Judge Grants MSJ in FDCPA Case Over Settlement Offer in Letter

In a case that was defended by Cooper Walker and the team at Frost Echols, a District Court judge in New York has granted a defendant’s motion for summary judgment, ruling a plaintiff lacked standing to pursue a Fair Debt Collection Practices Act case because she did not suffer a concrete injury after receiving a letter offering to settle a debt for which interest could have been accruing, but wasn’t.

A copy of the ruling in the case of Snyder v. LVNV Funding et al. can be accessed by clicking here.

The plaintiff defaulted on a credit card debt and was sued for the balance that was owed. A judgment was obtained, which ended up being acquired by one of the defendants. The judgment total — back in 2014 when it was obtained — was $1,015.20. In 2021, another defendant sent the plaintiff a collection letter, stating that the total due was $2,017.83 and offered to settle the account for 65% of the balance that was owed.

The plaintiff filed suit, ultimately accusing the defendants of violating Sections 1692e and 1692g(a)(1) of the FDCPA because interest on the judgment was technically accruing, whether the defendant was going to add it to the balance or not, which would bring into dispute the total amount of the debt owed as stated in the letter, and that the information in the letter was not clear enough to allow her to make an informed decision about what to do.

All of that may be true, but the plaintiff ultimately did not suffer any injury as a result of receiving the letter, noted Judge Cathy Seibel of the District Court for the Southern District of New York. Sure, the plaintiff claimed that had she not been confused by the letter that she would have borrowed money from family and friends to pay the balance and that the job she started a few months after receiving the letter would have allowed her to start making payments but she didn’t know if the offer was still available. That allowed interest to continuing accruing on the debt, she claimed.

But, as Judge Seibel noted, there was nothing in the letter that said the settlement offer would expire at some point in the future, and the ability to borrow money from family and friends is not concrete enough to have actually done anything in regards to repaying the debt.

“Plaintiff, then, was not faced with an increased payment obligation, but only the risk that in the future Defendants or some other entity would seek more money from her than what she was offered in the Letter,” Judge Seibel wrote. “That hypothetical set of circumstances represents only the risk of future harm, and is thus not concrete.”

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