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RAIMONDI v. MCALLISTER & ASSOCIATES

June 15, 1999

LISA M. RAIMONDI, PLAINTIFF,
v.
MCALLISTER & ASSOCIATES, INC., DEFENDANT.



The opinion of the court was delivered by: Gettleman, District Judge.

MEMORANDUM OPINION AND ORDER

Plaintiff Lisa M. Raimondi has filed a complaint against defendant McAllister & Associates, Inc., alleging violations of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. Plaintiff alleges that defendant violated § 1692e(5) and 1692e(10) by threatening to contact plaintiff's employer, and that defendant violated § 1692c(a)(2) by contacting her by telephone and letter after she had notified defendant that she was represented by counsel. Plaintiff also argues that the $1,000 statutory cap for actual damages is a per violation cap, not a per case cap, and that therefore she should receive $1,000 for each provision defendant violated. Defendant has filed a motion to dismiss. Defendant has also filed a motion for sanctions, alleging that plaintiff admitted to having spent all of the money she received from the state court's default judgment.*fn1 Plaintiff has filed a cross motion for summary judgment, and has requested punitive damages.*fn2

FACTS

Plaintiff alleges that defendant sent her a letter dated September 24, 1997, demanding the payment of a debt. The letter, a copy of which was attached to the complaint as Exhibit A, states, in relevant part: "This is to put you on notice that a professional collector will investigate your financial situations through credit reporting agencies, employers, banks and other lending institutions. If we determine you have the ability to pay, your account could be referred to McAllister & Associates Litigation Department." On September 29, 1997, counsel for plaintiff sent defendant a letter stating, "This is to inform you that we represent the above-referenced client." Although the letter was addressed to defendant's post office box and was not returned to plaintiff as undeliverable, defendant claims that it never received the letter. According to plaintiff, defendant contacted plaintiff three times by letter and once by telephone after plaintiff's attorneys sent the letter announcing their representation.

LEGAL STANDARDS

In deciding a Fed.R.Civ.P. 12(b)(6) motion to dismiss, the court considers "whether relief is possible under any set of facts that could be established consistent with the allegations." Bartholet v. Reishauer A.G., 953 F.2d 1073, 1078 (7th Cir. 1992). A claim may be dismissed only if it is beyond doubt that under no set of facts would the plaintiff's allegations entitle him to relief. See Travel All Over the World, Inc. v. Kingdom of Saudi Arabia, 73 F.3d 1423, 1429-30 (7th Cir. 1996). For purposes of a motion to dismiss, the court accepts the factual allegations of the complaint as true and draws all reasonable inferences in favor of the plaintiff. See Travel All Over the World, 73 F.3d at 1428.

Under Fed.R.Civ.P. 56(c), a court should grant a summary judgment motion if "there is no genuine issue of material fact and . . . the moving party is entitled to judgment as a matter of law." See Kreutzer v. A.O. Smith Corp., 951 F.2d 739, 743 (7th Cir. 1991). The burden is on the moving party to identify portions of the pleadings, answers to interrogatories, and affidavits which demonstrate an absence of a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The burden then shifts to the non-moving party to "set forth specific facts showing that there is a genuine issue for trial." Fed. R.Civ.P. 56(c). When reviewing a summary judgment motion, the court must read the facts in a light most favorable to the non-moving party. See Anderson v. Liberty Lobby Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

DISCUSSION

I. Claimed FDCPA Violations

A. Section 1692e(5)

Plaintiff alleges that defendant's statement, "a professional collector will investigate your financial situations through . . . employers," violated § 1692e(5) because it amounted to a threat to contact her employer. Section 1692e(5) prohibits a debt collector from threatening to take an action that cannot legally be taken. Section 1692c(b) prohibits a debt collector from communicating with third parties, including a debtor's employer. See Sluys v. Hand, 831 F. Supp. 321, 326 (S.D.N.Y. 1993) (holding that mailing a letter to a debtor's employer violates § 1692c(b)).

Taken in conjunction with § 1692c(b), § 1692e(5) forbids a debt collector from threatening to communicate with a debtor's employer. See Swanson v. Southern Oregon Credit Serv., Inc., 869 F.2d 1222, 1227 (9th Cir. 1988) ("Because section 1692c(b) prohibits uncontested and unauthorized communication with a debtor's employer concerning the debt, the threat constitutes a `threat to take any action that cannot legally be taken'" in violation of § 1692e(5)); Herbert v. Wexler & Wexler, 1995 WL 535107, *2 (N.D.Ill. Sept.5, 1995) ("Reading § 1692c(b) together with § 1692e(5), the Court concludes that the FDCPA, specifically § 1692e(5), does forbid a debt collector from threatening to contact a third party [such as a debtor's employer] in connection with the collection of a debt."); Rutyna v. Collection Accounts Terminal, Inc., 478 F. Supp. 980, 982 (N.D.Ill. 1979) (holding that a letter that read, "Our field investigator has now been instructed to make an investigation in your neighborhood and to personally call on your employer," violated § 1692e(5) because it "constitute[d] a false representation of the actions that defendant could legally take.").

Defendant argues that the letter does not violate § 1692e(5) because the Fair Credit Reporting Act, 15 U.S.C. § 1681b(3)(A), allows a debt collector to obtain credit reports on a debtor. This court need not consider this defense, however, because it is irrelevant if threatening to contact a debtor's employer violates the FDCPA. Defendant cites Adams v. Law Offices of Stuckert & Yates, 926 F. Supp. 521 (E.D.Pa. 1996), for the proposition that a debt collector is entitled to communicate with a debtor at his place of employment. Adams is inapposite. Plaintiff does not allege that defendant contacted her or threatened to contact her at her place of ...


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