The opinion of the court was delivered by: Wexler, District Judge
This is an action commenced by Plaintiff alleging that the various defendants violated the Federal Fair Debt Collection Practices Act ("FDCPA") and New York State law when attempting to collect a single debt in the amount of approximately $3,000 ("Plaintiff's Debt"). Cross claims have been asserted among the Defendants. These cross claims relate to the ownership and right to collect Plaintiff's Debt, along with approximately 2,500 other debts amounting to several million dollars.
Plaintiff has reached a settlement as to his claims with Defendants Portfolio Partners, G.M.K., LLC, Greg MacKinnon, Collins Law Office, LLC and Timothy Collins. Pursuant to this settlement, the parties submitted a stipulation providing for voluntary dismissal of all of Plaintiff's claims (including those not specifically settled with the remaining Defendants) with prejudice. The stipulation also provides that the cross claims asserted among the various Defendants are not to be dismissed, but to be litigated in this forum. Defendants Shekinah, Inc. and Scott Cass have expressed the position that they will not enter into the proposed settlement with Plaintiff unless they can continue to litigate their related claims here.
Noting that Plaintiff's FDCPA claim was the sole basis for federal jurisdiction, this court raised the issue of whether, after dismissal of Plaintiff's claim, subject matter jurisdiction remains over the cross claims. The court instructed the parties to submit letters on this issue. Those letters are presently before the court.
I. The Defendants/Cross Claimants
The complaint and subsequent amended complaint named eleven separate Defendants. Three Defendants defaulted, leaving eight Defendants before the court. The Defendants that defaulted and are no longer involved in this litigation are: (1) M&J Recovery, LLC ("M&J"); (2) Rebecca Gallagher and (3) NLRS, NY ("NLRS") (collectively the "Defaulting Defendants").
The remaining group of eight Defendants, who have asserted cross claims against each other, includes three groups of affiliated Defendants and one individual Defendant. Those parties are as follows:
* Shekinah Defendants: Shekinah, Inc. and Scott Cass
* Portfolio Defendants: Portfolio Partners, G.M.K., LLC and Greg MacKinnon
* Collins Defendants: Collins Law Office and Timothy Collins
* Individual Defendant: Brenda Kretchman (alleged to have worked for defaulting defendant M&J)
As noted, the cross claims relate to ownership and the right to collect Plaintiff's Debt along with several additional debts. Cross-claims have been asserted among all non-defaulting ...