KENNETH JON GUERRERO, Plaintiff, vs. RJM ACQUISITIONS, LLC, Defendant.
CIV. NO. 03-00038 HG-LEK
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF HAWAII
2004 U.S. Dist. LEXIS 15416
July 9, 2004, Decided
July 9, 2004, Filed
DISPOSITION: [*1] Defendant's Motion to Dismiss DENIED; Plaintiff's Motion for
Summary Judgment GRANTED IN PART AND DENIED IN PART; and Defendant's
Counter Motion for Summary Judgment GRANTED IN PART AND DENIED IN PART.
Plaintiff's request for reasonable attorneys' fees and costs GRANTED; Defendant's
request for reasonable attorneys' fees and costs DENIED.
For the reasons that follow, Defendant's Motion to Dismiss is DENIED; Plaintiff's
Motion for Summary Judgment n1 is GRANTED IN PART AND DENIED IN PART; and
Defendant's Counter Motion for Summary Judgment is GRANTED IN PART AND
DENIED IN PART.
The parties respectively seek summary judgment on the following claims:
(1) [*25] Defendant's failure to verify Plaintiff's alleged debt, in violation of 15
U.S.C. § 1692g
The Court discussed above, with respect to Defendant's motion to dismiss, the duties
that the FDCPA imposes upon a debt collector where an alleged debtor requests
verification of an alleged debt sought to be collected. Under 15 U.S.C. § 1692g(b),
when a consumer notifies the debt collector in writing within the designated time
period that the debt is disputed, or if the consumer requests the name and address
of the original creditor, the debt collector must obtain and mail a copy of such
verification to the consumer, and it must cease collection of the debt until it does so.
In sum, the June 14, 2002 letter from Defendant to Plaintiff's counsel expressly
constituted "an attempt to collect a debt" following Plaintiff's request for verification
of the debt, and establishes that Defendant did not cease in its efforts to collect the
alleged debt upon receipt of Plaintiff's request for verification.
The Court notes that even if Defendant had ceased with its efforts to collect the
alleged debt, Defendant still would have been obligated to verify the debt. Under 15
U.S.C. § 1692g(a)(4), a debt collector must inform a consumer that if the consumer
timely notifies the debt collector in writing that the debt is disputed, the debt
collector will obtain verification of the debt and that such verification will be mailed
to the consumer by the debt collector. The statute could not have required such a
statement without intending that a debt collector be required to follow through with
the promise to obtain and send verification. Chief Judge Ezra of this District Court
has so held on multiple occasions. See, e.g., Powell v. J. J. Mac Intyre Co., Inc.,
2003 U.S. Dist. LEXIS 24699, Civ. No. 03-00402 DAE-BMK (D. Haw. Oct. 16, 2003);
De Coito v. Unifund Corp., Civ. No. 01-00379 DAE-BMK (D. Haw. June 4, 2002).
District Judge Mollway's holding in Sambor v. Omnia Credit Servs., Inc., 183 F.
Supp. 2d 1234 (D. Haw. 2002), is not applicable to the facts of this case. In Sambor,
the Court held that verification was not required where it was undisputed that the
defendant had ceased collection of the alleged debt and returned the account to the
prior creditor. Id. at 1242. Even if Defendant had ceased collection of the alleged
debt in this case, a hypothetical unsupported by the facts, no evidence has been
presented to this Court that Defendant returned the account to Citibank.
Finally, the Court finds unconvincing Defendant's attempt to characterize its June 14,
2002 letter as a verification. First, the letter expressly acknowledged that it was not
a verification by stating, "We are in the process of complying with your request to
verify the above referenced account. Same will be sent to you upon receipt." At the
very least, the letter's indication that Defendant was "in the process" of complying
with Plaintiff's verification request and that the verification "will be sent . . . upon
receipt" implied that the substantive information contained in the letter was not
Even if the June 14, 2002 letter had not contained statements casting doubt
on the accuracy of the information regarding Plaintiff's account, the
information contained in the letter would not have sufficed to verify the
debt. The only information disclosed in the letter was the date that the
account was opened, the date that the last payment was posted, the name
and social security number listed on the account, and the current balance.
The letter did not indicate the amount or basis of the charges underlying the
current balance, nor did it indicate the dates on which such charges were
incurred. See, e.g., Chaudhry v. Gallerizzo, 174 F.3d 394, 406 (4th Cir.
1999); [*30] Graziano v. Harrison, 950 F.2d 107, 113 (3d Cir. 1991);
Stonehart v. Rosenthal, 2001 U.S. Dist. LEXIS 11566, 2001 WL 910771, *7
(S.D.N.Y. Aug. 13, 2001). The letter also failed to indicate whether interest
was factored into the current balance, and, if so, at what rate and for what
time period. Particularly in this case, where Defendant added interest at a
rate different from the original, contractual rate for Plaintiff's account, the
limited information provided in the June 14, 2002 letter was insufficient to
verify the alleged debt.
The Court finds that Defendant's June 14, 2002 letter did not verify Plaintiff's alleged
debt. The letter was an express "attempt to collect a debt" following Defendant's
receipt of Plaintiff's verification request. Defendant, therefore, violated 15 U.S.C. §
1692g by continuing its efforts to collect the alleged debt without first obtaining and
sending verification of the debt to Plaintiff. The Court grants summary judgment to
Plaintiff on his § 1692g claim.
(6) Defendant's use of two account numbers to collect the debt [*38]
Plaintiff alleges that Defendant's use of two account numbers in its efforts to collect
the single debt allegedly owed by Plaintiff violated the FDCPA. Although Plaintiff does
not cite particular provisions of the FDCPA violated by such conduct, Plaintiff appears
to be alleging potential violations of §§ 1692d (harassment or abuse), 1692e (false
or misleading representations), and/or 1692f (unfair practices).
In evaluating whether Defendant violated the FDCPA with respect to its
characterization of Plaintiff's account, the Court must determine whether
the use of slightly distinct account and file numbers on the two letters,
respectively, would be confusing to the least sophisticated debtor. See, e.g.,
Terran v. Kaplan, 109 F.3d 1428, 1431-32 (9th Cir. 1997); Swanson v. Southern
Oregon Credit Services, Inc., 869 F.2d 1222, 1225 (9th Cir. 1988). The "least
sophisticated debtor standard" is "lower than simply examining whether particular
language would deceive or mislead a reasonable debtor." Swanson, 869 F.2d at
The notices at issue contained, in large part, the same information, set forth in the
same format. Notwithstanding [*39] the notices' similarities, they also
contained the following distinctions:
One notice was sent to, and listed, Defendant's post office box address. At
the top and bottom of the notice, the Account and RJM file numbers were
listed as "146240502A" and "32844948A", respectively. At the top, the RJM
file number was listed in large, bold print so as to draw attention to it.
The other notice was sent to, and listed, Defendant's residential street
address. The Account and RJM file numbers on were listed as "146240502B"
and "32844948B", respectively. As was the case with the notice sent to
Defendant's post office box address, the RJM file number at the top of this
notice appeared in large, bold print.
In sum, Defendant sent Plaintiff two distinct notices concerning its efforts
to collect a single debt, and Defendant characterized the debt by
referencing distinct account and RJM file numbers on each notice. Although
the letters were sent to two distinct addresses, clearly, Defendant sent both
letters with the hope, if not expectation, that Plaintiff would receive them.
Neither letter contained a statement indicating it was a copy of an original
notice sent to a separate address. A least [*40] sophisticated debtor likely
would have been confused and would believe that he was being dunned for
two, distinct accounts. Defendant, therefore, violated the FDCPA when it sent
Plaintiff two notices, listing two distinct account numbers, in its effort to collect a
In accordance with the foregoing,
IT IS HEREBY ORDERED:
(6) Plaintiff's request for statutory damages of $ 1,000.00 for the FDCPA violations is