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Boucher v. Finance System of Green Bay, Inc.

United States District Court, E.D. Wisconsin

May 30, 2017

RYAN BOUCHER, HEATHER BOUCHER, CHRISTOPHER DETTLOFF, and ADAM DUCH, on behalf of themselves and all others similarly situated, Plaintiffs,


          William C. Griesbach, Chief Judge United States District Court

         Plaintiffs Ryan Boucher, Heather Boucher, Christopher Dettloff, and Adam Duch sued Defendant Finance System of Green Bay, Inc., for violating the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. (“FDCPA”). Plaintiffs allege that Finance System sent debt collection letters which falsely stated that the balances owed might increase “due to interest, late charges and other charges, ” even though Finance System had no authority or intent to charge “late charges and other charges.” On April 10, 2017, Finance System moved to dismiss Plaintiffs' complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons below, the motion to dismiss will be granted.


         The following allegations are taken directly from Plaintiffs' complaint and are accepted as true for the purpose of the motion to dismiss. Ameritech Corp. v. McCann, 297 F.3d 582, 585 (7th Cir. 2002). Each named plaintiff is alleged to have incurred and defaulted on a financial obligation for medical services. Compl. (ECF No. 1), ¶¶ 22, 45, 66. The creditor of those medical debts then assigned, placed, or transferred the debt to Finance System for collection. Id. at ¶¶ 27, 50, 71.

         Finance System sent a collection letter to each of the plaintiffs, which included the following statement:

As of the date of this letter, you owe $ [stated amount]. Because of interest, late charges, and other charges that may vary from day to day, the amount due on the day you pay may be greater. Hence, if you pay the amount shown above, an adjustment may be necessary after we receive your check. For further information, write to the address above or call [listed number].

Ex. A (ECF No. 1-1); Ex. B (ECF No. 1-2); Ex. C (ECF No. 1-3).

         Plaintiffs allege upon information and belief that late charges or other charges could never be lawfully imposed on the medical debts, that late charges or other charges were never imposed, and that Finance Services never intended to impose late charges or other charges. Compl. ¶¶ 35-41, 56-62, 77-83. They acknowledge, however, that Finance System is entitled to collect interest on the medical debts and that Finance System retains the collected interest as profit. Id. at ¶¶ 44, 65, 86.

         Based on these allegations, Plaintiffs claim that Finance System's collection letters are materially false, deceptive, and misleading in violation of the FDCPA. They allege that Finance System's letters falsely suggest to unsophisticated consumers that their debt will increase an undisclosed amount every day due to “late charges and other charges”; that the letters make false threats to take action that cannot be legally taken and/or that is not intended to be taken; that Finance System is using false representations and/or deceptive means to collect or attempt to collect a debt; and that Finance System fails to provide the amount of the debt. Id. at ¶ 104.

         Finance System has moved for dismissal for failure to state a claim. Finance System contends that the statement of debt in its collection letters does not violate the FDCPA because the language used is nearly identical to the safe harbor language the Seventh Circuit held satisfied the debt collector's duty to state the amount of the debt in Miller v. McCalla, Raymer, Padrick, Cobb, Nichols & Clark, LLC, 214 F.3d 872, 876 (7th Cir. 2000). Finance System also argues that because Finance System was authorized by the creditor to add 5% interest per year on Plaintiffs' accounts, the letters were not materially false, deceptive, or misleading in violation of the FDCPA. Exs. A-C.


         A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the complaint to state a claim upon which relief may be granted. Fed.R.Civ.P. 12(b)(6). Rule 8(a)(2) mandates that a complaint need only include “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). The Supreme Court has held that a complaint must contain factual allegations that “raise a right to relief above the speculative level.” Bell Alt. Corp. v. Twombly, 550 U.S. 544, 555 (2007). While a plaintiff is not required to plead detailed factual allegations, he or she must plead “more than labels and conclusions.” Id. A simple, “formulaic recitation of the elements of a cause of action will not do.” Id. In evaluating a motion to dismiss, the court must view the plaintiff's factual allegations and any inferences reasonably drawn from them in a light most favorable to the plaintiff. Yasak v. Retirement Bd. of the Policemen's Annuity & Benefit Fund of Chi., 357 F.3d 677, 678 (7th Cir. 2004).


         The Fair Debt Collection Practices Act is aimed at remedying the use of “abusive, deceptive, and unfair debt collection practices.” 15 U.S.C. § 1692(a). “Among other things, the FDCPA regulates when and where a debt collector may communicate with a debtor, restricts whom a debt collector may contact regarding a debt, prohibits the use of harassing, oppressive, or abusive measures to collect a debt, and bans the use of false, deceptive, misleading, unfair, or unconscionable means of collecting a debt.” Gburek v. Litton Loan Servicing LP, 614 F.3d 380, 384 (7th Cir. 2010) (citing §§ 1692, 1692c-1692f). Two threshold criteria must be met for a claim under the FDCPA: the defendant must be a “debt collector” and “the communication that forms the basis of the suit must have been made ‘in connection with the collection of any debt.'” Id. (citing ยงยง 1692c(a)-(b), 1692e, 1692g). Here, the parties do not dispute for the ...

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