District Court (N.J.) Dismisses FDCPA Class Action Based on Letter Allegedly Threatening Legal Action Because Letter Disclaimed Attorney Review and “Settlement” and “Amnesty” Words Used Did Not Threaten Legal Action

Powell claims that the Aldous letter threatens legal action in violation of Section 1692e(5). In that respect, he argues, this letter is distinguishable from the letters in Eddis, Hamilton, and Davis. First, Powell argues that Aldous’s letter contains legal language such as the words “amnesty,” “settlement,” and “obligation,” which he suggests may be interpreted by the least sophisticated consumer as threatening legal action. This argument is unavailing. Section 1692e(5) prohibits a debt collector from threatening to take action that it cannot legally take or does not intend to take. A debt collector may violate this section by threatening certain legal actions. See Brown v. Card Serv. Ctr., 464 F.3d 450, 452-53 (3d Cir. 2006); Davis, 855 F. Supp. 2d at 284. The Aldous letter, however, does not threaten legal action. There is not, for instance, threats to sue, attach personal property, or use legal procedures if the payment is not made. The use of words such as “amnesty,” “settlement,” or “obligation” falls far short of any such threat.  Second, Powell asserts that the three district court cases interpreting Lesher—i.e., Eddis, Hamilton, and Davis—all involved law firms licensed to practice in the state in which the consumer lived. (Pl. Br. 11). According to Powell, those firms at least could take legal action against the debtors. Aldous, however, is not licensed to practice in New Jersey; thus, says Powell, the letter threatens legal action that Aldous cannot take. As stated above, however, the premise of this argument is invalid; the Aldous letter does not threaten legal action at all. Whether or not any Aldous attorneys are licensed to practice in New Jersey does not change that analysis. The Aldous letter thus does not violate section 1692e(5); see Davis, 855 F. Supp. 2d at 284.⁷