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Consumer Loses on Validation Letter Claim

On Behalf of | Jan 12, 2013 | Consumer Protection

While I always try to write to you about the success stories of consumers that stood up for their rights, I also have to give the bad news on occasion.  Thus, today’s blog is about a recent decision that came out badly for the consumer.   In Zememckis v. Global Credit & Collection Corp. on appeal, the Seventh Circuit dismissed the consumer’s claims stating she failed to state a valid claim under the Fair Debt Collection Practices Act (“FDCPA”).

The basic facts of the case show that in March of 2010 Zemeckis owed money to Capital One Bank who in turn hired Global Credit & Collection Corp. (“Global”) to collect the debt on its behalf.  In its collection attempts Global sent Zemeckis an initial collection letter with notice of her right to request validation of the debt.  Zemeckis argued that the language used in the letter and repeated threats of legal action against her overshadowed the language required under the statute informing her that she had thirty days to dispute the validity of the debt and request validation.  The letter “urge[d] [her] to take action now,” and to “[c]all [Global’s] office today….”  The letter also stressed Capital One Bank’s right to file suit against Zemeckis, warning that “[her] account now meets … [the] guidelines for legal action” and that “Capital One Bank (USA), N.A. may be forced to take legal action.”  With the validation notice written on the back side of the letter, Zemeckis argued that Global’s letter masked her right to seek validation as required by the FDCPA.

Zemeckis argued Global violated Section1692g of the FDCPA by using threatening language in the letter which overshadowed her right to seek validation.  The district court disagreed and dismissed her claim.  Zemeckis appealed the district court’s ruling to the Seventh Circuit but had the same result.  Global’s initial collection letter did not violate the FDCPA and Zemeckis’ case was dismissed.

Under Section 1692g, a debt collector’s initial letter to a debtor must contain:

(1) the amount of the debt;

(2) the name of the creditor to whom the debt is owed;

(3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;

(4) a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and

(5) a statement that, upon the consumer’s written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.  15 U.S.C. § 1692g(a).  Zemeckis argued that under her interpretation of the statute the letter was misleading, however on appeal the Seventh Circuit could not agree.  In conclusion, the Court stated that while it by no means wishes to applaud Global’s initial collection letter, it does not feel that its letter rose to a level of violation of the statute.

If you are having issues with debt collection and need assistance contact SmithMarco P.C. for a free case review.