Judge Grants MTD in FDCPA Case Over ‘Generic’ References in Letter

A District Court judge in New Jersey has granted a defendant’s motion to dismiss, ruling the plaintiff lacked standing filing a class-action lawsuit against a collection law firm, accusing it of violating the Fair Debt Collection Practices Act because the pronouns used in a collection letter were too generic.

A copy of the ruling in the case of Vaughan v. Fein, Such, Kahn & Shephard can be accessed by clicking here.

The plaintiff received a collection letter from the defendant, referencing an unpaid debt which had been transformed into a wage garnishment. The plaintiff claimed in his complaint that the letter mis-stated the amount that was due because it did not indicate whether interest was accruing or if it had been waived, and because the letter referenced the original creditor as the “plaintiff” and referenced the plaintiff as “the consumer” and the defendant as “the debt collector” which “failed to provide clarity as to the parties” in violation of Section 1692g of the FDCPA.

In filing its motion to dismiss, the defendant argued the plaintiff lacked standing to sue, because he did not suffer a concrete injury. The plaintiff countered that his confusion about the amount of the debt, the party to whom the debt was owed, and whether the defendant was the debt collector “led to an inability to make an informed decision on payment that is similar in kind to common law factors for fraud-even if not similar in degree.”

Acknowledging that the analogue he alleged is “proper” Judge Claire C. Cecchi of the District Court for the District of New Jersey wrote that “deceptive debt collection practices and misleading or inaccurate information bear a preliminary kinship to common-law fraud or fraudulent misrepresentation.” But the plaintiff also needed to allege that he relied on the misrepresentation, Judge Cecchi noted, and “insofar as Plaintiff alleges he ‘would have pursued a different course of action were it not for Defendants’ statutory violations,’ he fails to allege what specifically he would have done differently, or that his actual course of action (which Plaintiff also does not specify) resulted in any harm.”

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