United States District Court, E.D. Missouri, Eastern Division
MEMORANDUM AND ORDER
JEAN C. HAMILTON, District Judge.
This matter is before the Court upon Plaintiff Mary Stroud's and Defendant AllianceOne Receivables Management, Inc.'s ("AllianceOne") Cross-Motions for Summary Judgment. (Doc. Nos. 16, 25.) The motions have been fully briefed and are ready for disposition.
The essential facts are undisputed. On or about December 27, 2013, AllianceOne sent Stroud a letter regarding alleged debt she owed to "Credit First." The letter read, in part: "As of the date of this letter, you owe $698.22. Your account balance may be periodically increased due to the addition of accrued interest or other charges if so provided in your agreement with your original creditor." (Doc. No. 17, Defendant's SUMF, ¶¶ 1-2.) On or about July 22, 2014, Stroud contacted AllianceOne and spoke to an AllianceOne representative. She asked the representative whether the amount due was accruing interest, and the representative responded, "[w]e don't add interest or late fees ma'am, no." Id. ¶¶ 4-7. Stroud also asked the representative whether she could pay the original creditor directly, and the representative responded:
They will just refer you back to us ma'am, because, we're the one, when it comes here there is no more interest or late fees and they don't offer settlements in-house, it's only settled once it goes to a collections agency and that's how the interest and late fees stop, is when it came here.
Id. ¶ 8. According to Stroud, during a subsequent phone call with Credit First, Credit First stated, "[y]ou can either pay them or you can pay us, it doesn't matter who you pay." (Compl. ¶ 17; Doc. No. 27, Plaintiff's SUMF, ¶ 6.)
In September 2014, Stroud filed her one-count complaint in the Circuit Court of St. Charles County, alleging that AllianceOne violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. ("FDCPA"), when it (1) falsely stated in the December 27 letter that her account balance may be periodically increased due to the addition of accrued interest or other charges; and (2) falsely stated during the July 22 phone call that she could not pay the original creditor directly. (Doc. No. 1.1.) AllianceOne timely removed the action to this Court and moved for summary judgment. (Doc. Nos. 1, 16.) Stroud thereafter filed a cross motion for summary judgment. (Doc. No. 25.)
SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate when no genuine issue of material fact exists and the movant is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(a). The substantive law determines which facts are material, and only disputes over "facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). At the summary judgment stage, the Court must view the facts in the light most favorable to the nonmoving party. Scott v. Harris, 550 U.S. 372, 380 (2007).
The moving party bears the initial responsibility of informing the district court of the basis of motion. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the moving party discharges this burden, the nonmoving party "must set forth specific facts demonstrating that there is a dispute as to a genuine issue for trial." Anderson, 477 U.S. at 248 (internal quotations omitted). A genuine issue for trial exists if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id.
The FDCPA was designed to protect consumers from "abusive debt collection practices by debt collectors." 15 U.S.C. § 1692(e). "In order to establish a violation of the FDCPA, a plaintiff must demonstrate that 1) plaintiff has been the object of collection activity arising from consumer debt; 2) the defendant attempting to collect the debt qualifies as a debt collector under the Act; and 3) the defendant has engaged in a prohibited act or has failed to perform a requirement imposed by the FDCPA." O'Connor v. Credit Prot. Ass'n LP, No. 4:11CV2187SNLJ, 2013 WL 5340927, at *6 (E.D.Mo. Sept. 23, 2013) (citations omitted). A debt collector engages in a prohibited act under the FDCPA by making a false, deceptive, or misleading representation in connection with the collection of any debt. See 15 U.S.C. § 1692e; Freyermuth v. Credit Bureau Servs., Inc., 248 F.3d 767, 770 (8th Cir. 2001).
In determining whether a debt collector's representations are false, deceptive, or misleading, courts within the Eighth Circuit apply the "unsophisticated-consumer standard, " which is "designed to protect consumers of below average sophistication or intelligence without having the standard tied to the very last rung of the sophistication ladder." Strand v. Diversified Collection Serv., Inc., 380 F.3d 316, 317 (8th Cir. 2004) (internal quotation omitted). This standard is intended to "protect the uniformed or naïve consumer, " while also maintaining "an objective element of reasonableness to protect debt collectors from liability for peculiar interpretations of collection letters." Id. at 317-18. "[I]t is proper to assume that an unsophisticated consumer would be confused or misled only if a significant fraction of people would be similarly misled." Campbell v. Credit Prot. Ass'n LP, No. 4:12CV00289AGF, 2013 WL 1282348, at *5 (E.D.Mo. Mar. 27, 2013) (internal quotations omitted).
False statements alone do not violate the FDCPA: a plaintiff must establish that the false statements are confusing or misleading, and that they are material. Hale v. AFNI, Inc., No. 08 CV 3918, 2010 WL 380906, at *5 (N.D.Ill. Jan. 26, 2010) (citing Wahl v. Midland Credit Mgmt., 556 F.3d 643, 645-46 (7th Cir. 2009)). Mere speculation that a statement confuses the unsophisticated consumer is insufficient. When a statement does not plainly reveal that it would be confusing to a significant fraction of the population, a plaintiff "must come forward with evidence beyond the [statement] and beyond his own self-serving assertions that the statement is confusing in order to create genuine issue of material fact for trial." Campbell, 2013 WL 1282348, at *5 (internal quotations omitted). "The materiality requirement is not concerned with mere technical falsehoods... but instead with genuinely misleading statements that may frustrate a consumer's ability to intelligently choose his or ...