McCamey v. Capital Management Services LP et al

Filing 46

MEMORANDUM OPINION AND ORDER DENYING 32 MOTION to Dismiss as set out herein. Signed by Judge Virginia Emerson Hopkins on 8/10/2018. (JLC)

FILED
2018 Aug-10 PM 04:26
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
NORTHEASTERN DIVISION
ROSITA MCCAMEY, individually
and on behalf of all others similarly
situated,
Plaintiff,
v.
CAPITAL MANAGEMENT,
SERVICES, LP, et al.,
Defendants.

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) Case No.: 5:17-CV-1429-UJH-VEH
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MEMORANDUM OPINION AND ORDER
I.

INTRODUCTION
In 1977, Congress found that there was “abundant evidence of the use of

abusive, deceptive, and unfair debt collection practices by many debt collectors” and
that the “[e]xisting laws . . . [were] inadequate to protect consumers.” 15 U.S.C. §
1692(a), (b); see also 104 AM. JUR. PROOF OF FACTS 3D Proof Under the Fair Debt
Collection Practices Act §1. To respond, Congress passed the Fair Debt Collection
Practices Act “to eliminate abusive debt collection practices by debt collectors, to
insure that those debt collectors who refrain from using abusive debt collection
practices are not competitively disadvantaged, and to promote consistent State action
to protect consumers against debt collection abuses.” 15 U.S.C. §1692(e). This law

is the centerpiece of Plaintiff Rosita McCamey’s lawsuit and the focus of today’s
opinion. (Doc. 1).
Before the Court is Defendants Capital Management Services, LP’s (“CMS”)
and Jefferson Capital Systems, LLC’s (“JCS”) joint Motion To Dismiss (the
“Motion”) under Rule 12(b)(6) and 12(c). (Doc. 32). The parties have completed their
briefing, and the Motion is ripe for review. For the reasons stated in this opinion, it is
due to be DENIED.
II.

RELEVANT BACKGROUND
“[I]n 2007 Ms. McCamey fell behind in paying some of her debts, including

one she allegedly owed for a Fingerhut account.” (Doc. 1 at ¶7). “Sometime after that
debt became delinquent, it was allegedly purchased/obtained by [JCS], which tried to
collect upon it, by having Defendant CMS demand payment of the debt, via collection
letters, dated February 12, 2017[,] and May 6, 2017.” (Id.). “These letters made
‘settlement’ offers of 66% and 61%.” (Id.). They also stated:
As a result of the expiration of the statute of limitations with respect to
such debt, legal action may not be brought against the consumer to
collect such debt. Any payment by the consumer towards the debt may
cause the statute of limitations for such debt to reset.
(Doc. 1-1 at 1-2). Ms. McCamey alleges that her debt was time barred under Alabama
law, and that these letters violated the FDCPA. (See Doc. 1 at ¶¶8-9). She filed her
federal lawsuit on August 22, 2017, alleging two counts for violations of §1692e and
2

§1692f of the FDCPA. (See id. at pg. 4-6).
III.

THE RULE 12(b)(6) AND 12(c) STANDARD
A Rule 12(b)(6) motion attacks the legal sufficiency of the complaint. See FED.

R. CIV. P. 12(b)(6) (“[A] party may assert the following defenses by motion: (6)
failure to state a claim upon which relief can be granted[.]”). The Federal Rules of
Civil Procedure require only that the complaint provide “‘a short and plain statement
of the claim’ that will give the defendant fair notice of what the plaintiff’s claim is and
the grounds upon which it rests.” Conley v. Gibson, 355 U.S. 41, 47, 78 S. Ct. 99, 103,
2 L. Ed. 2d 80 (1957) (footnote omitted) (quoting FED. R. CIV. P. 8(a)(2)), abrogated
by Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556, 127 S. Ct. 1955, 1965, 167 L.
Ed. 2d 929 (2007); see also FED. R. CIV. P. 8(a) (setting forth general pleading
requirements for a complaint including providing “a short and plain statement of the
claim showing that the pleader is entitled to relief”).
While a plaintiff must provide the grounds of his entitlement to relief, Rule 8
does not mandate the inclusion of “detailed factual allegations” within a complaint.
Twombly, 550 U.S. at 555, 127 S. Ct. at 1964 (quoting Conley, 355 U.S. at 47, 78 S.
Ct. at 103). However, at the same time, “it demands more than an unadorned,
the-defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662,
678, 129 S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009). “[O]nce a claim has been stated
3

adequately, it may be supported by showing any set of facts consistent with the
allegations in the complaint.” Twombly, 550 U.S. at 563, 127 S. Ct. at 1969.
“[A] court considering a motion to dismiss can choose to begin by identifying
pleadings that, because they are no more than conclusions, are not entitled to the
assumption of truth.” Iqbal, 556 U.S. at 679, 129 S. Ct. at 1950. “While legal
conclusions can provide the framework of a complaint, they must be supported by
factual allegations.” Id. “When there are well-pleaded factual allegations, a court
should assume their veracity and then determine whether they plausibly give rise to
an entitlement to relief.” Id. (emphasis added). “Under Twombly’s construction of
Rule 8 . . . [a plaintiff’s] complaint [must] ‘nudge[] [any] claims’ . . . ‘across the line
from conceivable to plausible.’ Ibid.” Iqbal, 556 U.S. at 680, 129 S. Ct. at 1950-51.
A claim is plausible on its face “when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.” Iqbal, 556 U.S. at 678, 129 S. Ct. at 1949. “The plausibility
standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer
possibility that a defendant has acted unlawfully.” Id. (quoting Twombly, 550 U.S. at
556, 127 S. Ct. at 1965).
Rule 12(c) of the Federal Rules of Civil Procedure provides that “[a]fter the
pleadings are closed--but early enough not to delay trial--a party may move for
4

judgment on the pleadings.” FED. R. CIV. P. 12(c). As the Eleventh Circuit has
explained the Rule 12(c) standard:
Judgment on the pleadings is appropriate when there are no material
facts in dispute, and judgment may be rendered by considering the
substance of the pleadings and any judicially noticed facts. See Bankers
Ins. Co. v. Florida Residential Property and Cas. Joint Underwriting
Ass'n, 137 F.3d 1293, 1295 (11th Cir. 1998) (citing Hebert Abstract Co.
v. Touchstone Properties, Ltd., 914 F.2d 74, 76 (5th Cir. 1990)); see also
Rule 12(c), [FED. R. CIV. P.] When we review a judgment on the
pleadings, therefore, we accept the facts in the complaint as true and we
view them in the light most favorable to the nonmoving party. See
Ortega, 85 F.3d at 1524 (citing Swerdloff v. Miami Nat'l Bank, 584 F.2d
54, 57 (5th Cir. 1978)). The complaint may not be dismissed “‘unless it
appears beyond doubt that the plaintiff can prove no set of facts in
support of his claim which would entitle him to relief.’” Slagle, 102 F.3d
at 497 (quoting Conley v. Gibson, 355 U.S. 41, 45–46, 78 S. Ct. 99,
101–02, 2 L. Ed. 2d 80 (1957) & citing Hartford Fire Ins. Co. v.
California, 509 U.S. 764, 811, 113 S. Ct. 2891, 2916–17, 125 L. Ed. 2d
612 (1993)).
Hawthorne v. Mac Adjustment, Inc., 140 F.3d 1367, 1370 (11th Cir. 1998).
Further, “[w]hether the court examine[s] [a pleading] under Rule 12(b)(6) or
Rule 12(c), the question [remains] the same: whether the [complaint] stated a claim
for relief.” Sampson v. Washington Mut. Bank, 453 F. App’x 863, 865 n.2 (11th Cir.
2011) (first alteration supplied; all other alterations in original) (quoting Strategic
Income Fund, L.L.C. v. Spear, Leeds & Kellogg Corp., 305 F.3d 1293, 1295 n.8 (11th
Cir. 2002)); id. (applying Strategic Income and concluding that court’s error in
granting a dismissal under Rule 12(c) instead of Rule 12(b)(6) was harmless).
5

IV.

AN OVERVIEW OF THE FAIR DEBT COLLECTION PRACTICES ACT
“To assert a claim under the FDCPA, a plaintiff must establish the following

elements: ‘(1) the plaintiff has been the object of collection activity arising from
consumer debt, (2) the defendant is a debt collector as defined by the FDCPA, and (3)
the defendant has engaged in an act or omission prohibited by the FDCPA.’”
Buckentin v. Sun Trust Mortg. Corp., 928 F. Supp. 2d 1273, 1294 (N.D. Ala. 2013)
(citing sources).
The FDCPA prohibits certain conduct. “Section 1692e of the FDCPA provides
that ‘[a] debt collector may not use any false, deceptive, or misleading representation
or means in connection with the collection of any debt.’” Crawford v. LVNV Funding,
LLC, 758 F.3d 1254, 1258 (11th Cir. 2014) (quoting 15 U.S.C. § 1692e). The statute
goes on to give examples of specific conduct that violates the act. See 15 U.S.C. §
1692e (1)-(16). “Section 1692f states that ‘[a] debt collector may not use unfair or
unconscionable means to collect or attempt to collect any debt.’” Crawford, 758 F.3d
at 1258 (quoting 15 U.S.C. § 1692f). Similarly, this section also gives specific
examples of conduct violating the law. See 15 U.S.C. § 1692f(1)-(8).1 “To enforce the
1

It is crucial for the reader to understand that Ms. McCamey brought her action under
§1692e and §1692f. (Doc. 1 at 4-6). The plain text of §1692e is very broad and makes clear that
the examples of violations under that section are not meant to “limit[ ] the general application”
that “[a] debt collector may not use any false, deceptive, or misleading representation or means
in connection with the collection of any debt.” See 15. U.S.C. §1692e. While Ms. McCamey also
mentions §1692e(2)(A) and §1692e(5) in her Complaint, mentioning those specific provisions
6

FDCPA's prohibitions, Congress equipped consumer debtors with a private right of
action, rendering ‘debt collectors who violate the Act liable for actual damages,
statutory damages up to $1,000, and reasonable attorney's fees and costs.’” Crawford,
758 F.3d at 1258 (citing sources).
To understand actions under the FDCPA requires knowing the “least
sophisticated consumer.” See LeBlanc v. Unifund CCR Partners, 601 F.3d 1185, 1193
(11th Cir. 2010). This is because “[t]he inquiry is not whether the particular
plaintiff-consumer was deceived or misled; instead, the question is ‘whether the ‘least
sophisticated consumer’ would have been deceived’ by the debt collector's conduct.”
Crawford, 758 F.3d at 1258. “The ‘least-sophisticated consumer’ standard is
consistent with basic consumer-protection principles.” LeBlanc, 601 F.3d at 1194
(citing sources). “‘The least sophisticated consumer’ can be presumed to possess a
rudimentary amount of information about the world and a willingness to read a
collection notice with some care.” Id. (quoting another source) (internal quotation
marks omitted). “However, the test has an objective component in that ‘[w]hile
protecting naive consumers, the standard also prevents liability for bizarre or
idiosyncratic interpretations of collection notices by preserving a quotient of

does not detract from the overall prohibition mentioned in §1692e. (See Doc. 1 at 4-5).
Accordingly, this Court would err if it focused on only one provision while ignoring the rest of
the section. §1692f has a similar construction to §1692e. 15 U.S.C. §1692f.
7

reasonableness.’” Id. (quoting another source).
“Generally, ‘whether the 'least sophisticated consumer' would construe [the
conduct] as deceptive is a question for the jury.’” Miljkovic v. Shafritz & Dinkin, P.A.,
791 F.3d 1291, 1307 n.11 (11th Cir. 2015) (quoting Jeter v. Credit Bureau, 760 F.2d
1168, 1178 (11th Cir. 1985)); see also Buchanan v. Northland Group, Inc., 776 F.3d
393, 397 (6th Cir. 2015) (noting that in most cases “whether a letter is misleading
raises a question of fact”). “Courts do not lightly reject fact-based claims at the
pleading stage.” Buchanan, 776 F.3d at 397. “[This Court] may do so only after
drawing all reasonable inferences from the allegations in the complaint in the
plaintiff's favor and only after concluding that, even then, the complaint still fails to
allege a plausible theory of relief.” Id. (citing FED.R.CIV.P. 12(b)(6); Ashcroft v. Iqbal,
556 U.S. 662, 677–79 (2009)).
V.

ANALYSIS
The Defendants’ primary argument is two-pronged. (See Doc. 32 at 2). They

argue that the letter would not be misleading without the disclaimer, and that it was
not misleading with the disclaimer. (See id.). A third, more peripheral, argument is
that, under Alabama law, a partial payment would not have reset the statute of
limitations anyway. (See id.). At bottom, resolving this Motion requires the Court to
address one main issue: whether the letters sent to Ms. McCamey were in violation of
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the FDCPA in light of the least sophisticated consumer standard.
A.

Statute of Limitations Disclaimers Are Not Required, but the Letters
Here Could Have Been Deceptive to the Least Sophisticated
Consumer Without One

The Defendants argue that “[Eleventh Circuit precedent] supports dismissal
even if the letters did not contain the disclaimer.” (Doc. 32 at 8) (emphasis and
capitalization omitted). They start by noting that, in Alabama, “a creditor has the right
to payment of a debt even after the limitations period has expired.” (See id. at 9)
(citing sources). They then go on to assert that “the sending of a letter seeking
payment on an outstanding debt in and of itself cannot support liability under the
FDCPA so long as the letter does not threaten litigation.” (See id. at 9) (citing
Crawford v. LVNC Funding, LLC, 758 F.3d 1254, 1259 (11th Cir. 2014)). This
statement is correct in that “[f]ederal circuit and district courts have uniformly held
that a debt collector's threatening to sue on a time-barred debt and/or filing a
time-barred suit in state court to recover that debt violates §§ 1692e and 1692f.” See
Crawford, 758 F.3d at 1259 (citing sources). However, as the plain text of the FDCPA
indicates, there are numerous ways that a debt collector can violate the statute;
improperly threatening litigation is just one of them. See 15 U.S.C. §§ 1692e, 1692f.
Defendants then rely heavily on decisions from the Third and Eighth Circuits
to support their main contention “that absent an explicit threat of litigation in a
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collection letter or actual litigation, there could be no violation of the FDCPA” when
a debt collector sends a letter to collect a time-barred debt without a disclaimer stating
that fact. (See Doc. 32 at 9-12) (citing Freyermuth v. Credit Bureau Servs., Inc., 248
F.3d 767 (8th Cir. 2001); Huertas v. Galaxy Asset Mgmt., 641 F.3d 28 (3d Cir. 2011)).
The Defendants further contend that at least two district courts in the Eleventh Circuit
have followed their approach, while distinguishing one that did not. (See id. at 10-11)
(citing Elrich v. Convergent Outsourcing, Inc., 2015 U.S. Dist. LEXIS 145459, *7
(S.D. Fla. 2015); Olsen v. Cavalry Porfolio Servs., LLC, 2016 U.S. Dist. LEXIS
106186, *5 (M.D. Fla. 2016); Lopera v. Midland Credit Mgmt., 2016 U.S. Dist.
LEXIS 155960, *2 (M.D. Fla. 2016)).2 In response, Ms. McCamey argues that “[t]he
majority of appellate courts hold that a debt collector can violate the FDCPA when it
makes a ‘settlement offer’ on a time-barred debt; a threat of litigation is not required
for a violation.” (See Doc. 39 at 8-9) (citing cases from the Third, Fifth, Sixth, and
Seventh Circuits).3
As an initial matter, it is clear to the Court that a debt collector can attempt to
get a debtor to pay a debt that is time-barred. Cf. Midland Funding, LLC v. Johnson,

2

The Court notes that district court opinions are not binding precedent.

3

The Court has read and considered the Defendants’ arguments distinguishing the cases
from the other circuits. (See Doc. 32 at 12-18). The Court recognizes that the factual scenarios
can vary. What the Court does in this opinion is apply the law surrounding the FDCPA to the
facts of this case.
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137 S.Ct. 1407, 1411 (2017) (citing sources) ("Alabama's law, like the law of many
States, provides that a creditor has the right to payment of a debt even after the
limitations period has expired."); Buchanan v. Northland Group, Inc., 776 F.3d 393,
397 (6th Cir. 2015) (“There thus is nothing wrong with informing debtors that a debt
remains unpaid or for that matter allowing them to satisfy the debt at a discount.”). On
some level, these efforts to collect time-barred claims are little more than appeals to
a debtor’s internal moral compass. See Buchanan, 776 F.3d at 397 (“Legal defenses
are not moral defenses.”); McMahon v. LVNV Funding, LLC, 744 F.3d 1010, 1020
(7th Cir. 2014) (“[S]ome people might consider full debt re-payment a moral
obligation, even though the legal remedy for the debt has been extinguished.”);
Pantoja, 852 F.3d at 684 (“The creditor retains the legal right to appeal to the debtor
to honor the debt out of a sense of moral obligation even if the legal obligation can no
longer be enforced in court.”). Of course, this effort must be consistent with the
FDCPA. See Pantoja, 852 F.3d at 684 (citing 15 U.S.C. §§ 1692e, 1692f).
The parties agree that the Eleventh Circuit has not spoken conclusively on the
questions raised in this case. (See Doc. 32 at 11); (see also Doc. 39 at 11) (“The
Eleventh Circuit has not yet addressed the issue whether a ‘settlement offer’ on a
time-barred debt can violate the FDCPA absent a threat of litigation.”) (footnote
omitted). For this reason, much of the ink spilled in briefing this Motion can only be
11

termed as a battle of persuasive authority. The Court is left to apply the law most
consistent with the text of the FDCPA to the facts of this case. To do so, the Court
starts with a very basic premise – words have meaning.
This Court has often advised litigants that their word choice matters because
every word has meaning, connotations, and implications. Here, the primary focus is
on the use of the word “settlement.” (See Doc. 1-1 at 1, 2). The February 12, 2017,
letter uses the word “settlement.” (See id. at 1). Similarly, the May 6, 2017, letter
describes a “SETTLEMENT OFFER” and uses the word “settlement” throughout the
letter. (See id. at 2) (“[CMS] is willing to accept less than the full balance due as a
settlement.”); (id.) (“You may send the settlement payment to [CMS].”).
Judge Sutton capably explained why this term could be misleading in the
Buchanan decision:
[A] “settlement offer” with respect to a time-barred debt may falsely
imply that payment could be compelled through litigation. Formal and
informal dictionaries alike contain a definition of “settle” that refers to
concluding a lawsuit. On the formal side, one defines the verb as “to
conclude (a lawsuit) by agreement between the parties usu[ally] out of
court.” Webster's Third New International Dictionary 2079 (2002).
Another defines it as “[t]o decide (a case) by arrangement between the
contesting parties.” OED Online, Oxford University Press (September
2014), http://goo.gl/yd1KF6. A third defines “settlement” as “[t]he
resolution of a lawsuit or dispute by settling.” The American Heritage
Dictionary of the English Language (5th ed.2014), available at
http://goo.gl/dPSCMH. On the informal side, Wiktionary defines
“settlement agreement” as “[a] contractual agreement between parties to
actual or potential litigation by which each party agrees to a resolution
12

of the underlying dispute.” See http://goo.gl/00xE9s.[ ]And[
]Dictionary.com defines “settle” as “to terminate (legal proceedings) by
mutual consent of the parties.” See http://goo.gl/vOmoty. Perhaps the
best definition, one that accounts for the various ways an everyman
individual might read the terms, appears oddly enough in Black's Law
Dictionary. It acknowledges that the word is one of “equivocal
meaning,” “meaning different things in different connections, and the
particular sense in which it is used may be explained by the context or
surrounding circumstances.” Black's Law Dictionary 1372 (6th ed.1990).
All of these definitions make it plausible to allege that a “settlement
offer” falsely implies that the underlying debt is enforceable in court.
Buchanan, 776 F.3d at 399. The aforementioned passage is particularly persuasive,
and the Court adopts that reasoning here. The Seventh Circuit has noted similar
implications from “settlement” terminology:
If a consumer received an “offer for settlement” and searched on Google
to see what is meant by “settlement,” she might find the Wikipedia entry
for “settlement offer.” Settlement offer, Wikipedia, (Mar. 10, 2014 at
4:06 pm), http://en.wikipedia.org/wiki/Settlement_offer. There she
would learn that the term “offer to settle” is “used in a civil lawsuit to
describe a communication from one party to the other suggesting a
settlement—an agreement to end the lawsuit before a judgment is
rendered.”
McMahon, 744 F.3d at 1021. The least sophisticated consumer does not have a law
degree. It is objectively reasonable for such a consumer, upon receiving a letter with
“settlement offer” to start wondering about legal exposure.
The Court is not saying that anytime a debt collection letter uses the word
“settlement” that it is misleading a debtor, or otherwise violating the FDCPA. See
Tatis, 882 F.3d at 430. Far from it. In fact, one definition of “settlement” is: “payment
13

or adjustment of an account.” MERRIAM WEBSTER’S COLLEGIATE DICTIONARY 1069
(2000); see also Tatis, 882 F.3d at 429-30 (discussing the different meanings of
“settle”).
Defendants urge the Court to follow the lead of the Third and Eighth Circuits.
(See Doc. 32 at 9-11) (citing Freyermuth, 248 F.3d 767; Huertas, 641 F.3d 28). In
Freyermuth, the Eighth Circuit “[held] that, in the absence of a threat of litigation or
actual litigation, no violation of the FDCPA has occurred when a debt collector
attempts to collect on a potentially time-barred debt that is otherwise valid.”
Freyermuth, 248 F.3d at 771. However, the holding from Freyermuth is linked to the
theories actually litigated by the parties. By way of example, under §1692e there are
about sixteen ways in which the FDCPA can be violated. See 15 U.S.C. § 1692e. For
example, even if a debt collector did not threaten litigation on a time-barred claim, this
Court assumes that it could still be liable for “[t]he false representation or implication
that any individual is an attorney.” See 15 U.S.C. §1692e(3). The Freyermuth holding
should not be stretched too far.
Defendants also point to the Third Circuit in Huertas. (See Doc. 32 at 9-11)
(citing Huertas, 641 F.3d 28). However, seven years later, the Third Circuit revisited
and further explained Huertas in Tatis. See Tatis, 882 F.3d at 427-28 (explaining what
Huertas meant). Tatis recognized the limitations of the Huertas decision. See id. at
14

428 (“Thus, Huertas stands for the proposition that debt collectors do not violate 15
U.S.C. § 1692e(2)(A) when they seek voluntary repayment of stale debts, so long as
they do not threaten or take legal action. But the FDCPA sweeps far more broadly
than the specific provision found in § 1692e(2)(A). It prohibits ‘any false, deceptive,
or misleading representation’ associated with debt-collection practices. 15 U.S.C. §
1692e (emphasis added).”) (emphasis by underlining added). Tatis went on to say that
“construing the Act to require a threat of legal action for any FDCPA violation
interposes a mandate that is not found in its text.” See id. at 429 (citing McMahon, 744
F.3d at 1020-21). Accordingly, Tatis speaks more clearly to the question before the
Court.
The Court holds that a letter attempting to collect a time-barred debt can violate
the FDCPA, even if it does not expressly threaten litigation, if it is otherwise
prohibited by the FDCPA. This approach is consistent with the sound reasoning of
other circuits, and it best applies the plain text of the statute. Guided by the persuasive
circuit authority, the Court finds that the letters (without considering the disclaimer
at the bottom of the page) could be considered deceptive to the least sophisticated
consumer. The least sophisticated consumer could see the settlement terminology
throughout the letter and be under the impression that his debt was legally
enforceable. This reasonable impression could make the least sophisticated consumer
15

more likely to pay money on a debt that was legally unenforceable. However, since
the letters each had a disclaimer, the Court next considers the effect of that disclaimer.
B.

The Disclaimers Are Not Unambiguous as a Matter of Law so as To
Render the Letters in Compliance with the FDCPA

The Court now looks at the language of the disclaimer to see its effect on the
understanding the least sophisticated consumer would have. The parties have not
pointed the Court to any legal precedent using the exact same language at issue here.
Ms. McCamey takes issue with the disclaimer in the ways discussed below.
The first issue here is whether the use of the phrase “may not” renders the
disclaimer ambiguous. (See Doc. 39 at 14-17); (Doc. 45 at 7-8). This presents an
interesting question because the word “may” also can have different meanings in
different contexts. To illustrate this, the Court turns to Black’s Law Dictionary. It
defines “may” as “[t]o be permitted to” and “[t]o be a possibility.” May, BLACK’S
LAW DICTIONARY (10th ed. 2014). Among other definitions, Merriam-Webster’s
Collegiate Dictionary defines “may” as “have the ability to” and “used to indicate
possibility or probability.” See May, MERRIAM-WEBSTER’S COLLEGIATE DICTIONARY
(10th ed. 2000).
Obviously, Defendants would prefer the definition of “may” that speaks to
permission, while Ms. McCamey would prefer the definition of “may” that speaks to
probability. (See Doc. 45 at 6-8); (Doc. 39 at 16). Here is the disclaimer as it appeared
16

in the letter:
As a result of the expiration of the statute of limitations with respect to
such debt, legal action may not be brought against the consumer to
collect such debt. Any payment by the consumer towards the debt may
cause the statute of limitations for such debt to reset.
(Doc. 1-1 at 1-2). With one definition of “may” it could read:
As a result of the expiration of the statute of limitations with respect to
such debt, legal action [is not permitted to] be brought against the
consumer to collect such debt. Any payment by the consumer towards
the debt [is permitted to] cause the statute of limitations for such debt to
reset.
With the other definition of “may” it could read:
As a result of the expiration of the statute of limitations with respect to
such debt, legal action [possibly or probably will not] be brought against
the consumer to collect such debt. Any payment by the consumer
towards the debt [possibly or probably will] cause the statute of
limitations for such debt to reset.
The question before the Court is whether these two readings are both
reasonable, thus creating a question of fact, or whether the latter reading is “bizarre
or idiosyncratic.” LeBlanc, 601 F.3d at 1194 (quoting another source, quotation marks
omitted). This matters, because the Court cannot say as a matter of law that the latter
reading is sufficient to dispel any misconceptions about the legal status of the debt
created through the previous use of “settlement” language discussed in sub-section A.
Linguistically, people use the word “may” both ways in oral conversations all
the time. People can usually distinguish between its various meanings through context
17

clues and oral inflections. However, when reading words, those oral inflections do not
come through. This is part of the reason why people sometimes misunderstand written
communication.
This is not to say that the written “may” is always ambiguous. Defendants point
out that the FDCPA itself “enforces liability through the same ‘may not’ language.”
(See Doc. 32 at 23) (citing 15 U.S.C. §§ 1692e, 1692f). Obviously, reading the statute
to include a “may” that indicates “possibility or probability” would lead to an absurd
result.4 But the letters before the Court are not that statute, and the Court must put
itself in the shoes of the least sophisticated consumer when reviewing the letters.
Ms. McCamey also argues that because “[t]he disclosure is written in the third
person” it “would not necessarily be understood as applying to this specific debt or
to the recipient of the letters.” (Doc. 39 at 16). In response, Defendants imply that this
understanding is “bizarre” and “idiosyncratic.” (See Doc. 45 at 6-7) (using the
language from LeBlanc, 601 F.3d at 1194). On this point, the Court agrees with
Defendants. While it is poor writing form to go from referring to the reader of the
letter as “you” to “the consumer” and “this debt” to “such debt,” the Court cannot say
that even the least sophisticated consumer could not figure out that the Defendants are

4

“[T]he law tries to avoid absurd results.” Durr v. Shinseki, 638 F.3d 1342, 1344 (11th
Cir. 2011).
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referring to her and her debt.
Defendants argue that the language they used “is virtually identical to that used
in prior bills proposed in the House of Representatives concerning debt collection.”
(See Doc. 32 at 22) (citing proposed legislation). The Court notes the similarities. But
this argument holds little weight because “Congress speaks through the laws it
enacts.” Cf. In re Aiken County, 725 F.3d 255, 260 (D.C. Cir. 2013). What Defendants
cited was merely proposed legislation. (See Doc. 32 at 22).
Finally, the Court must determine whether it should dismiss the case on legal
grounds. The Fifth Circuit has discussed how to approach the division of law and fact
in FDCPA cases:
There are some letters that, as a matter of law, are not deceptive based on
the language and placement of a disclaimer. At the other end of the
spectrum, there are letters that are so deceptive and misleading as to
violate the FDCPA as a matter of law, especially when they do not
contain any disclaimer . . . . In the middle, there are letters that include
contradictory messages and therefore present closer calls.
Gonzalez v. Kay, 577 F.3d 600, 606 (5th Cir. 2009). This case resides in that middle
ground. Here is why. For the Court to rule in favor of Defendants (in the process
saying that Ms. McCamey’s claim is not even plausible), the Court has to make three
critical leaps. First, the Court has to say that even the least sophisticated consumer
would not understand “settlement” in a commonly understood meaning (implying
legal action). Second, the Court has to say that even the least sophisticated consumer
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would understand what the term “statute of limitations” means and how it applies to
her.5 Third, the Court has to say that the even least sophisticated consumer would
understand “may not” to actually mean “cannot.” The Court is unwilling to make
those three leaps at only the pleading stage.
Defendants raise their concerns that the Court should not “‘nitpick’ the
language used by a collector so long as the language provides sufficient information
to put the debtor on notice of the statute of limitation issues.” (See Doc. 45 at 8-9)
(Doc. 32 at 21-22). The Court understands this concern. However, the Court is not
attempting to dictate what language is effective, though Defendants had their pick of
prior court-approved language.6 The Court is not even holding that a disclaimer in a

5

The parties have not specifically briefed whether the least sophisticated consumer
would know what a “statute of limitations” is (and its legal implications), but the Court is
skeptical that the least sophisticated consumer knows the meaning of this term.
6

The Court notes that Defendants themselves have pointed to disclaimer language that
has been effective in the past. (See Doc. 45 at 6) (citing two district courts); (Doc. 32 at 19-20).
Additionally, there is language from the FTC that courts have looked favorably on:
Given the potential for confusion, and to avoid creating a misleading impression,
the FTC recommended that if a collector knows or should know that it is
collecting on a time-barred debt, it must inform the consumer that (1) the
collector cannot sue to collect the debt, and (2) providing partial payment would
revive the collector's ability to sue to collect the remaining balance. FED. TRADE
COMM'N, THE STRUCTURE AND PRACTICE OF THE DEBT BUYING
INDUSTRY 47 (2013) (FTC Report 2013). . . . [The FTC consent] decree
requires the company to disclose to consumers whether it knows or believes that a
debt was incurred outside the limitations period, using this language: “The law
limits how long you can be sued on a debt. Because of the age of your debt, we
will not sue you for it.”
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letter attempting to collect on a time-barred claim is required. However, since the
letters use the word “settlement” several times, and the least sophisticated consumer
could be misled by that terminology, there must be some language dispelling that
potentially misleading terminology. In this case, the Court is not convinced that the
disclaimer did so. In other words, the Court cannot determine at the very outset of
litigation that the least sophisticated consumer would not misunderstand the letters,
despite the disclaimer.
VI.

CONCLUSION
Throughout this opinion, the Court has evaluated the constituent relevant parts

of the letters for the reader’s benefit, but the Court decision is based on its
consideration of the letters as a whole. Today’s decision announces no new
requirements and does not even require that a letter attempting to collect a time-barred
debt include a disclaimer; the letter just cannot run afoul of the prohibitions in §1692e
and §1692f. The Court also takes no position on the ultimate merits at the summary
judgment stage. All Ms. McCamey has to do at this stage is move her §1692e and
§1692f claims “across the line from conceivable to plausible.” See Iqbal, 556 U.S. at
680 (internal quotations and citations omitted). She has done so. For the

Cf. McMahon, 744 F.3d at 1015-16. That is not the language Defendants in this case chose to
use. (See Doc. 1-1 at 1-2).
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aforementioned reasons, the Motion is DENIED.
DONE and ORDERED this the 10th day of August, 2018.

VIRGINIA EMERSON HOPKINS
United States District Judge

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