Delgado v. Client Services, Inc.
OPINION AND ORDER 28 . Signed by the Honorable Sara L. Ellis on 3/7/2018. (yap, )
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
CLIENT SERVICES, INC.,
No. 17 C 4364
Judge Sara L. Ellis
OPINION AND ORDER
Plaintiff Jose Delgado alleges that Defendant Client Services, Inc. (“Client Services”)
violated the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., by sending
Delgado a misleading letter regarding a debt that he owed. Client Services moves to dismiss the
Amended Complaint, arguing that the letter is not misleading on its face as a matter of law and
that Client Services met the FDCPA’s requirements regarding communicating the amount of the
debt owed. Because the Amended Complaint fails to adequately allege that Client Services
violated the FDCPA, the Court grants Client Services’ motion to dismiss without prejudice.
Delgado is an individual consumer who obtained a credit card from Capital One and
allegedly defaulted on the debt he had incurred on that card. Subsequently, Client Services, a
debt collector, obtained the debt’s collection rights. On May 15, 2017, Client Services sent
Delgado a collection letter (the “Letter”) seeking to collect on the debt. The Letter included the
following statement and itemization:
The facts in the background section are taken from Delgado’s Amended Complaint  and exhibits
attached thereto and are presumed true for the purpose of resolving Client Services’ motion to dismiss.
See Virnich v. Vorwald, 664 F.3d 206, 212 (7th Cir. 2011); Local 15, Int’l Bhd. of Elec. Workers, AFLCIO v. Exelon Corp., 495 F.3d 779, 782 (7th Cir. 2007).
The above CAPITAL ONE BANK (USA), N.A., account has been placed with our
organization for collections.
Balance Due At Charge-Off:
Doc. 33-1, Ex. B. Reading the Letter, Delgado believed that, in light of the fact that “interest”
and “other charges” were itemized in the letter, interest and charges would begin accruing on the
alleged debt if he did not pay it.
A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the complaint, not
its merits. Fed. R. Civ. P. 12(b)(6); Gibson v. City of Chicago, 910 F.2d 1510, 1520 (7th Cir.
1990). In considering a Rule 12(b)(6) motion to dismiss, the Court accepts as true all wellpleaded facts in the plaintiff’s complaint and draws all reasonable inferences from those facts in
the plaintiff’s favor. AnchorBank, FSB v. Hofer, 649 F.3d 610, 614 (7th Cir. 2011). To survive
a Rule 12(b)(6) motion, the complaint must not only provide the defendant with fair notice of a
claim’s basis but must also be facially plausible. Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct.
1937, 173 L. Ed. 2d 868 (2009); see also Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.
Ct. 1955, 167 L. Ed. 2d 929 (2007). “A claim has facial plausibility 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.
Under 15 U.S.C. § 1692e, a debt collector violates the FDCPA by using “any false,
deceptive, or misleading representation or means in connection with the collection of any debt.”
This section of the FDCPA specifically lists sixteen prohibited types of conduct, including
(1) “[t]he false representation of [ ] the character, amount, or legal status of any debt,” (2) “[t]he
threat to take any action that cannot legally be taken or that is not intended to be taken,” and
(3) “[t]he use of any false representation or deceptive means to collect or attempt to collect any
debt.” 15 U.S.C. §§ 1692e(2)(A), 1692e(5), 1692e(10). In addition, § 1692g requires that,
within five days of communicating with a consumer about their debt, debt collectors must inform
the consumer of the amount of the debt owed if they did not inform them at the time of the
communication. 15 U.S.C. § 1692g(a)(1). Delgado alleges that Client Services’ Letter violated
§ 1692e by including lines for interest and other charges. Though the Letter listed both
categories as “0.00,” Delgado argues that this implied that interest and other charges would
accumulate in the future, and that this falsely represented the status of the debt and falsely
represented that interest and other charges could be applied that Client Services never intended to
apply. In the alternative, Delgado argues that if Client Services did intend to potentially assess
interest or other charges against him for lack of payment, the Letter violates § 1692g for failure
to notify him of the actual amount of the debt.
False, Deceptive, or Misleading Statement Under § 1692e
Delgado first alleges that the inclusion of “interest” and “other charges” in the Letter’s
itemization of Delgado’s debt made the communication misleading. Specifically, although the
Letter clearly lists that no interest or other charges exist at the time of the Letter, Delgado states
that the mere inclusion of those categories on the itemization of his debt led him to believe that
Client Services would impose these extra costs on Delgado if he did not pay his debt. For the
purposes of this claim, Delgado alleges that Client Services had no basis for charging interest or
other charges, and never intended to actually impose those costs—rather, it included those
categories in an attempt to induce Delgado to pay his balance to avoid further debt. Client
Services argues that the inclusion of interest and other charges in the itemization of Delgado’s
debt, when 0.00 is listed for both categories, could not lead an unsophisticated consumer to
believe that interest or other charges would later accrue. The Court agrees.
Section 1692e prohibits the use of false, deceptive, or misleading representations in
connection with the collection of a debt. 18 U.S.C. § 1692e. To determine whether a
communication violates § 1692e, the Court must apply the “unsophisticated consumer” test.
Wahl v. Midland Credit Mgmt., Inc., 556 F.3d 643, 645 (7th Cir. 2009). “If a statement would
not mislead an unsophisticated consumer, it does not violate the FDCPA.” Id. at 645–46. The
unsophisticated consumer “isn’t a dimwit.” Id. at 645. He or she has “rudimentary knowledge
about the financial world and is capable of making basic logical deductions and inferences.” Id.
(citations omitted) (internal quotation marks omitted). Although an unsophisticated consumer
“may tend to read collection letters literally, he does not interpret them in a bizarre or
idiosyncratic fashion.” Gruber v. Creditors’ Prot. Serv., Inc., 742 F.3d 271, 274 (7th Cir. 2014)
(citation omitted) (internal quotation marks omitted). Typically determining whether a
communication is misleading is a question of fact that a court cannot determine at the motion to
dismiss stage. Zemeckis v. Global Credit & Collection Corp., 679 F.3d 632, 636 (7th Cir. 2012).
However, if the Court can determine from the face of the letter in question that “not even a
significant fraction of the population would be misled by it . . . the court should reject it without
requiring evidence beyond the letter itself.” Taylor v. Cavalry Inv., L.L.C., 365 F.3d 572, 574–
75 (7th Cir. 2004) (citation omitted) (internal quotation marks omitted). If the statements in
question “plainly, on their face, are not misleading or deceptive,” the Court may dismiss the case
based on its own determination without looking at extrinsic evidence. Boucher v. Fin. Sys. of
Green Bay, Inc., 880 F.3d 362, 366 (7th Cir. 2018) (citations omitted) (internal quotation marks
In addition to the requirement that a statement must be misleading or deceptive, the
Seventh Circuit requires that an alleged violation of § 1692e be material and as such “have [a]
practical impact on a consumer’s rights or decision-making process—that is, . . . represent the
kind of conduct the [FDCPA] was intended to eliminate.” Janetos v. Fulton Friedman &
Gullace, LLP, 825 F.3d 317, 324 (7th Cir. 2016). Thus, the Court asks not only whether the
statement is false or misleading, but also whether the statement is material. Hahn v. Triumph
P’ships LLC, 557 F.3d 755, 758 (7th Cir. 2009).
Turning to the case at hand, Client Services cites three district court decisions within the
Seventh Circuit for the proposition that dunning letters containing itemizations of “Interest:
0.00” do not violate the FDCPA. See Doc. 29 at 10–11 (citing Smith v. First Nat’l Collection
Bureau, Inc., No. 06 C 4742, 2007 WL 4365335 (N.D. Ill. Dec. 10, 2007); Humes v. Blatt,
Hasenmiller, Liebsker & Moore, LLC, No. 1:06-cv-985-SEB-JPG, 2007 WL 2793398 (S.D. Ind.
Sept. 26, 2007); Porter v. Law Office of Charles G. McCarthy, Jr. & Assocs., No. 09-1370, 2011
WL 3320331 (C.D. Ill. Aug. 2, 2011)). Ironically, Client Services cites these cases misleadingly.
Though all three cases do involve dunning letters that contained itemizations of “Interest: 0.00,”
none of these courts considered whether the mere presence of those itemizations implies that
interest will be due; the parties in those cases never raised that argument. See Smith, 2007 WL
4365335, at *1 (plaintiff argued that listing zero interest was false and misleading, in light of the
fact that the original debtor (not the collection agency) had charged the plaintiff interest); Humes,
2007 WL 2793398, at *2 (same); Porter, 2011 WL 3320331, at *3 (considering “whether the
Defendant violated the FDCPA by including in the amount of debt an amount for attorney’s fees
and by threatening to file suit”).
Though these cases are not persuasive, the Court agrees that Delgado has not successfully
alleged that the Letter is false, misleading, or deceptive. The language in the Letter is clear. It
displays the amount due at the top, and includes an itemization in the body of the letter,
including “Interest: 0.00” and “Other Charges: 0.00.” Doc. 33-1, Ex. B. Rather than making a
false, misleading, or deceptive statement, the letter sets forth the amount due and provides an
accounting of that amount, making it explicit that no part of the amount due includes interest or
other charges. A virtually identical fact pattern occurred in Dick v. Enhanced Recovery Co.,
where the court addressed whether a collection letter that contained the same type of itemization
(there, the terms were “Interest Accrued” and “Non-Interest Charges and Fees”) was misleading
under § 1692e. No. 15-CV-2631 (RRM) (SMG), 2016 WL 5678556 (E.D.N.Y. Sept. 28, 2016).
There, the court held that the letter was not false, deceptive, or misleading, noting that “the
[l]etter does not leave [the plaintiff] in doubt of the nature and legal status of the underlying debt;
nor does it impede the consumer’s ability to respond to or dispute collection.”2 Id. at *4. The
situation is the same here. To find otherwise places debt collectors between a rock and a hard
place, where they cannot simply list the amount owed, for fear of being misleading, but likewise,
cannot breakdown the amount into categories either, for fear of being misleading. Debt
collectors would be damned if they do and damned if they don’t. This is clearly not what
Congress intended the FDCPA to do – essentially turn debt collectors into a modern-day version
The Second Circuit applies the least sophisticated consumer standard, which is substantially similar to
the Seventh Circuit’s unsophisticated consumer test. See Dick, 2016 WL 5678556, at *3 (the least
sophisticated consumer standard is “intended to protect the naïve from abusive practices, while
simultaneously shielding debt collectors from liability for bizarre or idiosyncratic interpretations of debt
collection letters” (internal quotation marks omitted)); see also Chuway v. Nat’l Action Fin. Servs., Inc.,
362 F.3d 944, 948–49 (7th Cir. 2004) (noting the similarity of the two standards but finding that the
“unsophisticated debtor” standard is more precise).
of Goldie Locks, who cast about searching for the letter that is just right, not listing too little
information or too much. Indeed, Client Services has done precisely what the Seventh Circuit
recommends by clearly itemizing the various components of the debt. See Fields v. Wilber Law
Firm, P.C., 383 F.3d 562, 566 (7th Cir. 2004)(simply stating the total debt without indicating
that it included attorneys’ fees and collection costs gives a false impression of the character of
the debt, and noting “[o]ne simple way to comply with § 1692e and § 1692f in this regard would
be to itemize the various charges that comprise the total amount of the debt.”).
Consideration of the Letter as a whole reinforces the fact that it is not misleading. There
is no suggestion that the amount due will change if the balance is not paid within a certain period
of time and no other mention of interest and other charges. Most convincingly, the Letter
indicates that Delgado had already begun repaying his debt at the time he received the Letter
(“Payments Made: 20.00,” Doc. 33-1, Ex. B), and still the interest and other charges remained at
zero. If Delgado believed that the Letter was threatening to assess interest and collection fees, it
would not make sense that the amounts remained at zero after collection had already begun.
Delgado contends that Tylke v. Diversified Adjustment Service, Inc. provides persuasive
authority that the itemization in the Letter is misleading. No. 14-CV-748, 2014 WL 5465173
(E.D. Wis. Oct. 28, 2014). In Tylke, the court found a collection letter misleading under § 1692e
where the letter stated, “The above balance due includes a Verizon Wireless Collection Fee of
$0.00.” Id. at *1. Tylke is distinguishable from this case because the Tylke statement was not as
clear as the itemization in the Letter. An independent sentence stating that the balance
“includes” a collection fee could potentially imply to an unsophisticated consumer that one will
be included, even if the collection fee at that time is zero. On the other hand, an itemization
accounts for what is and is not included in a total balance. An itemization of zero shows that the
balance due does not include interest or other charges, rather than showing what is included in
the balance, which is what distinguishes this situation from Tylke.
Ultimately, the Letter is clear. Delgado does not allege that listing interest and other fees
as zero was inaccurate. On the contrary, he alleges that “no interest was due to be assessed on
the alleged debt, nor were any other charges.” Doc. 33 ¶ 23. This is exactly what the Letter
reflected. The FDCPA does not require Client Services to note that an amount will not increase;
“there is no requirement that every statement in a debt collection notice include an extra
assurance that the fact stated will not change in the future.” Dick, 2016 WL 5678556, at *5
(emphasis in original). There is no indication in the Letter that the balance is subject to increase,
and the fact that interest and other charges remained at zero after Delgado began repaying the
debt reinforces the idea that the balance would not increase. In light of this, Delgado has failed
to state a claim under § 1692e.
Failure to Inform of Amount of Debt Owed Under § 1692g
As an afterthought, Delgado appears to plead in the alternative that if Client Services did
intend to assess interest or other charges against him for lack of payment, the Letter violates
§ 1692g for failure to notify him of the actual amount of the debt. He contends that, if Client
Services intended to charge interest or other charges, it needed to include the Miller safe harbor
language. See Miller v. McCalla, Raymer, Padrick, Cobb, Nichols, & Clark, LLC, 214 F.3d 872
(7th Cir. 2000). Client Services responds that the Miller safe harbor language is not required and
does not apply in this case, and that Delgado has not adequately pleaded facts to support a claim
under this provision.
When a debt collector communicates with a consumer regarding a debt, § 1692g(a)(1)
requires that the collector notify the consumer of the amount of the debt within five days of that
initial communication (unless the information is provided in the initial communication). The
question here is whether the Letter states the amount of the debt clearly enough so that an
unsophisticated consumer would not misunderstand it. See Taylor, 365 F.3d at 574.
The Amended Complaint simply does not contain sufficient facts to sustain a claim under
this section of the FDCPA. Rather, Delgado’s allegations regarding this claim are all couched in
hypotheticals. “[W]ere the debt actually subject to any possible adjustment, because of interest
or otherwise, [Client Services] failed to properly inform Plaintiff of how to determine the
balance of the alleged debt.” Doc. 33 ¶ 29. “Assuming, arguendo, that any adjustment were
possible or intended, [Client Services] failed to properly inform the Plaintiff it would notify him
prior to depositing his payment that the amount had changed.” Id. ¶ 31. Delgado does not argue
that the current balance listed in the letter is inaccurate, and he never actually alleges that Client
Services intended to charge him interest or other charges. To the contrary, he alleges that Client
Services never intended to charge him interest or other charges. See id. ¶ 26. A plaintiff can
plead inconsistent facts, if they are legitimately in doubt about the facts in question. See Carlson
v. Nielsen, No. 13 CV 5207, 2014 WL 4771669, at *3 (N.D. Ill. Sept. 24, 2014); Fed. R. Civ. P.
8(d). But the plaintiff still must plead sufficient facts to sustain those claims, and Delgado has
not done so here. The arguments here are linked to the arguments regarding whether the Letter’s
itemization was misleading: had the Court found that the itemization was misleading or
deceptive in that it implied that interest or other charges would later be charged, there would also
be a potential implication that Client Services intended to charge interest or other fees. Without
that, the Letter is devoid of any indication that Client Services intended to charge Delgado
interest or other fees, as is the Amended Complaint. Delgado’s arguments regarding the Miller
safe harbor language does not save this claim because Miller only applies in situations where the
debt involved is variable. See 214 F. 3d at 876. Delgado has neither adequately nor plausibly
alleged an FDCPA violation under § 1692g, and the Court grants Client Services’ motion to
dismiss with respect to this claim.
For the foregoing reasons, the Court grants Client Services’ motion to dismiss . The
Court dismisses the Amended Complaint  without prejudice.
Dated: March 7, 2018
SARA L. ELLIS
United States District Judge
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