United States District Court, D. South Carolina, Charleston Division
BELICIA SMITH, individually and on behalf of all others similarly situated, Plaintiff,
DYNAMIC RECOVERY SOLUTIONS LLC, LVNV FUNDING LLC, and JOHN DOES 1-25, Defendants.
C. NORTON, UNITED STATES DISTRICT JUDGE
matter is before the court on defendant Dynamic Recovery
Solutions LLC (“Dynamic Recovery”) and defendant
LVNV Funding LLC's (“LVNV”) (collectively,
“defendants”) joint motion to dismiss, ECF No. 9.
For the reasons set forth below, the court grants the motion.
Plaintiff Belicia Smith (“Smith”) allegedly
incurred a debt to Regional Finance Corporation of South
Carolina (“RFC”) some time prior to January 16,
2018. Smith alleges that RFC issued funds to her on credit,
and she was unable to make the required payments due to
financial constraints. As a result, the debt, totaling
$960.68, went into default. LVNV then allegedly purchased the
debt and contracted with Dynamic Recovery to collect the
received a letter from Dynamic Recovery dated January 16,
2018 seeking to collect the debt (“the Letter”).
The Letter offers Smith several repayment options. The first
option permits Smith to resolve her account in full if she
makes a payment of $384.27 by March 2, 2018. The second
option offers full resolution of the account with a total
amount due of $432.31, made in two payments of $216.16
each. The third option offers Smith to resolve
her account in full with four payments of $120.09 each. The
Letter states that the total amount due under this final
option is $480.34; however, the sum of four payments of
$120.09 is actually $480.36. Smith argues that this
difference “is an attempt to collect an amount greater
than allowed under the proposed offer” and is confusing
and misleading. Compl. ¶¶ 42-48.
addition, at the bottom of the Letter, there is language that
states “[t]he law limits how long you can be sued on a
debt. Because of the age of your debt, LVNV Funding LLC will
not sue you for it. If you do not pay the debt, LVNV Funding
LLC may report it to the credit reporting agencies as
unpaid.” ECF No. 1-1 at 2. Smith alleges that this
language is deceiving because it “implies that [LVNV]
has chosen not to sue . . . instead of the true fact that
neither [LVNV] nor [Dynamic Recovery] nor any subsequent
creditor/collector can file a lawsuit.” Compl. ¶
result, Smith filed a proposed class action complaint
alleging violations of the Fair Debt Collection Practice Act
(“FDCPA”) pursuant to 15 U.S.C. §§
1692e and 1692f. Defendants filed a joint motion to dismiss
on March 19, 2019. ECF No. 9. Smith responded on April 16,
2019, ECF No. 13, and defendants replied on April 23, 2019,
ECF No. 15. The motion is fully briefed and ripe for review.
12(b)(6) motion for failure to state a claim upon which
relief can be granted “challenges the legal sufficiency
of a complaint.” Francis v. Giacomelli, 588
F.3d 186, 192 (4th Cir. 2009) (citations omitted); see
also Republican Party of N.C. v. Martin, 980 F.2d 943,
952 (4th Cir. 1992) (“A motion to dismiss under Rule
12(b)(6) . . . does not resolve contests surrounding the
facts, the merits of a claim, or the applicability of
defenses.”). To be legally sufficient, a pleading must
contain a “short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). A Rule 12(b)(6) motion should not be
granted unless it appears certain that the plaintiff can
prove no set of facts that would support his claim and would
entitle him to relief. Mylan Labs., Inc. v. Matkari,
7 F.3d 1130, 1134 (4th Cir. 1993). When considering a Rule
12(b)(6) motion, the court should accept all well-pleaded
allegations as true and should view the complaint in a light
most favorable to the plaintiff. Ostrzenski v.
Seigel, 177 F.3d 245, 251 (4th Cir.1999); Mylan
Labs., Inc., 7 F.3d at 1134. “To survive a motion
to dismiss, a complaint must contain sufficient factual
matter, accepted as true, to ‘state a claim to relief
that is plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
“A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.” Id.
FDCPA protects consumers from abusive and deceptive practices
by debt collectors, and protects non-abusive debt collectors
from competitive disadvantage.” United States v.
Nat'l Fin. Servs., Inc., 98 F.3d 131, 135 (4th Cir.
1996). Specifically, the FDCPA prohibits the “use [of]
any false, deceptive, or misleading representation or means
in connection with the collection of any debt.” 15
U.S.C. § 1692e. It is a violation of § 1692e, among
other things, to: (1) falsely represent the character,
amount, or legal status of any debt, id. §
1692e(2); (2) threaten to take any action that cannot be
legally taken, id. § 1692e(5); or (3) use
“any false representation or deceptive means to collect
or attempt to collect any debt or to obtain information
concerning a consumer, ” id. § 1692e(10).
In a similar vein, § 1692f prohibits the “use [of]
unfair or unconscionable means to collect or attempt to
collect any debt.” To state a claim for a FDCPA
violation, the plaintiff must allege that “(1) the
plaintiff has been the object of collection activity arising
from consumer debt; (2) the defendant is a debt collector as
defined by the FDCPA; and (3) the defendant has engaged in an
act or omission prohibited by the FDCPA.” Ruggia v.
Washington Mut., 719 F.Supp.2d 642, 647 (E.D. Va. 2010),
aff'd, 442 Fed.Appx. 816 (4th Cir. 2011). “Whether
a communication is false, misleading, or deceptive in
violation of § 1692e is determined from the vantage of
the ‘least sophisticated consumer,' evaluating how
that consumer would interpret the allegedly offensive
language.” Powell v. Palisades Acquisition XVI,
LLC, 782 F.3d 119, 126 (4th Cir. 2014) (citation
Smith alleges that “[d]efendants made deceptive and
misleading representations” based on the language that
LVNV chose not to sue Smith in violation of 15 U.S.C.
§§ 1692e, 1692e(2), 1692e(5), and 1692e(10). Compl.
¶ 55. Smith also alleges that defendants made false,
misleading, and unfair misrepresentations by offering Smith a
payment option with terms that “deceptively attempted
to collect more than the amount of the offer” in
violation of 15 U.S.C. §§ 1692e, 1692e(2),
1692e(10), and 1692f. Compl. ¶¶ 56, 61. Defendants
argue that Smith's complaint should be dismissed because
(1) the statute of limitations disclosure language does not
violate the FDCPA, and (2) the payment option amount
discrepancy was a rounding error that does not violate the
FDCPA. The court agrees and finds as a matter of law that the
conduct alleged by Smith is not a violation of the FDCPA.
Statute of Limitations Disclosure Language
defendants argue that the statute of limitations disclosure
language at the end of the Letter does not violate the FDCPA.
The language states that “[t]he law limits how long you
can be sued on a debt. Because of the age of your debt, LVNV
Funding LLC will not sue you for it. If you do not pay the
debt, LVNV Funding LLC may report it to the credit reporting
agencies as unpaid.” ECF No. 1-1 at 2. Smith alleges
that stating that LVNV “will not sue” is
deceiving when LVNV cannot sue due to the statue of