New Jersey Federal Court Holds That Collection Letter Informing Debtor That He Could Call Debt Collector if He Had Insurance Coverage for the Debt Violated the FDCPA

The United States District Court for the District of New Jersey recently granted the plaintiff debtor’s motion for summary judgment and held that a debt collection letter stating, “[i]f you carry any insurance that may cover this obligation, please contact [the defendant debt collector’s] office at the number above” violated the Fair Debt Collection Practices Act (“FDCPA”).  See Kassin, v. AR Resources, Inc., 2018 WL 6567703 (D.N.J. Dec. 13, 2018).  In the putative class action, defendant debt collector sent a collection letter to plaintiff that contained the requisite validation notice that plaintiff could dispute the debt in writing within 30 days of receipt of the letter.  However, before including this language, the letter stated “[i]f you carry any insurance that may cover this obligation, please contact [defendant’s] office at the number above.”  Plaintiff then filed this action, arguing that the validation notice stating that plaintiff had to dispute the debt in writing—which is required by 15 U.S.C. 1692g—was overshadowed by this language stating plaintiff could call defendant.  The Court denied defendant’s motion to dismiss and, after discovery, the parties cross-moved for summary judgment.

The Court denied defendant’s motion and granted plaintiff’s, finding that the letters violated the FDCPA.  Although the Court acknowledged that “the case before me presents a close call,” it held: 

A least sophisticated debtor could reasonably interpret that language to mean that to the extent the debtor believes that an insurance provider is responsible for payment of a portion of the debt (e.g., if the debtor only believes he or she is responsible for a co-payment), or the whole debt, he or she may dispute the debt obligation by calling [defendant], rather than disputing the debt in writing.  In other words, the least sophisticated debtor could reasonably be misled into calling — rather than writing — to dispute a debt by claiming that the insurance provider is the liable party.

Based on this potential to mislead consumers in violation of the FDCPA, the Court granted plaintiff’s motion for summary judgment.

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