Villegas v. Riley

723 F.Supp.2d 755

Delores VILLEGAS, Plaintiff,

v.WEINSTEIN & RILEY, P.S., Defendant.

Civil Action No. 3:10-CV-304.

United States District Court,M.D. Pennsylvania.

July 14, 2010.

Kenneth W. Pennington, Carlo Sabatini, Sabatini Law Firm, LLC, Dunmore, PA, for Plaintiff.

Lawrence G. Reinhold, Weinstein & Riley P.S., Akron, OH, for Defendant.

MEMORANDUM

RICHARD P. CONABOY, District Judge.

Pending before the Court is the “Motion of Defendant Weinstein & Riley, P.S. to Dismiss for Failure to State a Claim Upon which Relief Can be Granted” (Doc. 17). Plaintiff initiated this action on February 9, 2 010, by filing her Complaint (Doc. 1) alleging that Defendant violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692. Specifically, Plaintiff claims Defendant violated the Fair Debt Collection Practices Act when it falsely threatened to sue Plaintiff. According to Plaintiff, Defendant communicated the threat indirectly through Plaintiff's attorney in the form of a settlement offer.

Defendant filed its Motion to Dismiss (Doc. 17) along with its supporting brief (Doc. 17-3) on June 4, 2010. On June 18, 2010, Plaintiff filed her Brief Opposing Defendant's Motion to Dismiss (Doc. 19). Defendant filed its reply brief on July 2, 2010 (Doc. 20), and therefore this matter is ripe for our disposition. For the reasons discussed below, Defendant's motion to dismiss (Doc. 17) is granted.

I. BACKGROUND

Plaintiff initiated this action on February 9, 2010, by filing her Complaint (Doc. 1) alleging that Defendant violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692. According to Plaintiff, after Plaintiff filed for bankruptcy, Defendant Weinstein & Riley, P.S., a company engaged in the business of collecting debts (Doc. 1 at 2), sent a letter to Plaintiff's bankruptcy counsel threatening to file a lawsuit in bankruptcy court asking the court to hold that a debt owed to Discover Bank was nondischargeable. (Doc. 19 at 2.) Plaintiff contends that Defendant offered to forego the threatened litigation if Plaintiff would settle the claim for a fixed sum. ( Id.)

Shortly, thereafter, Defendant sent a substantively identical letter to Plaintiff's bankruptcy counsel making a similar threat and settlement offer regarding a different debt that was owed to FIA Card Services, N.A. ( Id.) The Complaint does not allege that Defendant ever mailed any letters directly to Plaintiff. (Doc. 17 at 2.)

Plaintiff contends that Defendant knew that Plaintiff's bankruptcy counsel was ethically obligated to communicate the content of the letters to Plaintiff. (Doc. 19 at 2.) Plaintiff did not respond to either letter and Defendant never filed the threatened actions. ( Id.)

On June 4, 2010, Defendant filed the present Motion to Dismiss (Doc. 17) along with its supporting brief (Doc. 17-3). On June 18, 2010, Plaintiff filed her Brief Opposing Defendant's Motion to Dismiss (Doc. 19). Defendant filed its reply brief (Doc. 20) on July 2, 2010, and therefore this matter is ripe for our disposition.

II. LEGAL STANDARD

When deciding a motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6), the Court must accept as true all well-pleaded allegations and view them in the light most favorable to the plaintiff. Angelastro v. Prudential-Bache Sec., Inc., 764 F.2d 939, 944 (3d Cir.1985). Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint, in whole or in part, for failure to state a claim upon which relief can be granted. Dismissal is appropriate only if, accepting as true all the facts alleged in the complaint, a plaintiff has not pleaded “enough facts to state a claim to relief that is plausible on its face,” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), meaning enough factual allegations “ ‘to raise a reasonable expectation that discovery will reveal evidence of’ ” each necessary element, Phillips v. County of Allegheny, 515 F.3d 224, 234 (3d Cir.2008) ( quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955). “[T]he factual detail in a complaint [must not be] so undeveloped that it does not provide a defendant [with] the type of notice of claim which is contemplated by Rule 8.” Phillips, 515 F.3d at 232.

In deciding a motion to dismiss, the Court should consider the allegations in the complaint, exhibits attached to the complaint, and matters of public record. See Pension Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir.1993). The Court may also consider “undisputedly authentic” documents when the plaintiff's claims are based on the documents and the defendant has attached copies of the documents to the motion to dismiss. Id. The Court need not assume the plaintiff can prove facts that were not alleged in the complaint, see City of Pittsburgh v. W. Penn Power Co., 147 F.3d 256, 263 (3d Cir.1998), or credit a complaint's “ ‘bald assertions' ” or “ ‘legal conclusions,’ ” Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir.1997) ( quoting In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1429-30 (3d Cir.1997)). “While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations.” Ashcroft v. Iqbal, --- U.S. ----, 129 S.Ct. 1937, 1950, 173 L.Ed.2d 868 (2009).

When considering a Rule 12(b)(6) motion, the Court's role is limited to determining whether a plaintiff is entitled to offer evidence in support of his claims. See Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974). The Court does not consider whether a plaintiff will ultimately prevail. See id. A defendant bears the burden of establishing that a plaintiff's complaint fails to state a claim. See Gould Elecs. v. United States, 220 F.3d 169, 178 (3d Cir.2000).

III. DISCUSSION

Defendant brought the present Motion to Dismiss alleging that Plaintiff's Complaint fails to state a claim upon which relief can be granted. For the reasons that follow, we will grant Defendant's Motion to Dismiss (Doc. 17).

According to Defendant, sending the letters at issue in this lawsuit to the attorney for the debtor rather than directly to the debtor Plaintiff was not a violation under the Fair Debt Collections Act (“the Act” or “FDCPA”). In support, Defendant points to cases from the Ninth Circuit, Guerrero v. RJM Acquisitions LLC, 499 F.3d 926 (9th Cir.2007), the Second Circuit, Kropelnicki v. Siegel, 290 F.3d 118, 127-28 (2nd Cir.2002), as well as cases from various district courts including those in the Eastern and Western Districts of Pennsylvania. See Marshall v. Portfolio Recovery Associates, Inc., 646 F.Supp.2d 770 (E.D.Pa.2009) (O'Neil, J.); Wright v. Phelan, Hallinan & Schmieg, L.L.P., Civ. No. 09-03538, 2010 WL 786536, 2010 U.S. Dist. LEXIS 21977 (E.D.Pa. March 8, 2010) (Baylson, J.); Duraney v. Washington Mut. Bank, F.A., Civ. A. No. 07-13, 2008 WL 4204821, at *14 (W.D.Pa. Sept. 11, 2008) (holding that communications with counsel are not covered by the Act) (Cercone, J.)

Defendant argues that the United States Court of Appeals for the Ninth Circuit held that communications directed only to a debtor's attorney, and unaccompanied by any threat to contact the debtor, are not actionable under the Act. (Doc. 17-3 at 6) ( citing Guerrero v. RJM Acquisitions LLC, 499 F.3d 926, 935-36 (9th Cir.2007).) According to Defendant, Guerrero, 499 F.3d 926, sets forth that the Act as a whole suggests a congressional understanding that when it comes to debt collection matters lawyers and their debtor clients will be treated differently. (Doc. 17-3 at 3.) Defendant argues that Congress viewed attorneys as intermediaries able to bear the brunt of debt collection practices from which debtors should be protected. (Doc. 17-3 at 4.) In support, Defendant notes that Section 1692c(d) of the Act, in outlining the communications in connection with debt collection, defines “consumer” broadly to include a range of the debtor's relatives and fiduciaries. According to Defendant, the conspicuous absence of the debtor's attorney from the list suggests that in approaching the debt collection problem, Congress did not view attorneys as susceptible to the abuses that spurred the need for the legislation and that Congress built that differentiation into the statute itself. (Doc. 17-3 at 4 ( citing Zaborac v. Phillips & Cohen Assocs., Ltd., 330 F.Supp.2d 962, 967 (N.D.Ill.2004)).) Defendant asserts that the rationale behind this rule is because unsophisticated consumers are easily bullied and misled while trained attorneys are not. (Doc. 17-3 at 5.)

Defendant also cites to Kropelnicki v. Siegel, 290 F.3d 118, 127-28 (2nd Cir.2002), where the Second Court noted:

A review of the FDCPA's purpose, as explained both in the statute and in the legislative history, and this Court's treatment of the FDCPA in other cases leads us to believe that alleged misrepresentations to attorneys for putative debtors cannot constitute violations of the FDCPA.

(Doc. 17-3 at 7.)

In opposition, Plaintiff argues that settlement offers made to a lawyer are communications to a consumer because the lawyer is ethically obligated to convey the settlement offer to his client and therefore such communications are included under the FDCPA. (Doc. 19 at 5 ( citing Pa. R. Prof. Conduct ¶¶ 1.2(a), 1.4(a)(1)).) Plaintiff argues that this view has been supported by both the Seventh and Fourth Circuits. See Evory v. RJM Acquisitions Funding L.L.C., 505 F.3d 769 (7th Cir.2007); Sayyed v. Wolpoff & Abramson, 485 F.3d 226 (4th Cir.2007). In Evory, the Seventh Circuit held:

[I]f the debt collector knows that the consumer is represented by a lawyer, then (with immaterial exceptions) he may not communicate with the consumer directly. He must go through the lawyer. The lawyer receives the notice and shares it with, or explains it to, his client. Hence the debt collector is communicating with the consumer within the meaning of the Act, which defines “communication” as “the conveying of information...