Blunt v. Financial Business and Consumer Solutions, Inc.
Filing
18
ORDER denying 9 Defendant's Motion to Stay. Signed by Judge James S. Moody, Jr on 1/13/2017. (JG)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
PRISCILLA BLUNT, on behalf of herself and
all others similarly situated,
Plaintiff,
v.
CASE NO: 8:16-CV-2430-T-30MAP
FINANCIAL BUSINESS AND CONSUMER
SOLUTIONS, INC.,
Defendant.
____________________________________/
ORDER
THIS CAUSE comes before the Court upon Defendant’s Motion to Stay Proceedings
(Dkt. 9) and Plaintiff’s Memorandum of Law in Opposition to Defendant’s Motion to Stay
(Dkt. 17). Upon review of the motion, response, and being otherwise advised in the
premises, the court denies Defendant’s request for a stay.
DISCUSSION
On August 24, 2016, Plaintiff, Priscilla Blunt, on behalf of herself and all others
similarly situated, brought this putative class action against Defendant Financial Business
and Consumer Solutions, Inc. for alleged violations of the Fair Debt Collection Practices Act,
15 U.S.C. § 1692, et seq. (“FDCPA”) predicated on Defendant’s September 9, 2015
collection letter. Specifically, Plaintiff alleges that Defendant’s collection letter offered to
resolve Plaintiff’s time-barred debt without disclosing that the obligation was beyond the
applicable statute of limitations. Plaintiff also contends that the collection letter neglected
to inform Plaintiff that if she made a partial payment on the debt, “the applicable statute of
limitations could reset or begin anew.” (Dkt. 1).
Defendant contends that the allegations in the complaint are substantially similar to
claims recently dismissed by courts in Christopher Olson v. Cavalry Portfolio Services, LLC,
No. 8:15-cv-2520-T-23AAS, 2016 WL 4248009 (M.D. Fla. Aug. 11, 2016) and Stephen
Holzman v. Malcolm S. Gerald & Associates, et al., No. 9:16-cv-80643-RLR (S.D. Fla. Sep.
9, 2016) and for which appeals are currently pending before the Eleventh Circuit. Defendant
requests a stay of this action pending the resolution of those appeals.
Plaintiff counters that Plaintiff’s legal theory is different from the theories pled in
Olson and Holzman. Plaintiff points out that the court in the more recent case of Lopera v.
Midland, 2016 WL 6650744 (M.D. Fla. Nov. 10, 2016)1, which contains facts more similar
to the instant case, denied the defendant’s motion to dismiss and, in doing so, distinguished
the facts from those presented in Olson and Holzman. Upon review of the case law, the
Court agrees with Plaintiff because the collection letters in Olson and Holzman are materially
different from the collection letter in this case.
The Olsen letter offered to “settle” the debt for a percentage of the outstanding
balance but also stated: “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. We will continue to report information about
your account to credit reporting agencies.” Olsen, 2016 WL 4248009, at *1. Also, the Olsen
letter did not offer partial payment options. Defendant’s collection letter in this case does
1
Defendant’s motion neglects to mention the Lopera case.
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not contain such an assurance that the debt collector would not sue because of the debt’s age;
rather, the letter is silent as to litigation and the debt’s age. Defendant’s collection letter in
this case also presented Plaintiff with partial payment options.
The Holzman letter is also distinguishable from Defendant’s collection letter: there
is no mention of settlement or an offer to settle in the Holzman letter and the Holzman letter
does not contain different payment plans or payment options. This is a key distinguishing
fact because, although the Eleventh Circuit has not yet addressed this issue, three appellate
courts have recently expressed concern with a debt collector’s failure to disclose the
possibility that a partial payment may revive a time-barred debt. See, e.g., Daugherty v.
Convergent Outsourcing, Inc., 836 F.3d 507, 513 (5th Cir. 2016) (finding the FDCPA claim
plausible and holding that “we agree that a collection letter seeking payment on a time-barred
debt (without disclosing its unenforceability) but offering a ‘settlement’ and inviting partial
payment (without disclosing the possible pitfalls) could constitute a violation of the
FDCPA.”); Buchanan v. Northland Group, Inc., 776 F.3d 393, 399 (6th Cir. 2015) (reversing
dismissal of FDCPA claim involving a letter that used the term “settlement offer” and stating,
“The other problem with the letter is that an unsophisticated debtor who cannot afford the
settlement offer might nevertheless assume from the letter that some payment is better than
no payment. Not true: Some payment is worse than no payment. The general rule in
Michigan is that partial payment restarts the statute-of-limitations clock, giving the creditor
a new opportunity to sue for the full debt. As a result, paying anything less than the
settlement offer exposes a debtor to substantial new risk.”) (internal citation omitted);
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McMahon v. LVNV Funding, LLC, 744 F.3d 1010, 1021 (7th Cir. 2014) (addressing a letter
that offered to “settle” a debt and stating, “The fact that both [ ] letters contained an offer of
settlement makes things worse, not better, since a gullible consumer who made a partial
payment would inadvertently have reset the limitations period and made herself vulnerable
to a suit on the full amount. That is why those offers only reinforced the misleading
impression that the debt was legally enforceable.”).
The main issue presented in Plaintiff’s case here is not whether legal action was
threatened on a time-barred claim, but whether Defendant’s debt collection letter was
misleading or deceptive because it failed to inform the consumer that the statue of limitations
had expired, and that by entering into a new agreement (via different payment options), a
new obligation could be created and a new statute of limitations could be established as to
the new obligation, thereby allowing Defendant to commence legal action against the
consumer. Because the letters at issue in Olson and Holzman did not offer partial payments,
any ruling from the Eleventh Circuit would not clearly resolve the legal question presented
in this case. Accordingly, staying this action would not be appropriate.
It is therefore ORDERED AND ADJUDGED that Defendant’s Motion to Stay
Proceedings (Dkt. 9) is DENIED.
DONE and ORDERED in Tampa, Florida on January 13, 2017.
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Copies furnished to:
Counsel/Parties of Record
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