Webb v. AWA Collections
| Decision Date | 26 July 2021 |
| Docket Number | 20 C 5656 |
| Parties | ISSA WEBB, Plaintiff, v. AWA COLLECTIONS, Defendant. |
| Court | U.S. District Court — Northern District of Illinois |
Plaintiff Issa Webb (“Webb”) filed a complaint against Defendant AWA Collections (“AWA”), a debt collection agency, alleging that AWA Collections violated his right to privacy and caused him financial injury through their debt collection practices. AWA Collections filed a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing that Webb's allegations, even it taken as true, fail to state a claim for relief under the Fair Debt Collection Practices Act. For the following reasons, the Court grants AWA's motion [12].
Webb filed his complaint against AWA under 15 U.S.C. § 1692 commonly known as the Fair Debt Collection Practices Act. Though Webb's allegations lack detail, the Court infers the following facts from his complaint and the attached documents[1]. On February 8, 2020, Lotsu Digestive Health sent Webb a bill for medical services. The bill stated that Webb owed $171.86. Around June of 2020, Lotsu Digestive hired AWA to collect the $171.86 from Webb. As of June 2020 AWA's collection appeared on Webb's credit report. On June 24th, 2020, AWA sent Webb a letter regarding the collection.
On August 1st, 2020, Webb sent an “Affidavit of Truth” to AWA where he outlined various claims he believed he had against AWA under 15 USC § 1692. AWA never responded directly to this affidavit. Webb then sent AWA an invoice for $36, 000 for the same 15 USC § 1692 alleged violations. Also on August 1st, 2020, Webb filed his first complaint with the Consumer Financial Protection Bureau. In this complaint, Webb states that AWA attempted to collect a debt he did not owe. AWA responded by closing the account and stating that any information sent to credit bureaus would be removed.
On August 19th, 2020, Webb wrote AWA a letter titled “Notice of Default and Opportunity to Cure.” This letter stated that AWA failed to rebut his “Affidavit of Truth” and thus defaulted in the amount of $36, 000. At some point, Webb also sent a cease-and-desist letter though the document attached to the complaint is not dated and Webb's complaint contains no allegations about when the letter was sent. On August 24th, 2020, Webb filed a second complaint with the Consumer Financial Protection Bureau (hereafter the “Bureau”) regarding AWA. In his amended complaint, Webb states that AWA violated his rights under 15 USC § 1692. As a result, Webb sought to collect the $36, 000 he invoiced AWA, along with an apology. AWA responded that it already resolved the issues in the prior Bureau complaint, closed the account, and deleted any information sent to credit bureaus. AWA also stated it didn't recognize the affidavit of truth as a valid legal document. Based on this response, the Bureau closed out Webb's second complaint.
The present lawsuit followed and Webb alleges in his complaint that AWA failed to comply with the Fair Debt Collection Practices Act. Webb generally asserts that AWA “violated [his] right to privacy, caused financial injury, and ruined [his] reputation as a federally protected consumer.” Along with his complaint, Webb submitted an affidavit of truth, a cease-and-desist letter, and several other documents related to facts underlying his claim.
AWA filed a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim, arguing that Webb does not identify what portions of the Fair Debt Collection Practices Act AWA allegedly violated. In response to AWA's motion, Webb filed an opposition brief where he restates the allegations in his complaint, expands on his initial allegations, and attempts to add allegations to his original complaint. AWA replied to Webb's brief reinforcing their belief that Webb failed to state a claim in his original complaint. Additionally, AWA points out that Webb cannot amend his complaint through an opposition brief.
When considering a Rule 12 motion to dismiss, the Court accepts all well-pled facts as true and will grant the motion only when the complaint fails to allege facts sufficient to “state a claim to relief that is plausible on its face.” Nischan v. Stratosphere Quality, LLC, 865 F.3d 922, 928 (7th Cir. 2017) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)). To determine whether a claim is plausible, the Court considers facts stated in the complaint, as well as any attached documents referred to in the complaint and central to the plaintiff's claim. Thompson v. Ill. Dep't of Prof'l Regulation, 300 F.3d 750, 753 (7th Cir. 2002). Moreover, when deciding a Rule 12(b)(6) motion to dismiss, the Court must “construe the complaint in the light most favorable to the plaintiff.” Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008). This requires the court to draw all possible inferences in plaintiff's favor. Id.
In his complaint [9], Webb generally asserts that AWA “violated [his] right to privacy, caused financial injury, and ruined [his] reputation as a federally protected consumer.” (Dkt. 9 at p.5). To support his allegations Webb argues: (1) AWA could not validate the alleged debt; (2) AWA gave inaccurate information to his consumer reports; (3) AWA did not have written consent to obtain his personal information; and (4) AWA did not comply in an administrative process initiated by Webb. AWA moves to dismiss all four of these separate bases. The Court addresses each in turn.
First, Webb alleges that AWA “could not validate the debt.” Though Webb does not specify what provision of the Fair Debt Collection Practices Act he relies on, the Court presumes this refers to § 1692g, which addresses the verification of debts. 15 U.S.C. § 1692g.
Section 1692g ensures that a debt collector makes certain disclosures when it attempts to collect a debt. Pa Panko v. Pellettieri & Assocs., P.C., No. 04 C 3981, 2004 U.S. Dist. LEXIS 19295, 2004 WL 2191574 at *2 (N.D. Ill. 2004). It further provides that a debt collector communicating with a consumer must, either within the initial communication or five days later, send the consumer a written notice containing (1) the amount of debt, (2) the creditor's name to whom the debt is owed, (3) notice that they have thirty days to dispute the debt's validity, (4) notice that the debt will be assumed valid unless they do so, and (5) notice that if they dispute the debt within thirty days, the debt collector will cease pursuing collection until it verifies the debt and mails it to the consumer. See Allen v. Bank of Am., N.A., No. 11 C 9259, 2012 U.S. Dist. LEXIS 158632, 2012 WL 5412654, at *2-3 (N.D. Ill. 2012).
But, as the Seventh Circuit explains, verification of a debt does not obligate the collector to confirm whether the underlying debt actually belongs to the consumer. Walton v. EOS CCA, 885 F.3d 1024, 1027 (7th Cir. 2018). Indeed, “[i]t would be both burdensome and significantly beyond the [Fair Debt Collection Act's] purpose to interpret § 1692g(b) as requiring a debt collector to undertake an investigation into whether the creditor is actually entitled to the money it seeks.” Id. at 1027-28. Rather, § 1692g(b) merely requires that the debt collector confirm in writing that the amount being demanded matches the amount the creditor claims is owed. Id. at 1028.
To satisfy § 1692g(a), a notice must state all required information clearly enough so that the recipient is likely to understand it. Janetos v. Fulton Friedman & Gullace, LLP, 825 F.3d 317, 321 (7th Cir. 2016). Section 1692g(b) further states that if the debtor requests verification of the debt within the thirty days, the debt collector must cease efforts to collect the debt until they send verification. 15 U.S.C. 1692g(b). An “unsophisticated consumer” standard governs whether the contents of a letter are clear enough to provide adequate validation. Zemeckis v. Glob. Credit & Collection Corp., No. 11-cv-701, 2011 U.S. Dist. LEXIS 54169, 2011 WL 2036263, at *2 (N.D. Ill. 2011). The unsophisticated consumer “has rudimentary knowledge about the financial world and is capable of making basic logical deductions and inferences[.]” Wahl v. Midland Credit Mgmt., 556 F.3d 643, 645 (7th Cir. 2009) (internal citations omitted). Whether a letter confuses the unsophisticated consumer is generally a fact-based inquiry, yet “there will be occasions when a district court will be required to hold that no reasonable person, however unsophisticated, could construe the wording of the communication in a manner that will violate the statutory provision” McMillan v. Collection Professionals Inc., 455 F.3d 754, 760 (7th Cir. 2006).
Here, the Court finds that the letter attached to Webb's complaint demonstrates that AWA gave adequate verification. AWA sent a letter to Webb on June 24, 2020 validating the debt it contended he owed. Webb attaches this letter to his complaint. The letter's cover page reads as follows:
“Creditor: Lotsu Digestive Health/# WEIS000001/AWA #HW9723 Original Balance: $171.86 … Interest and Fees $ … Current Balance: $171.86… Enclosed is a validation of your debt as supplied by our client… [t]he amount indicated as negative is what our client shows after your debt was Charged off as bad debt & placed for collections.”
An unsophisticated consumer would be able to deduce from this letter that the creditor is Lotsu Digestive and that the amount due is $171.86. Thus, the letter adequately verified Webb's debt under 15 U.S.C. § 1692g(a)(1)-(2).
Regarding the disclosures required under § 1692g(a)(3)-(5), Webb does not allege that AWA...
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