United States District Court, E.D. Wisconsin
Stadtmueller U.S. District Judge
plaintiff, Modesta Bencomo (“Bencomo”), alleges
in her amended complaint several causes of action, both on
behalf of herself and on behalf of a putative class, for
violations of the Fair Debt Collection Practices Act
(“FDCPA”) and the Wisconsin Consumer Act
(“WCA”). (Docket #14). The alleged violations
arise out of a debt collection letter she received from
Forster & Garbus LLP (“Forster”) regarding
her delinquent Target-brand credit card account. Id.
She has sued Forster, the debt collector who sent the letter;
TD Bank USA, N.A. (“TD Bank”), who issued and
held Bencomo's credit card account; and Target
Corporation (“Target”), the servicer of the
store-branded credit card account.
October 23, 2018, Forster filed a motion to dismiss
Bencomo's amended complaint. (Docket #18). On December 3,
2018, TD Bank and Target filed a joint motion to dismiss the
amended complaint. (Docket #25). Both motions are fully
briefed and ripe for adjudication. For the reasons stated
below, both must be granted.
STANDARDS OF REVIEW
Rule 12(b)(6) Standard
defendants have moved to dismiss Bencomo's amended
complaint pursuant to Federal Rule of Civil Procedure
12(b)(6) for failure to state a viable claim for relief. To
state a viable claim, a complaint must provide “a short
and plain statement of the claim showing that the pleader is
entitled to relief.” Fed.R.Civ.P. 8(a)(2). In other
words, the complaint must give “fair notice of what the
. . . claim is and the grounds upon which it rests.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)
reviewing Bencomo's amended complaint, the Court is
required to “accept as true all of the well-pleaded
facts in the complaint and draw all reasonable inferences in
[Plaintiff's] favor[.]” Kubiak v. City of
Chi., 810 F.3d 476, 480-81 (7th Cir. 2016) (citation
omitted). Dismissal is appropriate only “if it appears
beyond doubt that the plaintiff could prove no set of facts
in support of [her] claim that would entitle [her] to the
relief requested.” Enger v. Chi. Carriage Cab
Corp., 812 F.3d 565, 568 (7th Cir. 2016).
Seventh Circuit, FDCPA claims are evaluated under the
objective “unsophisticated consumer standard.”
Gruber v. Creditors' Prot. Serv., Inc., 742 F.3d
271, 273 (7th Cir. 2014). Such a person may, on one hand, be
“uninformed, naive, or trusting, but on the other hand
[she] does possess rudimentary knowledge about the financial
world, is wise enough to read collection notices with added
care, possesses reasonable intelligence and is capable of
making basic logical deductions and inferences.”
Id. (internal quotation marks omitted).
Additionally, “while the unsophisticated consumer may
tend to read collection letters literally, [she] does not
interpret them in a bizarre or idiosyncratic fashion.”
Id. at 274 (internal quotation marks omitted). If
not even “a significant fraction of the population
would be misled” by the debt collector's letter,
dismissal is required. Id. (quoting Zemeckis v.
Global Credit & Collection Corp., 679 F.3d 632, 636
(7th Cir. 2012)).
in the Seventh Circuit treat the question of whether an
unsophisticated consumer would find certain debt collection
language misleading as a question of fact. Lox v. CDA,
Ltd., 689 F.3d 818, 822 (7th Cir. 2012). To frame the
court's analysis of that question, the Seventh Circuit
has set out three categories of § 1692e cases.
Id. The first category includes cases in which the
allegedly offensive language is plainly not misleading.
Id. In these cases, “no extrinsic evidence is
needed to show that the reasonable unsophisticated consumer
would not be confused by the pertinent language.”
Id. The second category includes language that is
not misleading or confusing on its face but has the potential
to be misleading to the unsophisticated consumer.
Id. If a case falls into this category, the
plaintiff must produce “extrinsic evidence, such as
consumer surveys, to prove that unsophisticated consumers do
in fact find the challenged statements misleading or
deceptive.” Id. The final category includes
cases involving letters that are plainly deceptive or
misleading, and therefore do not require any extrinsic
evidence for the plaintiff to prevail. Id. at 801.
around June 12, 2018, Forster, a New York law firm engaged in
the business of debt collection, mailed a letter to Bencomo
regarding a debt she owed to “TD BANK USA, N.A. -
CREDITOR/TARGET CREDIT CARD” (hereinafter, the
“Letter”). (Docket #14-1). TD Bank issues and
holds credit card accounts, including store-brand credit card
accounts from merchants like Target and other retail stores.
Target is the servicer of Target store-branded credit card
debt Forster was attempting to collect was a store-branded
credit card account, used only for Bencomo's purchase of
household goods at Target stores. Bencomo believes the Letter
is a form letter, generated by a computer, with the
information specific to her inserted by computer.
Letter is printed on Forster's letterhead and identifies
Forster as a “New York law firm.” Id.
The subject line indicates that the “MINIMUM AMOUNT due
by July 8, 2018” was $392.00 and the “FULL
BALANCE” was $2, 019.38. Id. The first
sentence of the Letter states that “[t]he above
referenced account has been referred to this firm for
collection. The Full Balance shown above is the full amount
owed as of the date of this letter.” Id. The
Letter goes on to explain that “[t]he Minimum Amount
Due shown above is an amount that if paid by the due date
above will bring your account to a current status and stop
collections (unless your account goes past due in the
future). The account will then be returned to our
Letter then provides statutorily-mandated information about
Bencomo's right to dispute the validity of the debt and
her timeframe for doing so, known as the validation period.
Id. Finally, the Letter closes with information
about how to pay the debt, as well as this language about
Forster's role in collecting the debt:
At this time we are only acting as a debt collector.
Attorneys may act as debt collectors. Our firm will not
commence a suit against you. However, if we are not able to
resolve this account with you, our client may consider
additional remedies to recover the balance due. . . . Please
note that we are required, under federal law to advise you
that we are debt collectors and any information we obtain
will be used in attempting to collet this debt.
alleges that at the time this Letter was mailed to her, no
attorney at Forster had reviewed any documentation underlying
the alleged debt. No. attorney at Forster had exercised his
or her professional judgment to determine that Bencomo was
delinquent in her debt and a candidate for legal action.
Finally, Bencomo also alleges that TD Bank and Target
approved the language in Forster's debt collection
letters, including the language described above.
One, Two, and Three of Bencomo's amended complaint,
lodged only against Forster, allege violations of the FDCPA.
Count One alleges that the Letter creates the false
impression that an attorney at Forster had personally
reviewed the circumstances of Becomo's debt, in violation
of 15 U.S.C. §§ 1692e, 1692e(3), 1692e(10), and
1692f. Count Two alleges that the Letter represents to the
consumer that Forster, the creditor, or some other attorney
“may consider additional remedies” during the
validation period without explaining how those
“additional remedies” fit together with the
consumer's right to dispute the debt, in violation of 15
U.S.C. §§ 1692e, 1692e(5), 1692e(10), 1692g(a)(4),
and 1692g(b). Count Three alleges that the Letter equivocates
as to whether Forster was attempting to resolve the entire
account or was attempting to collect only the minimum
payment, in violation 15 U.S.C. §§ 1692e,
1692e(2)(A), 1692e(10), and 1692g(a)(1).
Four is the only claim lodged against all defendants. In it,
Bencomo alleges a violation of the WCA based on the Letter
giving the false impression that an attorney at Forster had
personally reviewed the circumstances of Bencomo's debt.
As to TD Bank and Target in particular, Bencomo alleges they
authorized Forster to misrepresent its degree of attorney
involvement and approved the ambiguous language that purports
to disclaim meaningful attorney involvement.
Count One: FDCPA Violation Based on Attorney-Involvement
FDCPA is intended, as its name suggests, to “eliminate
abusive debt collection practices.” 15 U.S.C. §
1692(e). It contains a number of subsections which regulate
certain debt collection practices. In the first Count of her
amended complaint, Bencomo claims that Forster's Letter
violated two of those subsections. The first is Section
1692e, which prohibits the use of false or misleading
representations in the collection of a debt. Id.
§ 1692e. The second is Section 1692f, which disallows
the use of “unfair or unconscionable means” in
collecting debts. Id. § 1692f. Each of these
subsections have, in turn, enumerated subparts providing
specific examples of prohibited conduct. Id.
§§ 1692e, f. Bencomo cites specifically to the
subparts at §§ 1692e(3) (prohibiting the
“false representation or implication that any
individual is an attorney or that any communication is from
an attorney”) and 1692e(10) ...