Tatis v. Allied Interstate, LLC, Civil Action No. 16-00109
| Decision Date | 29 September 2016 |
| Docket Number | Civil Action No. 16-00109 |
| Parties | MICHELLE TATIS, individually and on behalf of all others similarly situated, Plaintiffs, v. ALLIED INTERSTATE, LLC and JOHN DOES 1-25, Defendants. |
| Court | U.S. District Court — District of New Jersey |
NOT FOR PUBLICATION
This matter comes before the Court on Defendant Allied Interstate, LLC's ("Allied" or "Defendant") motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). Plaintiff brought a class action against Allied alleging violations of the Fair Debt Collection Practices Act, 15 U.S.C. 1692, et seq. ("FDCPA"). Plaintiff claims that Allied violated Sections 1692e and 1692f of the FDCPA by attempting to collect a settlement payment on a time-barred debt without disclosing that the statute of limitations had expired. Allied moved for a judgment on the pleadings pursuant to the Third Circuit's decision in Huertas v. Galaxy Asset Management, 641 F.3d 28 (3d Cir. 2011). The Court reviewed all submissions made in support and in opposition to the motion, and considered the motion without oral argument pursuant to L. Civ. R. 78.1(b). For the reasons that follow, Defendant's motion is treated as a one to dismiss and it is granted.
The facts of this matter derive from Plaintiff's Complaint and the exhibit attached thereto. See Pension Ben. Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). Sometime before May 18, 2005, Plaintiff incurred a debt to Bally Total Fitness Holding Corporation. Compl. at ¶ 14 (D.E. 1). Plaintiff's debt was later bought by or assigned to LVNV Funding LLC ("LVNV"). Id. at ¶ 18. On May 18, 2015, on behalf of LVNV, Allied sent a letter to Plaintiff attempting to collect the debt (the "Collection Letter"), which allegedly totaled $1289.86. Compl., Ex. 1 at 1. At the time the Collection Letter was sent, the statute of limitations had expired and the debt was no longer legally enforceable. Id. at ¶ 26. The Collection Letter offered to settle Plaintiff's debt for $128.99, which amounted to a 90% discount of the actual amount owed. Id., Ex. 1 at 1. The Collection Letter stated in relevant part:
The reverse side of the letter provided instructions on how to stop Allied from contacting Plaintiff and how to make a complaint about its collection efforts. This portion provided as follows:
On January 8, 2016, Plaintiff filed a class action alleging violations of the FDCPA under 15 U.S.C. §§ 1692e & f. Prior to filing an answer, Defendant moved for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). Defendant's Motion for Judgement on the Pleadings, D.E. 6 ("Def. Br."). Plaintiff opposed Defendant's motion (D.E. 13, "Pl. Op."), and Defendant subsequently filed a reply brief (D.E. 14, "Def. Reply").
In relying upon the Third Circuit's decision in Huertas, Defendant argues that it did not violate 15 U.S.C. § 1692e of the FDCPA by attempting to collect Plaintiff's time-barred debt because it did not threaten legal action. Def. Br. at 8. Defendant maintains that use of the word "settle" in the Collection Letter cannot be interpreted as a threat of litigation, even from theprospective of the least sophisticated consumer. Id. at 9-12. According to Defendant, there is no requirement under the FDCPA for a debt collector to advise a debtor whether or not a debt is legally enforceable. Id. at 12-14. Similarly, Defendant argues that Plaintiff fails to state a claim under 15 U.S.C. § 1692f because it is based on the same conduct underlying the Section 1692e count. Id. at 15-16.
Plaintiff counters that Defendant violated the FDCPA because the "Collection Letter was deceptive, in offering to 'settle' the Plaintiff's debt with a payment plan, without advising the Plaintiff that the statute of limitations on the entire debt would be restarted by the tender of any monetary payment." Pl. Opp. at 10. Arguing that Huertas is distinguishable, Plaintiff relies on authority from the District of New Jersey and the Sixth and Seventh Circuits to support her position that an offer to settle may mislead the least sophisticated consumer into believing that a time-barred debt is legally enforceable, even when litigation is not threatened. Id. at 10-11. Plaintiff also contends that the Collection Letter was "deceptive and misleading because, upon reading the Letter, the least sophisticated debtor would believe that she had a legal obligation to pay the subject debt." Id. at 11.
On April 14, 2016, the Court ordered the parties to submit supplemental briefing "as to which state law applies to the potential revival of the statute of limitations of the allegedly owed debt if partial payment of the debt occurs." D.E. 15. The Court also ordered the parties to "discuss what impact, if any, the applicable state law has on the pending [motion]." Id.
In their supplemental briefing, both parties agreed that New Jersey law applies as to the potential renewal of the statute of limitations. Plaintiff's Supplemental Brief ("Pl. Supp. Br.") at 6; Defendant's Supplemental Brief ("Def. Supp. Br.") at 1. Plaintiff contends that New Jersey law has no impact on this motion other than establishing the six-year statute of limitations underN.J.S.A. 2A:14-1. Plaintiff also cited to a recently decided opinion from the District of New Jersey to support its position that "Defendant's Collection Letter was deceptive, in offering to 'settle' the Plaintiff's debt, without advising the Plaintiff that the statute of limitations on the entire debt had already run." Id. at 6 (citing Filgueiras v. Portfolio Recovery Associates, LLC, No. 15-8144, 2016 WL 1626958 (D.N.J. Apr. 25, 2016)). Defendant counters that New Jersey law is significant because it "confirms that the statute of limitations would not have been revived if Plaintiff had actually accepted the settlement offered to her and made the payment." Def. Br. at 3. Defendant also distinguishes Filgueiras arguing that settlement by means of a single payment of a time-barred debt -- as opposed to a payment plan -- is not misleading or violative of the FDCPA. Id. at 2-3.
As an initial matter, the Court notes that Defendant's motion for judgment on the pleadings should have been filed as a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) because it was filed prior to the close of the pleadings. See F.R.C.P. 12(c) ; Turbe v. Gov't of Virgin Islands, 938 F.2d 427, 428 (3d Cir. 1991) ( ).
As a result, the Court will consider the motion as one to dismiss. Grant v. JPMorgan Chase Bank, No. 12-06248, 2013 WL 1558773, at *1 (D.N.J. Apr. 10, 2013) (). The standard of review for a motion for judgment on the pleadings and a motion to dismiss for failure to state a claim are identical. Gebhart v.Steffen, 574 F. App'x 156, 158 (3d Cir. 2014) ().
According to Rule 12(b)(6) of the Federal Rules of Civil Procedure, a court should dismiss a complaint when it fails "to state a claim upon which relief can be granted." In analyzing a motion to dismiss under Rule 12(b)(6) the court will "accept...
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