BENCOSME v. STILLMAN LAW OFFICE, LLC

Filing 13

MEMORANDUM and ORDER denying 8 MOTION to Dismiss Pursuant to Fed R. Civ.P. 12(b)(6) filed by STILLMAN LAW OFFICE, LLC. Signed by Judge Peter G. Sheridan on 9/24/2018. (mmh)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

ESTIBALY BENCOSME, individually and
on behalf of others similarly situated,

Civil Action No:
I 8-cv-03 304 (PGS)(DEA)

Plainty’f
v.

)

MEMORANDUM AND
ORDER

STILLMAN LAW OFFICES, LLC,
Defendant.

SHERIDAN, U.S.D.J.

This matter comes before the Court on Defendant’s motion to dismiss pursuant to Fed. R.
Civ. P. 12(b)(6). (ECF No. 8). Plaintiff Estibaly Bencosme, brings a class action on Plaintiff’s
behalf and on behalf of similarly situated individuals, against Defendant, Stillman Law Office,
LLC to redress Defendant’s unfair and unconscionable means to collect a debt. (Complaint,
“Compi”. ECF No. 1, pg. 1, and ¶3-4). Generally, Plaintiff alleges violations of the Fair Debt
Collections Practices Act, 15 U.S. C. § 1692, (FDCPA) and seeks damages, along with declaratory
and injunctive relief. (Id. ¶6). The Plaintiff alleges “it is a violation of FDCPA for an attorney to
send a debt collection letter without having first meaningfully reviewed the collection file,”
(Comp. ¶25) and is also a violation of the New Jersey Rules of Professional Conduct. The
requirement arose because a “consumer reacts with far more duress to an attorney’s improper threat
of legal action.” (Comp. ¶26). In this case, no attorney allegedly reviewed the collection letter, or
Plaintiff’s account prior to the mailing of the collection letter. (Compi.

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¶ 27 and 28).

More specifically, some time prior to January 17, 2018, Plaintiff incurred a debt, or
financial obligation to Dr. Hussain arising out of a transaction for “personal, medical, family or
household purposes. (Id.

¶f 12).

On or about January 17, 2018, Plaintiff, a New Jersey resident, received a letter from
Stiliman Law Offices (Stiliman Letter), a Massachusetts law firm attempting to collect the alleged
Dr. Hussain debt. (Id. ¶16, See Ex. A). Plaintiff contends that by sending this letter on firm
letterhead, Defendant engaged in the practice of law in a manner that violated FDCPA. Plaintiff
avers that, upon information and belief, no attorney reviewed the collection letter before it was
mailed out to the Plaintiff. (Id. ¶27). Plaintiff further avers that no Stillman Law Office attorney is
licensed to practice in New Jersey. (Id. ¶30)
Plaintiff avers that she was fearful of the Stiliman Letter because she felt an attorney would
institute suit immediately. As a result, she was required to take steps to address the debt which
she probably would not have done if it were a letter from a collection agency. Lastly, Plaintiff
avers that since Defendant Stillman Law Office, LLC cannot practice law in New Jersey, the
Stiliman Letter created a false threat that a lawsuit may be filed when such an action cannot legally
be taken. (Id. ¶36). The Stiliman Letter reads:

[Proceed to Next Page]

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Dear Bencosme Estibaly:
We have been hired to collect a debt owed to DR HUSSAIN. As of the date of this letter, DR HUSSAIN asserts
that you owe $216.13.
Also, we have been asked to contact you to determine your intentions with respect to repayment of this debt. We
have not been retained to file a lawsuit against you. Further, at this time, no attorney with this firm has personally
reviewed the particular circumstances ol’ your account,
Unless, within thirty days after youl leceipt of this kucr, you dispute the validity of the debt or any portion thereof,
this office will assume the debt to be valid. If, within thirty days after your receipt of this letter, you notify us in
writing that the debt or any portion thereof is disputed, we will obtain verification of the debt or a copy of a

judgment, if any, and we will mail you a copy of such verification or judgment. Also, upon your written request
made within thirty days after receipt of this notice, we will provide you with the name and address of the original
creditor, if different from the cuirent creditor.
Sincerely.

Slilirnan Jaw Office, 110

ICSOO 1
This correspondence is from a debt collector. This is an attempt to collect a debt, and any information obtained
will be used for that purpose.
Important notices appear on the back of this fetter. Please read them as they may affect your rights.

Of importance, according to Defendant’s brief, are two statements set forth in the second
paragraph of the letter: “we have not been retained to file a lawsuit against you” and “at this time,
no attorney with this firm has personally reviewed the particular circumstances of your account.”
At oral argument, Defendant also pointed to a sentence at the bottom of the letter stating “This
correspondence is from a debt collector. This is an attempt to collect a debt, and any information
obtained will used for that purpose.” Defendant argues this language has satisfied other courts
who have opined about the actions of an attorney when they are involved in a FDCPA matter.

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Plaintiff additionally claims that the Stiliman Letter violates New Jersey’s Rules of
Professional Conduct. The Complaint alleges:
By sending this Letter, Defendant engaged in the practice of law
implying that there existed attorney involvement. In a New Jersey
joint-committee ethics opinion, it was determined that sending a
debt collection letter on a law firm letterhead is “the practice of law”
and a violation of New Jersey’s Rules of Professional Conduct
absent attorney involvement, and that violations of state ethical
codes are, in essence, the basis for civil liability under the FDCPA.
See Comm. on the Unauthorized Practice of Law Opinion 48;
Advisory Comm. on Prof 1 Ethics Opinion 725, 208 N.J L.J. 58, 58
(2012). (Compi. ¶ 2 1-22)
II.
On a motion to dismiss for failure to state a claim pursuant to Fed. R. Civ. P. 12(b)(6), the
Court is required to accept as true all allegations in the Complaint and all reasonable inferences
that can be drawn therefrom, and to view them in the light most favorable to the non-moving party.
See Oshiver v. Levin, Fishhein, Sedran & Berman, 38 F.3d 1380, 1384 (3d Cir. 1994). “To survive
a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.” Ashcrofl v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Ati. Corp. v. Twombly, 550 U.S. 544, 570, 127 5. Ct. 1955, 167 L. Ed. 2d 929 (2007)). While
a court will accept well-pleaded allegations as true for the purposes of the motion, it will not accept
bald assertions, unsupported conclusions, unwarranted inferences, or sweeping legal conclusions
cast in the form of factual allegations. Iqbal, 556 U.S. at 678-79; see also Morse v. Lower Merion
School District, 132 F.3d 902, 906 (3d Cir. 1997). A complaint should be dismissed only if the
well-pleaded alleged facts, taken as true, fail to state a claim. See In re Warfarin Sodium, 214 F.3d
395, 3 97-98 (3d Cir. 2000).

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III.
Generally, Congress enacted the FDCPA in response to the “abundant evidence of the use
of abusive, deceptive, and unfair debt collection practices by many debt collectors.” 15 U.S.C.

§

1692(a). Congress explained that the law’s purpose was to eliminate abusive debt collection
practices while “insur[ing] that those debt collectors who refrain from using abusive debt
collection practices are not competitively disadvantaged.” Id.
private right of action. Id.

§

§

1692(e). The FDCPA confers a

1692k. Powellv. Aldous & Assocs., P.L.L.C., 2018 U.S. Dist. LEXIS

982, *9 (D.N.J. Jan. 3, 2018). Because the FDCPA is a remedial statute, courts construe its
language broadly so as to affect its purpose. See Lesher v. Law Offices ofMitchell N. Kay, PC, 650
F.3d 993, 997 (3d Cir. 2011). For that reason, FDCPA claims in the Third Circuit are analyzed
under “the least sophisticated debtor” standard. Brown v. Card Serv. Ctr., 464 F.3d 450, 454 (3d
Cir. 2006). Under this standard, the least sophisticated debtor is presumed to read a collection
notice in its entirety. Campuzano-Burgos v. Midland Credit Mgmt., Inc., 550 F.3d 294, 299 (3d
Cir. 2008). Here, Plaintiff alleges a letter from an attorney who is collecting a debt by itself places
the least sophisticated consumer under duress. See 15 U.S.C.

§

1692e.

III.
In its motion to dismiss, Defendant argues that Plaintiff’s Complaint asserts that all lawyer
collection letters violate FDCPA when, in fact, some courts have required that certain language be
placed in the letter to overcome that duress. Here, the Defendant argues the Stiliman letter included
language that other courts have accepted to overcome a FDCPA claim alleging duress by receiving
a letter from a lawyer. As such, Defendants assert Plaintiffs’ cause of action should be dismissed.
In Greco v. Trauner, Cohen & Thomas, LLP, 412 F.3d 260 (2d Cir. 2005), the Court held
that the FDCPA does not prohibit attorneys from acting as debt collectors, rather the statute
mandates that lawyers must make their role clear in the collection of a debt. In Greco, the Court
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found that a sufficient disclaimer explaining the limited involvement of the attorneys is necessary,
and is sufficient. The Court found a letter that stated “At this time, no attorney with this firm has
personally reviewed the particular circumstances of your account.” is satisfactory because it
advises that a legal action has been considered. Id. at 361. This language is similar to the language
in the Stillman Letter (“We have not been retained to file a lawsuit against you. Further, at this
time, no attorney with this firm has personally reviewed the particular circumstances of your
account.”) See Powell v. Aldous & Assocs., P.L.L.C., 2018 U.S. Dist. LEXIS, 982, *13 (D.N.J.
Jan 3, 2018). In Powell, the Court held that a letter stating “At this time, not [sic] attorney with
this firm has personally reviewed the particular circumstance of your account.” sufficiently and
clearly disclaimed attorney involvement and dismissed Plaintiff’s Complaint. Id. at *12..13. See
also Eddis v. Midland Funding, L.L.C., No. 1 1-cv-3923, 2012 U.S. Dist. LEXIS 22193, 2012 WL
664812, at *9 (D.N.J. Feb. 28, 2012) (Distinguishing the holding in Greco and Lesher)
Plaintiff rebuts by citing to Lesher v. Law Office of Mitchell N. Kay, P.C.,650 F3d 993,
1000 (3d Cir. 2011), wherein the court found that an unsophisticated consumer will be more likely
to respond to a letter from an attorney because of the additional weight conveyed by the letter. In
Lesher, the Third circuit found that the disclaimer was negated by the language found on the front
of the letter, and the additional fact that the disclaimer was set on the back side of the letter, thus,
it was less prominent. Id. at 1003. Here, the disclaimer was featured on the front of a one-page
letter in normal font and clear phrasing. Thus, the statement sufficiently disclaims meaningful
attorney involvement.
The statute (15 U.S.C. 1692e(10)) prohibits “[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.”

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Moreover, defendant asserts that the disclaimer contained in the Stiliman Letter sufficiently
defined the attorney’s role misleading the Plaintiff. Specifically, the Stiliman Letter stated “we
have been asked to contact you to determine your intentions with respect to repayment of this debt.
We have not been retained to file a lawsuit against you.” Defendant contends that the Stiliman
Letter does not request payment to be enclosed in response and does not mention that failure to
respond would result into any specific consequences. See 15 U.S.C. 1692e(5) (prohibiting the
threat to take any action that cannot be legally taken or that is not intended to be taken).
To the contrary, Plaintiff rebuts same by arguing an attorney’s letter may constitute an act
in the practice of law that is disallowed under Joint Opinion 48, Committee on the Unauthorized
Practice of Law (Joint Opinion). See also, Latteri v. Mayer, 2018 WL 2317531 (D.N.J. May 22,
2018). The application of the Joint Opinion gives rise to many fact and legal issues. For instance,
the Joint Opinion refers to a law firm that permitted a collection agency to use its letterhead to
send letters to consumers without any review of such letter in consideration of a monthly retainer.
Nothing similar to that is alleged herein.
The case law under the FDCPA and the Joint Opinion appear to contradict each other. In
the Joint Opinion it was pointed out that “[w]hile the FDCPA arguably permits a law firm to send
debt collection letters in a lay capacity, New Jersey ethics rules have always prohibited the
practice.” (Op. 48, pg. 5). Defendant argues that Stiliman’s firm is not aNew Jersey firm; and thus,
Opinion 48 does not apply to it. Generally, Rule 1:14 of the New Jersey Rules of Court, “The
Rules of Professional Conduct

...

shall govern the conduct of the members of the bar and the

judges and employees of all courts of this state;” but it is uncertain whether a firm like Stiliman
can send a letter to a New Jersey resident without engendering the applicability of the rationale
under the Joint Opinion.

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At any rate, there is a factual dispute over whether or how the Rules of Professional
Conduct should apply or whether the language asserted in Greco is sufficient. Those questions are
better resolved at summary judgment. For the reasons stated herein, the motion to dismiss is
denied.
ORDER

THIS MATTER having been opened to the Court by Defendant’s motion to dismiss [ECF
No. 8]; and the Court having fully considered the submissions in support thereof, and any
opposition thereto;

IT IS on this

24th

day of September, 2018,

ORDERED that Defendant’s motion to dismiss [ECF No. 8] is denied.

PETER G. SHERIDAN, U.S.D.J.

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