Editor's Note: This article was written by Punit Marwah, Ethan G. Ostroff, and David N. Anthony and was originally published on the Troutman Sanders LLP Consumer Financial Services Law Monitor. It is republished here with permission.
The United States District Court for the Western District of Texas recently granted summary judgment in favor of a debt collector, holding that letters sent with the same client account number for two different debts incurred with the same underlying creditor was not false, deceptive, or misleading or otherwise in violation of the Fair Debt Collection Practices Act.
Consumer plaintiff Mary Reynolds incurred debts with the original creditor, Methodist Specialty & Transport Hospital, for two separate hospital visits five months apart in 2017. Medicredit, Inc. sent Reynolds two collection letters relating to the hospital visits. These letters included the same account number generated by Medicredit but pertained to debts from two separate hospital visits, with two separate balances, and different account numbers for the original creditor.
The first letter stated the balance owed as $600 for a hospital visit in March 2017, and the second letter stated a balance of $75, pertaining to a hospital visit in the following August. Reynolds alleged this caused her to believe that the amount of debt had decreased due to her insurance paying off a portion of the debt.
Reynolds filed suit, alleging Medicredit violated the FDCPA by unlawfully confusing her by including the same internal account number on both letters even though the letters pertain to separate debts. Specifically, Reynolds alleged a violation of § 1692e for using any false, deceptive, or misleading representation or means in connection with the collection of any debt, and a violation of § 1692(f) for using unfair or unconscionable means to collect or attempt to collect any debt. Medicredit filed a motion for summary judgment on the basis that no reasonable factfinder could find the correspondences at issue misleading because an unsophisticated consumer would understand that the letters were for separate financial obligations.
In its opinion, which can be found here, the Court held that the ultimate question in the case is whether the unsophisticated or least sophisticated consumer would have been led by the debt collection letter into believing something untrue that would have influenced their decision making.
In granting Medicredit’s motion for summary judgment, the Court noted that the collection letters would deceive or mislead only under a “bizarre or idiosyncratic” reading. The Court reasoned that an unsophisticated consumer, when reading the letters as a whole with some care, would note the differing client account numbers in the letters, the fact that the dates of service differed by more than four months, and the large gap between the two balances of $600 and $75. Finally, the Court held that Medicredit’s inclusion of a self-generated account number, even viewed from an unsophisticated consumer’s perspective, is not unfair or unconscionable, just as it is not false, deceptive, or misleading.