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Judge Grants MTD in FDCPA Case Over Two Cent Difference in Settlement Offer

A District Court judge in Michigan has granted a defendant’s motion to dismiss after it was sued for allegedly violating the Fair Debt Collection Practices Act because it could not evenly divide a settlement offer into four equal payments and thus rounded up to the next penny, resulting in a $0.02 difference in what was listed in a collection letter compared with what the plaintiff would have actually paid had she accepted the offer and made the payments as set forth.

A copy of the ruling in the case of Jones-Bell v. Dynamic Recovery Solutions can be accessed by clicking here.

The plaintiff received a collection letter in regards to an unpaid debt of $434.00. The letter offered several payment options, including one option that offered to resolve the balance due if the plaintiff paid $282.10 in four installments. The letter said each payment would be for $70.53 and, once paid, would satisfy the debt. The plaintiff, who did not allege she attempted to pay her debt via this option, did not allege she intended to do so, and did not attempt to contact the defendant when she noted that $70.53 times four is $282.12, not the $282.10 that was offered. Instead, she filed suit, alleging the letter violated Sections 1692e, 1692e(2), 1692e(10), 1692f because the letter sought to collect more than the amount of the offer.

The defendants asserted that its accounting software was nearly rounding up to the nearest penny in calculating how much would have to be paid in each installment to satisfy the settlement offer for that particular option. The plaintiff could not very well make four equal payments of $70.525 each, the defendant argued.

Determining that the plaintiff lacked standing to file a lawsuit over a $0.02 discrepancy, Judge Terrence Berg of the District Court for the Eastern District of Michigan, Southern Division, noted that an individual receiving such a settlement offer should consider himself or herself lucky and not quibble over two cents.

“While it may be plausible to claim that the average consumer would be unlikely to take the time to perform this simple calculation, or notice the error, it is even more unlikely that the average consumer who did the calculation would care much about a 2-cent mistake, when they were realizing approximately a $151 discount on their $434 debt,” Judge Berg wrote, in ruling that the plaintiff also failed to state a claim.

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