; thus, if Roth voluntarily paid the amount due, she could have retained the property.

         About four months after the discharge of Roth's debt, Nationstar started sending Roth monthly statements related to her mortgage. The statements included a disclaimer that they were not debt collection, but also included an amount due, due date, and instructions on how to send payment back to Nationstar. Roth had her attorney send a cease and desist letter, but the statements kept coming. She then filed her first motion for sanctions in bankruptcy court, alleging that the statements were improper debt collections in violation of 11 U.S.C. § 524, as well as a separate civil action claiming violations of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692e et seq, and the Florida Consumer Collection Practices Act (FCCPA). Arlene Roth v. Nationstar Mortgage LLC, No. 2:15-cv-508-FtM-38CM (M.D. Fla.). The parties resolved the first sanctions motion and first FDCPA action in a settlement.

         But communication from Nationstar continued in the form of a November 18, 2015 "Informational Statement," which again contained an amount due, due date, and instructions for how to pay Nationstar, as well as a lengthy disclaimer. The full text of the disclaimer reads as follows:

This statement is sent for informational purposes only and is not intended as an attempt to collect, assess, or recover a discharged debt from you, or as a demand for payment from any individual protected by the United States Bankruptcy Code. If this account is active or has been discharged in a bankruptcy proceeding, be advised this communication is for informational purposes only and is not an attempt to collect a debt. Please note, however Nationstar reserves the right to exercise its legal rights, including but not limited to foreclosure of its lien interest, only against the property securing the original obligation.

         Consequently, on December 14, 2015, Roth filed a second lawsuit against Nationstar alleging the Informational Statement was an improper debt collection under the FDCPA. Roth v. Nationstar Mortg., LLC, No. 2:15-cv-783-FtM-29MRM, 2016 WL 3570991 at *1 (M.D. Fla. July 1, 2016). Nationstar filed a motion to dismiss that case, arguing that the Informational Statement was not sent for debt collection purposes as a matter of law, but the district court denied the motion after applying the FDCPA's "least sophisticated consumer" standard. Id. at *5. On May 30, 2017, the parties notified the district court that they had reached a settlement in that case. Notice of Settlement, Roth v. Nationstar Mortg., LLC, No. 2:15-cv-783-FtM-29MRM (M.D. Fla. May 30, 2017).

         Based on the same Information Statement, on December 14, 2015-the same day that she filed her second FDCPA case-Roth filed a second motion for sanctions in her bankruptcy case, which is at issue here. Roth alleged that Nationstar's communication was an attempt to collect a discharged debt in violation of the discharge order. Nationstar claimed that the statement was only informational and not a violation of § 524. After briefing, the bankruptcy court denied Roth's motion for sanctions at a hearing, and later entered an opinion and an order finding that the "informational statement" was not a debt collection attempt, and therefore was not in violation of the § 524 injunction. Roth appealed the denial of this second sanctions motion to the district court, which affirmed the bankruptcy court's opinion and rejected Roth's request to apply the FDCPA's "least sophisticated consumer" standard. In re Roth, 568 B.R. 139, 145 (M.D. Fla. 2017). This appeal followed.

         II.

         In bankruptcy cases, this Court "sits as a second court of review and thus examines independently the factual and legal determinations of the bankruptcy court and employs the same standards of review as the district court." In re Ocean Warrior, Inc., 835 F.3d 1310, 1315 (11th Cir. 2016) (quoting In re Fisher Island Invs., Inc., 778 F.3d 1172, 1189 (11th Cir. 2015)); see also In re Gonzalez, 832 F.3d 1251, 1253 (11th Cir. 2016), cert. denied sub nom. Fla. Dep't of Revenue v. Gonzalez, 137 S.Ct. 2293 (2017). When the district court affirms the bankruptcy court, we review the bankruptcy court's decision, reviewing its "factual findings for clear error and its legal conclusions de novo." In re Ocean Warrior, Inc., 835 F.3d at 1315 (internal ...