MARTINEZ v. DIVERSIFIED CONSULTANTS, INC. et al
Filing
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OPINION. Signed by Judge Esther Salas on 1/24/2019. (sm)
Not for Publication
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
WALESKA MARTINEZ,
on behalf of herself and all others
similarly situated,
Plaintiff,
v.
DIVERSIFIED CONSULTANTS, INC.
and JOHN DOES 1-25,
Defendants.
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Civil Action No. 17-11923 (ES) (JAD)
OPINION
SALAS, DISTRICT JUDGE
This putative class action arises from alleged violations of the Fair Debt Collection
Practices Act, 15 U.S.C. 1692 et seq. (the “FDCPA”). (See generally D.E. No. 1, Complaint
(“Compl.”)). Before the Court is Defendant Diversified Consultants, Inc.’s (“Defendant’s”)
motion to dismiss Plaintiff Waleska Martinez’s (“Plaintiff’s”) Complaint under Federal Rule of
Civil Procedure 12(b)(6). (D.E. No. 16). Having considered the parties’ submissions,1 the Court
decides this matter without oral argument. See D.N.J. Civ. R. 78(b). For the reasons below, the
Court GRANTS Defendant’s motion to dismiss.
I.
Background
The Court will “set out facts as they appear in the Complaint . . . .” See Bistrian v. Levi,
696 F.3d 352, 358 n.1 (3d Cir. 2012).
1
29).
(See generally D.E. No. 14; D.E. No. 16-1 (“Def. Mov. Br.”); D.E. No. 19 (“Pl. Opp. Br.”); D.E. Nos. 23–
Before September 19, 2017, Plaintiff incurred a financial obligation to Verizon. (Compl.
¶ 25). On or before September 19, 2017, Plaintiff’s account with Verizon became past due and
entered default. (Id. ¶ 31). To collect on that debt, Verizon referred the financial obligation to
Defendant. (Id. ¶ 32). On September 19, 2017, in an attempt to collect on the debt, Defendant
sent a collection letter (the “Collection Letter”) to Plaintiff. (Id. ¶ 34; see D.E. No. 1 at 16 (“Compl.
Ex. A”)).2 The Collection Letter states:
This notice is to inform you that your account with VERIZON has
been referred to our office for collections.
Unless you notify this office within 30 days after receiving this
notice that you dispute the validity of this debt, or any portion
thereof, this office will assume this debt is valid. If you notify this
office in writing within 30 days from receiving this notice that you
dispute the validity of this debt, or any portion thereof, this office
will obtain verification of the debt or obtain a copy of a judgment
and mail you a copy of such judgment or verification. If you request
of this office in writing within 30 days after receiving this notice,
this office will provide you with the name and address of the original
creditor, if different from the current creditor.
Calls to or from this company may be monitored or recorded.
This is an attempt to collect a debt. Any information obtained will
be used for that purpose. This communication is from a debt
collector.
Sincerely,
Diversified Consultants, Inc.
PO Box 551268
Jacksonville, FL 32255-1268
800-604-0064
(Compl. Ex. A). At the top, the Collection Letter also lists Plaintiff’s name and account number
(in redacted form) and the balance due. (Id.). In the middle, below the signature block, the
“In resolving a motion to dismiss pursuant to Rule 12(b)(6), a court generally should consider . . . documents
that are attached to or submitted with the complaint, . . . and any matters incorporated by reference or integral to the
claim . . . .” Siwulec v. J.M. Adjustment Servs., LLC, 465 F. App’x 200, 202 (3d Cir. 2012).
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Collection Letter lists Defendant’s toll-free phone number, hours of operation, and website. (Id.).
And on a cut-off at the bottom, the Collection Letter lists Defendant’s address and toll-free phone
number, and Plaintiff’s account information and the balance due. (Id.).
Plaintiff filed the Complaint on November 21, 2017, contending that Defendant violated
15 U.S.C. § 1692g(a) because the Collection Letter “would cause the least sophisticated consumer
to become confused as to what she must do to effectively dispute [a] debt” (id. ¶ 45; see also id.
¶¶ 42–57) (Count I); and that Defendant violated 15 U.S.C. § 1692e(10) by “using [a] false
representation or deceptive means to collect or attempt to collect any debt” (id. ¶ 59; see also id.
¶¶ 58–68) (Count II).
II.
Legal Standards
A.
Fed. R. Civ. P. 12(b)(6)
Federal Rule of Civil Procedure 8(a)(2) requires that a complaint contain a “short and plain
statement of the claim showing that the pleader is entitled to relief.” But in order to survive a
motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), the complaint must contain
“enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007). “A claim has facial plausibility when the pleaded factual content 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) (quoting Twombly, 550 U.S. at 556).
Pursuant to the pleading regime established by Twombly and Iqbal, the Court of Appeals
for this Circuit has promulgated a three-pronged test of the sufficiency of a complaint. See
Santiago v. Warminster Twp., 629 F.3d 121, 130 (3d Cir. 2010). First, the Court considers “the
elements a plaintiff must plead to state a claim.” Id. Second, the Court abstracts from mere legal
conclusions contained in the complaint, which “are not entitled to an assumption of truth.” Id.
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(quoting Iqbal, 556 U.S. at 680). That is, a complaint’s “[t]hreadbare recitals of the elements of a
cause of action, supported by mere conclusory statements,” Iqbal, 556 U.S. at 678, cannot “nudge[]
[a plaintiff’s] claims across the line from conceivable to plausible,” Twombly, 550 U.S. at 570.
Finally, the Court considers the complaint’s remaining well-pleaded factual allegations and
“determine[s] whether they plausibly give rise to an entitlement for relief.” Santiago, 629 F.3d at
130 (quoting Iqbal, 556 U.S. at 679). Throughout this process, the Court is “required to accept as
true all allegations in the complaint and all reasonable inferences that can be drawn from them
after construing them in the light most favorable to the nonmovant.” See, e.g., McDermott v.
Clondalkin Grp., Inc., 649 F. App’x 263, 266 (3d Cir. 2016).
B.
The FDCPA
Congress enacted the FDCPA “to eliminate abusive debt collection practices by debt
collectors” because “[e]xisting laws and procedures . . . [we]re inadequate to protect consumers.”
See 15 U.S.C. § 1692(b) & (e). “The FDCPA is a strict liability statute to the extent it imposes
liability without proof of an intentional violation.” Allen ex rel. Martin v. LaSalle Bank, N.A., 629
F.3d 364, 368 (3d Cir. 2011).
15 U.S.C. § 1692g(a) requires a debt collector to provide the following information to the
debtor:
(1)
(2)
(3)
(4)
the amount of the debt;
the name of the creditor to whom the debt is owed;
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;
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
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(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.
“Paragraphs 3 through 5 of section 1692g(a) contain the validation notice—the statements
that inform the consumer how to obtain verification of the debt and that he has thirty days in which
to do so.” Caprio v. Healthcare Revenue Recovery Gro., LLC, 709 F.3d 142, 147 (3d Cir. 2013).
The validation notice must be “interpreted from the perspective of the least sophisticated debtor”
and must not be “overshadowed or contradicted by accompanying messages from the debt
collector.”
Graziano v. Harrison, 950 F.2d 107, 111 (3d Cir. 1991).3
Under the “least
sophisticated debtor” standard, a debt collection communication violates the FDCPA when it can
be reasonably read by the least sophisticated debtor “to have two or more different meanings, one
of which is inaccurate.” Caprio, 709 F.3d at 149. The least-sophisticated debtor standard is “lower
than simply examining whether particular language would deceive or mislead a reasonable debtor”
and “protects [even] naive consumers.” Wilson v. Quadramed Corp., 225 F.3d 350, 354 (3d Cir.
2000). But the least-sophisticated debtor standard “does not go so far as to provide solace to the
willfully blind or non-observant;” “and the debt collector accordingly cannot be held liable for
bizarre or idiosyncratic interpretations.” Caprio, 709 F.3d at 149. “For example, even the ‘least
sophisticated debtor’ is expected to read any notice in its entirety.” Id.
When evaluating whether a debt collection letter violates the Section 1692g, courts
consider both the “form” and “substance” of the letter. See, e.g., Caprio, 709 F.3d at 151 (citing
Wilson, 225 F.3d at 361). “Substance” is matter of language—such as “please call”—and “form”
“[W]hether language in a collection letter contradicts or overshadows the validation notice is a question of
law.” Wilson v. Quadramed Corp., 225 F.3d 350, 353 n.2 (3d Cir. 2000).
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is a matter of the presentation and context of that language—such as whether it is bolded and where
it appears. See id.
In Caprio, for instance, the Court of Appeals ruled that the language “If we can answer any
questions, or if you feel you do not owe this amount, please call us toll free at 800-984-9115 or
write us at the above address” violated Section 1692g because it appeared on the front side of the
collection letter—unlike the validation notice, which appeared on the back—and was bolded. See
id. at 150–52. Further, the telephone number appeared in relatively large font such that “the ‘least
sophisticated debtor’ would take the easier—but legally ineffective—alternative of making a tollfree telephone call to dispute the debt.” See id. The Caprio court observed that that language—
“if you feel you do not owe this amount, please call”—“did more than merely ask [the plaintiff] to
call or write if ‘we can answer any questions.’” Id. at 152. And the court distinguished the form
and substance of that language from language in a collection letter from an earlier case, which
“was presented in the same ordinary font and without any particular emphasis . . . and [included]
the required validation notice . . . on the front side of the document.” Id. at 152.
The FDCPA also prohibits the use of “any false, deceptive, or misleading representation
or means in connection with the collection of any debt.” 15 U.S.C. §1692e. More specifically,
“[t]he use of any false representation or deceptive means to collect or attempt to collect any debt
or to obtain information concerning a consumer” is prohibited. 15 U.S.C. §1692e(10). Section
1692e(10) is a “catch-all-type provision.” Rosenau v. Unifund Corp., 539 F.3d 218, 224 (3d Cir.
2008). But “[w]hen allegations under 15 U.S.C. §1692e(10) are based on the same language or
theories as allegations under 15 U.S.C. §1692g, the analysis of the §1692g claim is usually
dispositive.” Caprio, 709 F.3d at 155 (internal quotation marks and citations omitted).
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III.
Analysis
A. Count I: 15 U.S.C. § 1692g
Defendant’s primary conclusion is that the Collection Letter complies with Section 1692g
of the FDCPA and, under the least-sophisticated debtor standard, did not overshadow or mislead
Plaintiff regarding her right to dispute the debt in writing. (See Def. Mov. Br. at 4–12). More
specifically, the Collection Letter “merely provide[d] the consumer with [Defendant]’s telephone
number and disclosed that calls to or from the company may be monitored or recorded” but “d[id]
not ask the consumer to call [Defendant] whatsoever.” (Id. at 4). Moreover, the Collection Letter
“d[id] not include any bold text, italics, or other emphasis on certain text or font, or place extra
emphasis or textual prominence on [Defendant’s] telephone number.” (Id.).
Plaintiff’s primary response emphasizes the placement of Defendant’s telephone number
three times on the Collection Letter and the language “Calls to or from this company may be
monitored or recorded.”
(See Pl. Opp. Br. at 8–9).
Plaintiff also argues that Defendant
“inappropriately shift[s] the burden in complying with the FDCPA” apparently because the
Collection Letter offers debtors the option to dispute their debts in writing—what Plaintiff calls a
“fictitious condition[] precedent” that would require Plaintiff to “dispute the debt, or demand
verification, to have a successful FDCPA claim against [Defendant].” (See id. at 9–11).
For the reasons discussed below, the Court rules that the Collection Letter contains the
required validation notice under Section 1692g(a) and does not violate Section 1692g in substance
or form because it does not “overshadow” or “contradict” the validation notice. See, e.g.,
Graziano, 950 F.2d at 111; Wilson, 225 F.3d at 356.
The Court “begin[s] with the ‘substance’ of the Collection Letter.” See Caprio, 709 F.3d
at 151. The Collection Letter does not “instruct[] [Plaintiff] to call.” See id. The Collection Letter
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thus does not, for instance, “instruct[] [Plainitff] to call either a toll-free telephone number or a 24hour automated customer service number . . . .” See Laniado v. Certified Credit & Collection
Bureau, 705 F. App’x 87, 90 (3d Cir. 2017). And the Collection Letter does not suggest that a
telephone call could be used to dispute a debt—such as by stating, “If you feel you do not owe this
amount, please call.” See, e.g., Caprio, 709 F.3d at 150–52. The Collection Letter simply provides
Defendant’s telephone number, spaced throughout three times, and states, “Calls to or from this
company may be monitored or recorded”4 in a standalone paragraph. (See Compl. Ex. A).
The Court observes that even an “instruction to call”—of which there is none here—would
not necessarily violate Section 1692g. See, e.g., Rosa v. Encore Receivable Mgmt., Inc., No. 152311, 2016 WL 4472951, at *3 (D.N.J. Aug. 23, 2016); Reynolds v. Encore Receivable Mgmt.,
Inc., No. 17-2207, 2018 WL 2278105, at *4 (D.N.J. May 18, 2018) (“The Court agrees with Judge
Shipp’s reasoning in Rosa.”), appeal dismissed sub nom. Reynolds v. Encore Receivable Mgmt. I,
No. 18-2269, 2018 WL 6536133 (3d Cir. Oct. 25, 2018). And “merely provid[ing] the consumer
with . . . contact information” such as a telephone number—as the Collection Notice does do
here—does not violate Section 1692g. See, e.g., Riccio v. Sentry Credit, Inc., No. 17-1773, 2018
WL 638748, at *6 (D.N.J. Jan. 31, 2018).
With respect to the “form” of the Collection Letter, the Court observes that none of the
factors that informed the Caprio court’s decision are present here: neither an exhortation to “call”
nor Defendant’s telephone number is “printed in bold” on the Collection Letter; Defendant’s
telephone number does not appear anywhere on the Collection letter in relatively “larger font;”
Defendant’s “mailing address [does not] only appear[] in the letterhead” of the Collection Letter;
and the validation notice is not “relegated to the back side of the Collection Letter.” See Caprio,
4
The Court notes that it has no occasion to consider Florida law. (See, e.g., Pl. Opp. Br. at 15–16).
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709 F.3d at 151–52; see also Wilson, 225 F.3d at 352–53 (rejecting a claim under Section 1692g
when “all three paragraphs” of the relevant collection letter were “printed in the same font, size
and color type-face”); Reizner v. Nat’l Recoveries, Inc., No. 17-2572, 2018 WL 2045992, at *9
(D.N.J. May 2, 2018) (“There is no language emphatically instructing Plaintiff to contest the debt
by telephone. The validation notice is not on the backside of the letter in grey typeface.”).
Furthermore, the factors that led the Caprio court to distinguish an earlier case in which a
collection letter was upheld—such as the fact that the “validation notice appeared on the [relevant]
front side of the document”—are present here. See Caprio, 709 F.3d at 152–53.
For those reasons, the Collection Letter “ultimately does not overshadow or contradict,
even when viewed from the perspective of the least sophisticated debtor.” See Cruz v. Recoveries,
No. 15-0753, 2016 WL 3545322, at *4 (D.N.J. June 28, 2016), appeal dismissed sub nom. Cruz v.
Fin. Recoveries, No. 16-3017, 2016 WL 11262517 (3d Cir. Nov. 16, 2016).
The Court also rejects Plaintiff’s argument that—apparently because the Collection Letter
offers debtors the option to dispute their debts in writing—Defendant “inappropriately shift[ed]
the burden in complying with the FDCPA.” (See Pl. Opp. Br. at 2 & 9–10). In Wilson, for instance,
the collection letter used almost the exact same language as the Collection Letter here;5 but there,
the Court of Appeals ruled that “neither the form nor the substance of [the] letter overshadowed or
contradicted the validation notice.” See, e.g., Wilson, 225 F.3d at 352 & 361.
Compare Wilson, 225 F.3d at 352 (“Unless you notify this office within 30 days after receiving this notice
that you dispute the validity of this debt or any portion thereof, this office will assume this debt is valid. If you notify
this office in writing within 30 days from receiving this notice, this office will obtain verification of the debt or obtain
a copy of a judgement and mail you a copy of such judgement or verification. If you request this office in writing
within 30 days after receiving this notice this office will provide you with the name and address of the original creditor,
if different from the current creditor.”), with Compl. Ex A.
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B.
Count II: 15 U.S.C. § 1692e(10)
Plaintiff’s Section 1692e(10) claim is premised on the same allegations as her Section
1692g claim. (See, e.g., Compl. ¶ 58 (“Plaintiff repeats the allegations contained in paragraphs 1
through 57 as if the same were here set forth at length.”)). But “[w]hen allegations under 15 U.S.C.
§ 1692e(10) are based on the same language or theories as allegations under 15 U.S.C. § 1692g,
the analysis of the § 1692g claim is usually dispositive.” Caprio, 709 F.3d at 155 (internal
quotations and citations omitted). “Because Plaintiff cannot prevail on her claim under Section
1692g, Plaintiff likewise cannot proceed under Section 1692e(10).” See, e.g., Cruz, 2016 WL
3545322, at *4; Reizner, 2018 WL 2045992, at *10 (“The Court finds that the letter does not
violate Section 1692g(a) and, as result, it also does not violate Section 1692e(10).”).
IV.
Conclusion
For the foregoing reasons, the Court GRANTS Defendant’s motion to dismiss: The
Compliant is DISMISSED without prejudice. To the extent Plaintiff can cure any deficiencies
identified in the Court’s Opinion, Plaintiff may do so within thirty days in an amended complaint.
But “application for dismissal . . . may be made if a timely amendment is not forthcoming within
that time.” See Shane v. Fauver, 213 F.3d 113, 116 (3d Cir. 2000) (quoting Borelli v. City of
Reading, 532 F.2d 950, 951 n.1 (3d Cir. 1976) (per curiam)). And a failure to amend within
thirty days or to cure the deficiencies identified in the Court’s Opinion will result in a
dismissal with prejudice. An appropriate Order accompanies this Memorandum.
s/Esther Salas
Esther Salas, U.S.D.J.
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