Vu v. Diversified Collection Services, Inc.
2013 U.S. Dist. LEXIS 142093
| E.D.N.Y | 2013Background
- Plaintiff Pauline Yu sued Diversified Collection Services, Inc. (DCS) in 2010 alleging FDCPA violations from DCS debt-collection communications.
- Two classes were proposed: Class A (timeliness of validation notice) and Class B (language in validation notices).
- The October 5, 2010 phone call between Yu and a DCS representative marked the first live contact; the October 15, 2010 debt-collection letter followed.
- An automatic system glitch prevented an initial demand letter for Yu, and a broader glitch affected 192 of 26,065 NY accounts processed between 2009–2010.
- The court denied Class A certification, granted Class B certification, and resolved summary-judgment issues, including FDCPA timeliness, overshadowing/false representations, and the bona fide error defense.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Class A can be certified under Rule 23(a) and (b)(3). | Yu contends common questions predominate. | DCS argues individualized inquiries prevent predominance. | Class A fails; predominance not satisfied. |
| Whether Class B can be certified under Rule 23(a) and (b)(3). | Language in form notices is uniform and central to claims. | Class B lacks commonality or predominance. | Class B certified; common issues predominate. |
| Whether the October 15th Letter overshadowed or contradicted the validation notice under 1692g(a). | Letter’s wording misleads by urging phone contact and denial of written dispute. | Letter interpreted by least sophisticated consumer as acceptable; not overshadowing. | Overshadowing established; violates 1692g(a) as to Class B. |
| Whether the false representation/undue effect claims under 1692e(10) are viable given the timing of the notice. | Untimely validation notice supports 1692e(10). | Untimeliness alone does not prove false representations. | Evidence supports 1692e and 1692e(10) violations for the stated claims. |
| Whether the Bona Fide Error Defense precludes liability on timeliness and content claims. | Defense partially denied; triable issues exist; summary judgment denied for some claims. |
Key Cases Cited
- Brown v. Kelly, 609 F.3d 467 (2d Cir. 2010) ( Rule 23 analysis and class action prerequisites guidance)
- Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (U.S. 2011) (commonality and predominance considerations in class actions)
- Ramos v. SimplexGrinnell L.P., 796 F. Supp. 2d 346 (E.D.N.Y. 2011) (concurrent handling of class certification and summary judgment)
- Easterling v. Collecto, Inc., 692 F.3d 229 (2d Cir. 2012) (objective standard for FDCPA communications; least sophisticated consumer)
- Clomon v. Jackson, 988 F.2d 1314 (2d Cir. 1993) (definition of communication under FDCPA)
- Savino v. Computer Credit, Inc., 164 F.3d 81 (2d Cir. 1998) (overshadowing/deceptive-acts considerations under FDCPA)
- Omogbeme v. Risk Mgmt. Alternatives, Inc., 2003 WL 21909773 (E.D.N.Y. 2003) (timeliness/settlement-period considerations in unequally timed notices)
- Gallo v. Prudential Residential Servs., L.P., 22 F.3d 1219 (2d Cir. 1994) (summary judgment standard and burden on movant)