The Court of Appeals for the Sixth Circuit has overturned a lower court’s dismissal of a lawsuit, ruling that it was too eager to discredit that the words “Collection Bureau” were clearly visible through the glassine portion of an envelope containing a collection letter and remanding the case back to the District Court.
A copy of the ruling in the case of Cagayat v. United Collection Bureau can be accessed by clicking here.
The plaintiff received a collection letter from the defendant. On the inward side of the letter was the defendant’s name. The “Collection Bureau” of “United Collection Bureau” allegedly bled through the paper and were visible through the glassine portion of the envelope. The plaintiff filed suit, alleging the letter violated Section 1692f(8) of the Fair Debt Collection Practices Act, which prohibits using any language or symbol, other than the debt collector’s address, on an envelope, except that a debt collector may use his business name if such name does not indicate that it is in the debt collection business. The District Court granted the defendant’s motion to dismiss, ruling that the words “Collection Bureau” were not clearly visible and “barely legible” and that even a least sophisticated consumer would not be able to read the words without “unusual strain or effort because those words are printed on the opposite side of the Letters and are upside-down and backwards.”
But at the motion to dismiss stage, the District Court erred because the exhibits provided by the plaintiff — the letters in question — would have to “utterly discredit” the plaintiff’s allegations, and they do not, the Appeals Court ruled.
“We find it is reasonable to conclude that discovery will reveal that the Letters, when viewed in normal lighting, display clearly visible language that indicates that the communications pertain to collection of a debt,” the Appeals Court wrote in its ruling. “Thus, we disagree with the district court’s holding that Cagayat’s exhibits contradict her assertion that the words “Collection Bureau” are clearly visible.”
The Appeals Court also ruled that the District Court mis-applied the least sophisticated consumer standard because all someone had to do was to turn the envelope around and the text of the letters would no longer be upside down.
“This decision does not affect what a debt collector can write inside a letter,” the Appeals Court wrote. “All it requires is a simple adjustment, such as lighter ink, thicker writing paper or envelopes, or an extra sheet of paper covering the letter inside. A contrary decision would permit an end-run around § 1692f(8) by clever envelope, paper, or font selection. Thus, applying the least sophisticated consumer standard, the fact that the words ‘Collection Bureau’ are upside-down and backwards does not utterly discredit Cagayat’s assertion that the language can be clearly read without unusual strain or effort.”