221 F. Supp. 3d 292
E.D.N.Y2016Background
- Plaintiff Nicholas Zirogiannis received a May 14, 2015 collection letter from mortgage servicer Seterus concerning a residential mortgage loan he owed.
- The letter stated an amount "as of the date of this notice" but warned it was "not a payoff statement" and that a payoff might include additional third-party or future costs.
- Zirogiannis sued individually and as putative class representative under the FDCPA, alleging the letter failed to state the amount of the debt as required by 15 U.S.C. § 1692g(a)(1).
- Seterus moved to dismiss under Fed. R. Civ. P. 12(b)(1) (lack of Article III standing) and 12(b)(6) (failure to state an FDCPA claim), and also argued it was not a "debt collector" because the loan was not shown to be in default when servicing began.
- The parties briefed the effect of Spokeo v. Robins on standing; the court considered Plaintiff’s motion to strike portions of Defendant’s reply brief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Motion to strike reply arguments | Defendant’s reply is responsive; no unfair surprise | Reply raised new standing argument for first time | Denied — reply was responsive to issues in opposition |
| Article III standing (Spokeo) | Alleged statutory disclosure violation is a concrete, particularized injury; information deprivation suffices | Plaintiff alleges only a statutory violation without concrete harm | Denied — Plaintiff has standing; deprivation of FDCPA-mandated information is a concrete, particularized injury |
| Whether Seterus is a "debt collector" under FDCPA | Seterus regularly services loans that are delinquent; Plaintiff’s loan was one such loan (therefore debt collector) | The complaint fails to allege the loan was in default when Seterus began servicing it; mere delinquency is not default | Granted for Defendant — complaint fails to plead that loan was in default when acquired, so Seterus not shown to be a debt collector |
| Sufficiency of FDCPA claim / disposition | Letter violated §1692g by not stating the amount; seeks statutory damages | Failure to plead the debt was in default defeats §1692 liability; move to dismiss | Granted — complaint dismissed with prejudice for failure to state a claim |
Key Cases Cited
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (Sup. Ct.) (injury-in-fact must be concrete and particularized; statutory violations can be concrete if they cause or risk real harm)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (Sup. Ct.) (elements of Article III standing)
- Ashcroft v. Iqbal, 556 U.S. 662 (Sup. Ct.) (plausibility standard for Rule 12(b)(6))
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (Sup. Ct.) (pleading must be plausible)
- Alibrandi v. Financial Outsourcing Services, Inc., 333 F.3d 82 (2d Cir.) (mortgage servicer is a "debt collector" under the FDCPA only if the loan was in default when servicing began)