Judge Denies MTD in FDCPA Case Over Missing Reference in Validation Notice

We’ve all heard the joke, what happens when you assume? You make an ass of u and me. A collection law firm is learning that lesson the hard way after a District Court judge in North Carolina denied its motion to dismiss because it did not explicitly state who was assume a debt to be valid in a collection letter.

A copy of the ruling in the case of Golden v. Higgins Benjamin can be accessed by clicking here.

The plaintiff received a collection letter from the defendant that included the following passage:

“This law firm is a debt collector. This letter is an attempt to collect a debt and any information obtained will be used for that purpose. Unless you dispute the validity of this debt, or any portion, within 30 days after receipt of this letter, the debt will be assumed to be valid.”

The plaintiff filed a single count complaint, alleging the letter violated Section 1692g(a) of the FDCPA because it did not explicitly state who would assume the debt to be valid. The least sophisticated consumer, the plaintiff alleged, might think that a court, credit reporting agency, or other authority would consider the debt to be valid and not the collection agency that sent the letter.

In denying the motion to dismiss, Judge Thomas Schroeder of the District Court for the Middle District of North Carolina ruled there was nothing in the letter or the passage in question to indicate that it would be the collector which would assume the debt to be valid, even though the passage starts by saying “This law firm is a debt collector.”

“…the presence of identifying language elsewhere in the same paragraph, combined with the conspicuous absence in the key sentence, does not eliminate the ambiguity but may increase the tendency to be misleading,” Judge Schroeder wrote. “As other courts interpreting similar language have found, the least sophisticated consumer could read this absence to indicate that the debt would be assumed valid by an entity other than the firm.”

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