18th Annual Workplace Class Action Report - 2022 Edition

592 Annual Workplace Class Action Litigation Report: 2022 Edition Moyer, et al. v. Patenaude & Felix, 2021 U.S. App. LEXIS 7566 (3d Cir. March 16, 2021). Plaintiff filed a class action alleging that Defendant sent her a collection letter that violated the Fair Debt Collection Practices Act (“FDCPA”). Defendant’s letter stated that the debtor should call Defendant “to "eliminate further collection action." Id . at *1. Plaintiff asserted that the letter: (i) deceived debtors by making them think a phone call was a "legally effective" means of ceasing collection activity, and (ii) made debtors uncertain about their right to dispute a debt in writing. Id . Defendant filed a motion for summary judgment, which the District Court granted. On Plaintiff’s appeal, the Third Circuit affirmed the District Court’s ruling. Plaintiff contended that Defendant’s statement that it would “eliminate” collection actions if the debtor were to call Defendant would deceive the debtor into believing that the call would, by law, require collection efforts to cease. Id . at *7. The Third Circuit determined that Plaintiff was reading an implication into the language of the letter that the phone call would force Defendant to cease collection efforts, which, in effect, it never stated that the phone call itself would do such a thing. Accordingly, the Third Circuit affirmed the District Court’s ruling granting Defendant’s motion for summary judgment. Shepherd, et al. v. Debt Recovery Solutions Of Ohio, Inc. , 2021 U.S. Dist. LEXIS 77253 (N.D. Ohio April 22, 2021). Plaintiff, a debtor, filed a class action alleging that Defendant’s debt collection letter it sent to him violated the Fair Debt Collection Practices Act ("FDCPA"). Defendant filed a motion to dismiss, which the Court granted. Defendant sent Plaintiff a letter concerning a debt in connection with healthcare services, which stated that the debt could be paid by credit card with an additional 3% transaction fee. Plaintiff contended that he did not agree to the transaction fee and that Defendant was not permitted to attempt to collect it. Id . at *2. Plaintiff further alleged that "Defendant misled and deceived Plaintiff into the belief that he falsely owed an additional 3% transaction fee” when such a charge was a violation of the FDCPA. Id . Defendant argued that Plaintiff failed to allege an injury-in-fact sufficient to confer standing. The Court agreed. The Court opined that the allegations in the complaint mischaracterized the plain language of the letter, which stated that there would be an additional 3% fee in the event the debt was paid with a credit card. The letter also explained that “you are not required to make payments with a debit or credit card." Id . at *4-5. The Court reasoned that even if even if it were to assume that the fee violated the FDCPA, Plaintiff only alleged that the violation could have caused him harm, but not that it actually did cause any harm. The Court held that, at most, Plaintiff asserted that Defendant may have caused him to have the mistaken belief that he could be charged a 3% transaction fee on a credit card payment in the future. Id . at *5-6. The Court held that this possible future harm was insufficient to establish standing. For these reasons, the Court granted Defendant’s motion to dismiss. Tataru, et al. v. RGS Financial , 2021 U.S. Dist. LEXIS 581 (N.D. Ill. Jan. 4, 2021). Plaintiff, a debtor of Defendant, filed a class action asserting violations of the Fair Debt Collection Practices Act (“FDCPA”). Specifically, Plaintiff defaulted on his credit card account with the First National Bank of Omaha, and the bank assigned the debt to Defendant. In turn, Defendant subsequently sent Plaintiff a dunning letter in which it identified First National Bank of Omaha as “FNB Omaha II.” Id. at *1. According to Plaintiff, this abbreviated identification of the bank constituted misleading and confusing communications, which were prohibited by the FDCPA. Plaintiff filed a motion for class certification, and both parties also filed cross-motions for summary judgment as to liability under the FDCPA. The Court granted Plaintiff’s motions and denied Defendant’s cross- motion for summary judgment. As a threshold matter, Defendant argued that Plaintiff lacked standing because he did not suffer an injury-in-fact. Id. at *4. However, the Court rejected that defense. It noted that Defendant’s letter caused Plaintiff to suspect fraud, and that “a failure to identify the correct creditor is not the kind of ‘bare procedural violation’ that was insufficient to confer standing.” Id. at *9. As to Plaintiff’s motion for class certification, the Court determined that Plaintiff satisfied the numerosity, commonality, and typicality requirements of Rule 23. Defendant attempted to assert an affirmative defense pursuant to a class waiver allegedly executed by Plaintiff with the bank, but the Court refused to consider this defense because it was raised for the first time in opposition to class certification. Defendant further contended that Plaintiff failed to show that the debt at issue was consumer debt (as is required by the FDCPA), citing Plaintiff’s credit card purchase from a company co-owned by Plaintiff. The Court held, however, that Seventh Circuit case law authority had rejected this same argument because, if it were accepted, “then it is difficult to imagine any FDCPA class being certified.” Id. at *17-18. Defendant also argued that the retainer agreement between Plaintiff and his attorney created a potential conflict with the putative class by forcing Plaintiff to pay all attorneys’ fees if he accepted a settlement against the advice of counsel. Id. at *19-20. The Court acknowledged that this issue