Blackwell v. Professional Business Services, Civ. A. No. C81-105A.

• Decision Date: 14 November 1981
• Docket Number: Civ. A. No. C81-105A.
• Citation: 526 F. Supp. 535
• Parties: Annie BLACKWELL, Plaintiff, v. PROFESSIONAL BUSINESS SERVICES OF GEORGIA, INC., Defendant.
• Court: U.S. District Court — Northern District of Georgia

526 F. Supp. 535

Annie BLACKWELL, Plaintiff, v. PROFESSIONAL BUSINESS SERVICES OF GEORGIA, INC., Defendant.

Civ. A. No. C81-105A.

United States District Court, N. D. Georgia, Atlanta Division.

November 14, 1981.

Barbara L. Smith, Conyers, Ga., for plaintiff.

Kehir & Baker, Atlanta, Ga., for defendant.

ORDER

TIDWELL, District Judge.

The above-styled action under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq., hereinafter FDCPA or "the Act" is before the court on the parties' cross-motions for summary judgment. The facts that form the basis of this litigation are not in dispute. The plaintiff allegedly incurred a debt to Doctor's Hospital, and the defendant attempted to collect this debt by contacting the plaintiff on a single occasion. This contact was made by form letter, which read:

FINAL NOTICE BEFORE LEGAL REFERRAL. YOUR DELINQUENT ACCOUNT may be scheduled for referral to an attorney for action. You may, therefore, be responsible for additional costs prior and subsequent to a resulting judgement sic. With judgement, creditor's attorney can garnishee wages and/or attach tangible and real property.

On the reverse of this form letter, the following language appears, in smaller type:

Unless you notify this office in 30 days after receiving this notice that you dispute the validity of the debt or any portion thereof, this office will assume this debt is valid.

IF you notify this office in writing in 30 days from receiving this notice, this office will obtain verification of the debt or obtain a copy of the judgment against you and mail a copy of such judgment or verification.

IF you request this office in writing within 30 days after receiving this notice, this office will provide you with the name and address of the original creditor, if different from the current creditor.

This form letter was the only contact between the plaintiff and the defendant.

In the plaintiff's motion for partial summary judgment, she asserts that the defendant's communication with her violated the provisions of FDCPA. She contends, first, that the defendant's form letter constituted a "false representation of ... the character, amount, or legal status of any debt ...." under § 1692e(2)(A); second, that the validation notice required by § 1692g was improper in form and wording; third, that the validation notice misrepresented the legal status of the plaintiff's alleged debt in violation of § 1692e(2)(A). The defendant for its part denies that its form letter was violative of the Act in any of the particulars set forth by the plaintiff.

The plaintiff first asserts that the language in the defendant's form letter misleads the debtor as to the legal status of the debt, in that it gives the impression that the debtor must act immediately to avoid judgment, that judgment is inevitable, and that with judgment the creditor can garnish wages or attach property. While the defendant prefaced this language with the qualifier that the account "may" be referred to an attorney and such consequences "may" result, the plaintiff suggests that the printing of the words "FINAL NOTICE BEFORE LEGAL REFERRAL" in large type negates the effect of the word "may".

It is clear that this language does not, on its face, amount to a "false representation of ... the ... legal status" of the debt within the meaning of § 1692e(2)(A). Nothing in the statement, particularly when prefaced by the cautionary "may", can be pointed out as untrue. The plaintiff, however, contends that the form is deceptive or misleading in its total effect or impression. In this contention, the plaintiff appears to be relying on the first paragraph of § 1692e, which states:

A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section ....

The legislative history makes it clear that other practices than those specifically forbidden may be found to be in violation of the Act:

In addition to these specific prohibitions, this bill prohibits in general terms any harassing, unfair, or deceptive collection practice. This will enable the courts, where appropriate, to proscribe other improper conduct which is not specifically addressed. Sen.Rep.No. 95-382, 95th Cong., 1st Sess., reprinted in 1977 U.S. Code Cong. & Ad.News 1695, 1698.

In order to determine whether a statement is false, deceptive or misleading within the general meaning of the Act, the plaintiff urges the adoption of the standard employed in Bingham v. Collection Bureau, Inc., 505 F.Supp. 864 (D.N.D.1980), which found a violation of the Act where "debtors on the low side of reasonable capacity read into the message oppressiveness, falsehood or threat." This court is not bound by the decisions of other district courts, see Dean v. Timpson Independent School District, 486 F.Supp. 302, 310 (E.D.Tex.1979), and declines to adopt this novel standard. Rather, in the absence of relevant case law in this circuit, the court will look to the standard adopted by the Fifth Circuit in an analogous situation.

In Bustamante v. First Federal Savings & Loan Assn., 619 F.2d 360 (5th Cir.1980), the Fifth Circuit was called upon to determine the meaning of "materiality" under § 1635 of the Truth-in-Lending Act. No definition was provided in the Act, the regulations, or its legislative history. Reviewing the purposes of Truth-in-Lending legislation, the Court of Appeals found that the purpose of that section was to enable the consumer to make an informed decision in obtaining credit, and that an objective standard should be applied, based on "what a reasonable consumer would find significant in deciding whether to use credit." 619 F.2d at 364.

In the instant case, a similar problem exists in defining "deceptive or misleading". Nothing in the Act or its legislative history provides any guidance to the meaning of these terms in the context of § 1692e. The FDCPA, like the Truth-in-Lending Act, was designed to safeguard consumers in their dealings with business; here, as in Bustamante, the particular safeguard at issue is the text or wording of the form provided to the consumer. Accordingly, in determining whether a violation of § 1692e exists, the court will look to whether a reasonable consumer would be deceived or misled by particular language.

Applying this standard, which is both less stringent and more widely used than the "something less than reasonable consumer" standard proposed by the plaintiff, the court finds that the language employed in the defendant's form letter communication would not convey such an impression to the reasonable consumer as to constitute a deceptive or misleading statement within the meaning of § 1692e.

The plaintiff's second assertion is that the validation notice...