Courts Rule No FDCPA Violations in Separate Cases

The appearance of consumers’ account numbers on the outside of envelopes containing letters from debt collection agencies does not violate the Fair Debt Collection Practices Act, two New York federal judges recently ruled in separate cases.

Southern District Judge Colleen McMahon and Western District Judge John Curtin declined to follow a ruling last year from the U.S. Court of Appeals for the Third Circuit that has caused concern among many in the collection industry by stating that the appearance of an account number with the addressee's name on a collection envelope violated the FDCPA.

In the latest cases, McMahon ruled, in Perez v. Global Credit and Collection, that the eight-digit account number Yajaira Perez objected to was "meaningless to anyone other than someone at Global Credit."

"Even the fact that it is an account number says nothing about whether the plain white envelope contained a debt collection communication, as opposed to a renewal notice, a special offer to consumer, or any of the other myriad junk mail communications that arrive in plain white envelopes with glassine windows on a daily basis in the mailboxes of America," McMahon wrote.

In Gelinas v. Retrieval-Masters Creditors Bureau, Curtin ruled that "nothing about the series of letters and numbers above the addressee's name intimates that the contents of the envelope relate to the collection of a delinquent debt, and the visibility of these numbers and letters is neither threatening nor embarrassing."

Markings on the envelope received by consumer Lucienna Gelinas were benign, the court said. An exception that courts have recognized under the FDCPA for benign, unidentifiable markings on creditors' communications should apply, Curtin wrote.Plaintiffs Perez and Gelinas had cited Douglass v. Convergent Outsourcing, the September 2014 ruling by the Philadelphia-based Third Circuit. In that case, the court ruled that Convergent violated the FDCPA by sending a letter where the debtor's account number appeared through the envelope's transparent address window. 

Formerly ER Solutions, Convergent sent the letter in 2011 to pursue a debt allegedly owed to T-Mobile.  

The Third Circuit held that a consumer's account number with a collection agency was "not meaningless" and when coupled with the name of the addressee could potentially identify the consumer as a debtor.

But in Perez v. Global Credit and Collection, McMahon wrote that the Third Circuit's analysis in Douglass was "unsupported by any analysis."

McMahon and Curtin agreed that the FDCPA seeks to prohibit wording on envelopes that identifies addressees as debtors, thus causing them possible embarrassment or worse, but that the coding visible on envelopes in the cases before them was indecipherable to members of the public.

Both judges wrote that the courts have come to recognize an exception under the FDCPA for communications from creditors with "benign" words or notations that cannot be construed as being threatening to consumers or designed to cause them embarrassment because they owe money.

In March, an Illinois federal court dismissed another FDCPA case involving a collection account number being visible on an envelope containing a collection letter. 

The court, in Sampson v. MRS BPO LLC, held that simply placing an undecipherable sequence of numbers and symbols on the outside of an envelope cannot constitute an abusive collection practice as outlined by the FDCPA. In short, the mere presence of such internal tracking numbers, markings or codes on such an envelope cannot serve as a legitimate basis for an FDCPA action, according to the court.