Esterling v. Collecto, Inc.
- Summarized by Wayne Greenwald , Jacobs, PC, Greenwald, P.C.
- 12 years 4 months ago
- Citation:
- Easterling, v. Collecto, Inc., --- F.3d ----, 2012 WL 3734389, (2nd Cir. August 30, 2012) Case No. 11-3209-CV, (Per Curiam)
- Tag(s):
-
- Ruling:
- Reversed and Remanded. Defendant violated the FDCPA's proscription against “false, misleading, or deceptive” debt collection practices by sending Plaintiff, a former debtor, a collection letter incorrectly stating that her student loans were “ineligible for bankruptcy discharge” and therefore her account “must be resolved.” Although this Plaintiff may face significant hurdles to discharging her student loans, the least sophisticated consumer would interpret the as representing, incorrectly, that discharge of the loans was wholly unavailable.
- Procedural context:
- Appeals District Court (W.D.N.Y) granting defendant summary judgment and dismissing claim under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. (“FDCPA”)
- Facts:
- In 2001, Plaintiff filed Chapter 7 case. She scheduled a $2,469 student loan as “not dischargeable,” She did not attempt to discharge her student loan and it was not discharged.
In 2008, the Defendant, collection agency, sent the Plaintiff a letter stating “* * * * *ACCOUNT INELIGIBLE FOR BANKRUPTCY DISCHARGE* * * * *. Your account is NOT eligible for bankruptcy discharge and must be resolved,.” and offering options to pay the debt.
When the Plaintiff received the collection letter, it was technically possible to discharge her student loan. She could reopen her prior case or file a new case, and then commence an adversary proceeding to discharge the loan by proving undue hardship. Thus it was possible, though difficult, for her to overcome 11 U.S.C. § 523(a)(8)’s presumption of non-dischargeability
- Judge(s):
- Katzmann, Wesley, and Lynch, Circuit Judges
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