Kalkstein v. Collecto, Inc.

304 F.R.D. 114, 2015 U.S. Dist. LEXIS 2019, 2015 WL 59246
CourtDistrict Court, E.D. New York
DecidedJanuary 5, 2015
DocketNo. 13-cv-2621 (ADS)(AKT)
StatusPublished
Cited by13 cases

This text of 304 F.R.D. 114 (Kalkstein v. Collecto, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kalkstein v. Collecto, Inc., 304 F.R.D. 114, 2015 U.S. Dist. LEXIS 2019, 2015 WL 59246 (E.D.N.Y. 2015).

Opinion

MEMORANDUM OF DECISION & ORDER

SPATT, District Judge.

This ease arises out of the attempted collection by the Defendant Collecto, Inc. (the “Defendant”) of a debt allegedly owed by the Plaintiff Eli Kalkstein (the “Plaintiff’) to the New York Institute of Technology (“N.Y. Tech”) for tuition expenses. On April 30, 2013, the Plaintiff filed a complaint asserting that the Defendant violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. (“FDCPA”) and seeking (i) statutory damages, (ii) compensatory damages, (iii) attorneys’ fees and litigation expenses, (iv) a declaratory judgment that the Defendant violated the FDCPA, and (v) any other relief the Court deems proper.

Presently before the Court is a motion by the Plaintiff for an order permitting this case to proceed as a class action against the Defendant pursuant to Federal Rule of Civil Procedure (“Fed. R. Civ.P.”) 23. For the reasons set forth below, the Court grants the Plaintiffs motion.

I. BACKGROUND

A. Annunziato v. Collecto, Inc., 293 F.R.D. 329, 333 (E.D.N.Y.2013)

As an initial matter, the Court notes that it certified a class in Annunziato v. Collecto, Inc., 293 F.R.D. 329, 333 (E.D.N.Y.2013) (Spatt, J.), which was substantially similar to the proposed class in the instant case. The plaintiff in Annunziato, similar to the Plaintiff here, was a former student at N.Y. Tech who received a letter from the Defendant in which the Defendant sought to collect a debt from him for tuition expenses and charge him a collection fee of forty-two percent of the principal balance of his alleged debt to N.Y. Tech. Id. at 332.

[?]*?As discussed in more detail below, the letter sent by the Defendant to class members in Annunziato differed slightly from the letter at issue in the instant case. In particular, the letter at issue in Annunziato was sent by the Defendant to the plaintiff on May 16, 2012 and stated “our client has the right to take further steps to collect this account.” Annunziato, 293 F.R.D. at 332. Here, the Defendant sent a letter to the Plaintiff on January 16, 2013, which stated, “[w]e may report information about your account to credit bureaus.” (Am. Compl., Ex. A).

However, the Court finds these distinctions to be immaterial because the claims involve the same core allegations against the Defendant—namely, that the Defendant (i) sent proposed class members a letter purporting to collect a debt that may be time-barred; (ii) improperly purported to charge the class members with collection fees even though N.Y. Tech and the class members had not entered into an agreement regarding collection fees; and (iii) improperly inflated collection fees and expenses to intimidate the class members into paying the putative debt. See Annunziato, 293 F.R.D. at 336 (“In this case, [the] [p]laintiff alleges that the [defendant directed the same unlawful conduct toward the [p]laintiff and the proposed class by allegedly sending to all proposed class members identical form letters which improperly imposed a 42% collection fee and deceptively threatened to take ‘further steps’ in debt collections.”).

Therefore, the Court finds Annunziato to be directly applicable to this ease. As is set forth below, this ease, together with other FDCPA eases, militate toward granting the Plaintiffs present motion.

B. The Instant Case

In the instant ease, the Plaintiff is a citizen of New York State who resides in this District. (Am. Compl. at ¶ 2.) The Defendant is a company that engages in the collection of debts allegedly owed to others. (Id. at ¶ 6.)

On an unspecified date, N.Y. Tech hired the Defendant to collect a debt allegedly owed by the Plaintiff to N.Y. Tech for tuition expenses. (Id. at ¶ 14.) In that regard, on January 16, 2013, the Defendant sent a letter that detailed the Plaintiffs alleged debt as follows:

Principal: $5,172.00
Interest: $0.00
Fees/Coll Costs: $2,216.57
Other Accounts: $0.00
Total Due: $7,388.57

(Id.) The fees and collection costs listed in the letter consisted of forty three percent of the principal of the alleged debt that the Plaintiff owed to the Defendant. (Am. Compl. at ¶ 19.) The Plaintiff alleges that he never agreed to pay forty three percent of the principal as fees and collection costs in connection with his debt to N.Y. Tech. (Id. at ¶ 21.) The Plaintiff further alleges that the Defendant intentionally inflated its collection fees and costs to “intimidate and scare [the] Plaintiff into paying the so-called ‘Principal.’” (Id.)

The letter further states: “[N.Y. Tech] has placed your account with us for collection. This is a demand for payment of your debt. We urge you to remit payment to our office, unless you dispute this debt____ We may report information about your account to credit bureaus.” (Am. Compl., Ex. A.)

As of January 16, 2013, when the Defendant mailed the letter to the Plaintiff, he alleges that he had not attended or been a student at N.Y. Tech for more than 14 years. (Am. Compl. at ¶ 13.) The Plaintiff asserts that Defendant is legally prohibited from reporting a debt to credit bureaus that is more than eight years old. (Id. at ¶ 25.) As a result, the Plaintiff further asserts that the Defendant’s statement that it “may report information about your account to credit bureaus” is false because the period during which the Defendant could report the debt to credit bureaus had expired. (Id. at ¶ 19.) However, the Plaintiff does not specify the statute or body of law which allegedly provides for an eight year statute of limitations for reporting debts to credit bureaus.

The Defendant sent letters to 360 individuals with a mailing address in New York State who allegedly attended N.Y. Tech using language that was “identical” to the language that the Defendant used in its January 16, 2013 letter to the Plaintiff. (The Def.’s Re[118]*118sponses to the Pl.’s First Set of Interrogatories at 2.)

The Plaintiff alleges that by sending these letters, the Defendant violated FDCPA § 1692. The amended complaint defines the proposed class as follows:

All individuals who (a) have mailing addresses within New York State; (b) who between July 20, 2012 and April 30, 2013; (c) were sent a collection letter in a form materially identical or substantially similar to the form letter sent by the Defendant to the Plaintiff; (d) regarding a debt that was outside the permissible credit reporting period; (e) or containing a collection fee that had not been previously authorized by agreement with N.Y. Tech; (f) which was not returned by the postal service as undelivered.

(Am. Compl. at ¶ 31.)

II. DISCUSSION

A. Legal Standards

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Cite This Page — Counsel Stack

Bluebook (online)
304 F.R.D. 114, 2015 U.S. Dist. LEXIS 2019, 2015 WL 59246, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kalkstein-v-collecto-inc-nyed-2015.