Judge Grants MTD in Case Over Interest Disclosure in Letter

A District Court judge in Wisconsin has granted a defendant’s motion to dismiss after it was sued for allegedly violating the Fair Debt Collection Practices Act by not being clear enough about the purported interest that may have been accruing on an unpaid debt.

A copy of the ruling in the case of Salvatore v. Americollect, Inc., can be accessed by clicking here.

The plaintiff received a collection letter regarding an unpaid medical debt. The letter referenced that the amount due was $98.52 and included the following statement above that amount: “The amount due stated below, is the amount due as of the date of this letter. Future interest of 5% per year may be added to the account if the amount due is not paid.”

The plaintiff filed suit, alleging the letter violated Section 1692g(a)(1) of the FDCPA by not clearly stating the total amount due on the date the letter was sent. She contended that the reference to future interest of 5% possibly being added to her balance was “unclear because the letter doesn’t say how Americollect will assess interest, tell her what Americollect would do if she paid the stated amount after additional interest had accrued, or direct her to contact Americollect with questions about her current debt amount.”

Using language similar to that which was challenged in Taylor v. Cavalry Inc., the defendant in this case made a “clear statement of a truism” in relation to the amount due, said Judge James Peterson of the District Court for the Western District of Wisconsin.

The plaintiff contended that the letter should have gone further to explain what would happen if she submitted an insufficient payment and expressly directing her to contact the defendant if she had any questions. But, Judge Peterson noted, there is nothing in the FDCPA that requires the defendant to include such information.

“The debt-collection letter that Americollect sent to Salvatore told her the precise amount that she owed as of the date of the letter and said that future interest might accrue if she did not pay her debt,” Judge Peterson wrote in granting the motion to dismiss. “This is all that § 1692g(a)(1) requires. Even if the information that Salvatore contends that the letter lacked would have been helpful, its absence does not give rise to a cause of action under the FDCPA.”

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