District Court Concludes that Validation Notice in Debt Collection Letter was Presumptively Valid because it Tracked Section 1692g of the Fair Debt Collection Practices Act (FDCPA), but Concluded that Least Sophisticated Consumer could have been Confused by “Subject To” Language in Letter and so Denies Defense Motion to Dismiss Class Action Complaint
Plaintiffs filed a putative class action against debt collection law firm alleging that a debt collection letter sent in August 2005 violated the federal Fair Debt Collection Practices Act (FDCPA). Meselsohn v. Lerman, 485 F.Supp.2d 215, 216 (E.D.N.Y. 2007). Defense attorneys moved to dismiss the class action complaint for failure to state a claim on the ground that the letter was presumptively valid. Surprisingly, plaintiff admitted that the letter “properly informs the consumer of his rights to dispute the debt, request verification of the debt and request creditor information within thirty (30) days of the initial communication from the debt collector.” Id., at 217. The class action complaint was premised on the theory that the letter violated the FDCPA because the 30-day validation period required by Section 1692g is “improperly overshadowed by the demand for payment of the debt within the same thirty days.” Id. According to plaintiff, it was unclear that he had the right “to either pay the debt or request validation,” id. (italics added). Defense attorneys argued that dismissal of the class action was warranted because the letter “tracks the statutory language of the FDCPA and is presumptively valid,” and argued further that the demand for payment “is specifically made ‘subject to’ the thirty day notice provisions” and so the validation notice is not “overshadowed” by the payment demand. Id. Plaintiff countered that the letters should have included “transitional language explaining to the consumer that the demand for payment does not override the consumer’s right to seek validation of the debt” and that it is deficient because it is not clear that the consumer may either pay the debt or dispute it. Id. The district court agreed with plaintiff.