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Judge Denies MTD in FDCPA Dispute Response Case

A federal judge in Washington has denied a defendant’s motion to dismiss after it was sued for allegedly violating the Fair Debt Collection Practices Act in a letter that was sent to the plaintiff in response to her disputing the debt in question.

A copy of the ruling in Lagrou v. Monterey Financial Services can be accessed by clicking here.

The plaintiff received a collection letter from the defendant and sent a letter back in response, disputing the debt, requesting validation, and asking not to be contacted via the telephone. In response to the plaintiff’s letter, the defendant sent this letter back in reply:

In response to the letter we received and pursuant to the debt validation requirements set forth in the Fair Debt Collection Practices Act, all calls from my office regarding the defaulted account with HDL, Inc. will cease. However, this defaulted account will report accordingly, as a disputed collection account on your credit report. Call our office today to set up the necessary arrangements to satisfy your obligation to the contract.

The plaintiff filed suit, alleging the letter Sections 1692e(5) and 1692g(b) of the FDCPA because the statement about reporting the debt was deceptive and the entire letter constituted attempting to collect a debt without providing verification.

The defendant sought to have the case dismissed on the grounds that the plaintiff had not adequately pled her claims. Judge Stanley Bastian of the District Court for the Eastern District of Washington disagreed.

Because the letter intimated that the defendant was going to report the debt to the credit bureaus by using the verb “will,” the plaintiff’s interpretation was a “reasonable one,” Judge Bastian wrote.

Regarding the count that the entire letter was an attempt to collect on a debt without providing verification, the judge ruled the last sentence of the letter “presents a clear message” that the plaintiff is instructed to contact the defendant “to arrange paying for the debt.”

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