Judge Grants Summary Judgment in Favor of Plaintiff in FDCPA Letter Case

A federal judge in Pennsylvania has granted summary judgment in favor of a plaintiff who sued a collection agency, alleging that a letter sent by the defendant violated the Fair Debt Collection Practices Act because it misleadingly indicated a dispute could be made by calling the defendant, even though the defendant used the statutory text related to disputes in the letter.

A copy of the ruling in Coulter v. Receivables Management Systems can be accessed by clicking here.

The plaintiff received an invoice from a healthcare facility relating to treatment he had received. Believing his insurance would cover the bill, the plaintiff did not pay the invoice. The account was subsequently placed with the defendant for collection. The defendant sent the plaintiff a collection letter, which included the following passage: 


Your delinquent account with Patient First has been placed with RMS for immediate attention. 

Our records indicate that despite our client’s numerous requests for payment you have allowed your account to become seriously PAST DUE. Your payment of this balance, however, will allow us to cease further collection action against you. 

If you feel that this balance may be due from your insurance carrier please contact your carrier prior to contacting the representative at the extension listed below. 

Our Collection Representatives are available to work with you between the hours of 8:30 a.m. and 4:30 p.m. Mail your payment or call today. 

Collection Representative: Phil Irvin Extension 3141 

Federal Law requires us to inform you that: 

Unless you notify this office within 30 days after receiving this notice that you dispute the validity of the debt or any portion thereof, this office will assume this debt is valid. If you notify this office in writing within 30 days from receiving this notice, this office will: obtain verification of the debt or obtain a copy of a judgment and mail you a copy of such judgement or verification. 

Below the notice, a P.O. Box was listed as well as two telephone numbers for the defendant.

The plaintiff filed suit, alleging the letter violated Sections 1692g and 1692e of the FDCPA, because by indicating that the plaintiff should call the defendant if he believed the debt should be paid by the insurance company.

Judge Juan Sanchez of the District Court for the Eastern District of Pennsylvania, ruled the validation notice was overshadowed and contradicted by the paragraphs that advised the plaintiff to call the defendant to raise an “insurance-related dispute” of the debt, looking at the precedent of Caprio v. Healthcare Revenue Recovery Group.

“Because the least sophisticated debtor could reasonably understand the challenged provisions of the Collection Letter to instruct the consumer that an insurance-related dispute regarding the debt could be raised by calling RMS, when, in fact, a dispute of a debt must be in writing to be effective, the Court finds these provisions overshadowed and contradicted the validation notice in the Letter in violation of § 1692g,” Judge Sanchez wrote.

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