Blair v. Fed. Pac. Credit Co.

563 F.Supp.3d 347

Yvette N. BLAIR, Plaintiff,

v.FEDERAL PACIFIC CREDIT COMPANY, LLC, Convergent Outsourcing, Inc., and John Does 1 to 10, Defendants.

Civ. No. 20-4100 (KM) (JBC)

United States District Court, D. New Jersey.

Signed September 27, 2021

Philip D. Stern, Yongmoon Kim, Kim Law Firm, LLC, Hackensack, NJ, for Plaintiff.

Matthew Brady Johnson, Gordon Rees Scully Mansukhani LLP, New York, NY, for Defendant Federal Pacific Credit Company, LLC.

Aaron Raphael Easley, Sessions, Israel& Shartle, LLC, Flemington, NJ, Matthew Brady Johnson, Gordon Rees Scully Mansukhani LLP, New York, NY, for Defendant Convergent Outsourcing, Inc.

KEVIN MCNULTY, U.S.D.J.:

This putative class action arises under the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. The plaintiff, Yvette N. Blair, received a letter from Convergent Outsourcing, Inc. ("Convergent"), regarding a debt owned by Federal Pacific Credit Company, LLC ("Federal Pacific").

Now before the Court is Defendants Convergent and Federal Pacific's motion to dismiss the amended complaint (DE 22) under Federal Rule of Civil Procedure 12(b)(6). For the reasons set forth below, the motion is granted .

I. Background¹

Blair is subject to an alleged financial obligation arising from a Verizon account, although she disputes the obligation.² (Am. Compl. ¶¶ 17-19.) The account allegedly went into default, and Federal Pacific purchased the debt from Verizon. (Id. ¶¶ 26-27.) Defendant Convergent sent Blair a collection letter ("the Letter"), a copy of which is attached to the complaint as Exhibit A. (DE 20-1.) At the time the Letter was sent, a claim based on the debt would have been barred by the statute of limitations. (Am. Compl. ¶ 35.)

Because the allegations are based on the Letter, I describe it in some detail. The Letter is on Convergent's letterhead. (Letter at 1.) Below Convergent's address, business hours, and phone number is a rectangle containing the following:

Date: 04/13/2019

Creditor: Federal Pacific Credit Company, LLC

Client Account #: [REDACTED]

Convergent Account #: [REDACTED]

Original Creditor: Verizon

Reduced Balance Amount: $80.51

Amount Owed: $230.03

Total Balance: $230.03

The Letter is titled "Reduced Balance Opportunity." (Id. ) The body of the Letter begins by stating that this "notice is being sent to you by a collection agency. The records of Federal Pacific Credit Company, LLC show that your account has a past due balance of $ 230.03." (Id. ) It then states the following:

Our client has advised us that they are willing to satisfy your account for 35% of your total balance. The full amount must be received in our office by an agreed upon date. If you are interested in taking advantage of this opportunity, call our office within 60 days of this letter. Your reduced balance amount would be $ 80.51. Even if you are unable to take advantage of this opportunity, please contact our office to see what terms can be worked out on your account. We are not required to make this arrangement to you in the future.

(Id. ) Below Convergent's signature, on the first page and in all capitals, is the following notice: "NOTICE: PLEASE SEE REVERSE SIDE FOR IMPORTANT CONSUMER INFORMATION." (Id. )

At the bottom of the first page is a tear-off payment stub, which describes three "plans": the first provides for a lump sum payment of $80.51; the second provides for a 50% payment over three months; and the last provides for full payment of the debt over the course of 12 months. (Id. )

On the reverse side, below two other paragraphs, including a "notice about electronic check conversion," is the following:

The law limits how long you can be sued on a debt. Because of the age of your debt, Federal Pacific Credit Company, LLC cannot sue you for it and this debt cannot be reported to any credit reporting agency. Convergent Outsourcing, Inc. cannot sue you on this debt and Convergent Outsourcing, Inc. cannot report this debt to any credit reporting agency.

(Id. )

In April 2020, Blair brought this suit against Federal Pacific, Convergent, and John Does 1 to 10, alleging violations of the FDCPA, which requires certain notifications and prohibits the use of false, deceptive or misleading representations or unfair practices to collect a debt. See 15 U.S.C. § 1692g (prescribing contents of debt collector's initial communication to debtor); 15 U.S.C. § 1692e (prohibiting false and deceptive practices); 15 U.S.C. § 1692f (prohibiting unfair practices).

On January 25, 2021, I granted Defendants’ first motion to dismiss the complaint for failure to state a claim without prejudice to the filing of an amended complaint. (DE 18, DE 19.) As I explained in that Opinion, Blair's initial Complaint did not provide sufficient allegations as to the nature of the underlying debt. (DE 18 at 7.) On February 24, 2021, Blair filed an amended complaint. (DE 20. References herein to the "complaint," unless otherwise specified, are to the Amended Complaint.) The amended version of the complaint corrected the original complaint's failure to allege the nature of the debt.³ On March 10, 2021, Defendants filed this motion to dismiss the amended complaint. (DE 22.)

II. Standard of Review

Federal Rule of Civil Procedure 8(a) does not require that a complaint contain detailed factual allegations. Nevertheless, "a plaintiff's obligation to provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ; see Phillips v. Cnty. of Allegheny , 515 F.3d 224, 232 (3d Cir. 2008) ( Rule 8 "requires a ‘showing’ rather than a blanket assertion of an entitlement to relief." (citation omitted)). Thus, the complaint's factual allegations must be sufficient to raise a plaintiff's right to relief above a speculative level, so that a claim is "plausible on its face." Twombly , 550 U.S. at 570, 127 S.Ct. 1955 ; see also West Run Student Hous. Assocs., LLC v. Huntington Nat. Bank , 712 F.3d 165, 169 (3d Cir. 2013).

That facial-plausibility standard is met "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, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Twombly , 550 U.S. at 556, 127 S.Ct. 1955 ). While "[t]he plausibility standard is not akin to a ‘probability requirement’ ... it asks for more than a sheer possibility." Id.

Rule 12(b)(6) provides for the dismissal of a complaint if it fails to state a claim upon which relief can be granted. The defendant, as the moving party, bears the burden of showing that no claim has been stated. Animal Science Products, Inc. v. China Minmetals Corp. , 654 F.3d 462, 469 n.9 (3d Cir. 2011). For the purposes of a motion to dismiss, the facts alleged in the complaint are accepted as true and all reasonable inferences are drawn in favor of the plaintiff. New Jersey Carpenters & the Trustees Thereof v. Tishman Const. Corp. of New Jersey , 760 F.3d 297, 302 (3d Cir. 2014).

The Court, in considering a Rule 12(b)(6) motion, is confined to the allegations of the complaint, with narrow exceptions:

Although phrased in relatively strict terms, we have declined to interpret this rule narrowly. In deciding motions under Rule 12(b)(6), courts may consider "document[s] integral to or explicitly relied upon in the complaint," In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997) (emphasis in original), or any "undisputedly authentic document that a defendant attaches as an exhibit to a motion to dismiss if the plaintiff's claims are based on the document," PBGC v. White Consol. Indus. , 998 F.2d 1192, 1196 (3d Cir. 1993).

In re Asbestos Products Liability Litigation (No. VI) , 822 F.3d 125, 134 n.7 (3d Cir. 2016). See also Estate of Roman v. City of Newark , 914 F.3d 789, 796–97 (3d Cir. 2019) ("complaint, exhibits attached to the complaint, [and] matters of public record" as well as documents "that a defendant attaches as an exhibit to a motion to dismiss," if "undisputedly authentic" and "the [plaintiff's] claims are based [on them]"); Schmidt v. Skolas , 770 F.3d 241, 249 (3d Cir. 2014) ("However, an exception to the general rule is that a ‘document integral to or explicitly relied upon in the complaint’ may be considered ‘without converting the motion to dismiss into one for summary judgment.’ ") (quoting In re Burlington Coat Factory , 114 F.3d at 1426 ); Pension Ben. Guar. Corp. v. White Consol. Indus., Inc. , 998 F.2d 1192, 1196 (3d Cir. 1993).

The complaint attaches a copy of a letter from Convergent, the wording of which is the foundation of the allegations. (DE 20-1.) Its authenticity does not seem to be disputed. I therefore may consider it on this motion without converting it to one for summary judgment.

III. Discussion

Blair alleges that Defendants violated Sections 1692e, 1692f, and 1692g of the FDCPA. Defendants move to dismiss the complaint under Rule 12(b)(6), asserting that Plaintiff fails to state a claim because: (1) Plaintiff fails to allege that the Letter fulfils the requirements of § 1692g(a) ; (2) the Letter identifies the current creditor and the amount of the debt; (3) the discount offers are not false, deceptive, and misleading; and (3) the Letter clearly informs Plaintiff that Defendants could not sue her.

a. FDCPA

The FDCPA is a consumer protection statute that "imposes open-ended prohibitions on, inter alia , false, deceptive or unfair" debt-collection practices. Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA , 559 U.S. 573, 587, 130 S.Ct. 1605, 176 L.Ed.2d 519 (2010). To state a claim under the FDCPA, a plaintiff must allege that: "(1) she is a consumer, (2) the defendant is a debt collector, (3) the defendant's challenged practice involves an attempt to collect a ‘debt’ as the Act defines it, and (4) the defendant...