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Dix v. National Credit Systems, Inc.

United States District Court, D. Arizona

October 27, 2017

JOHN DIX, Plaintiff,
v.
NATIONAL CREDIT SYSTEMS, INC., Defendant.

          ORDER

          H. Russel Holland United States District Judge

         Motion for Summary Judgment

         Plaintiff moves for summary judgment.[1] This motion is opposed.[2] Oral argument was not requested and is not deemed necessary.

         Facts

         From March 28, 2013 through February 18, 2015, plaintiff John Dix lived at an apartment complex called Metro on 19th, [3] which is operated by a property management company called Chamberlin & Associates.[4] Plaintiff moved out of his apartment at Metro on 19th because his upstairs neighbors were too loud.[5] Metro on 19th contended that plaintiff owed a balance of $851.07 upon move out. Metro on 19th retained defendant National Credit Systems, Inc. to collect this amount from plaintiff.

         On January 9, 2016, defendant sent plaintiff a debt collection letter. After the date line, the next line of the letter read: “Re: Metro on 19th/Chamberlin & Assoc/G171.[6] The next line contained an account number and the line following that read: “Balance: $851.07.”[7]The body of the letter provided that “[t]he above referenced account has been placed with this office for collection” and that defendant “ha[d] been authorized to recover this debt...”[8]The final line of the letter read: “This communication from a debt collector is an attempt to collect a debt and any information obtained will be used for that purpose.”[9] The January 9 collection letter was defendant's initial communication to plaintiff.

         On September 26, 2016, plaintiff commenced this action in which he asserts two claims against defendant pursuant to the Fair Debt Collection Practices Act (“FDCPA”). In Count I, plaintiff alleges that “[d]efendant[] violated 15 U.S.C. § 1692g(a)(2) by failing to meaningfully convey the identity of the current creditor in” the January 9 collection letter.[10] In Count II, plaintiff alleges that

[d]efendant violated 15 U.S.C. § 1692e for using false, misleading, or deceptive means in connection with the collection of a debt, including by listing the name of the current creditor in a way in which [p]laintiff could reasonably interpret the identity of the current creditor in multiple ways, one of which must be inaccurate.[11]

         Plaintiff now moves for summary judgment on both of his claims.

         Discussion

         Summary judgment is appropriate when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a).

         “The FDCPA was enacted as a broad remedial statute designed to ‘eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.'” Gonzales v. Arrow Financial Services, LLC, 660 F.3d 1055, 1060 (9th Cir. 2011) (quoting 15 U.S.C. § 1692(e)). “The FDCPA does not ordinarily require proof of intentional violation, and is a strict liability statute.” Id. at 1161. “In order to state a claim under the FDCPA, a plaintiff must show: 1) that he is a consumer; 2) that the debt arises out of a transaction entered into for personal purposes; 3) that the defendant is a debt collector; and 4) that the defendant violated one of the provisions of the FDCPA.” Freeman v. ABC Legal Services Inc., 827 F.Supp.2d 1065, 1071 (N.D. Cal. 2011). It is undisputed that plaintiff is a consumer, that the debt involved in this case arises out of a transaction for personal purposes, and that defendant is a debt collector. What is disputed is whether defendant violated any provision of the FDCPA.

         First, plaintiff alleges that defendant violated section 1692g(a)(2) which “requires that the initial communication with a consumer in connection with a debt contain ... the name of the creditor[.]” Terran v. Kaplan, 109 F.3d 1428, 1431 (9th Cir. 1997). It is not sufficient for the debt collector to merely include the name of the creditor in the communication. Rather, the information “must be conveyed effectively to the debtor.” Swanson v. Southern Oregon Credit Service, Inc., 869 F.2d 1222, 1225 (9th Cir. 1988). “[W]hether the initial communication violates the FDCPA depends on whether it is ‘likely to deceive or mislead a hypothetical “least sophisticated debtor.”'” Terran, 109 F.3d at 1431 (quoting Wade v. Regional Credit Ass'n, 87 F.3d 1098, 1100 (9th Cir. 1996)). “The objective least sophisticated debtor standard is ‘lower than simply examining whether particular language would deceive or mislead a reasonable debtor.'” Id. at 1431-32 (quoting Swanson, 869 F.2d at 1227). “‘Most courts agree that although the least sophisticated debtor may be uninformed, naive, and gullible, nonetheless h[is] interpretation of a collection notice cannot be bizarre or unreasonable.'” Tourgeman v. Collins Financial Services, Inc., 755 F.3d 1109, 1119 (9th Cir. 2014) (quoting Evon v. Law Offices of Sidney Mickell, 688 F.3d 1015, 1027 (9th Cir. 2012)). “[T]he standard ‘preserv[es] a quotient of reasonableness and presum[es] a basic level of understanding and willingness to read with care.'” Gonzales, 660 F.3d at 1062 (quoting Rosenau v. Unifund Corp., 539 F.3d 218, 221 (3d Cir. 2008)). The “determination of whether a collection letter violates section 1692g is a question of law....” Terran, 109 F.3d at 1432.

         Plaintiff argues that defendant violated section 1692g(a)(2) because the January 9 collection letter did not clearly identify the name of the creditor to whom the alleged debt is owed. It is undisputed that Metro on 19th is the creditor to whom the alleged debt is owed, but the only place in the January 9 collection letter that Metro on 19th is mentioned is in the “re” line. This is not sufficient to comply with section 1692g(a)(2). Courts have consistently held that “[m]erely including the current creditor's name in a debt collection letter, without more, is insufficient to satisfy 15 U.S.C. § 1692g(a)(2).” McGinty v. Professional Claims Bureau, Inc., Case No. 15-cv-4356 (SJF) (ARL), 2016 WL 6069180, at *4 (E.D.N.Y. Oct. 17, 2016); see also, Suellen v. Mercantile Adjustment Bureau, LLC, Case No. 12-cv-00916 NC, 2012 WL 2849651, at *6 (N.D. Cal. June 12, 2012) (observing that courts have held that “[m]erely naming the creditor without identifying it as the current creditor” is not sufficient for purposes of section 1692g(a)(2)); Sparkman ...


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