Judge Grants MSJ in FDCPA Suit Over Payment Options ‘May’ Not Be Available

A District Court judge in Illinois has granted a defendant’s motion for summary judgment after it was sued for violating the Fair Debt Collection Practices Act by saying in a collection letter that payment options “may” not be available if the recipient of the letter did not contact the collection agency.

A copy of the ruling in the case of Ramirez, Avina, Nieto, Ranos, and Gonzalez v. Midland Funding, Midland Credit Management, and Encore Capital Group can be accessed by clicking here.

The plaintiffs all had debts with different creditors that were purchased by the defendant. Each of the plaintiffs received a collection letter that included the following statement:

LET US HELP YOU! If the Account goes to an attorney, our flexible options may no longer be available to you. There is still an opportunity to make arrangements with us. We encourage you to call us at: (800) 939-2353.

Ultimately, lawsuits were filed against two of the five plaintiffs that sought to collect on the unpaid debts.

The plaintiffs filed suit, alleging the statement violated Sections 1692e(5) and 1692f of the FDCPA by threatening an action that the defendant did not intend to take and for using unconscionable means to collect on a debt.

For cases in which the language in question is not misleading or confusing on its face, the plaintiffs are burdened with producing extrinsic evidence to provide that unsophisticated consumers find the statements to be challenging or deceptive. The plaintiffs tried to convince the judge that the statement was misleading and confusing on its face, arguing that attorneys could accept settlements and lump-sum payments, but the plaintiffs ignored the most important word in the statement, according to Judge Jorge Alonso of the District Court for the Northern District of Illinois, Eastern Division. And that word is “may.”

“Had the dunning letters at issue in this case used the word ‘will’ instead of ‘may,’ then the Court would agree that the letters would have been false on their face,” Judge Alonso wrote. “That is so, because, under some circumstances, an attorney could accept a reduced lump-sum payment or payment plan. It could not, therefore, be true that flexible options ‘will’ no longer be available. The letter, though, says ‘may.’ Furthermore, ability to pay is fluid, and, when the letter was sent, MCM could not know what the debtor’s ability to pay would be going forward which means MCM could not know whether flexible payment options would be agreeable to an attorney in the future.”

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