Seventh Circuit Holds Complaint’s Validation Notice Violated FDCPA

The United States Court of Appeals for the Seventh Circuit recently held that a misleading validation notice in a debt collection complaint violated the fair Debt Collection Practices Act (“FDCPA”) because it would mislead an unsophisticated consumer as to his or her method and deadline to dispute the claim.  See Marquez v. Weinstein, Pinson & Riley, P.S., 2016 WL 4651403 (7th Cir. Sept. 7, 2016).  In the case, the debt collectors filed complaints against consumers, and each complaint included a provision stating “the debt referenced in this suit will be assumed to be valid and correct if not disputed in whole or in part within thirty (30) days from the date hereof.”  The consumers filed a putative class action against the debt collectors, claiming that this validation notice violated the FDCPA.  The debt collectors filed a motion to dismiss for failure to state a claim which the district court granted.  On appeal, the Seventh Circuit reversed the lower court’s dismissal.  First, it joined the other circuits that have addressed the issue and found that pleadings or filing in court can be subject to the FDCPA.  See, e.g., Kaymark v. Bank of Am., N.A., 783 F.3d 168 (3d Cir. 2015), cert. denied sub nom. Udren Law Offices, P.C. v. Kaymark, 136 S. Ct. 794 (2016).  Second, it found that the validation notice violated the FDCPA because it would mislead an unsophisticated consumer.  See 15 USC §1692e.  The debt collectors here had previously sent dunning letters to the consumers which stated that “unless you dispute this debt, or any portion of it, within 30 days from receipt of this notice, we will assume the debt to be valid” and that the consumers could dispute the debt by either calling a toll free number or writing to a specific law office.  The complaints, however, stated that “the debt referenced in this suit will be assumed to be valid” unless disputed within 30 days, without clarifying that it would only be assumed valid by the debt collectors and not by the court.  Based on this language, an unsophisticated consumer could believe that his or her time to answer the complaint was only thirty days from the date of the complaint, which was less than the time provided by law.  Additionally, because the validation notice in the complaint mirrored that of the dunning letters, the consumers might be misled to believe they could contest the complaint by calling the toll free number or writing to the law firm.  Therefore, the notice’s “presence in the complaint serves no purpose, . . . [and] is only to mislead” and constituted a violation of the FDCPA.

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