Judge Denies MTD Over ‘Will Not Sue’ Statement About Time-Barred Debt

A District Court judge in Illinois has denied a defendant’s motion to dismiss after it was sued for allegedly violating the Fair Debt Collection Practices Act because it said it “will not” sue an individual for a time-barred debt instead of saying it “can not” do so.

A copy of the ruling in the case of Barnett v. Midland Credit Management, Inc., can be accessed by clicking here.

The plaintiff sought to get more information about a debt allegedly owed to the defendant by visiting the defendant’s website. While on the website, the plaintiff was presented with a disclaimer, which read:

If you live in IL, this applies to you: The law limits how long you can be sued on a debt and how long a debt can appear on your credit report. Due to the age of this debt, we will not sue you for it or report payment or nonpayment of it to a credit bureau. If you make a payment on this debt, we will not use the payment to restart the time to sue you for this debt even if the law permits us to do so.

As well, while on the site, the plaintiff was presented with “discount offers” that the defendant said it was not “obligated to renew,” and that the offer “might not be available after today,” which, the plaintiff said, violated the FDCPA because they “induced a false sense of urgency to pay a time-barred debt.”

Even though it said in the disclosure that it would not restart the statute of limitations if a payment was made, the fact that the defendant said “will not sue” instead of “can not sue” is material, Judge Matthew Kennelly ruled. The judge said that had he been asked to rule if the statement was misleading, he might decline to do so, but because the defendant was arguing that it was not misleading, he could not agree. “Given the potential for misinterpretation of the statement about why Midland was not suing Barnett, the Court cannot make such a determination,” he wrote.

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