CRENSHAW v. COMPUTEX INFORMATION SERVICES, INC. et al
Filing
40
OPINION denying Plaintiff's motion for summary judgment and granting Defendants' motion for summary judgment. Signed by Magistrate Judge Michael A. Shipp on 04/29/2011. (NR)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
__________________________________________
:
MARCELLA CRENSHAW,
:
:
Civil Action No. 10-1493 (MAS)
Plaintiff,
:
:
v.
:
OPINION
:
COMPUTEX INFORMATION SERVICES,
:
INC., et al.,
:
:
Defendants.
:
__________________________________________:
SHIPP, Michael A., United States Magistrate Judge
On March 23, 2010, Plaintiff Marcella Crenshaw (“Plaintiff”) filed a Complaint on behalf
of herself and all others similarly situated, seeking a broad range of damages and relief, alleging
violations of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692, et seq. (See
generally Docket Entry Number (“Doc. No.”) 1 (“Compl.”).) Specifically, Plaintiff alleges
Defendants Computex Information Services, Inc. (“Computex”), Levy, Ehrlich & Petrillo, PC
(“LEP”) (collectively, “Defendants”) and Evergreen Apartment Management, LLC (“Evergreen”)
violated five provisions of the FDCPA, which comprise the following five Counts:
Count I – Defendants violated Section 1692j(a) by collaborating “to design,
furnish and deliver a collection form letter to Plaintiff which they knew or should
have known would create the false belief that the alleged debt had already been
turned over to [LEP];”
Count II – Evergreen violated Section 1692j(b) by collaborating with Computex
and LEP, who allegedly violated Section 1692j(a);1
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On July 21, 2010, this Court granted Evergreen‟s Federal Rule of Civil Procedure 12(b)(6)
motion to dismiss. (Doc. Nos. 17-18.) Accordingly, Count II, which only pertained to
Evergreen, is no longer at issue and will not be addressed in this Opinion.
Count III – Defendants violated Sections 1692g(a)(3),(4),(5) by sending a “joint
collection letter,” which would cause the least sophisticated consumer to be
unsure of her rights;
Count IV – Defendants violated Section 1692e(10) by using deceptive and false
representations to collect or attempt to collect a debt; and
Count V – Defendants violated Section 1692c(c) by sending Plaintiff an
additional validation notice (“collection letter”) after Plaintiff‟s counsel notified
Defendants to “Cease and Desist direct communication with Plaintiff.”
(Compl. ¶¶ 24-46 (emphasis in original).)
This matter now comes before the Court on cross-motions for summary judgment
submitted by Plaintiff and Computex and LEP, pursuant to Federal Rule of Civil Procedure
56(a). (Doc. No. 26 (“Pl.‟s Moving Br.”); Doc. No. 27 (“Defs.‟ Moving Br.”), respectively.)
Pursuant to Federal Rule of Civil Procedure 78(b), the cross-motions for summary judgment
shall be decided on the papers submitted.
Having carefully reviewed and considered the relevant papers, and for the following
reasons, Plaintiff‟s motion for summary judgment is DENIED on all counts and Defendants‟
motion for summary judgment is GRANTED on all counts.
I.
BACKGROUND
Plaintiff was a tenant at a property owned by Evergreen, pursuant to a one year lease
agreement. (Doc. No. 34 (“Pl.‟s Reply Br.”) 6.) After failing to timely pay her December rent,
on December 15, 2009, Defendants sent Plaintiff one validation notice attempting to collect the
outstanding rent and associated fees on behalf of its client Evergreen. (Compl. ¶¶ 16-21; Defs.‟
Moving Br. 5-6; Doc. No. 30 (“Defs.‟ Opp‟n Br.”) 2-3.) This letter attempted to collect
$1,184.00 in back rent, plus any fees that accrued between the time the letter was sent and
payment of the debt, for rent owed to Evergreen. (Defs.‟ Joint St. of Uncontested Mat. Facts
(“DUMF”) ¶¶ 5-6; Pl.‟s Opp‟n to DUMF ¶ 5.) The letter was written on the letterhead of both
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Computex and LEP (Pl.‟s St. of Uncontested Mat. Facts (“PUMF”) ¶ 2) and states, in pertinent
part:
According to the records of EVERGREEN APT. MGMT., LLC [identified earlier
in the letter as the creditor/landlord], the total amount you owe them is $1,184.00.
Additional sums may become due at the time you choose to pay. You may
contact the creditor/landlord or Computex to obtain the amount due at that time.
Federal law requires our offices to inform you that unless you notify in writing
either office within thirty (30) days after receiving this Notice that you dispute the
validity of this debt or any portion thereof, our offices will assume this debt is
valid. If you notify either office in writing within thirty (30) days from receiving
this Notice that the debt or any portion thereof is disputed, the office contacted by
you in writing will obtain a verification of the debt or obtain a copy of a judgment
and mail you a copy of such judgment or verification.
The office contacted by you will provide the name and address of the original
creditor, if different from the current creditor, if requested by you in writing
within 30 days from receiving this Notice.
This disclosure pertains to your dealings with our offices. It does not affect your
dealings with the Court. In particular, it does not change the time or date at which
you must appear in Court in response a [sic] Summons and Complaint. A
Summons is a command from the Court, not our offices, and you must follow its
instructions even if you dispute the validity or amount of the debt.
This communication is from debt collectors. This is an attempt to collect a debt
and any information obtained will be used for that purpose.
(Compl. Ex. A.) Defendants simultaneously filed a Summons and Complaint for the
eviction of Plaintiff based on her delinquent rent obligation. (Defs.‟ Moving Br. 6.)
In a letter dated January 6, 2010, Plaintiff‟s counsel responded by notifying Defendants
“that [Plaintiff] disputed the validity of the alleged debt and requested a full accounting” (PUMF
¶ 10; DUMF ¶ 8; Defs.‟ Opp‟n Br. 4) and instructed Defendants to “Cease and Desist all
collection efforts and communications with Ms. Crenshaw.” (Compl. Ex. B, emphasis in
original; Defs.‟ Moving Br. 7.) Defendants responded to Plaintiff‟s counsel on January 10, 2010
with a full accounting and explanation of the outstanding debt owed to Evergreen. (DUMF ¶ 9;
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Defs.‟ Moving Br. 7.) The accounting included an amount for the outstanding December rent
and the associated late fee, a legal fee and the January rent and late fee, since the January rent
payment was not received on the fifth day of the month, as otherwise required by the lease
agreement. (Compl. Ex. C; DUMF ¶¶ 5-6; Pl.‟s Opp‟n to DUMF 1, ¶ 5.) On or about January
25, 2010, Plaintiff paid her outstanding December rent, the attendant late fees and interest, her
January rent plus fees and interest. (DUMF ¶¶ 10; Pl.‟s Opp‟n to DUMF ¶ 10; Decl. of Marc
Sampson (“Sampson Decl.”) ¶¶ 9.)
On February 11, 2010, Defendants sent a nearly-identical validation letter to Plaintiff,
based on her unpaid, outstanding February rent. (DUMF ¶¶ 13; Pl.‟s Opp‟n to DUMF ¶ 13.) In
response, on February 22, 2010, Plaintiff‟s counsel sent Defendants another letter advising that
Plaintiff was represented by counsel with respect to this debt and instructing Defendants to cease
and desist all direct communications. (Compl. Ex. E; Defs.‟ Moving Br. 7-8; Defs.‟ Opp‟n Br. 4.)
II.
LEGAL DISCUSSION
As discussed above, both Plaintiff and Defendants move for summary judgment on all
remaining Counts, which allege that Defendants violated 15 U.S.C. Sections 1692j(a),
1692g(a),(3),(4),(5), 1692e(10) and 1692c(c). After reviewing Plaintiff‟s and Defendants‟
motion papers and supporting materials, it is clear that neither party disagrees on the content of
the December 15, 2009, January 6, 2010 and February 11, 2010 letters, the number of validation
letters sent, nor whether the February 11, 2010 letter was sent after Plaintiff‟s counsel requested
Defendants to cease and desist all collection efforts and/or communications with Plaintiff. Thus,
the Court finds that there are no issues of genuine material fact in dispute that bear relevance to
the remaining disputes and, as such, this matter is ripe for summary judgment consideration.
Having carefully reviewed and considered the parties‟ legal positions, as well as the applicable
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standards of law, statutes and case law, the Court finds that Defendants are entitled to summary
judgment as a matter of law.
A.
STANDARD OF REVIEW
(i)
Summary Judgment
Summary judgment should be granted when “there is no genuine issue of material fact
and . . . the moving party is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c). An
issue or dispute concerning a material fact is considered genuine “if the evidence is such that a
reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986). A fact is material if it could “affect the outcome of the suit under
governing law.” Kaucher v. County of Bucks, 455 F.3d 418, 423 (3d Cir. 2006). Any
outstanding disputes over irrelevant or immaterial facts will not preclude granting a motion for
summary judgment. Anderson, 477 U.S. at 248.
The burden of proving that no genuine issue of material fact exists rests with the party
moving for summary judgment. Celotex Corp. v. Catrett, 477 U.S. 317, 330 (1986). While the
non-moving party bears the burden of proof at trial, the movant may discharge its burden by
demonstrating that the non-moving party has no evidence to support its claim. Id. at 325.
Alternatively, the moving party may submit evidence negating material elements of the nonmoving party‟s claim. Id. If the movant brings such evidence, or demonstrates that the nonmoving party lacks the evidence necessary to prove its claim, then the burden of proof shifts to
the non-movant to “set forth specific facts showing that there is a genuine issue for trial.” Id. at
324. Nevertheless, the non-moving party must establish each element necessary to succeed on
the claims on which it bears the burden of proof at trial. Id. at 322. When assessing whether or
not a material fact exists, the Court must consider all facts on record and draw all reasonable
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inferences in light of the non-moving party. However, the Court must not “weigh the evidence
and determine the truth of the matter.” Anderson, 477 U.S. at 249. Rather, the Court must
“determine whether there is a genuine issue for trial.” Id. If there is no genuine issue of material
fact, then the Court must grant summary judgment.
(ii)
The Fair Debt Collections Practices Act
Congress passed the FDCPA in order to combat creditors‟ and debt collectors‟ use of
deceptive practices in the collection of debts. See 15 U.S.C. § 1692; Pollice v. Nat’l Tax
Funding, L.P., 225 F.3d 379 (3d Cir. 2000). When analyzing claims arising out of the FDCPA
courts generally use a “least sophisticated debtor” standard. Compuzano-Burgos v. Midland
Credit Mgmt., Inc., 550 F.3d 294, 298 (3d Cir. 2008) (internal citations omitted). The “„least
sophisticated debtor‟ standard is lower than simply examining whether particular language
would deceive or mislead a reasonable debtor.” Wilson v. Quadramed Corp., 225 F.3d 350, 354
(3d Cir. 2000) (internal citations omitted). However, a debtor cannot shirk her responsibilities
based on “bizarre or idiosyncratic interpretations of notices,” as the standard “preserv[es] a
quotient of reasonableness and presum[es] a basic level of understanding and willingness to read
with care.” Id. at 354-55. Most importantly, interpreting communications and their potential to
mislead consumers, as outlined in the FDCPA, is a matter of law for the Court to decide. Id. at
353 n.2.
B.
COUNT I
In Count I of the Complaint, Plaintiff alleges that Defendants violated 15 U.S.C. Section
1692j(a) (Compl. ¶¶ 22-7), which states, in pertinent part:
It is unlawful to design, compile, and furnish any form knowing that such form
would be used to create the false beliefs in a consumer that a person other than the
creditor of such consumer is participating in the collection of or in an attempt to
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collect a debt such consumer allegedly owes such a creditor, when in fact such a
person is not so participating.
Under the FDCPA, a “debt collector” is defined as follows:
any person who uses any instrumentality of interstate commerce or the mails in
any business the principal purpose of which is the collection of any debts, or who
regularly collects or attempts to collect, directly or indirectly, debts owed or due
or asserted to be owed or due another . . .
15 U.S.C. § 1692a(6). Notably, in Heintz v. Jenkins, the United States Supreme Court held that
for purposes of the FDCPA, an attorney or law firm is considered a debt collector when it
regularly engages in litigation to collect consumer debts. 514 U.S. 291, 294-95 (1995).
Similarly, in discussing and applying the FDCPA, the New Jersey Supreme Court found
that law firms regularly engaged in summary dispossession actions may only be considered a
debt collector under the FDCPA, if the filing of the action for nonpayment of rent is a direct or
indirect attempt to collect the debt. Hodges v. Sasil Corp., 189 N.J. 210, 224-25 (2007).2 The
Hodges court explained:
[I]n practice, the summary dispossession action is . . . a powerful debt collection
mechanism. . . . [that] “is designed to secure performance of the rental
obligation.” . . . The tenant and landlord understand the summons and complaint
[for an eviction proceeding] to be a demand for payment of rental arrears, a
demand that prompts defaulting tenants to pay owed rent.
Id. at 226-28 (internal citation omitted). Correspondingly, the Third Circuit has held that third
parties who engage in non-traditional debt collection activities are considered “debt collectors”
for FDCPA purposes. See Oppong v. First Union Mortg. Corp., 215 Fed. Appx. 114, 118-19 (3d
Cir. 2007) (holding Wells Fargo, when enforcing a foreclosure proceeding, is considered a “debt
collector” under the FDCPA); Piper v. Portnoff Law Assocs., 396 F.3d 227, 235 (3d Cir. 2005)
2
The Court understands that New Jersey Supreme Court case law is not binding authority;
nevertheless, the Court‟s application and interpretation of the FDCPA, as well as the Heintz case
and other relevant case law, in this instance, is informative and persuasive.
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(holding those enforcing a lien for an unpaid water bill are considered “debt collectors” under the
FDCPA).
In this matter, Plaintiff maintains that LEP‟s inclusion in the December 15, 2009 letter is
designed to create the false belief that LEP was participating in the debt collection, when in fact
LEP merely initiated an eviction proceeding, which Plaintiff asserts is separate and apart from
the debt collection. (Pl.‟s Moving Br. 8-9; Doc. No. 31 (“Pl.s‟ Opp‟n Br.”) 4-5.) Defendants, on
the other hand, respond that Plaintiff‟s belief was not false and, in fact, was accurate. (Defs.‟
Moving Br. 3-4, 11-12; Defs.‟ Opp‟n Br. 6.) Defendants explain that LEP‟s filing of the eviction
proceeding on behalf of Evergreen is a form of debt collection, which is why LEP was included
in the letter. (Defs.‟ Moving Br. 3-4, 11-12.) Thus, Defendants argue, the collection letter does
not violate Section 1692j(a) of the FDCPA. This Court agrees.
Here, the Court finds that pursuant to the relevant statutes and case law, because LEP
regularly files summary dispossession or eviction actions on behalf of creditor Evergreen, LEP is
considered a debt collector under the FDCPA. (See Decl. of Bruce Gudin (“Gudin Decl.”) ¶ 3.)
Since LEP is considered a debt collector under the FDCPA, the Court finds that its inclusion in
the December 15, 2009 validation letter is not misleading. Further, the inclusion of LEP in the
letter was not intended to create any false belief in Plaintiff that LEP was participating in the
debt collection, as LEP was in fact participating by way of the eviction proceedings. Thus, the
Court finds that there are no genuine issues of disputed material facts and Defendants are entitled
to judgment as a matter of law on Count I of Plaintiff‟s Complaint. Based on the foregoing
reasons, Plaintiff‟s motion for summary judgment regarding Count I of the Complaint is
DENIED and Defendants‟ motion for summary judgment on Count I is GRANTED.
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C.
COUNT III
In Count III of the Complaint, Plaintiff alleges that Defendants violated Section 1692g(a)
of the FDCPA, which states, in pertinent part, that when a debt collector is attempting to collect
from a consumer the debt collector must:
Within five days after the initial communication with a consumer in connection
with the collection of any debt . . . send the consumer a written notice containing –
...
(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)(3),(4),(5).
The notice requirements under Section 1692g(a) of the FDCPA are designed to ensure
that validation notices make a consumer‟s rights clear. Wilson, 225 F.3d at 354 (“[T]he debt
validation provisions of section 1692g were included by Congress to guarantee that consumers
would receive adequate notice of their rights under the law”). A communication does not
provide adequate notice, and is deceptive, when it can reasonably be read to have two or more
meanings, one of which is inaccurate, or otherwise presents contradictory demands. See id.;
Campuzano-Burgos., 550 F.3d at 298; Rosenau v. Unifund Corp., 539 F.3d 218 (3d Cir. 2008);
Graziano v. Harrison, 950 F.2d 107, 111 (3d Cir. 2000). Furthermore, while the Court, as
explained above, must interpret the letter through the eyes of the “least sophisticated debtor,” this
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standard does not relieve the debtor of the responsibility to read the validation notice with care.
Wilson, 225 F.3d at 354-55.
Plaintiff argues that the Defendants‟ validation notice did not provide adequate notice and
violated Section 1692g(a) of the FDCPA because: (1) it did not clearly explain who Plaintiff
should contact to retrieve the correct amount due and dispute the validity of the debt; (2)
Defendants should have sent two validation notices, instead of one, since there are “two debt
collectors;” and (3) the letter gave the impression that disputing the debt was not possible since
the matter was already referred to the court and thus did not adequately notify Plaintiff of her
rights. (Pl.‟s Moving Br. 8-9; Pl.‟s Opp‟n Br. 4-5.) Specifically, Plaintiff contends that the
collection letter is deceptive and confusing because it instructs her to call Evergreen or
Computex to pay the debt or to receive the exact amount owed, while also asking her to contact,
if she chooses to dispute the validity of the debt, Computex or LEP, the senders of the letter.
(Pl.‟s Moving Br. 8.) Therefore, Plaintiff asserts that two separate validation notices were
required, because the FDCPA requires a debtor to notify each debt collector if a debt is being
disputed and there is no provision that states that notification to one debt collector will bind the
other debt collector seeking the same debt. (Pl.‟s Opp‟n Br. 2.) According to Plaintiff, the
notice fails under the FDCPA requirements, because it left Plaintiff uncertain as to what her
rights were and how she should dispute the alleged debt. (Id. at 3.)
Finally, Plaintiff argues that Defendants‟ validation notice improperly references
Plaintiff‟s possible dealings with the court. Plaintiff contends that the references to the “court”
could lead the least sophisticated debtor to fail to dispute her debt, believing that the matter has
already been referred to the court. Also, Plaintiff contends that because no court proceeding had
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been initiated at the time the notice was sent, the reference to the “court” is false and designed to
intimidate Plaintiff. (Pl.‟s Moving Br. 6.)
Defendants, on the other hand, vehemently disagree with Plaintiff‟s position, arguing that
the letter is not deceptive or confusing, does not present any choices to the debtor Plaintiff that
are inaccurate or otherwise conflicting and, as such, summary judgment should be granted in its
favor. (Defs.‟ Moving Br. 9-10; Defs.‟ Opp‟n Br. 8.) Defendants maintain that the collection
letter explicitly advises Plaintiff that she can “call Evergreen or Computex to find out the exact
amount of rent/late fees owed, can write to Computex or Levy [LEP] to dispute the validity of
the debt, and must follow the instructions on any legal process separately received, but can still
dispute the validity of the debt.” (Defs.‟ Opp‟n Br. 8.) Defendants contend that providing a
debtor with an option to contact one of two debt collectors to dispute a single debt, while also
ensuring that Plaintiff is aware that she must comply with any court orders, independent of her
right to dispute the debt, is neither contradictory nor confusing. (Defs.‟ Moving Br. 9-11.)
Since the letter indicates that Plaintiff could contact “either office” to dispute the debt and/or
seek validation and further states that the office she contacted would obtain the verification,
Defendants argue that the letter satisfies the FDCPA requirements, as “it would not leave the
least sophisticated consumer „uncertain as to her rights.‟” (Id. at 11.) Defendants further note
that, in dismissing Evergreen from this action, the Court previously found that the letter came
from both Computex and LEP, as debt collectors, and was not confusing as to the relationship
between the Defendants and Evergreen. (Id. at 10-11.)
Here, as a matter of law, the Court finds that while the letter provides multiple options for
receiving the amount due or disputing the validity of the debt, the options are not inaccurate or
do not otherwise require contradictory demands. The letter clearly identifies all parties
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participating in the debt collection process and what roles each entity plays. (See Compl. Ex. A.)
The letter is written on both Computex‟s and LEP‟s letterhead, it is signed by both entities, and
the word “our” is mentioned frequently throughout; thus, the Court finds that both Defendants
are identified as the senders of the letter. (Id.) Additionally, Evergreen, in a standalone sentence
at the beginning of the letter, is specifically identified as the creditor/landlord. (Id.) The letter
explicitly states that “[Plaintiff] may contact the creditor/landlord or Computex to obtain the
amount due at that time.” (Id. (emphasis added).) While the letter outlines a number of options
for accomplishing various goals, none of the options are contradictory or inaccurate. Plaintiff
may contact either Evergreen or Computex to pay the debt or either Computex or LEP to dispute
the validity of the debt – each option is identified and available to the Plaintiff. Thus, the Court
finds that by carefully reading the letter, as is required, the least sophisticated debtor would be
adequately notified of her rights.
Similarly, the Court finds Plaintiff‟s argument that Defendants were required to send two
validation notices, instead of a joint notice, unpersuasive. Plaintiff does not refer to any binding
or persuasive authority to support her position. Indeed, it appears there is none. Again, the
ultimate goal of a validation notice is to properly notify the consumer of her rights. Here, the
Court finds that Defendants‟ validation notice satisfied the goals and requirements of the
FDCPA. Indisputably, the letter sent to Plaintiff clearly identifies Computex and LEP as the
debt collectors and senders of the letter, and properly notifies Plaintiff of her rights.
Furthermore, had Computex and LEP sent their own validation notices, instead of a joint notice,
it may have created unjustified confusion, as it could give Plaintiff the impression that she owes
two debts instead of one. Thus, the Court does not find that Defendants‟ joint validation notice
violated Section 1692g of the FDCPA.
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Equally unconvincing is Plaintiff‟s asserted confusion regarding Defendants‟ reference to
court proceedings and her contention that no court proceeding had been initiated on or about the
time Plaintiff received the collection letter. First, it is clear by the facts of this case that the
Summons and Complaint for Plaintiff‟s eviction was prepared and filed on December 15, 2009.
(See DUMF ¶ 7.) Indeed, Plaintiff does not dispute this fact and has not provided any evidence
that would lead this Court to believe otherwise. (See Pl.‟s Opp‟n to DUMF ¶ 7 (leaving this
issue to Defendants to prove, as opposed to denying Defendants‟ undisputed material fact).) In
fact, Defendants provided a copy of the Summons and Complaint filed on December 15, 2009,
which demonstrates that a court proceeding had indeed been initiated by the time Plaintiff
received Defendants‟ collection letter. (Gudin Decl. Ex. A.)
Second, references to court proceedings would not cause confusion to the least
sophisticated debtor, as the letter clearly stated: “This disclosure pertains to your dealings with
our offices. It does not affect your dealings with the Court. . . . you must follow [the Court‟s]
instructions even if you dispute the validity or amount of the debt.” (Compl. Ex. A (emphasis
added).) Thus, the plain language of the collection letter references two distinct issues: (1)
Plaintiff‟s dealings with a court and (2) Plaintiff‟s rights to pay or dispute the debt directly, as
discussed in the letter. As an eviction proceeding had already begun, references to the court
serve to inform Plaintiff that her rights to dispute the validity of the debt remain, notwithstanding
the court proceedings and/or instructions or requirements made by a court. Indeed, had the letter
not instructed Plaintiff that she was required to follow any instructions provided by a court, even
if she was simultaneously disputing the debt directly with Defendants, the letter would have been
considered by this Court to be misleading, deceptive and/or confusing, because Plaintiff may
have believed that she was not required to defend herself in the eviction proceeding.
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Accordingly, the Court finds that references to a court in the validation notice properly notified
Plaintiff of her consumer rights and did not violate the FDCPA notice requirements.
Again, as a debtor, Plaintiff has a duty to read the collection letter and validation notice
carefully, with a basic level of understanding. Carefully reading Defendants‟ collection letter
makes its contents and instructions clear, as it sufficiently sets forth the necessary FDCPA notice
requirements and advises Plaintiff of her rights. Based on the foregoing reasons, and for other
good cause shown, the Court finds that Defendants are entitled to judgment as a matter of law on
Plaintiff‟s Count III of the Complaint, as there are no genuine issues of material fact in dispute.
Accordingly, Plaintiff‟s motion for summary judgment regarding Count III of the Complaint is
DENIED and Defendants‟ motion for summary judgment on Count III is GRANTED.
D.
COUNT IV
Count IV of the Complaint alleges that Defendants‟ collection letter runs afoul of Section
1692e(10) of the FDCPA, which makes it a violation for a debt collector to “use . . . any false
representation or deceptive means to collect or attempt to collect any debt or to obtain
information concerning a consumer.” As explained above, a collection letter is deceptive when it
can reasonably be read to have two or more meanings, one of which is inaccurate or
contradictory to another requirement. Wilson, 225 F.3d at 354. However, the consumer has a
duty to read the collection letter carefully and is presumed to have “a basic level of
understanding and a willingness to read with care.” Campuzano-Burgos, 550 F.3d at 299;
Wilson, 225 F.3d at 354-55.
In support of her assertion that Defendants violated Section 1692e(10), Plaintiff makes
many of the same arguments set forth above under this Court‟s discussion of Count III of the
Complaint. Specifically, Plaintiff claims that the collection letter or validation notice is deceptive,
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as it would lead the least sophisticated consumers “to be uncertain as to whether they should
dispute the alleged debt with Computex or [LEP], or with both Computex and [LEP],” or with
neither Defendant. (Compl. ¶ 40; Pl.‟s Moving Br. 7; Pl.‟s Opp‟n Br. 4.) Additionally, Plaintiff
contends that the use of law firm letterhead deceptively implies that the threat of litigation looms if
Plaintiff fails to pay the debt or adequately dispute it. (Pl.‟s Moving Br. 8-9; Pl.‟s Opp‟n Br. 4-5.)
Plaintiff cites to Lesher v. Law Office of Mitchell N. Kay, P.C., as support for this proposition, in
which the court found that each collection letter sent to a debtor gave rise to the implication that an
attorney was involved in the debt collection and implicitly threatened legal action, when in fact
court claims were not anticipated. 724 F. Supp. 2d 503, 509 (M.D. Pa. 2010).
Defendants again vehemently disagree with Plaintiff‟s position, making the same
arguments used to support their summary judgment motion on Count III. Defendants maintain
that the letter is not deceptive or confusing, as it explicitly advises Plaintiff that she can contact
either Computex or Levy to dispute the debt and that whichever of the two offices she contacts
will be the same office to respond to her written request. (Defs.‟ Opp‟n Br. 8.) Thus, based on
the explicit language of the letter, Defendants assert that Plaintiff‟s uncertainty as to whether she
had to contact both Defendants or neither to dispute the debt necessarily fails. (See id.) With
regard to Plaintiff‟s assertion that use of the LEP letterhead implied a threat of litigation,
Defendants again contend that the argument is misplaced, as the eviction proceeding had in fact
commenced. (Id.)
The Court finds that the letter adequately explains who the debt collectors are and who
Plaintiff can contact to dispute the validity of the debt. Furthermore, the Court agrees with
Defendants that Plaintiff‟s asserted confusion as the result of Defendants‟ use of the LEP
letterhead is misplaced. Certainly, the use of LEP‟s letterhead was not intended as a “threat” or
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intimidation tool, as a Summons and Complaint for eviction was simultaneously filed when the
notice was sent, which is well within Evergreen‟s landlord rights. Further, the letter is sent on
the letterhead of both Computex and LEP and is signed by both Defendants, as the letter was sent
by both organizations. Additionally, the first paragraph reads, “[t]his letter has been sent to you
by the office of Computex Information Services, Inc. . . . and the law offices of Levy, Ehrlich &
Petriello, A Professional Corporation.” (Compl. Ex. A (emphasis added).) The use of the word
“and” in the first paragraph specifically indicates that the collection letter was sent by both
Defendants. Additionally, the first sentence in paragraph four reads: “Federal law requires our
offices to inform you that unless you notify in writing either office . . . .” (Id. (emphasis added).)
Here, the use of the word “either” in describing who Plaintiff can contact to dispute the validity
of the debt indicates that any office can be contacted in order to dispute the debt. It, therefore,
logically follows that Plaintiff was not required to contact both offices. Finally, the first sentence
of the fifth paragraph (“[t]he office contacted by you will provide . . . .” (Id.)), places Plaintiff on
notice that the office she contacts will provide the information requested. While the letter
provides Plaintiff with the option to either contact Computex or LEP to dispute the debt, the
option is accurate, the letter clearly states that both options are available and a careful reader, no
matter her sophistication, would understand this.
Likewise, the Court finds that Plaintiff‟s argument that the letter is deceptive because it is
written on law firm letterhead and meant to convey the threat of litigation, is equally
unpersuasive. In the matter at bar, LEP, on behalf of Evergreen, had already initiated an eviction
proceeding and, as such, use of its letterhead was appropriate. Since the eviction litigation had
begun, there was never any false implication or threat of litigation conveyed, only facts.
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Accordingly, the Court finds that Defendants‟ validation notice adequately explains who
Computex and LEP are, what roles they play in the debt collection and does not improperly
convey a threat of litigation. As there are no genuine issues of material fact in dispute, the Court
finds that Defendants are entitled to judgment as a matter of law on Count IV of Plaintiff‟s
Complaint. As such, based on the foregoing reasons, Plaintiff‟s motion for summary judgment
regarding Count IV of the Complaint is DENIED and Defendants‟ motion for summary
judgment on Count IV is GRANTED.
E.
COUNT V
Count V of the Complaint alleges that Defendants violated Section 1692c(c) of the
FDCPA, which 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.
15 U.S.C. § 1692c(c) (emphasis added). Notably, debt is defined as:
[A]ny obligation or alleged obligation of a consumer to pay money arising out of
a transaction in which the money, property, insurance, or services which are the
subject of the transaction are primarily for personal, family, or household
purposes, whether or not such obligation has been reduced to judgment.
Id. at § 1692a(3).
In the instant matter, Plaintiff argues, and Defendants do not contest, that after
Defendants sent her the December 15, 2009 collection letter, Plaintiff‟s counsel notified
Defendants, on January 6, 2010, that Plaintiff had retained counsel and that Defendants should
“Cease and Desist all collection efforts and communications with Ms. Crenshaw.” (Compl. Ex.
B, emphasis in original.) After Plaintiff paid the outstanding debt owed for her December and
January rents, on February 11, 2010, Defendants sent a second collection letter to Plaintiff,
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regarding her failure to pay rent for the month of February. (Pl.‟s Moving Br. 9; DUMF ¶¶ 11-4;
PUMF ¶¶ 13-4; Sampson Decl. ¶¶ 10-4.)
Notably, the parties agree that Plaintiff failed to pay rent in December, that she settled her
December rent obligation, interest and fees in late January, and then failed to pay rent again in
February. (DUMF ¶¶ 11-4; Pl.‟s Opp‟n to DUMF ¶¶ 11-4; Sampson Decl. ¶¶ 9-14.) Based on
the December cease and desist letter sent to Defendants, Plaintiff takes the position that it was
improper to send the second collection letter, as both debts or defaults are a consequence of the
same, one year lease or contract (Pl.‟s Moving Br. 9; Pl.‟s Reply Br. 6; Pl.‟s Opp‟n Br. 6-7.)
Defendants, however, assert that the second letter was not inappropriate, as it relates to an
entirely different file and debt than the one addressed in counsel‟s initial cease and desist letter.
(Defs.‟ Moving Br. 4-5, 12-14; Defs.‟ Opp‟n Br. 9.)
Thus, the only outstanding disagreement between the parties is whether the unpaid
February rent constitutes a separate debt obligation from the unpaid December rent or if both
obligations constitute a single debt arising from the lease, which would make the initial
December cease and desist letter applicable to the second collection letter. Having carefully
reviewed and considered the parties‟ legal arguments, as well as the applicable laws and case
law, the Court finds that Defendants did not violate Section 1692c(c) of the FDCPA. It is clear
and undisputed by the facts that Plaintiff failed to pay her rent in December, triggering the
December 15, 2009 letter and Plaintiff‟s January 6, 2010 response. (DUMF ¶¶ 5-8; Pl.‟s Opp‟n
to DUMF ¶¶ 5-8; Sampson Decl. ¶¶ 5-9.) In January, Plaintiff satisfied her December and
January rent obligations and the eviction proceeding Defendants initiated against her was
dismissed. (DUMF ¶ 10; Pl.‟s Opp‟n to DUMF ¶ 10; Sampson Decl. ¶ 9.) It follows logically
that by settling the unpaid December and January rent obligations, it brings Plaintiff‟s total rental
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obligation to zero, therefore eliminating any outstanding debt. Thus, when Plaintiff failed to pay
rent in February it created a new outstanding rental obligation. While both debts arise from the
same lease transaction, Plaintiff‟s second and separate failure to pay rent created an entirely new
debt. Therefore, the Court finds that the single transaction, Plaintiff‟s lease, created two separate
debts based on two separate violations, one for December/January rent and one for February rent.
Certainly, “with respect to such debt” is the essential phrase in Section 1692c(c) of the
FDCPA, as it signifies that debt collectors are only required to cease communication with
consumers, after being asked by the consumer or her counsel with respect to the debt that the
initial notification referenced. The Third Circuit Court of Appeals agrees. In analyzing a similar
subsection of Section 1692c that contains the same “with respect to such debt” phrase,3 the Third
Circuit held that if a consumer incurs a new, separate debt, then the debt collector is free to
contact the consumer directly, despite having been previously notified that the consumer was
represented by counsel regarding a previous debt. Graziano, 950 F.2d at 113. Since Plaintiff
incurred two separate debt obligations, one for December/January rent and one for February rent,
Defendants were free to contact Plaintiff regarding the unpaid February rent despite her
counsel‟s January 6 letter. See id. Accordingly, the Court finds that Defendants are entitled to
3
Specifically, 15 U.S.C. § 1692c(a)(2), which pertains to communications with the consumer,
provides:
Without the prior consent of the consumer given directly to the debt collector or
the express permission of a court of competent jurisdiction, a debt collector may
not communicate with a consumer in connection with the collection of any debt –
if the debt collector knows the consumer is represented by an attorney with
respect to such debt and has knowledge of, or can readily ascertain, such
attorney's name and address, unless the attorney fails to respond within a
reasonable period of time to a communication from the debt collector or unless
the attorney consents to direct communication with the consumer.
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judgment as a matter of law with regard to Count V of Plaintiff‟s Complaint, as there are no
genuine issues of material fact in dispute.
Thus, for the foregoing reasons, Plaintiff‟s motion for summary judgment regarding
Count V of the Complaint is DENIED and Defendants‟ motion for summary judgment on Count
V is GRANTED.
III.
CONCLUSION
For the foregoing reasons, and for other good cause shown, Plaintiff‟s motion for
summary judgment is DENIED in its entirety and Defendants‟ motion for summary judgment is
GRANTED in its entirety. Pursuant to Federal Rule of Civil Procedure 56, Defendants have
demonstrated that there are no genuine issues of material fact in dispute and that Defendants are
entitled to judgment as a matter of law on Counts I, III, IV and V of Plaintiff‟s Complaint. An
appropriate form of order will be filed together with this Opinion.
s/ Michael A. Shipp
MICHAEL A. SHIPP
UNITED STATES MAGISTRATE JUDGE
Dated: April 29, 2011
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