Judge Grants MTD in FDCPA Case Over Credit Reporting Language in Letter

A District Court judge in New Jersey has granted a defendant’s motion to dismiss a class action Fair Debt Collection Practices Act case over language related to furnishing information about an unpaid debt to a credit reporting agency in a collection letter.

A copy of the ruling in the case of Knight v. AR Resources can be accessed by clicking here.

The plaintiff received a collection letter from the defendant. The letter, in part, stated: “Please be advised that our client is a credit reporting client. Your credit report may have a negative impact if we do not hear from you.” The plaintiff filed suit, claiming the language violated Section 1692e(5) and 1692e(10) of the FDCPA because the language makes it appear as though both the creditor and the collector will be reporting the debt to the credit reporting agency separately, and that the statement was deceptive because the creditor never had any intention of reporting the debt.

For the plaintiff, this was her second kick at the can, after Judge John Michael Vazquez of the District Court for the District of New Jersey had previously dismissed her complaint without prejudice, giving her the chance to file an amended complaint. In his original opinion, Judge Vazquez noted that the statement in question was a little confusing because the defendant referred itself as “us” earlier in the letter and then switched to “we.” But “despite this ambiguity, neither interpretation was inaccurate because Plaintiff did not allege an inaccuracy and the Court was ‘not aware of any reason why either Defendant or Union Emergency, or both, were unable to report Plaintiff’s debt to a credit reporting agency,’ ” he wrote.

Reviewing the amended complaint, Judge Vazquez reiterated that “it is not unlawful for two entities to report the same debt.”

Regarding the statement, “Please be advised that our client is a credit reporting client,” the plaintiff lacked any proof or substantiation to that claim, Judge Vazquez noted.

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