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Financial Services Law Insights and Observations

District Court rejects FDCPA claims

Courts FCRA FDCPA Debt Collection


On May 7, the U.S. District Court for the Southern District of New York granted a Missouri-based accounts receivable management company’s (defendant) motion for judgment on the pleadings concerning alleged FDCPA violations. The defendant stated in a collection letter that the plaintiff’s account would be placed with an attorney “for possible legal action” if repayment could not be arranged. The letter also listed two addresses—a physical office address at the top left of the letter and a P.O. Box at the top left of a detachable payment coupon at the bottom of the letter. The plaintiff alleged the letter violated Sections 1692e and 1692g of the FDCPA, claiming that the least sophisticated consumer could read the letter and think that legal action was “imminent,” which would ultimately overshadow the 30-day period to dispute the validity of the debt. The court disagreed, however, concluding that even the least sophisticated consumer would not think the use of the words “if” and “possible” in the letter in question meant that legal action was imminent. Moreover, the court ruled that the inclusion of two different addresses in the letter would not confuse anyone about where to send a dispute notification. Specifically, the validation notice in the letter informed the plaintiff that the defendant would assume the debt to be valid unless its office was notified of a dispute and the letter provided only one office address.

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