Park v. Dynamic Recovery Solutions, LLC
1:20-cv-01671
| E.D.N.Y | Aug 13, 2021Background
- Plaintiff Juhyeon Park obtained a Visa store credit card, fell behind in 2007, and the account was charged off and later handled by Pinnacle; Dynamic Recovery sent an April 15, 2019 collection letter seeking $38,263.48 with an itemized $17,759.50 in post–charge-off interest.
- Park sued under the FDCPA on behalf of a putative class, alleging the letter (1) overstated the debt by including unlawful post–charge-off interest and (2) misidentified Pinnacle as the current creditor without notifying him of a transfer.
- Defendants produced evidence of the chain of title (US Bank → Fourscore Resource Capital → Pinnacle) and showed interest had ceased accruing by April 25, 2016.
- The parties cross-moved for summary judgment; the Court reviewed the claims under the "least sophisticated consumer" FDCPA standard and Rule 56 summary-judgment law.
- The Court granted defendants’ motion and denied Park’s cross-motion, finding no FDCPA violation on the issues presented.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether listing post‑charge‑off interest on the itemization violated §§1692g(a)(1), 1692e, 1692e(2)(A), 1692e(10) | Park: Interest cannot lawfully accrue after charge‑off; the listed interest overstates the debt | Defs: No legal prohibition on post‑charge‑off interest; itemization is accurate and not misleading | Court: Rejected Park; inclusion of interest did not violate §§1692g or 1692e; summary judgment for defendants |
| Whether failing to state that interest is no longer accruing (i.e., that the debt is "static") rendered the letter misleading | Park: Omitting that interest ceased is deceptive and misleading under §1692e | Defs: No affirmative duty to disclose that interest is not accruing; Taylor controls | Court: Followed Taylor; omission is not misleading where consumer can repay the stated amount; no FDCPA violation |
| Whether naming Pinnacle as the current creditor without explaining the chain of ownership violated §1692g(a)(2) | Park: He never dealt with Pinnacle and had no notice of a sale; letter thus deceptive | Defs: FDCPA requires only naming the current creditor; defendants produced chain‑of‑title evidence | Court: Naming Pinnacle satisfied §1692g(a)(2); defendants’ evidence unrebutted; summary judgment for defendants |
Key Cases Cited
- Jacobson v. Healthcare Fin. Servs., Inc., 516 F.3d 85 (2d Cir. 2008) (articulating the "least sophisticated consumer" standard in FDCPA cases)
- Avila v. Riexinger & Assocs., LLC, 817 F.3d 72 (2d Cir. 2016) (holding letters that fail to disclose that interest will continue accruing can be deceptive)
- Taylor v. Fin. Recovery Servs., Inc., 886 F.3d 212 (2d Cir. 2018) (holding no FDCPA duty to disclose a debt is static where the letter gives sufficient information to repay the stated amount)
- Clomon v. Jackson, 988 F.2d 1314 (2d Cir. 1993) (rejecting reliance on "bizarre or idiosyncratic" consumer interpretations)
- Bentley v. Great Lakes Collection Bureau, 6 F.3d 60 (2d Cir. 1993) (noting FDCPA is a strict liability statute; intent to deceive not required)
- Russell v. Equifax A.R.S., 74 F.3d 30 (2d Cir. 1996) (describing §1692g validation notice requirements)
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment burden rules)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (materiality and summary judgment standards)