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Bland v. LVNV Funding, LLC

United States District Court, E.D. Missouri, Eastern Division

September 8, 2015

MARGARETTA BLAND, Plaintiff,
v.
LVNV FUNDING, LLC, Defendant

Page 1153

          For Margaretta Bland, Plaintiff: Richard A. Voytas, Jr., LEAD ATTORNEY, VOYTAS AND COMPANY, St. Louis, MO.

         For LVNV Funding, LLC, Defendant: Mayer S. Klein, LEAD ATTORNEY, Samuel Michael Goldenhersh, FRANKEL AND RUBIN, Clayton, MO.

Page 1154

         MEMORANDUM AND ORDER

         RODNEY W. SIPPEL, UNITED STATES DISTRICT JUDGE.

         This matter is before me on Defendant LVNV Funding, LLC's Motion to Dismiss

Page 1155

in this Fair Debt Collection Practices Act, 15 U.S.C. § § 1692, et seq. (" FDCPA" ), action. The issues are fully briefed and I have heard oral argument on the motion. For the reasons that follow, I will grant in part and deny in part defendant's motion to dismiss.

         Background

         This action arises out of a debt collection lawsuit. In 2002, Sears Roebuck Co. sued plaintiff to collect on an unpaid credit card bill. Plaintiff did not respond to the lawsuit and Sears took a default judgment in the amount of $3,387.96. Sears assigned the 2002 judgment to defendant,[1] a debt collector. Defendant hired the law firm Miller & Steeno, P.C. (" Miller" ) to revive the judgment. Miller filed a motion to revive the judgment, and then somewhat sporadically sought to serve plaintiff with process between November 2011 and June 2014. Plaintiff was served with the revival suit on June 25, 2014. The state court held a hearing on defendant's motion to revive judgment. Again, plaintiff did not respond to the motion or appear at the hearing. On August 7, 2014, the Circuit Court of St. Louis City, Missouri revived the judgment against plaintiff, giving full force and effect to the 2002 judgment in the amount of $3,387.96. Plaintiff never appealed the default judgment or the revival of the judgment.

         In late August or early September 2014, defendant, through Miller, contacted plaintiff about the debt by phone. Plaintiff alleges that the phone call was the " initial communication" as defined by the FDCPA, triggering defendant's requirement to provide plaintiff with notice of her dispute and validation rights. Plaintiff alleges that defendant never sent her notification of her dispute and validation rights, nor did defendant provide plaintiff with written notice of the amount of the debt or a copy of either of the state court judgments. Plaintiff alleges that during the phone call, defendant told plaintiff it would take legal action such as garnishment if she did not make payment that day. Shortly after receiving the phone call, plaintiff started making payments to defendant.

         In January 2015, Miller sent plaintiff a collection letter. Plaintiff alleges that the letter did not state the amount of the debt and concealed the fact that defendant was assessing interest on the debt. The letter instructed plaintiff to make $50 monthly payments through April 2015 and stated that after April 2015, Miller would seek to collect the full amount due.

         On February 6, 2015, plaintiff filed this action in the Circuit Court of St. Louis County, Missouri, alleging violations of the FDCPA, abuse of process, and violation of the Missouri Merchandising Practices Act, RSMo. § 407.025(1) (" MMPA" ). Defendant removed this action to this Court on March 9, 2015. On April 7, 2015, plaintiff filed her First Amended Complaint.

         In addition to plaintiff's state law claims, plaintiff alleges that defendant violated § § 1692d, 1692e, 1692f, and 1692g of the FDCPA because defendant (1) fooled plaintiff into believing that Sears, rather than defendant, was pursuing her, (2) failed to notify plaintiff of her dispute and validation rights, (3) overshadowed plaintiff's dispute and validation rights, (4) attempted to collect a debt from plaintiff when it had no legal standing to do so, (5) failed to accurately state the amount of the debt, and (6) used unfair and unconscionable practices to attempt to collect the debt.

         On April 20, 2015, defendant filed this motion to dismiss, arguing that plaintiff has failed to state a claim under Fed.R.Civ.P. 12(b)(6).

Page 1156

         Legal Standard

         In ruling on a motion to dismiss brought under Fed.R.Civ.P. 12(b)(6), I must accept as true all factual allegations in the complaint and view them in the light most favorable to the plaintiff. Kohl v. Casson, 5 F.3d 1141, 1148 (8th Cir. 1993). " To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Bell A. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). " A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. While a court must accept factual allegations as true, it is " not bound to accept as true a legal conclusion couched as a factual allegation." Carton v. Gen. Motor Acceptance Corp., 611 F.3d 451, 454 (8th Cir. 2010) (internal citations omitted). " Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 556 U.S. at 678 (internal citations omitted).

         Discussion

         A. FDCPA

         " The purpose of the FDCPA is to eliminate abusive debt collection practices by debt collectors . . ." Dunham v. Portfolio Recovery Assocs., LLC, 663 F.3d 997, 1000 (8th Cir. 2011). When a court is evaluating a debt collection communication it must view it " through the eyes of an unsophisticated consumer." Freyermuth v. Credit Bureau Services, Inc., 248 F.3d 767, 771 (8th Cir. 2001). This standard is " designed to protect consumers of below average sophistication or intelligence without having the standard tied to the very last rung on the sophistication ladder." Strand v. Diversified Collection Services, Inc., 380 F.3d 316, 317-18 (8th Cir. 2004) (internal quotations and citations omitted). It " protects the uninformed or naive consumer, yet also contains an objective element of reasonableness to protect debt collectors from liability for peculiar interpretations of collection letters." Id.

         Section 1692d of the FDCPA provides that " a debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of any debt." Section 1692e provides that a " debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt." Section 1692f provides that a " debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt." Section 1692g sets out information a debt collector must provide to a consumer within five days after the initial communication of a debt collection.

         1. Section 1692g Dispute and Validation Rights

         Plaintiff alleges that defendant violated 15 U.S.C. § 1692g by failing to send plaintiff the requisite written notice informing plaintiff of her rights under the FDCPA. Section 1692g requires a debt collector to provide to a consumer certain information within five days after the initial communication of a debt collection. The required information includes " the amount of the debt" and " the name of the creditor to whom the debt is owed." 15 U.S.C. § 1692g(a)(1),(2). The notice must also contain:

(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 ...

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