A District Court judge in Pennsylvania has added to the confusion about what is and what is not allowed in a validation letter after denying a motion to dismiss a class-action lawsuit that was filed against a collection agency for allegedly violating the Fair Debt Collection Practices Act with respect to how a debt must be disputed.
A copy of the ruling in Henry v. Radius Global Solutions can be accessed by clicking here.
The plaintiff received a collection letter that included the following passage:
Unless you notify this office within 30 days after receiving this notice that you dispute the validity of this debt, or any portion thereof, this office will assume this debt is valid. If you notify this office in writing within 30 days after receiving this notice that you dispute the validity of this debt, or any portion thereof, this office will obtain verification of the debt or obtain a copy of a judgment and mail you a copy of such judgment or verification. If you request of this office in writing within 30 days after receiving this notice this office will provide you with the name and address of the original creditor, if different from the current creditor.
The plaintiff then filed suit, alleging the letter violated Sections 1692g and 1692e of the FDCPA by failing to adequately inform her that the debt must be disputed in writing, and that the letter is false, misleading, or deceptive.
Even though the defendant used the statutory language, the relevant Court of Appeals does not require letters to include the “in writing” requirement to comply with 1692g, the court still sided with the plaintiff.
In this case, the plaintiff is arguing that the validation notice itself violates 1692g, “because it does not adequately inform her a dispute must be in writing to be effective.” The Third Circuit Court of Appeals, which covers Pennsylvania, has not yet dealt with this specific question, so the judge in this case looked to how other Districts have ruled.
Furthermore, the judge attempted to parse out the different subsections of 1692g and whether that yields any additional clarity. For example, both Sections 1692g(a)(4) and 1692g(a)(5) reference the need for a dispute to be filed in writing in order to be considered valid. But Section 1692g(a)(3) only says that a validation notice must include: a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector. There is no mention of that dispute needing to be made in writing.
While acknowledging that the letter sent by the defendant “tracks the statute,” the judge also said that “merely tracking the statutory language is insufficient to comply with Section 1692g – the validation notice ‘must also be conveyed effectively to the debtor.’ “
The judge ruled that a least sophisticated debtor might be confused by the word “if” in the second sentence and think that a debt could be disputed orally or in writing.
We do not view our role as coaching skilled draftsmen as to debt collection language – and nothing in our suggestion should ensure a result in another case – but our reading of the Act and our Court of Appeals’ guidance may be better explained by also telling the debtor: “You may dispute the debt orally but we will only answer you if your dispute is in writing.”
The defendant also tried to argue that 1692g is unconstitutionally vague, but the judge denied the motion for summary judgment on that claim.