District Court Refuses to Punish Debt Collector for Accurately Disclosing FDCPA Rights to a Consumer

A New York district court recently dismissed an FDCPA putative class action attempting to penalize a collection agency for disclosing the FDCPA’s cease and desist requirements to a consumer.  Illobre v. Fin. Recovery Servs., 2016 U.S. Dist. LEXIS 153525, 16 CV 452 (S.D.N.Y. Nov. 3, 2016).  The demand letter in question accurately provided the consumer with its Validation Notice under 15 U.S.C. §1692g(a) on the front of the letter.  The back of the letter additionally contained a paragraph under a “NOTICE TO ALL CONSUMERS” which provided as follows:

“You can stop us from contacting you by writing a letter to us that tells us to stop contact or that you refuse to pay the debt.  Sending such a letter does not make the letter go away if you owe it.  Once we receive your letter, we may not contact you again, except to let you know that there won’t be any more contact or that we intend to take a specific action.”

Illobre at *3-4. 

The consumer filed suit contending that the inclusion of the additional language as to cease and desist rights with the validation notice violated both sections 1692e and 1692g because it was confusing to the consumer and overshadowed and contradicted the validation notice.  Section 1692c(c) provides:

If a consumer notifies a debt collector in writing that the consumer refuses to pay a debt or that the consumer wishes the debt collector to cease further communication with the consumer, the debt collector shall not communicate further with the consumer with respect to such debt, except—

(1)  to advise the consumer that the debt collector’s further efforts are being terminated;

(2)  to notify the consumer that the debt collector or creditor may invoke specified remedies which are ordinarily invoked by such debt collector or creditor; or

(3) where applicable, to notify the consumer that the debt collector or creditor intends to invoke a specified remedy.

If such notice from the consumer is made by mail, notification shall be complete upon receipt.

15 U.S.C. §1692c(c).

In granting the collection agency’s motion to dismiss, the court made short order of the consumer’s position noting that the FDCPA “does not aid plaintiffs whose claims are based on bizarre or idiosyncratic interpretations of collection notices.”  Illobre at *7.  The court’s review of the collection letter noted that the validation notice fully recited the requirements of 1692g(a) and accurately summarized the consumer’s rights as 1692c(c).  The court concluded that a reasonable unsophisticated consumer would understand that the notices were distinct disclosures explaining separate and distinct rights.   

The court was also dismissive of the consumer’s nonsensical argument that the debt collector somehow violated the FDCPA by advising the consumer of its rights under the FDCPA.  The consumer contended that the FDCPA does not require the debt collector to disclose to the consumer the communication rights found in Section 1692c(c) and Congress did not intend for this information to be disclosed to a consumer.  The consumer therefore argued that by making the disclosures, the debt collector violated the FDCPA.  As aptly pointed out by the collection agency, however, “[i]t is difficult to imagine Congress enacting a statute for the purpose of providing rights to protect consumers, but not intending that those right be disclosed to the individuals the statute was enacted to protect.” Illobre v. Financial Recovery Services, Inc., 16 CV 452 {S.D.N.Y. Nov. 3, 2016) at Dkt No. 13, p. 10.  The court “decline[d] to construe the FDCPA, a consumer protection statute, in such a way that prohibits or discourages debt collectors from sensible and accurately informing consumers of their rights.”  Illobre at *12.