Nieto v. MRS Associates

Filing 28

MEMORANDUM Opinion and Order. Signed by the Honorable John Robert Blakey on 4/20/2018. Mailed notice(ep, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

RUEL NIETO,
Plaintiff,
v.
MRS ASSOCIATES,
Defendants.

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Case No. 17 C 8507
Judge John Robert Blakey

MEMORANDUM OPINION AND ORDER
Plaintiff Ruel Nieto sued Defendant MRS Associates for violating the Fair
Debt Collection Practices Act (FDCPA). Defendant moved to dismiss her complaint
under Federal Rule of Civil Procedure 12(b)96) for failure to state a claim. For the
reasons explained below, the motion is denied.
A.

The Complaint’s Allegations
Plaintiff’s complaint alleges that she incurred a debt with Chase Bank and

was unable to pay it; Chase retained Defendant, a debt collector, to secure payment
on the debt.

Complaint [1] at ¶¶ 11-13.

Defendant sent Plaintiff two letters

regarding the alleged debt. The first, sent January 6, 2017, “conveyed information
regarding the alleged debt, including the identity of the creditor, an account
number, and an amount due” and “provided several required disclosures to Plaintiff
with respect to her rights under § 1692g(a) of the FDCPA, including the right to
dispute the alleged debt within thirty days of the receipt of the letter.” Id. at ¶¶ 15,

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The second letter, sent February 1, 2017, similarly “conveyed information

regarding the alleged debt, including the identity of the creditor, an account
number, and an amount due.” Id. at ¶ 20. It also stated that the balance due was
$3,478.40 and “provided Plaintiff with three settlement options” to enable Plaintiff
“to avoid further collection activity being taken against” her:
Option 1: You only pay $1,982.70 in ONE PAYMENT that must be
received in this office on or before 02/15/2017.
Option 2: You make TWO PAYMENTS of $1,252.23 each. The first
payment must be received by this office on or before 02/15/2017 and
the second payment on or before 03/16/2017.
Option 3: A monthly payment plan on the full balance of the account.
Id. at ¶ 23. Plaintiff alleges that this second letter overshadowed the first letter’s
disclosure of Plaintiff’s rights to dispute the validity of the debt or to request
verification within the thirty day validation period, in violation of 15 U.S.C. §
1692g(b). Id. at ¶ 36. The second letter made Plaintiff believe she no longer had
the required thirty-day window to dispute the alleged debt. Id.
B.

Discussion & Analysis
The purpose of a 12(b)(6) motion to dismiss is to test the sufficiency of the

complaint, not to resolve the case on the merits. Gibson v. Chicago, 910 F.2d 1510,
1520 (7th Cir. 1990).

To survive a motion to dismiss under Rule 12(b)(6), the

complaint must provide “enough factual information to ‘state a claim to relief that is
plausible on its face’ and ‘raise a right to relief above the speculative level.’” Doe v.
Vill. of Arlington Heights, 782 F.3d 911, 914 (7th Cir. 2015) (quoting Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007)). A claim has “facial plausibility
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when the plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
When analyzing a motion under Rule 12(b)(6), this Court must construe the
allegations of the complaint in the light most favorable to Plaintiff, accepting as
true all well-pleaded facts and drawing all reasonable inferences in his favor. E.g.,
Yeftich v. Navistar, Inc., 722 F.3d 911, 915 (7th Cir. 2013) (citing Fed. R. Civ. P.
12(b)(6); Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008)). This Court
does not, however, accept a complaint’s legal conclusions as true. Brooks v. Ross,
578 F.3d 574, 581 (7th Cir. 2009).
Under Section 1692g, a debt collector’s letter to a debtor must contain:
(1) the amount of the debt; (2) the name of the creditor to whom the
debt is owed; (3) a statement that unless the consumer, within thirty
days after receipt of the notice, disputes the validity of the debt, or any
portion thereof, the debt will be assumed to be valid by the debt
collector; (4) a statement that if the consumer notifies the debt collector
in writing within the thirty-day period that the debt, or any portion
thereof, is disputed, the debt collector will obtain verification of the
debt or a copy of a judgment against the consumer and a copy of such
verification or judgment will be mailed to the consumer by the debt
collector; and (5) a statement that, upon the consumer’s written
request within the thirty-day period, the debt collector will provide the
consumer with the name and address of the original creditor, if
different from the current creditor.
15 U.S.C. § 1692g(a). Section 1692g also dictates that “[a]ny collection activities
and communication during the 30–day period may not overshadow or be
inconsistent with the disclosure of the consumer’s right to dispute the debt or
request the name and address of the original creditor.” 15 U.S.C. § 1692g(b).

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Plaintiff does not dispute that Defendant’s first letter complies with §
1692g(a), and a review of the letter, attached as an exhibit to the complaint,
confirms that it includes all required disclosures. See [1-1] (providing the amount of
the debt, the name of the creditor, and a statement of “Important Consumer
Information” including the language required under § 1692g(a)). Plaintiff alleges,
however, that Defendant’s second letter runs afoul of § 1692g(b). More specifically,
she alleges that the second letter made her think she no longer had the thirty days
promised in the first letter in which to challenge the debt. [1] at ¶ 36.
When determining whether a debt collection letter complies with the FDCPA,
courts apply the “unsophisticated consumer” standard. Zemeckis v. Glob. Credit &
Collection Corp., 679 F.3d 632, 635 (7th Cir. 2012). That is, the letter “must be
clear and comprehensible to an individual who is ‘uninformed, naïve, [and]
trusting,’ but not without a rudimentary knowledge about the financial world or
incapable of making basic deductions and inferences.” Id. (quoting Veach v. Sheeks,
316 F.3d 690, 693 (7th Cir. 2003); Wahl v. Midland Credit Mgmt., Inc., 556 F.3d
643, 645 (7th Cir. 2009)).
Plaintiff alleges that Defendant mailed the first letter to her on January 6,
2017. Plaintiff does not say when she received the letter. The second letter, dated
February 1, 2017, included two settlement options that required payment to be
received in Defendant's office “on or before February 15, 2017.”

Thus, even if

Plaintiff received the first letter the same day Defendant sent it, the second letter
could conceivably have required her to make a payment within the 30-day period.

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That is, for a payment to be received in Defendant’s office “on or before February 15,
2017,” one might reasonably suppose some action was required before February 6,
2017. Under these circumstances, an unsophisticated consumer could reasonably
have been confused about whether the payment options in the February 1 letter
(the second letter) overshadowed her right (promised in the first letter) to dispute
the debt during the full 30−day period.
Defendant argues that none of the settlement options described in the second
letter required Plaintiff to make a payment (or take any other action) prior to the
expiration of the validation period. Reply [26] at 4. But Defendant fails to explain
the basis of such a conclusion. And the pleadings on file do not allow the Court to
determine when Plaintiff received the first letter or when the 30−day clock started
ticking. See, e.g., Riley v. Portfolio Recovery Assocs., LLC, No. 14 C 9819, 2015 WL
1594298, at *2 (N.D. Ill. Apr. 7, 2015) (the 30–day clock starts upon a consumer’s
“receipt” of the debt notice, not upon the debt collector’s mailing of the collection
notice). Plaintiff has pled sufficient facts supporting a reasonable inference that
Defendant’s second letter overshadowed the rights articulated in the first letter.

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C.

Conclusion
For the reasons explained above, the Court finds that Plaintiff’s allegations

state a claim for violation of 15 U.S.C. § 1692g(b), and the Court, accordingly, denies
Defendant’s motion to dismiss [12].
Dated: April 20, 2018
ENTERED:

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John Robert Blakey
United States District Judge

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