A judge in the Eastern District of New York recently discussed in an opinion that Fair Debt Collection Practices (FDCPA) cases based on technicalities don’t serve the underlying purpose of the FDCPA to protect consumers.
Ocampo v. Client Services, Inc., No. 1:18-cv-4326 (E.D.N.Y. Jul. 3, 2019) centered on a claim that a collection letter did not properly identify the creditor to whom the debt was owed. The letter stated “Re: Synchrony Walmart MC" and this, according to plaintiff, does not satisfy the FDCPA's requirement.
The court disagreed. The court reasoned that a least sophisticated consumer would not be confused by the letter since it clearly lays out that the account has been placed for collections and the letter only lists one entity that could be the creditor: Synchrony Walmart MC. Considering there was only one entity named, the court did not agree that including “Re” somehow made it more confusing.
Instead, the court states:
Even the least sophisticated consumer, armed with the knowledge that she has a Walmart credit card, is not as lacking in financial acumen as plaintiff contends, and no reasonable jury could find otherwise. If she is able to fill out the Walmart credit card application, she is able to comprehend that a reference line in a collection letter to Walmart refers to her Walmart credit card, especially when she has used it to charge thousands of dollars in purchases.
What possible interpretation of the name, account number, and amount due could plaintiff have besides that which was clearly intended? This is her Walmart credit card; it simply cannot be anything else. Plaintiff offers no alternative construction. If she doesn’t know that it is her Walmart credit card that is being collected, her sophistication level is below that of the least sophisticated consumer.
The court finishes off the opinion with some choice words about lawsuits such as this one, which are based purely on technicalities:
Cases like this – litigation over whether an innocuous debt collection letter is in technical compliance with the FDCPA – are far afield from the original intent behind the FDCPA. . .That is not what happened here at all. Rather, this is a “lawyer’s case,” by which I mean that it alleges a defect of which only a sophisticated lawyer, not the least sophisticated consumer, would conceive.
The consequence of such cases, according to the court, is harm to the least sophisticated consumer by decreasing access to credit.
As stated in Moss & Barnett’s most recent Debt Collection Drill podcast, district courts in New York are getting tired of these hyper-technical FDCPA cases. This isn’t the first time the Eastern District of New York has called out such lawsuits and how they “serve largely to facilitate debt evasion and to prop profits among the plaintiffs’ bar.”
Defending these types of cases helps the industry in two main ways. First, it establishes precedent to support other industry companies facing identical claims. (Unfortunately, that’s not always the nail in the coffin for these types of suits, as we are still seeing in New York with the Avila-esque interest disclosure cases.) Second, it brings attention to the absurdity of these suits and, as they say, sunlight is the best disinfectant.