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Hurwitz v. Hecker

2009 WL 4282194 (U.S. Dist. Ct. D. N.J. 2009) (Unpublished)

ATTORNEYS; COLLECTION; FDCPA — Even though a collection letter properly contains the FDCPA requirement for a “thirty-day notice” provision, that requirement will not be met if the notice is overshadowed or contradicted by accompanying messages or notices from the debt collector, including from an attorney.

A New Jersey attorney sent a collection letter to a New York resident. The letter contained a standard thirty-day “Notice of Important Rights” informing the consumer of his right to contest the debt pursuant to the Fair Debt Collection Practices Act (FDCPA). On the reverse side were notices of rights as required by various state laws, including one state other than New Jersey. The collection letter also contained another notice as required by yet a third state, but it did not identify this notice as pertaining to the laws of the third state. The notices from the other states said that the creditor may file a negative credit report against the debtor and order an investigative consumer report. The debtor sued the attorney, alleging that the attorney used false and deceptive means in connection with the collection of the debt by falsely threatening the consumer with negative credit reporting as well as by obtaining an investigative report. The attorney moved to dismiss the suit.

The United States District Court dismissed the case, even though when a “thirty-day notice” is given the requirements of the FDCPA will not be met if the notice is overshadowed or contradicted by accompanying messages or notices from the debt collector. Whether a notice is deceptive or misleading is measured from the vantage point of an objective “least sophisticated consumer” in order to protect all consumers. Here, the consumer did not allege that the 30-day notice was inadequate. Rather, he alleged that two provisions in the letter constituted false and misleading threats, that, when read together, overshadowed the 30-day notice, and thus, dissuaded him from exercising his rights to dispute the debt. Since one of the clauses was on the reverse side of the 30-day notice and was clearly addressed to residents of another state, the Court felt it was implausible that the consumer would read such notices and believe they applied to him. As to the notice provision in the body of the collection letter that did not pertain to New York or New Jersey debtors, the Court held that the consumer may have reasonably believed the notice applied to him because it did not identify the applicable state for the notice. Nevertheless, the Court ruled that a consumer has to allege that this particular notice in the collection letter was abusive, deceptive or unfair. Here, the Court determined that the consumer only alleged, in a conclusory manner, that the mere inclusion of the non-applicable provisions violated the FDCPA. It noted that even though neither New York nor New Jersey law requires such notices in a collection letter, the consumer did not explain how the inclusion of these provisions was abusive, deceptive or unfair. Thus, the allegations were deemed to be insufficient to set forth a plausible claim. It also rejected the consumer’s claim that the FDCPA disallows procurement of investigative reports except in very narrow circumstances. It held that the Act specifically authorizes use of such reports to review accounts and determine if a consumer has violated account terms. In the instant case, the Court believed that the collection attorney clearly had a permissible purpose to obtain the reports in connection with the consumer’s account.

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