In Golden v. Benjamin, Judge Schroeder, of the United States District Court for the Middle District of North Carolina, denied Higgins Benjamin, PLCC’s (“Higgins”) motion to dismiss a class action claim brought by Mark and Geneva Golden under the Fair Debt Collection Practices Act.  In the Complaint, Plaintiffs alleged an FDCPA claim for failure to “inform Plaintiff[s] that the Debt will be assumed to be valid by Defendant” in the debt collection letter Higgins sent them.

The issue in the case was whether failing to include language identifying who specifically would be assuming the debt to be valid in a collection letter renders the notice misleading.

In that case, Higgins sent Plaintiffs a debt collection letter in April 2020 stating, in relevant part, “[u]nless you dispute the validity of this debt, or any portion, within 30 days after receipt of this letter, the debt will be assumed to be valid.” Plaintiffs alleged that Higgins violated the FDCPA, as the letter “fail[ed] to inform Plaintiff[s] that the Debt will be assumed to be valid by Defendant,” and asserted that a “least sophisticated consumer” could be “misled into believing that their debt will be determined to be valid by a court, credit reporting agency, or other authority.” Higgins argued that the collection letter was not misleading, as language in the same paragraph indicated Higgins “is a debt collector” and that, taken together as a whole, it was clear only Higgins was assuming the validity of the debt.

While the Court held that the FDCPA did not require a debt collector to “quote the statute’s language verbatim,” it reasoned that, in reading the FDCPA, it must “assume all language has a purpose,” including the inclusion of the term “debt collector” in each section. The Court found the reasoning in Fariasantos v. Rosenberg & Assocs., LLC persuasive, and accordingly held that “the key sentence, worded passively, [should be] “considered to ‘obscure’ the identity of who would consider the debt to be valid and for what purposes.” The Court found Higgins’ contention that the ambiguity was removed by inclusion of the statement “[t]his law firm is a debt collector” and identifying phrases such as “‘we,’ ‘us,’ and ‘our firm’ in other sentences in the paragraph,” unpersuasive, and reasoned that, as Higgins did not clearly indicate in the collection letter that only Higgins, as the debt collector, would assume the validity of the debt for collection purposes, a “least sophisticated consumer” would be misled by the ambiguity in the collection letter. Accordingly, the Court denied Higgins’ motion to dismiss.