Jones, Wolf & Kapasi, LLC defeated a motion to dismiss by Andrea Visgilio-McGrath LLC ("AVM") on behalf of a plaintiff and a putative class of New Jersey consumers who received debt collection letters which violated 15 U.S.C. §1692, the Fair Debt Collection Practices Act ("FDCPA"). Specifically, the Plaintiff, Doris Griffin, alleged that AVM's debt collection letters violated the FDCPA as they contained misleading and deceptive statements related to the following language set forth in the letter:
"Until this is paid, it may appear on your credit report and adversely impact your credit. Therefore, if you wish to resolve this matter, prompt payment should be remitted directly to my office made payable to “Andrea Visgilio-McGrath, LLC, Trust Account."
AVM made a motion to dismiss that Ms. Griffin failed to state a claim pursuant to Fed. R. Civ. P. 12(b)(6) and that she lacked standing under Article III of the United States Constitution pursuant to Fed. R. Civ. P. 12(b)(1). The District Court found that Ms. Griffin possessed the requisite Article III standing, in the form of an "informational injury---specifically, the receipt of false information..." sufficient to defeat Defendant's 12(b)(1) motion. As to Defendant's 12(b)(6) motion, the District Court stated the following:
"...By saying the item will 'continue to appear,' the Letter implies that the debt is a permanent black mark, erasable only by payment of the obligation. In fact, however, the Complaint alleges, the item will disappear of its own accord after seven years. That fact could well be material to a debtor weighing her options. A misstatement of that fact could therefore violate § 1692e, and inflict on the debtor an informational injury of the kind contemplated by the statute.
Second, the judgment would not disappear from the credit report simply because it has been paid. 'A payment made on a judgment has no effect as to whether a judgment continues to appear on a credit report or not.' (Cplt. ¶ 30)
The letter states or implies that the debtor should pay up now to avoid or minimize the negative effect on her credit report. In fact, the Complaint alleges, the item will continue to appear on the credit report (for up to seven years, anyway), even if it has been paid off. The benefit to the debtor's credit rating, then, is alleged to be exaggerated, if not illusory. That, too, would be of importance to a debtor in weighing her options."
The case is Doris Griffin v Andrea Visgilio-McGrath, LLC, 2:17-cv-00006 (KM)(MAH)(D. New Jersey July 18, 2017) and the court's Opinion can be read here.
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