United States District Court, E.D. Missouri, Eastern Division
MEMORANDUM AND ORDER
CATHERINE D. PERRY, UNITED STATES DISTRICT JUDGE.
Andrew Ketterman brings this suit against defendant I.C.
Systems, Inc., alleging that defendant violated two
provisions of the Fair Debt Collection Practices Act (FDCPA),
15 U.S.C. § 1692 et seq., when it attempted to
collect an Ameren UE debt from plaintiff. Ketterman alleges
that defendant attempted to collect an unlawful processing
fee for paying by credit or debit card and that defendant
unlawfully attempted to collect a debt that was not his
because his ex-wife had opened the Ameren account in his name
without his knowledge.
parties have moved for summary judgment, although plaintiff
filed his motion after the extended deadline for doing so.
Setting aside that procedural issue, I will grant
defendant's motion and deny plaintiff's. Defendant
has presented uncontroverted evidence that the fee for credit
card processing was a fee charged by and paid to the credit
card processor and defendant does not receive any of that
fee. Plaintiff's only evidence that the bill was not his
is his own testimony, which is contradicted by his testimony
that he lived in the house, that it was listed in his name,
and that he paid the Ameren electric bill while he lived
there. Even if this could create a genuine issue of fact, IC
is entitled to summary judgment because it has shown that any
error on its part was a bona fide error made in reasonable
reliance on the information provided by Ameren.
April 11, 2018, plaintiff called defendant to ask about
issues with his credit report. The phone call was recorded
and this was the only interaction between the parties. During
the brief call, plaintiff was informed that he owed a debt of
$449.81 for an unpaid Ameren utility bill. He was told that
he could pay the entire balance by check or credit or debit
card. He was also told that if he chose to pay by card he
would be charged a third-party payment processing fee in the
amount of $24.74, making the total amount due $474.55.
Further, the spokesperson stated “[a]gain, if you
don't want that additional fee, you're welcome to pay
it by check.” ECF 42-1 at 4. Plaintiff was also told
that he could break the payment into two separate payments.
debt that IC was attempting to collect was for electrical
service from Ameren UE for a house that plaintiff had
previously lived in with his ex-wife. He testified that he
had lived at the address shown, that it was a house owned by
him, in his name, and that he paid Ameren bills “up
until the time I moved out.” ECF 42-7 at ¶ 23, l.
25 to p. 24, l. 2. He also testified that his wife opened the
account in his name and without his knowledge. ECF 47-7 at p.
15, l. 2-7.
determining whether to grant summary judgment, I must view
the facts and any inferences from those facts in the light
most favorable to the nonmoving party. Matsushita Elec.
Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574,
587 (1986). The movant bears the burden of establishing that
(1) it is entitled to judgment as a matter of law and (2)
there are no genuine issues of material fact. Fed.R.Civ.P.
56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986). Once the movant has met this burden, the nonmoving
party may not rest on the allegations in its pleadings but
must, by affidavit or other evidence, set forth specific
facts showing that a genuine issue of material fact exists.
Fed.R.Civ.P. 56(c)(1), (e). Where a factual record taken as a
whole could not lead a rational trier of fact to find for the
nonmoving party, there is no genuine issue for trial.
Matsushita, 475 U.S. at 587.
filing of cross motions for summary judgment does not
necessarily indicate that there is no dispute as to a
material fact, or have the effect of submitting the cause to
a plenary determination on the merits.” Wermager v.
Cormorant Twp. Bd., 716 F.2d 1211, 1214 (8th Cir. 1983).
Instead, each summary judgment motion must be evaluated
separately on its own merits to determine whether a genuine
issue of material fact exists and whether the movant is
entitled to judgment as a matter of law. Husinga v.
Federal-Mogul Ignition Co., 519 F.Supp.2d 929, 942 (S.D.
order to establish a violation of the FDCPA, a plaintiff must
establish that: (1) plaintiff has been the object of
collection activity arising from a 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.” Weast v. Rockport Fin.,
LLC, 115 F.Supp.3d 1018, 1021 (E.D. Mo. 2015). “A
violation of the FDCPA is reviewed utilizing 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 on the sophistication ladder.” Strand v.
Diversified Collection Serv., Inc., 380 F.3d 316, 317
(8th Cir. 2004). The standard is designed to protect
uninformed consumers and contains an objective element in
order to protect debt collectors from liability for irregular
readings of collection letters. Id. at 317-18. The
specific subsections that plaintiff alleges defendant
violated are § 1692f(1) (collecting a fee not provided
in underlying agreement) and § 1692e(2)(A) (making false
and misleading statements).
§ 1692f debt collectors are prohibited from using
“unfair or unconscionable means to collect or attempt
to collect any debt, ” including “the collection
of any amount (including any interest, fee, charge, or
expense incidental to the principal obligation) unless such
amount is expressly authorized by the agreement creating the
debt or permitted by law.” 15 U.S.C. § 1692f(1).
Plaintiff argues that defendant's attempt to charge
plaintiff a processing fee if he chose to pay by card
violates this subsection.
argument fails because defendant has produced uncontested
evidence that a third party collects and retains the entirety
of the processing fee. Affidavits from officers of
defendant's company and of PNS Partners, LLC - the
third-party credit card processor used by IC - establish that
IC does not receive any of the additional fee. ECF 42-1;
42-6. Instead, PNS receives the money paid through the credit
or debit card and does not share the additional fee with IC.
This is not a violation of the act because the statute only
applies to a “debt collector” and here the fee is
paid to a third party which keeps the entire fee. See
Shami v. Nat'l Enter. Sys., 914 F.Supp.2d 353, 357
(E.D.N.Y. 2012) (granting summary judgment for defendant when
the evidence demonstrated that a third party collects and
retains the entire processing fee); Lewis v. ABC Business
Services, Inc., 911 F.Supp. 290, 292-29 (S. D. Ohio
1996) (summary judgment appropriate where uncontradicted
evidence showed the fee would go to the independent processor
of the payment processor). Moreover, the 5.5% fee does not
violate this subsection because it was an optional form of
payment which plaintiff could have avoided if he paid by
check. See Lee v. Main Accounts, Inc., 125 F.3d 855
(6th Cir. 1997)(affirming summary judgment because the fee
was collected by a third party when the debtor chose to pay
by credit card).
argues that in Weast this Court recognized that a
defendant could violate § 1692f(1) by charging a
processing fee. But the court in Weast was
considering a motion to dismiss, not a motion for summary
judgment, and specifically noted that although the defendant
might be able to produce evidence at the summary judgment
stage, it had not done so there. 115 F.Supp.3d at 1022.
Additionally, in Kojetin v. C U Recovery, Inc., 212
F.3d 1318 (8th Cir. 2000), on which plaintiff also relies,
the defendant debt collector was the one charging the
additional fee. I will grant summary judgment to defendant on
the § 1692f(1) claim.
§ 1692e(2)(A), “a debt collector may not use any
false, deceptive, or misleading representation or means in
connection with the collection of any debt, ” including
falsely representing ...