Second Circuit Holds Law Firm’s Threatening Letter May Have Violated FDCPA

The United States Court of Appeals for the Second Circuit recently reversed a District Court decision and held that a law firm’s letter threatening imminent litigation may have violated the FDCPA.  See Mizrachi v. Wilson, Elser, Moskowitz, Edelman & Dicker LLP, 2020 WL 6494875 (2d Cir. Nov. 5, 2020).  The defendant law firm sent a collection letter to plaintiff seeking to collect a debt.  Although the letter included the standard validation notice informing the debtor of his right to dispute the debt within 30 days, it also include language that the firm had been instructed to commence a lawsuit, that there may be “no further notice” before the filing of the lawsuit, that a lawsuit could be avoided by paying “now,” and that the debtor may be liable for defendant’s attorneys’ fees in the lawsuit.  The debtor then brought this action under the FDCPA, alleging violations because (i) the language about an imminent lawsuit overshadowed the required 30-day validation notice, and (ii) the claim about attorneys’ fees was false.  Defendant filed a motion to dismiss, and the District Court dismissed the action.

On appeal, the Court reversed.  First, the Court found that the threatening language overshadowed the validation notice in violation of the FDCPA.  “Even if the letter does not literally demand immediate payment, these warnings, combined with the all-caps admonition that no further notice might follow before a lawsuit is filed, could have created the misimpression that immediate payment is the consumer’s only means of avoiding a parade of collateral consequences, thereby overshadowing the consumer’s validation rights.”  Likewise, the Court found that the claim regarding attorneys’ fees should not have been dismissed.  Although defendant claimed that plaintiff’s debt was incurred as a result of a contract that allows for such fees – in which case, the claim would not have violated the FDCPA – the Court found that the contract at issue was an “unsigned form contract” that “at most raises a factual dispute” about fees.

For a copy of the decision, please contact Michael O’Donnell at, Michael Crowley at, or Anthony Lombardo at