Schik v. Miramed Revenue Group, LLC

Background

Sussie Schik sued Miramed Revenue Group, LLC, individually and on behalf of other similarly situated people, alleging violations of the Fair Debt Collection Practices Act. The complaint alleged that Miramed regularly collected debts for profit, that Schik owed a consumer debt, and that Miramed sent her an initial collection notice on April 12, 2018.

Schik challenged the notice in two ways. First, she alleged that the notice’s formatting overshadowed the validation rights required by 15 U.S.C. § 1692g. Second, she alleged that the notice falsely suggested that she could dispute the debt only in writing, violating §§ 1692g(a)(3) and 1692e. Miramed moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing that the complaint failed to state a legally sufficient claim.

Legal standard

The court applied the Rule 12(b)(6) standard, under which a complaint must contain enough factual matter to make the requested relief plausible. In evaluating the attached collection notice, the court applied the objective perspective of the “least sophisticated consumer”—a consumer without legal or debt-collection expertise, but not an unreasonable consumer.

For the validation-notice claim, the court explained that § 1692g requires debt collectors to communicate validation rights clearly. A notice violates that provision if other language overshadows or contradicts those rights. For the other claims, the court considered whether the notice was materially deceptive or reasonably open to an inaccurate interpretation.

Court’s analysis

The court rejected Schik’s claim that the validation rights were visually overshadowed. Although the validation language used smaller type than some other parts of the notice, the court found it easy to read. It was in the middle of the page and appeared in the same size type as nearby language about payment plans and settlement opportunities. The court also found that the notice’s use of larger, bold, capitalized, and white-on-black text did not make the validation rights unclear when the notice was read as a whole.

The court also rejected Schik’s claim that the notice suggested disputes had to be made in writing. The notice stated where to mail written notices, but that statement was far from the validation language, used a different typeface, and appeared in a stylistically separate section. The notice also prominently displayed a telephone number beneath “PLEASE CALL” without limiting that number to payment questions. The court concluded that the notice did not contradict the right to dispute the debt orally or make the least sophisticated consumer think that oral disputes were prohibited.

The court separately considered Miramed’s argument that Schik abandoned her § 1692e claim by failing to respond to the argument. It declined to dismiss the claim on that basis because, although Schik’s opposition was unclear, she did address the claim and Miramed’s arguments.

Disposition

The court held that Schik failed to state violations of § 1692g and §§ 1692g(a)(3) and 1692e. Judge Nelson S. Roman granted Miramed’s motion to dismiss with prejudice, dismissed Schik’s claims, and directed the Clerk to terminate the motion and the action.