U.S. DISTRICT COURT

Rush v. Portfolio Recovery Associates, L.L.C.

CREDITORS' AND DEBTORS' RIGHTS

New Jersey Law Journal

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Rush v. Portfolio Recovery Associates, L.L.C., Civ. No. 12-2276; U.S. District Court (DNJ); opinion by Wolfson, U.S.D.J.; filed October 17, 2013. DDS No. 09-7-xxxx [36 pp.]

Plaintiffs Alma and Gregory Rush assert violations of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq., and a state law claim for invasion of privacy arising out of phone calls Portfolio Recovery Associates, L.L.C., a national debt collection agency, allegedly made to plaintiffs' home regarding a debt allegedly owed by Alma. Plaintiffs retained counsel, who sent a cease-and-desist letter to Portfolio on Jan. 26, 2012, that was logged into Portfolio's records on Jan. 31, 2012. They testified in deposition that calls continued through April 2012. None of Portfolio's phone calls were answered by plaintiffs, who allowed the phone to ring until their voicemail system picked up. No message was ever left but Portfolio's number and a portion of its business name was captured by plaintiffs' caller ID system.

Defendant moves for summary judgment dismissing all counts.

Held: As to the calls that occurred after the cease-and-desist letter, summary judgment is granted on the § 1692c(a)(1) claim as plaintiffs have failed to provide anything other than speculation that they received the calls at any inconvenient time; the § 1692c(a)(2) and (c) claims since Portfolio is entitled to the bona fide error defense under § 1692k(c); the § 1692f claim because it is premised on the same conduct complained of in plaintiffs' other claims; and on the state law invasion-of-privacy claim because a debt collector's persistent phone calls that only result in annoyance to a reasonable person cannot sustain an intrusion-on-seclusion claim. Summary judgment is denied on the § 1692d and § 1692d(5) claims since there is a genuine issue of material fact as to the number, frequency and timing of the calls.

The court notes that the FDCPA defines a "communication" as "the conveying of information regarding a debt directly or indirectly to any person through any medium." Plaintiffs cite a District of Connecticut opinion that found that unanswered phone calls to the plaintiff's home by the debt collector constituted communications because the collector's number and information were displayed on the caller ID. Portfolio points to several decisions concluding that unanswered phone calls do not constitute FDCPA communications. Other courts have found that different methods of contacting a consumer do not fall within the FDCPA's statutory definition of "communication" when there is no reference to a debt.

The court says the record discloses that plaintiffs initially did not know who Portfolio was or why it was calling. However, they knew, at least from the cease-and-desist letter, that Portfolio was a debt collector and it can reasonably be inferred that they knew it was calling with respect to a debt.

Therefore, the court concludes that prior to Jan. 26, 2012, plaintiffs did not know that Portfolio was attempting to deliver a message regarding a debt. Summary judgment is granted as to the claims under § 1692c(a)(1) (inconvenient communications), (a)(2) (communication after known representation by attorney), and (c) (communication after demand to cease), for any phone call before that date.

However, plaintiffs understood that the calls after they retained counsel were from a debt collector regarding a debt. As to those calls, the court finds that plaintiffs have failed to provide anything other than speculation that they were received at any inconvenient time. Therefore, the court grants Portfolio's motion with respect to § 1692c(a)(1).

As to claims of communication after known representation and after a demand to cease, plaintiffs challenge the accuracy of Portfolio's phone logs showing no calls after the cease-and-desist letter was recorded in their' account. Portfolio contends that should the court find that it communicated with plaintiffs after that date, it is entitled to a bona fide error defense since any communications were unintentional, the result of errors, and contrary to established procedures it has designed to avoid such errors.

The court holds that Portfolio has shown that it had reasonable precautions in place to avoid making the alleged phone calls after receipt of the cease-and-desist letter, including that its employees are trained, and regularly retrained, on the FDCPA. The court finds its procedures are objectively reasonable and that plaintiffs have failed to rebut the adequacy or reasonableness of such procedures. Summary judgment is granted to Portfolio on its bona fide error defense under § 1692k(c), shielding it from liability for the § 1692c(a)(2) and (c) claims.

As to the § 1692d (harassing, annoying or abusive conduct) and § 1692d(5) (intent to annoy, abuse or harass) claims based on Portfolio's causing the telephone to ring, the court says whether a debt collector engages in such conduct is ordinarily an issue of fact for the jury. Portfolio argues its records show only 39 unanswered phone calls over a one-year period, with only a handful between December 2011 and April 2012. However, plaintiffs dispute the number, frequency, and timing of the phone calls. The court says plaintiffs' assertions are enough to merit a genuine dispute of fact and summary judgment is denied on these claims.

As to the § 1692f claim of unfair or unconscionable means to collect a debt, courts have determined that § 1692f cannot be the basis of a separate claim for conduct that is already explicitly addressed by other sections of the FDCPA. Since the § 1692 claim is premised on the same conduct complained of in plaintiffs' other claims, Portfolio is granted summary judgment as to this count.

Lastly, as to the invasion-of-privacy claim premised on Portfolio's unreasonable intrusion on plaintiffs' seclusion, the court says that even if Portfolio called plaintiffs as often as they claim, the undisputed record shows that plaintiffs found the phone calls merely "irritating" and "annoying." Since case law is clear that persistent phone calls by a debt collector that only result in annoyance to a reasonable person cannot sustain an intrusion-on-seclusion claim, Portfolio's motion for summary judgment on this claim is granted.

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