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Appeals Court Overturns Dismissal of FDCPA Case Over Failure to Identify Creditor in Letter

The Court of Appeals for the Third Circuit has overturned a lower court’s dismissal of a lawsuit that alleged a debt collector violated the Fair Debt Collection Practices Act by not accurately identifying the creditor when it send the plaintiff a collection letter.

A copy of the non-precedential ruling in the case of Gross v. Lyons Doughty & Veldhuis, P.C., can be accessed by clicking here.

The plaintiff received a collection letter from the defendant that said it “represents Capital One Bank (USA), N.A., assignee of HSBC BANK NEVADA N.A. RCS DIRECT MARKETING/ORCHARD BANK in connection with [the plaintiff’s] account.” The plaintiff sued, alleging the letter violated the FDCPA because it named four entities — Capital One, HSBC, RCS Direct Marketing, and Orchard Bank — and did not explicitly identify the creditor to whom the debt was owed.

The District Court judge granted a motion to dismiss, ruling the letter adequately conveyed that Capital One was the current creditor and did not violate Section 1692g(a)(2) of the FDCPA.

By using the words “represents” and “assignee” in the letter, the Appeals Court ruled that the letter overshadowed the identity of the actual creditor.

“The letter states that LDV ‘represents’ Capital One Bank and that [the defendant] is a debt collector,” the Appeals Court wrote in its ruling. “This conveys the identity of [the defendant’s] client and that [the defendant] has been retained to collect a debt, but the least sophisticated debtor could still think that any one or more of the listed entities was owed the debt.”

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