Dina Klein v. Credico, Inc.

Credico, Inc., which is licensed and does business in Minnesota as CreditCollections Bureau, sent Dina Klein a debt collection letter under the business name“Credit Collections Bureau” in March 2017. Klein filed a lawsuit, arguing that thecontent of the letter violated the Fair Debt Collection Practices Act (“FDCPA”). 15

U.S.C. § 1692. The district court1 granted Credico’s motion to dismiss, see Fed. R.

Civ. P. 12(b)(6), and Klein appeals. We affirm.

Credico’s letter included the words “CREDIT-COLLECTIONS-BUREAU” in

the top right corner. Several lines below the letter included the words

“PROFESSIONAL DEBT COLLECTORS.” The letter also said that if Klein’s debt

was not paid and if it was necessary to file a lawsuit to collect the debt, “it could

result in a judgment . . . and that judgment could include . . . pre-judgment interest.”

The letter was sent to Klein in Minnesota and signed by three people, including Kathy

Mitchell, who was not registered to collect debts in Minnesota. Below the signatures,

the letter stated, “Pay on-line or correspond with CCB at www.payccb.com.”

The district court determined that the use of “PROFESSIONAL DEBT

COLLECTORS” and “CCB” was not false or misleading when viewed through the

eyes of an unsophisticated consumer, and it further determined that the use was

nevertheless immaterial. The district court also held that Mitchell’s signature and the

statement that Credico could seek pre-judgment interest did not violate the FDCPA.

Klein appeals the district court’s rulings on each of these aspects of the letter.

“We review a grant of a motion to dismiss de novo.” Keating v. Neb. Pub.

Power Dist., 562 F.3d 923, 927 (8th Cir. 2009). “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)

(internal quotation marks omitted). A claim is facially plausible “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.

1The Honorable David S. Doty, United States District Judge for the District of

Minnesota.

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Klein first argues that Credico violated the FDCPA by including“PROFESSIONAL DEBT COLLECTORS” in the top right hand corner of the letterand by including the statement that Klein could “[p]ay on-line or correspond withCCB at www.payccb.com” at the bottom of the letter. The FDCPA provides that “[a]debt collector may not use any false, deceptive, or misleading representation or meansin connection with the collection of any debt.” § 1692e. This includes “[t]he use ofany business, company, or organization name other than the true name of the debtcollector’s business, company, or organization.” § 1692e(14). Klein argues that theuse of “PROFESSIONAL DEBT COLLECTORS” and the acronym “CCB” violated§ 1692e(14) because they are organization names other than Credico’s true name.

When “evaluating whether a debt collection letter is false, misleading, ordeceptive in violation of § 1692e, the letter must be viewed through the eyes of anunsophisticated consumer.” Peters v. Gen. Serv. Bureau, Inc., 277 F.3d 1051, 1055(8th Cir. 2002). The district court correctly determined that an unsophisticatedconsumer would not think that including “PROFESSIONAL DEBT COLLECTORS”and “CCB” in the letter is false or misleading. An unsophisticated consumer wouldunderstand that “PROFESSIONAL DEBT COLLECTORS” and “CCB” respectivelydescribe and reference Credico. We agree with Credico that CCB is a commonsenseabbreviation of Credit Collections Bureau, Credico’s other registered name and thename it used in its letter to Klein, not a different company. And we agree that“PROFESSIONAL DEBT COLLECTORS” clearly describes what Credit CollectionsBureau is. Further, Credico’s letter provided Klein with a correct registered name,its phone number, its website, the balance due, and a name and phone number for herassigned collector.

Though Klein argues the district court “erred in dismissing [her] case at thepleading stage based on the court’s conjecture as to how an unsophisticated consumerwould interpret a collection letter,” the unsophisticated consumer test contains an“objective element of reasonableness” that “prevents liability for bizarre or

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idiosyncratic interpretations of collection notices.” Id. at 1055-56 (concluding “asa matter of law” that there was no violation of § 1692e). The district court’sdetermination was not based on conjecture. Rather, it was based on the correctobjective determination that an unsophisticated consumer would not have viewedCredico’s statements as false, deceptive, or misleading. See id. at 1056(“[S]tatements that are merely ‘susceptible of an ingenious misreading’ do not violatethe FDCPA.”). Thus, Klein has not pleaded sufficient factual matter to state aplausible claim that Credico violated § 1692e by including “PROFESSIONAL DEBTCOLLECTORS” and “CCB” in its letter to Klein.2

Second, Klein argues that Credico’s letter violated the FDCPA because theletter was signed by Mitchell, “who [was] not licensed by the Minnesota Departmentof Commerce to engage in debt collection activities in Minnesota.” See Minn. Stat.§ 332.33. The FDCPA stipulates that “[a] debt collector may not use unfair orunconscionable means to collect or attempt to collect any debt.” § 1692f. The statutelists conduct that it considers “unfair or unconscionable,” and Klein argues thatMitchell’s signature violates § 1692f(1), which prohibits “[t]he collection of anyamount . . . unless such amount is expressly authorized by the agreement creating thedebt or permitted by law” because “Minnesota law requires all individual debtcollectors to obtain licenses as a prerequisite to collecting consumer debts inMinnesota.”

But the FDCPA “was not meant to convert every violation of a state debtcollection law into a federal violation.” Carlson v. First Revenue Assur., 359 F.3d1015, 1018 (8th Cir. 2004). Here, the relevant signature was one of three signatures

2Klein also argues that the district court should not have imported a materiality

standard into § 1692e. We need not address this argument because Credico’s

statements were not false, deceptive, or misleading. But see Hill v. Accounts

Receivable Servs., LLC, 888 F.3d 343, 346 (8th Cir. 2018) (joining the Third, Fourth,

Sixth, Seventh, and Ninth Circuits in adopting a materiality standard for § 1692e).

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on the letter, and the other two signatories were both registered to collect debts inMinnesota. Further, Credico, doing business as Credit Collections Bureau, is licensedto collect debts in Minnesota, so it could legally collect the debt, and Mitchell’ssignature was not an unfair or unconscionable means to attempt to collect a debt. Cf.Goetze v. CRA Collections, Inc., No. 15-3169, 2017 WL 5891693 at *3 (D. Minn.Nov. 28, 2017) (finding that the collection agency violated the FDCPA by engagingin collection activities “without first being licensed”). Thus, we agree with thedistrict court that Klein has not pleaded sufficient factual matter to state a plausibleclaim that Credico violated §1692f(1) by having Mitchell be one of the signatoriesto the letter.

Finally, Klein argues that Credico improperly attempted “to collectprejudgment interest” because Minnesota Statute section 549.09 does not allow therecovery of pre-judgment interest here. She claims this attempt also violated§ 1692f(1). Credico’s letter said, “When suit is filed, it could result in a judgmentagainst you and that judgment could include . . . pre-judgment interest.” Credicoagrees that it could not have collected pre-judgment interest under section 549.09. Instead, Credico says it could seek pre-judgment interest pursuant to MinnesotaStatute section 334.01.

The district court properly concluded that Minnesota law does not prohibitCredico from seeking pre-judgment interest. We observed in Hill v. AccountsReceivable Servs., LLC that the Minnesota Supreme Court has not yet decidedwhether section 334.01 allows for the recovery of pre-judgment interest in a case suchas this. 888 F.3d at 346. We also determined that “the text of § 334.01 does notprohibit” recovering pre-judgment interest. Id. Thus, because it was not false tosuggest that Credico could collect pre-judgment interest, we conclude that Klein hasnot pleaded sufficient factual matter to state a plausible claim that Credico violated§ 1692f(1).

For the foregoing reasons, we affirm the district court’s dismissal.