Rogers v. Overton, Russell, Doerr, and Donovan, LLP
MEMORANDUM-DECISION AND ORDER granting 8 Motion to Dismiss: The Court hereby ORDERS that Defendant's motion to dismiss is GRANTED; and the Court further ORDERS that the Clerk of the Court shall serve a copy of this Memorandum-Decision and O rder on the parties in accordance with the Local Rules; and the Court further ORDERS that the Clerk of the Court shall enter judgment in Defendant's favor and close this case. Signed by U.S. District Judge Mae A. D'Agostino on 2/13/2017. (ban)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
OVERTON, RUSSELL, DOERR & DONOVAN, LLP,
RC LAW GROUP, PLLC
285 Passiac Street
Hackensack, New Jersey 07601
Attorneys for Plaintiff
DANIEL KOHN, ESQ.
BARCLAY DAMON, LLP
2000 HSBC Plaza
100 Chestnut Street, Suite 2000
Rochester, New York 14604
Attorneys for Defendant
PAUL A. SANDERS, ESQ.
Mae A. D'Agostino, U.S. District Judge:
MEMORANDUM-DECISION AND ORDER
On June 29, 2016, Cheryl Rogers ("Plaintiff") commenced this action alleging that
Overton, Russell, Doerr, and Donovan, LLP ("Defendant") violated 15 U.S.C. §§ 1692 et seq.,
commonly referred to as the Fair Debt Collections Practices Act ("FDCPA"). See Dkt. No. 1 at ¶
1. Currently before the Court is Defendant's motion to dismiss. See Dkt. No. 8.
This action concerns Plaintiff's alleged consumer debt as defined by 15 U.S.C. § 1692a(5)
and Defendant's inaction as a debt collector to provide the credit bureau with a status update for
Plaintiff's alleged debt. See Dkt. No. 1 at ¶¶ 9, 13, 16. Nearly two years before April 6, 2016,
Defendant reported Plaintiff's alleged debt to a credit bureau. See id. at ¶ 11; Dkt. No. 8 at 1. On
April 6, 2016, Plaintiff sent Defendant a letter to dispute the alleged debt. See Dkt. No. 1 at ¶ 12.
On June 1, 2016, Plaintiff examined her credit report and saw that Defendant had neither removed
the credit account nor marked it as "disputed by consumer." Id. at ¶ 13. As a result, Plaintiff
asserts that Defendant violated "various provisions of the FDCPA, including but not limited to 15
U.S.C. §§ 1692d, 1692e(2), 1692e(5), 1692e(8), 1692e(10), and 1692f." Id. at ¶ 16.
On August 23, 2016, Defendant filed a motion to dismiss pursuant to Rule 12(b)(6). See
Dkt. No. 8. Defendant argues that the complaint raises a single legal issue, "whether a debt
collector has an affirmative/continuing duty to report to a credit bureau Plaintiff's dispute learned
after the initial report." Id. at 2. Defendant further contends "that a debt collector owes no
affirmative post-reporting duty to communicate a dispute." Id.
Currently before the Court is Defendant's motion to dismiss for failure to state a claim.
Standard of review
A motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6) of the Federal
Rules of Civil Procedure tests the legal sufficiency of the party's claim for relief. See Patane v.
Clark, 508 F.3d 106, 111-12 (2d Cir. 2007) (citation omitted). In considering the legal
sufficiency, a court must accept as true all well-pleaded facts in the pleading and draw all
reasonable inferences in the pleader's favor. See Lanier v. Bats Exch., Inc., 838 F.3d 139, 150 (2d
Cir. 2016) (citing ATSI Commc'ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87, 98 (2d Cir. 2007)). This
presumption of truth, however, does not extend to legal conclusions. See Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (citation omitted). Although a court's review of a motion to dismiss is
generally limited to the facts presented in the pleading, the court may consider documents that are
"integral" to that pleading, even if they are neither physically attached to, nor incorporated by
reference into, the pleading. See Mangiafico v. Blumenthal, 471 F.3d 391, 398 (2d Cir. 2006)
(quoting Chambers v. Time Warner, Inc., 282 F.3d 147, 152-53 (2d Cir. 2002)).
To survive a motion to dismiss, a party need only plead "a short and plain statement of the
claim," see Fed. R. Civ. P. 8(a)(2), with sufficient factual "heft to 'sho[w] that the pleader is
entitled to relief[,]'" Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007) (quotation omitted).
Under this standard, the pleading's "[f]actual allegations must be enough to raise a right of relief
above the speculative level," see id. at 555 (citation omitted), and present claims that are
"plausible on [their] face," id. at 570. "The plausibility standard is not akin to a 'probability
requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully."
Iqbal, 556 U.S. at 678 (citation omitted). "Where a complaint pleads facts that are 'merely
consistent with' a defendant's liability, it 'stops short of the line between possibility and
plausibility of "entitlement to relief."'" Id. (quoting [Twombly, 550 U.S.] at 557, 127 S. Ct.
1955). Ultimately, "when the allegations in a complaint, however true, could not raise a claim of
entitlement to relief," Twombly, 550 U.S. at 558, or where a plaintiff has "not nudged [its] claims
across the line from conceivable to plausible, the[ ] complaint must be dismissed[,]" id. at 570.
Plaintiff's claim under 15 U.S.C. § 1692
The FDCPA was enacted "to eliminate abusive debt collection practices, to ensure that
debt collectors who abstain from such practices are not competitively disadvantaged, and to
promote consistent state action to protect consumers." Jerman v. Carlisle, McNellie, Rini,
Kramer & Ulrich LPA, 559 U.S. 573, 577 (2010) (citing 15 U.S.C. § 1692(e)). To that end, "[a]
debt collector may not use any false, deceptive, or misleading representation or means." 15
U.S.C. § 1692e. Additionally, the FDCPA provides "examples of particular practices that debt
collectors are forbidden to employ" but the list "is non-exhaustive, and the FDCPA generally
forbids collectors from engaging in unfair, deceptive, or harassing behavior." Kropelnicki v.
Siegel, 290 F.3d 118, 127 (2d Cir. 2002) (citing 15 U.S.C. §§ 1692 et seq.). Whether a debt
collector's communications to a consumer comply with the FDCPA is determined "from the
perspective of the 'least sophisticated consumer.'" Greco v. Trauner, Cohen & Thomas, L.L.P.,
412 F.3d 360, 363 (2d Cir. 2005) (quotation omitted). The Second Circuit has defined the "least
sophisticated consumer standard" as "'an objective analysis that seeks to protect the naive from
abusive practices, while simultaneously shielding debt collectors from liability for bizarre or
idiosyncratic interpretations of debt collection letters.'" Altman v. J.C. Christensen & Assocs.,
Inc., 786 F.3d 191, 193 (2d Cir. 2015) (quoting Greco, 412 F.3d at 363).
To establish a violation under the FDCPA, "'(1) the plaintiff must be a "consumer" who
allegedly owes the debt or a person who has been the object of efforts to collect a consumer debt,
and (2) the defendant collecting the debt is considered a "debt collector," and (3) the defendant
has engaged in any act or omission in violation of FDCPA requirements." Polanco v. NCO
Portfolio Mgmt., Inc., 132 F. Supp. 3d 567, 578 (S.D.N.Y. 2015) (quoting Plummer v. Atl. Credit
& Fin., Inc., 66 F. Supp. 3d 484, 488 (S.D.N.Y. 2014)).
Plaintiff alleges that Defendant violated the FDCPA because Defendant had "not removed
the credit amount nor marked it as 'disputed by consumer'" after Plaintiff sent a dispute letter on
April 6, 2016. Dkt. No. 1 at ¶¶ 12-13; see also Dkt. No. 12 at 1-2. In response, Defendant asserts
that the dispute letter was sent nearly two years after Defendant reported the debt to a credit
bureau and that "a debt collector owes no affirmative post-reporting duty to communicate a
dispute." Dkt. No. 8 at 2.
In pointing to Defendant's failure to update the debt's status, Plaintiff appears to allege a
violation of 15 U.S.C. § 1692e(8), which prohibits "[c]ommunicating or threatening to
communicate to any person credit information which is known or which should be known to be
false, including the failure to communicate that a disputed debt is disputed."1 In making this
allegation, Plaintiff does not cite any case law to support the assumption that a debt collector has
an affirmative duty to update the status of a debt after it is reported to a credit bureau.2
In her complaint, Plaintiff alleges violations of six separate provisions of the FDCPA,
"including but not limited to 15 U.S.C. §§ 1692d, 1692e(2), 1692e(5), 1692e(8), 1692e(10) and
1692f." Dkt. No. 1 at ¶ 16. The only substantive allegations in her complaint, however, allege
Defendant's failure to update the status of her alleged debt once it was informed that Plaintiff
disputed the debt. Plaintiff does not allege any additional misconduct prohibited by the FDCPA
in either her complaint or response to the motion to dismiss. As such, the only provision of the
FDCPA which is arguably applicable based on the facts set forth in the complaint is 15 U.S.C. §
1692e(8). See 15 U.S.C. § 1692d (providing that "[a] debt collector may not engage in any
conduct the natural consequence of which is to harass, oppress, or abuse any person in connection
with the collection of a debt"); 15 U.S.C. § 1692e(2) (prohibiting "false representation"); 15
U.S.C. § 1692e(5) (prohibiting "threats to take any action that cannot legally be taken or that is
not intended to be taken"); 15 U.S.C. § 1692e(10) (prohibiting "the use of any false representation
or deceptive means to collect or attempt to collect any debt or to obtain information concerning a
consumer"); and 15 U.S.C. § 1692f (stating that a "debt collector may not use unfair or
unconscionable means to collect or attempt to collect any debt").
Plaintiff cites Acosta v. Campbell, No. 6:04-cv-761, 2006 WL 3804729 (M.D. Fla. Dec.
22, 2006) for the proposition that "Defendant's insituation [sic] that a debt collector can wash its
hands of responsibility for failing to property [sic] report a dispute is false." Dkt. No. 12 at 6.
Plaintiff's reliance is misplaced. Accosta involved two defendants, a mortgage holder and a law
firm engaged in debt collection activity. The plaintiff alleged that the mortgage holder violated
the FDCPA "by reporting the delinquent status of his account to credit reporting agencies from
July 2003 to April 2006 without stating that it was disputed." Accosta, 2006 WL 3804729, at *7.
The court found that the claim failed as a matter of law because the mortgage holder was not a
debt collector under the FDCPA. See id. (citations omitted). The plaintiff also tried to "impose
an affirmative duty on debt-collectors to report 'disputed' debts to credit reporting agencies even
when no debt is reported at all because the Law Office knew the [mortgage holder/creditor] was
reporting Plaintiff's debt." Id. The court again dismissed this claim and found that because the
law firm "did not report the account to a credit reporting agency, it had no duty to report
Plaintiff's account as disputed." Id.
Additionally, nothing in 15 U.S.C. §§ 1692d, 1692e, and 1692f creates this obligation.
Contrary to Plaintiff's conclusory allegations, the case law makes clear that a debt
collector owes no affirmative post-reporting duty to communicate a dispute that arises after the
debt has been reported. In Kinel v. Sherman Acquisition II LP, No. 05 Civ. 3456, 2006 WL
5157678 (S.D.N.Y. Feb. 28, 2006), the court relied on commentary provided by the Federal Trade
Commission to reject this very argument. See id. at *17. Specifically, the court held as follows:
The FTC has issued commentary on the FDCPA which clarifies a
debt collector's duties under § 1692e(8). . . . The FTC Commentary
explains, "If a debt collector knows that a debt is disputed by the
consumer ... and reports it to a credit bureau, [the debt collector]
must report it as disputed." . . . However, when a debt collector
learns of a dispute after the debt has been reported, "the dispute
need not also be reported." . . . Thus, the FTC Commentary has
interpreted § 1692e(8) as not explicitly requiring a debt collector to
update information about the disputed status of a debt about which
it has not reported, or about which it has already reported prior to a
Id. (quoting The Federal Trade Commission (FTC) Commentary, 53 F.R. 50097 § 807(8)).
More recently, in Vernot v. Pinnacle Credit Servs., L.L.C., ___ F. Supp. 3d ___, 2017 WL
384327 (E.D.N.Y. 2017), the court rejected the same arguments. In Vernot, the plaintiff alleges a
violation of the FDCPA when the defendant "did not change the status of the outstanding debt on
plaintiff's credit report once plaintiff sent defendant the dispute letter." Id. at *1 n.2. Rejecting
this argument, the court fist noted that only two provisions of the FDCPA deal with credit
reporting at all, sections 1692e(8) and 1692e(16). See id. Since section 1692e(16) prohibits debt
Similarly, Plaintiff's reliance on Semper v. JBC Legal Group, No. 04-cv-2240, 2005 WL
2172377 (W.D. Wash. Sept. 6, 2005) is unavailing. In Semper, the court held that a debt collector
cannot refuse to report a debt is disputed "[b]ased solely on its own determination that plaintiff
had failed to establish the merits of her dispute[.]" Id. at *3. The Court did not address whether a
debt collector has an affirmative obligation to report a dispute learned years after it had reported
collectors from making false representations or implications that they operate or are employed by
a consumer reporting agency, the section was clearly inapplicable. See id. As to section
1692e(8), the court held that it applies "'once a debt has been disputed' and prevents debt
collectors from 'communicat[ing] the debtor consumer's credit information to others without
disclosing the dispute.' . . . It does not impose an affirmative duty on debt collectors to update the
status of each debt it has reported." Id. (quoting Hooks v. Forman, Holt, Eliades & Ravin, LLC,
717 F.3d 282, 285 (2d Cir. 2013)). Courts throughout the country have reached the same result.
See Wilhelm v. Credico, Inc., 519 F.3d 416, 418 (8th Cir. 2008); Wells v. Deca Fin. Servs., LLC,
No. 1:12-cv-1514, 2013 WL 772870, *3 (S.D. Ind. Feb. 28, 2013) (citing cases).
Plaintiff has failed to provide the Court with any persuasive arguments why it should
reject this overwhelming weight of persuasive authority. Like in Anderson, Plaintiff's letter of
dispute came after Defendant reported the debt. In fact, Plaintiff sent the dispute letter nearly two
years after Defendant sent the initial report to the credit bureau. See Dkt. No. 8 at 1. Even
Plaintiff admits that her "claims for violations of the Fair Debt Collection Practices Act, 15
U.S.C. § 1692 et seq. (the 'FDCPA') stem from Defendant's failure to remove or notate as
disputed a debt reported to credit reporting agencies after Ms. Rogers put Defendant on notice of
a dispute by a way of a letter date April 6, 2015 [sic] sent certified mail, which Defendant
received." Dkt. No. 12 at 1-2 (emphasis in the original). Since section 1692e(8) does not create
an affirmative obligation to report that the debtor has disputed the debt after it had already been
reported to the credit reporting agencies, the Court finds that Plaintiff has failed to plausibly
allege a violation of the FDCPA.
Based on the foregoing, the Court finds that Plaintiff has failed to establish the requisite
elements for a claim under the FDCPA and, therefore, grants Defendant's motion to dismiss.
After carefully reviewing the entire record in this matter, the parties' submissions and the
applicable law, and for the above-stated reasons, the Court hereby
ORDERS that Defendant's motion to dismiss is GRANTED; and the Court further
ORDERS that the Clerk of the Court shall serve a copy of this Memorandum-Decision
and Order on the parties in accordance with the Local Rules; and the Court further
ORDERS that the Clerk of the Court shall enter judgment in Defendant's favor and close
IT IS SO ORDERED.
Dated: February 13, 2017
Albany, New York
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