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Judge Says 'Please Call' Note About Insurance Coverage Voided Collection Letter, Certifies Class

U.S. District Judge Freda Wolfson of the District of New Jersey/photo by Carmen Natale

It was "a close call," the judge said, but a debt collection letter's invitation to "please call" the collector to discuss the possibility of insurance coverage was found to violate the federal Fair Debt Collection Practices Act.

U.S. District Judge Freda Wolfson of the District of New Jersey granted summary judgment to the plaintiff and certified a class of plaintiffs in the decision, where she "declined to impose on the least sophisticated debtor the obligation to draw a narrow legal distinction between 'resolving' and 'disputing' a debt."

"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," Wolfson wrote on Dec. 13 in Kassin v. AR Resources, adding that the Third Circuit "has taken a broad view of what types of 'call' language contradict or overshadow a validation notice."

She added, "Although even the least sophisticated debtor is charged with reading the entirety of the collection letter, including the validation notice that follows the insurance language at issue, under these circumstances, it is plausible that the least sophisticated debtor would interpret the offending language as providing that he or she could also dispute the debt through a legally invalid method—calling Defendant."

According to the decision, plaintiff Rafael Kassin in February 2016 received a one-page letter from defendant AR Resources Inc. seeking to collect $3,757 for "SELECT MEDICAL — KESSLER." Among the letter's contents were a validity notice, required by the FDCPA, stating that the debt would be assumed valid unless "you notify this office in writing within 30 days," and a separate message stating: "If you carry insurance that may cover this obligation, please contact ARR's office at the number above."

Kassin's suit alleged violations of two sections of the FDCPA: 1692g, which gives consumers a 30-day window to dispute a debt in writing, and 1692e, which prohibits using false or deceptive means to collect debts.

Wolfson last year denied AR Resources' motion for dismissal, finding that Kassin made out a claim that the collection letter could misguide consumers because, in addition to including the statutorily required validity language, it also invited the recipient to "please call" to discuss possible insurance coverage.

In granting Kassin's motion for summary judgment on Dec. 13, Wolfson relied on three Third Circuit decisions, including Caprio v. Healthcare Revenue Recovery Grp. from 2013 and Laniado v. Certified Credit & Collection Bureau from 2017. In the former, the court held that "'please call' language in the collection letter overshadowed and contradicted the validation notice, because it could be interpreted by the least sophisticated debtor as providing that he or she could dispute a debt by phone," and in the latter, the court said a collection letter inviting the recipient to call "should there be any discrepancy" was "materially indistinguishable from the letter at issue in Caprio," Wolfson said.

AR Resources argued that prior decisions, including Wilson v. Quadramed from the U.S. Court of Appeals for the Third Circuit in 2000, required dismissal of Kassin's case, but the letters at issue in those cases "include language that merely invites the debtor to call the debt collector to provide information other than potential insurance coverage, such as attorney information or payment details."

AR Resources also pointed to more recent decisions where courts found that similar "please call" notes didn't thwart the FDCPA: Cruz v. Fin. Recoveries from the District of New Jersey (2016) and Anela v. AR Resources from the Eastern District of Pennsylvania (2018).

The courts in those cases "rested on a distinction between 'resolving' and 'disputing' a debt to find that the alleged offending language there did not contradict or overshadow the required language in the validation notice," Wolfson said.

"While I acknowledge that the case before me presents a close call, and appreciate the distinction that these courts have drawn between disputing a debt and resolving a debt, under the relevant standard, I find that the insurance language in this case is so closely related to disputing a debt that it could mislead the least sophisticated debtor into forgoing his or her statutory right to effectively dispute a debt, i.e., in written form," Wolfson wrote.

Wolfson noted that the "please call" notice in AR Resources' collection letter had come up earlier this year in another case before her, Morello v. AR Resource, and that she had turned back the collector's legal arguments in that case, too.

The judge certified a class of plaintiffs who between July 2015 and July 2016 received a collection notice like the one Kassin received, a class with 2,350 potential members, she said. The motion for class certification was not opposed by AR Resources.

Wolfson named Kassin's counsel, Marcus & Zelman in Asbury Park, counsel to the class.

Ari Marcus, a partner at that firm, didn't return a call seeking comment on Wolfson's ruling.

Neither did Mark Fischer Jr. of High Swartz in Norristown, Pennsylvania, who represents AR Resources.