No FDCPA Violation Where Consumer Claims Not to Recognize Creditor Name
Aylix K. Jensen offers analysis and insights for the debt collection industry in her monthly newsletter, The Safe Harbor: Debt Collection Law Update by Aylix Jensen. This monthly newsletter provides an update of changes and developments in the law that impact the debt collection industry. It highlights new debt collection laws and practices, discusses what these may mean for the collection industry, and provides tips to ensure compliance. This article is featured in the July 2022 edition.
On July 14, 2022, the Southern District of New York granted a defendant’s motion to dismiss in a class action lawsuit in which the plaintiff alleged a Fair Debt Collection Practices Act (“FDCPA”) violation based on the identification of the creditor in a collection letter. See Vincent Williams v. MRS BPO, L.L.C. d/b/a MRS Associates, No. 21-CV-6656 (CS), 2022 WL 2759036 (S.D.N.Y. July 14, 2022). The collection letter at issue misspelled the plaintiff’s first name and identified the merchant as Synchrony Networks and the creditor as Synchrony Bank in a text box under the date. The plaintiff contended that the letter violated section 1692g(a)(2) of the FDCPA because it failed to state the correct name of the creditor to whom the debt is owed. The plaintiff also argued that the collection letter violated section 1692e of the FDCPA because it falsely represented the character of the debt by failing to effectively provide the name of the creditor to whom the debt is owed.
As for the section 1692g(a)(2) claim, the court found that the collection letter clearly identified the creditor as Synchrony Bank in the text box under the date. The court emphasized that the letter “does not name any other creditor” and provides further clarity regarding the current ownership of the debt by notifying the consumer that “[t]he above referenced creditor has placed your account with our office for collection.”
As for the section 1692e claim, the court concluded that there was only one reasonable interpretation of the collection letter when reading the letter in its entirety, which a least sophisticated consumer is expected to do. The court again focused on the explanation in the letter that “[t]he above referenced creditor has placed your account with our office for collection” and found that the sole entity identified as a “Creditor” in the collection letter currently owns the debt and is attempting to collect. The court noted that even if the identification of the merchant is a technical misrepresentation, it was not material to be actionable under section 1692e. In addition, the court found that the omission of a single letter from the plaintiff’s first name was a “minor misspelling” and concluded that it “is of no moment to determining whether the letter was misleading or deceptive in violation of the FDCPA,” especially since the collection letter was clearly directed to the plaintiff and arrived at his proper address.
This case is important because it clarifies that “the FDCPA does not require a debt collector to surmise an entity with which a consumer is familiar and include the name of that entity in its initial communication.” Moreover, the court makes clear that the FDCPA does not require that a collection letter resolve all questions that a consumer may have regarding the debt or that a debt collector anticipate and address all questions about the debt. Rather, the FDCPA merely requires that a collection agency provide the required information, which includes identifying the creditor clearly and accurately, and then sets out a process for a consumer to obtain additional information.