November FDCPA Case Law Review

insideARM maintains a free FDCPA resources page to provide the ARM community a destination for timely and topical information on the Fair Debt Collection Practices Act (“FDCPA”). This page is generously supported by TransUnion.

The centerpiece of the page is a chart of significant FDCPA cases. Case information and analysis is provided by Joann Needleman, a Clark Hill attorney and leader of the firm’s Consumer Financial Services Regulatory & Compliance Group. Where insideARM has published a story on the case, a link is provided.

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Maloney et al. v. Alliance Collection Agencies, Inc., No. 17-CV-1610 (E.D. Wis. Nov. 6, 2018)

Issue: Does sending a second validation letter within the 30-day validation period of the first validation letter confuses the consumer as to their 1692g rights?

Conclusion: Yes

Defendant collection agency sent a letter, including a notice of the recipient's 1692g validation rights, to plaintiff. Within the 30 day validation window, defendant sent a second letter to the consumer listing the same debts as the first letter as well as additional debts. The second letter also containing the notice of 1692g validation rights. Court denied defendant’s motion to dismiss, finding that it is reasonable that the least sophisticated consumer could be confused by the second letter, specifically about whether the validation rights in the second letter apply only to the new debts listed or also to the debts listed in the first letter.

Post v. Hodges Law Office, PLLC, No. 3:18-cv-358 (E.D. Va. Nov. 9, 2018)

Issue: Does a consumer’s request for debt validation impose a duty on a debt collection law firm to dismiss a collections suit against the consumer?

Conclusion: No

Plaintiff  sent a validation request to defendant, a debt collection law firm, after the firm filed a collection suit was filed against plaintiff. Plaintiff then filed a debt collection suit against defendant for not dismissing lawsuit after receiving the debt validation request. The court granted defendant’s motion to dismiss. In its decision, the court noted that while a debt collector cannot file a collection suit in response to a consumer’s validation request, the request does not impose a requirement for the debt collector to dismiss an already-filed lawsuit.

Brown v. Alltran Financial, LP, No. 18-cv-409 (E.D.N.Y. Nov. 14, 2018)

Issue: Is a debt collection letter false if the amount saved by the consumer per a settlement option is off my $0.01?

Conclusion: No.

Defendant collection agency sent a letter to the consumer listing three different settlement options, with each option providing the dollar amount the consumer would save. Plaintiff sued collection agency alleging that the savings amount was false because it was off by one penny. The court granted defendant’s motion to dismiss the case, finding that plaintiff’s interpretation was bizarre and idiosyncratic. According to the court, “no reasonable trier of fact could find that a single cent would be material in making a decision to repay or not repay a debt within six months.”