Clomon v. Jackson
| Decision Date | 17 March 1993 |
| Docket Number | No. 761,D,761 |
| Citation | 988 F.2d 1314 |
| Parties | Christ CLOMON, Plaintiff-Appellee, v. Philip D. JACKSON, Defendant-Appellant. ocket 92-7942. |
| Court | U.S. Court of Appeals — Second Circuit |
Philip D. Jackson, Freeport, NY (Ciaravino, Jackson & Tedeschi), for defendant-appellant, pro se. Ira Mitzner, Washington, DC (Dickstein, Shapiro & Morin, of counsel).
Joanne S. Faulkner, New Haven, CT, for plaintiff-appellee.
Before KEARSE and WINTER, Circuit Judges, and CABRANES, District Judge. *
Philip D. Jackson appeals from a judgment of the United States District Court for the District of Connecticut (Peter C. Dorsey, Judge) granting summary judgment against him in an action for damages under the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692-1692o. The district court held that Jackson violated the FDCPA when he authorized the sending of debt collection letters bearing his name and a facsimile of his signature without first reviewing the collection letters or the files of the persons to whom the letters were sent. We affirm.
The appellant, Philip D. Jackson, is an attorney employed on a part-time basis as general counsel for a debt collection agency, NCB Collection Services ("NCB"). The agency collects debts on behalf of American Family Publishers ("AFP"), an organization engaged in the business of selling magazine subscriptions. This case arises out of an attempt by NCB to collect a debt of $9.42 allegedly owed to AFP by the appellee, Christ Clomon.
NCB issues debt collection letters on behalf of AFP to approximately one million debtors each year through a computerized mass-mailing system. Under this system, AFP provides NCB with computer tapes containing information about delinquent accounts. NCB then transfers this information from the tapes to its own computer system, which inserts each debtor's name, address, account number, and balance due into a form letter requesting payment of the debt. The computer system then causes each letter to be printed, folded, and inserted into a window envelope for mailing. If a debtor does not respond to the initial collection letter, the computer automatically produces and mails additional letters according to a predetermined schedule. The collection agency maintains a program for assessing the reliability of its computer data, but no employee of the agency reviews the file of any individual debtor until the debtor responds to the agency's demands for payment.
Clomon received a series of six form letters from NCB regarding her $9.42 debt to AFP. The first of these letters was sent on a form bearing the logo of NCB and the name of "Althea Thomas, Account Supervisor." The remaining five letters were sent on letterhead containing the following words in the top margin:
P.D. Jackson, G.C. Offices of General Counsel
East Rockaway, N.Y. 11518 In addition, each of these letters bore the following signature line:
P.D. JACKSON, ATTORNEY AT LAW
GENERAL COUNSEL
The information in the letterhead and at the signature line was accurate, at least in a literal sense. Jackson is indeed an attorney, admitted to practice in the State of New York. He is employed as general counsel of NCB Collection Services, albeit on a part-time basis, for which he receives an annual salary of approximately $24,000. The address of NCB Collection Services in New York State is 336 Atlantic Avenue, East Rockaway, New York 11518. The letters were not, however, actually signed by Jackson or by any other person: each letter bore a mechanically reproduced facsimile of the signature of "P.D. Jackson."
The letters "signed" by Jackson were delivered to Clomon over a period of more than two months, from March 1991 to early June of that year. The letters contained a variety of threatening statements in an apparent effort to induce Clomon to pay the amount she owed. The following statements are representative of the letters' contents:
You have 30 days before we take any additional steps deemed appropriate regarding your outstanding balance....
....
Based on information made available to us, we must recommend that your creditor proceed with such further action as the circumstances may indicate to dispose of this outstanding balance.
....
After NCB reviews your collection file and previous correspondence sent you, I am suggesting we take the appropriate measures provided under the law to further implement the collection of your seriously past due account.
....
Your account was referred to us with instructions to pursue this matter to the furthest extent we deem appropriate.
....
Acting as General Counsel for NCB Collection Services, I have told them that they can lawfully undertake collection activity to collect your debt....
....
Accordingly, the disposition of your account has been scheduled for immediate review and/or further action as deemed appropriate.
....
Because of your failure to make any effort to pay your lawful debt ... we may find it necessary to recommend to your creditor that appropriate action be taken to satisfy the debt.
Jackson asserts, and Clomon does not dispute, that he personally approved the form letters used by NCB and that he also approved the procedures according to which those letters were sent. Jackson acknowledges, however, that he did not have any direct personal involvement in the mailing of letters to Clomon (or to any other debtor): he never reviewed Clomon's file; he never reviewed or signed any letter that was sent in his name to Clomon; he never gave advice to AFP about how to address particular circumstances of Clomon's case; and he never received any instructions from AFP about what steps to take against Clomon. In short, Jackson never considered the particular circumstances of Clomon's case prior to the mailing of the letters and he never participated personally in the mailing.
In a complaint filed on September 23, 1991, Clomon alleged that Jackson had violated the FDCPA in authorizing NCB to issue the collection letters that she received. The district court denied Jackson's motion for judgment on the pleadings on May 4, 1992. While that motion was still pending, the parties submitted cross-motions for summary judgment. The district court issued a written ruling granting summary judgment for Clomon on May 11, 1992. The court then granted, over objection, Clomon's motion for the maximum statutory damages of $1000. The court found no actual damages. On appeal, Jackson contends that the district court erred
(1) in finding that his conduct violated 15 U.S.C. § 1692e, (2) in awarding statutory damages in the amount of $1,000, and (3) in denying his motion for judgment on the pleadings.
The FDCPA establishes a general prohibition against the use of "false, deceptive, or misleading representation or means in connection with the collection of any debt." 15 U.S.C. § 1692e. The sixteen subsections of § 1692e set forth a non-exhaustive list of practices that fall within this ban. These subsections include:
(3) The false representation or implication that any individual is an attorney or that any communication is from an attorney.
....
(10) The use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer.
Id. Because the list in the sixteen subsections is non-exhaustive, a debt collection practice can be a "false, deceptive, or misleading" practice in violation of § 1692e even if it does not fall within any of the subsections of § 1692e. A single violation of § 1692e is sufficient to establish civil liability under the FDCPA. See 15 U.S.C. § 1692k ().
The most widely accepted test for determining whether a collection letter violates § 1692e is an objective standard based on the "least sophisticated consumer." This standard has been widely adopted by district courts in this circuit. See, e.g., Johnson v. NCB Collection Services, 799 F.Supp. 1298, 1306 (D.Conn.1992); Rabideau v. Management Adjustment Bureau, 805 F.Supp. 1086, 1094 (W.D.N.Y.1992); Britton v. Weiss, 1989 WL 148663, at *2, 1989 U.S.Dist. LEXIS 14610, at * 6 (N.D.N.Y. Dec. 18, 1989); cf. Riveria v. MAB Collections, Inc., 682 F.Supp. 174, 178 (W.D.N.Y.1988) (using "unsophisticated consumer" standard). This standard has also been adopted by all federal appellate courts that have considered the issue. See Smith v. Transworld Systems, Inc., 953 F.2d 1025, 1028 (6th Cir.1992); Graziano v. Harrison, 950 F.2d 107, 111 (3d Cir.1991); Jeter v. Credit Bureau, Inc., 760 F.2d 1168, 1174-75 (11th Cir.1985); Baker v. G.C. Services Corp., 677 F.2d 775, 778 (9th Cir.1982). But see Blackwell v. Professional Business Services, of Georgia, Inc., 526 F.Supp. 535, 538 (N.D.Ga.1981) (applying "reasonable consumer" standard). We now adopt the least-sophisticated consumer standard for application in cases under § 1692e. In doing so, however, we examine in some detail the purposes served by this standard as well as the extent of the liability that it creates.
The basic purpose of the least-sophisticated-consumer standard is to ensure that the FDCPA protects all consumers, the gullible as well as the shrewd. This standard is consistent with the norms that courts have traditionally applied in consumer-protection law. More than fifty years ago, the Supreme Court noted that
[t]he fact that a false statement may be obviously false to those who are trained and experienced does not change its character, nor take away its power to deceive others less experienced. There is no duty resting upon a citizen to suspect the honesty of those with whom he transacts business. Laws are made to protect...
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