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DISCLAIMER: This article is based on a complaint. The defendant has not responded to the complaint to present its side of the case. The claims mentioned are accusations and should be considered as such until and unless proven otherwise.
For those of you who have been around since before Regulation F went into effect, you might remember the days when there was much hand-wringing and consternation about a particular aspect of the Model Validation Notice: no, not the scissors, but the itemization date. Collectors had to choose from one of five different dates: the last statement date, the charge-off date, the last payment date, the transaction date, or the judgment date when itemizing a debt. The issue is that the notice didn’t require collectors to inform consumers which of those dates was being used. A collection operation is facing a Fair Debt Collection Practices Act class action because it allegedly failed to include a notice that a debt was time-barred because the itemization date that was used when the Model Validation Notice was sent to the plaintiff was allegedly outside of the window for a collection lawsuit to be filed.
The background: Last November, the plaintiff received a Model Validation Notice from the defendant, attempting to collect on a dent of $11,109.31. The notice used an itemization date of October 28, 2020.
- Under New York law, which is where the plaintiff resided, the statute of limitations on a consumer credit transaction is three years, according to the complaint. Therefore, the statute of limitations expired more than two years before the letter was sent, meaning the debt was time-barred, and the defendant allegedly violated the FDCPA by not mentioning that fact, according to the complaint.
- The notice also offered to settle the debt if the plaintiff made a payment of $6,110.12 and stated that the defendant was not obligated to renew the offer. This, according to the complaint, created a false sense of urgency that “pressures consumers to forego their right to dispute the debt in favor of accepting the ‘one-time’ settlement offer.”
- The defendant’s actions caused the plaintiff to experience “significant distress and anxiety” related to her financial standing and whether to accept the settlement offer, according to the complaint.
The claims: The complaint accuses the defendant of violating Section 1692g(a), 1692e, 1692e(10), and 1692f of the FDCPA by failing to inform her that the debt was passed the statute of limitations and negating the dispute window.
- The suit seeks to include anyone else living in the state of New York who received an initial letter from the defendant that omitted the fact that the statute of limitations for a lawsuit to occur had passed , and/or negating the 30-day validation window by offering a one-time settlement offer without explicitly stating that the settlement offer would remain open during the duration of that period.
