A District Court judge in New York has certified a class action against a collection law firm accused of violating the Fair Debt Collection Practices Act because it did not explicitly state in a collection letter that the plaintiff’s balance may increase in the future, even though the firm referenced that the amount owed represented the “balance due as of [date]” and included an itemized accounting of what the plaintiff owed.
A copy of the ruling in the case of Bitzko v. Weltman Weinberg & Reis may be accessed by clicking here.
The judge did grant summary judgment in favor of the defendant on the plaintiff’s claim that the letter mis-stated the amount that was owed and did deny class certification on that count as well.
The plaintiff received a collection letter from the defendant in reference to an unpaid student loan debt. The letter included the following passage:
Please be advised that the above referenced account has been placed with us to collect the outstanding balance due and owing on this account to the current creditor referenced above. As of the date of this letter you owe the amount listed above. Therefore, it is important that you contact us at 1-800-570-3931 to discuss an appropriate resolution for this matter. Additionally, you may be able to pay on your account online via our web pay website at www.wwrepay.com.
This communication is from a debt collector attempting to collect this debt for the current creditor and any information obtained will be used for that purpose. Unless you dispute the validity of this debt, or any portion thereof, within thirty (30) days after receipt of this letter, we will assume that the debt is valid. If you notify us in writing within the thirty (30) day period that the debt, or any portion thereof, is disputed, we will obtain verification of the debt or a copy of a judgment and a copy of such verification or judgment will be mailed to you. If you request in writing within the thirty (30) day period, we will provide you with the name and address of the original creditor if different from the current creditor.
The letter also included a line-item accounting of what was owed and the payments that had been made. The first line-item on the list was “Balance Due as of August 11, 2016 (the date the letter was sent): $13,750.28.”
Because the debt was accruing interest at the time the letter was sent, the defendant was obligated to mention that the balance may increase, the plaintiff claims. But the judge found the defendant’s argument that the language in the letter and the itemized list was sufficient to negate the need for a disclosure about the balance to be “unpersuasive.”
Under Avila v. Riexinger & Assocs collectors who do not disclose that the balance owed may increase are violating Section 1692e of the FDCPA.
A least sophisticated consumer would be confused about whether the balance owed was increasing or not, ruled Judge Brenda Sannes of the District Court for the Northern District of New York. As such, she certified a class of individuals that meet the following criteria:
All consumers to whom Weltman, Weinberg & Reis Co., LPA (WWR) mailed letters seeking to collect debts: (i) which were primarily for personal, family, or household purposes; and (ii) which debts were subject to increase based on interest and/or late fees; and (iii) to whom WWR sent letters failing to disclose that the amount of the debt was subject to increase; (iv) during the period from on or after a date one year prior to the filing of this action and on or before a date 21 days after the filing of this action.
