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Derosia v. Credit Corp Solutions Inc.

United States District Court, E.D. Wisconsin

March 27, 2018

DENISE DEROSIA, Plaintiff,
v.
CREDIT CORP SOLUTIONS, INC d/b/a TASMAN CREDIT CORP, Defendant.

          ORDER

          WILLIAM E. DUFFIN, U.S. MAGISTRATE JUDGE.

         INTRODUCTION

         Plaintiff Denise Derosia filed this lawsuit against defendant Credit Corp. Solutions, Inc., d/b/a Tasman Credit Corp (Tasman), alleging claims under the Fair Debt Collection Practices Act (FDCPA) and the Wisconsin Consumer Act (WCA). (ECF No. 1.) Both parties have consented to the full jurisdiction of a magistrate judge. (ECF Nos. 5, 8.) Tasman moves for dismissal under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted, and under Rule 12(b)(1) for failure to plead standing. (ECF No. 12.) The parties have fully briefed the motion, which is ready for resolution.[1]

         FACTS

         Tasman is a “receivables management company that purchases and collects consumer debt including unpaid retail finance and sales finance credit cards and personal loans.” (ECF No. 1, ¶ 12.) Tasman is licensed with the Wisconsin Department of Finance as a “Sales Finance Company.” (ECF No. 13 at 2.) Tasman is registered with the Utah Department of Commerce as a “Collection Agency.” (ECF No. 1, ¶ 8.) Tasman held a Wisconsin collection agency license between July 1, 2014, and April 11, 2017, after which that license expired. (ECF No. 1, ¶ 32.)

         On September 20, 2017, Tasman purchased a $2, 142.22 debt from Synchrony Bank - Care Credit Weight Loss (Debt) incurred by Derosia. (ECF No. 13 at 2.) On October 9, 2017, Tasman mailed Derosia Tasman's Validation Notice (Notice), informing her of the assignment of the Debt and the outstanding balance. (ECF No. 1, ¶ 21.) On the back of the Notice was a sentence that read: “This collection agency is licensed by the Division of Banking in Wisconsin Department of Financial Institutions, www.wdfi.org.” (ECF No. 1, ¶¶ 26-27.)

         Derosia alleges that this statement is false and misleading because Tasman is not licensed as a collection agency by the Division of Banking or any other Wisconsin governmental agency and was not so licensed at the time the Notice was sent to her. (ECF No. 1, ¶¶ 28-31.) Derosia alleges that, as a result of this false statement, she was confused and had to spend time and money investigating the Notice and the consequences of any potential responses to it. (ECF No. 1, ¶¶ 34-36.)

         MOTION TO DISMISS STANDARD

         “To survive a motion to dismiss under Rule 12(b)(6), a complaint must provide enough factual information to ‘state a claim to relief that is plausible on its face' and ‘raise a right to relief above the speculative level.'“ Thulin v. Shopko Stores Operating Co., 771 F.3d 994, 997 (7th Cir. 2014) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Accepting as true all well-pleaded facts, the court determines whether they give rise to an entitlement of relief. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009).

         ANALYSIS

         FDCPA

         The FDCPA prohibits the use of any “false, deceptive, or misleading representation or means in connection with the collection of any debt.” Boucher v. Finance System of Green Bay, Inc., 880 F.3d 362, 366 (7th Cir. 2018) (citing 15 U.S.C. § 1692e). The FDCPA also prohibits the “use or distribution of any written communication … which creates a false impression as to its source, authorization, or approval.” 15 U.S.C. § 1692e(9).

         To state a claim under § 1692e Derosia must plausibly allege that the Notice would materially mislead or confuse an unsophisticated consumer. See Boucher, 880 F.3d at 366. “Because this inquiry involves a fact-bound determination of how an unsophisticated consumer would perceive the statement, dismissal is only appropriate in cases involving statements that plainly, on their face, are not misleading or deceptive.” Id. (citing Marquez v. Weinstein, Pinson & Riley, P.S., 836 F.3d 808, 812, 814-15 (7th Cir. 2016)). When ruling on a Rule 12(b)(6) motion, a district court “must tread carefully before holding that a letter is not confusing as a matter of law” because “district judges are not good proxies for the ‘unsophisticated consumer' whose interest the statute protects.” Boucher, 880 F.3d at 367 (citing McMillan v. Collection Prof'ls., Inc., 455 F.3d 754, 759 (7th Cir. 2006)). The unsophisticated consumer is considered uninformed, naive, or trusting, but nonetheless deemed to possess rudimentary knowledge about the financial world and capable of making basic logical deductions. Durkin v. Equifax Check Servs., Inc., 406 F.3d 410, 414 (7th Cir. 2005).

         A statement cannot mislead for purposes of the FDCPA unless it is material. Hahn v. Triumph P'ships, LLC 557 F.3d 755, 758 (7th Cir. 2009). The FDCPA is designed to provide information that helps consumers choose intelligently, and by definition immaterial information neither contributes to that objective (if the statement is correct) nor undermines it (if the statement is incorrect). Id. at 757-58. To be material, a statement must “influence a consumer's decision … to pay a debt.” Boucher, 880 F.3d at 366 (quoting Muha v. Encore Receivables Management, Inc., 558 F.3d 623, 628 (7th Cir. 2009)). Even a statement that is false in a technical sense does not violate the FDCPA if it would not ...


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