The Northern District of Illinois recently held that a collection letter sent to a consumer's attorney seeking payment on a debt discharged in bankruptcy did not violate the Fair Debt Collection Practices Act based on the "competent lawyer" standard. The case is Grajny v. Credit Control, LLC, No. 18-C-2719, 2018 U.S. Dist. LEXIS 173682, 2018 WL 4905019 (N.D. Ill. Oct. 9, 2018).
After plaintiff Halina Grajny obtained a bankruptcy discharge, Credit Control, LLC sent a collection letter to her bankruptcy attorney regarding a debt discharged in the bankruptcy. The letter stated that it was "from a debt collector" and was "an attempt to collect a debt." The letter further stated that unless Grajny disputed the validity of the debt, it would be "assumed . . . valid," and directed her to pay the balance of her debt.
Grajny filed suit, alleging violation of the FDCPA, codified at 15 U.S.C. 1692, et seq., by (1) misrepresenting the "character, amount, or legal status" of the debt (§ 1692e(2)); (2) using "false representations" or "deceptive means" (§ 1692e(10)); (3) engaging in "unfair or unconscionable means" (§ 1692f); and (4) using "false, deceptive, or misleading" methods (§ 1692e). Credit Control moved to dismiss for failure to state a claim.
The Court noted at the outset that, in evaluating potential FDCPA violations, communications to an attorney are reviewed under a different standard than those sent directly to a consumer. Specifically, with regard to an alleged false, deceptive, or misleading representation to a consumer's attorney, the relevant inquiry is "whether a competent attorney, even if she is not a specialist in consumer debt law, would be deceived by" the subject collection letter.
Based on this standard, the Court found that Grajny failed to state a claim under the FDCPA because "[a] competent attorney that represents a plaintiff in a bankruptcy proceeding would not be deceived by a letter seeking to collect a debt that was discharged in the same bankruptcy proceeding."
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