Third Judge in D.N.J. Rules Language Inviting Calls with Questions in Validation Letter Does Not Mislead Consumers About Writing Requirement for Disputes

Debt collectors have seen a flurry of cases in the District of New Jersey alleging that a validation letter that contains language inviting the consumer to call the debt collector with questions allegedly violates the Fair Debt Collection Practices Act (FDCPA). The argument is that this confuses the consumer into thinking they can orally dispute their debt even though section 1692g of the FDCPA requires that disputes be in writing. In yet another case, Ferrulli v. BCA Financial Services, Inc., Case No. 17-cv-13177 (D.N.J. Sep. 28, 2018), the court does not agree.

Factual and Procedural Background

Plaintiff incurred a medical debt owed to Saint Barnabas Medical Center, which referred the debt to BCA Financial Services, Inc. (BCA) for collection. In its initial letter to plaintiff, BCA included the 1692g validation notice that tracks the statutory language, including, “if you notify this office in writing within 30 days…” (emphasis added). The letter also contained a sentence that stated, “If you have any questions regarding this debt you may speak to an account representative by calling our office.”

Plaintiff filed a lawsuit against BCA alleging that the sentence inviting calls to BCA with questions misleads consumers into thinking they can dispute the debt over the phone as well as in writing.

BCA filed a motion to dismiss the complaint because it failed to state a claim upon which relief can be granted.

The Decision

In reviewing this matter, the court looked at prior cases analyzing this issue within the it’s jurisdiction.

In Caprio v. Healthcare Revenue Recovery Grp., LLC, a letter stating “If we can answer any questions, or if you feel you do not owe this amount, please call us … or write to us at the address above” (emphasis added) on its front page overshadowed the validation notice, which was on the back of the letter.

The court distinguished Caprio with other, more recent cases such as Reizner v. National Recoveries, Inc., No. 17-2572 (D.N.J. May 2, 2018) and Borozan v. Financial Recovery Services, Inc., No. 17-11542 (D.N.J. June 22, 2018). Both the Reizner and the Borozan letters included the validation notice on the first page. The Reizner letter stated, “You may write to us at the address listed below or telephone us at the number provided below.” The Borozan letter stated, “Please feel free to call us at the toll-free number listed below or use our online consumer help desk.” In both cases, the judges found that these sentences never instructed the consumer that there was an alternative method of disputing the debt other than what was listed in the 1692g notice.

In the instant matter, the court found that BCA’s letter more closely resembles the letters in Reizner and Borozan than the letter in Caprio. Unlike Caprio, the BCA letter does not invite plaintiff to call if he feels he does not owe the debt (language that closely resembles the meaning of a dispute). The court found that language inviting a call if there are questions about the debt “neither supersed[es] or swallow[s] up the instructions about how to dispute the debt, nor provid[es] an alternative method for that purpose.”

The court found that the format of BCA’s letter also more closely resembles Reizner and Borozan since the validation notice appears on the front of the letter and the letter is in a uniform font. The court stated, “Arguably, BCA’s letter is even more debtor-friendly insofar as it repeats information about mounting a dispute in writing. It lists BCA’s mailing address three times and its phone number only once, whereas in the Borozan letter, the phone number appears five times.”

Based on the above, the court found that BCA’s letter does not overshadow or contradict the validation notice because it would not mislead the least sophisticated consumer into thinking he can dispute the debt by calling.

insideARM Perspective

Interestingly enough, all three cases -- the instant case, Reizner, and Borozan -- have the same plaintiffs' counsel. Both Reizner and Borozan were appealed and are currently before the Third Circuit awaiting briefing by the parties. Since both of the prior cases were appealed, it is safe to assume that plaintiffs' counsel will probably appeal the BCA decision as well. However, it seems the odds may be in the defendants-appellees' favor since there is a consensus in the lower courts. Three different judges presided over these three cases and each came to a similar conclusion on this type of claim.