18‐1292‐cv
Corwise v. FMS Investment Corp.
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION
TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND
IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS
COURT=S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT
FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR
AN ELECTRONIC DATABASE (WITH THE NOTATION ASUMMARY ORDER@). A PARTY
CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT
REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second
Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley
Square, in the City of New York, on the 19th day of March, two thousand
nineteen.
PRESENT: DENNIS JACOBS,
GUIDO CALABRESI,
DEBRA ANN LIVINGSTON,
Circuit Judges.
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐X
CINDY R. CORWISE,
Plaintiff‐Appellant,
‐v.‐ 18‐1292
FMS INVESTMENT CORP.,
Defendant‐Appellee.
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐X
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FOR APPELLANT: Craig B. Sanders (David M. Barshay on the
brief), Barshay Sanders PLLC, Garden City,
NY.
FOR APPELLEE: Spencer M. Schulz (Bryan C. Shartle and
Aaron R. Easley, on the brief), Sessions,
Fishman, Nathan & Israel LLC, Metairie,
LA.
Appeal from a judgment of the United States District Court for the Eastern
District of New York (Feuerstein, J.).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,
ADJUDGED AND DECREED that the judgment of the district court be
AFFIRMED.
Cindy R. Corwise appeals from a judgment of the United States District
Court for the Eastern District of New York (Feuerstein, J.) dismissing her
complaint for failure to state a claim upon which relief can be granted. Corwise
alleged that FMS Investment Corporation violated the Fair Debt Collection
Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., by sending misleading debt
collection letters. We assume the parties’ familiarity with the underlying facts
and procedural history.
FMS sent Corwise a collection letter that listed her total debt balance as of
the date the letter was sent and itemized the portions of the debt attributable to
principal, interest, and fees. The letter also included the following warning:
“Your account balance may be periodically increased due to the addition of
accrued interest or other charges as provided in the agreement with the original
creditor or as otherwise provided by Federal and/or State law.” JA 12.
The FDCPA prohibits “any false, deceptive, or misleading representation
or means in connection with the collection of any debt.” 15 U.S.C. § 1692e.
The Act further requires specific disclosures by a debt collector within five days
after an initial communication with a consumer, including “the amount of the
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debt.” Id. § 1692g(a)(1). Corwise argues that FMS’s collection letter failed to
provide enough information for her to determine either the amount of debt owed
at any date in the future or a date by which payment of the amount stated in the
letter would be accepted as payment‐in‐full.
We review de novo a grant of a motion to dismiss. Hart v. FCI Lender
Servs., Inc., 797 F.3d 219, 223 (2d Cir. 2015). “To survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as true, to ‘state a
claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). We
“accept as true all of the allegations contained in a complaint,” though
“[t]hreadbare recitals of the elements of a cause of action, supported by mere
conclusory statements, do not suffice.” Id.
In determining whether a collection notice violates the FDCPA, “we are
guided by two principles of statutory construction.” Avila v. Riexinger &
Associates, LLC, 817 F.3d 72, 75 (2d Cir. 2016). First, the Act must be construed
liberally to effectuate its stated purpose. Id. Second, collection notices are to
be looked at from the perspective of the “least sophisticated consumer.” Id.
Pursuant to this standard, “a collection notice can be misleading if it is open to
more than one reasonable interpretation, at least one of which is inaccurate.”
Id. (internal quotation marks omitted).
Section 1692e of the FDCPA “requires debt collectors, when they notify
consumers of their account balance, to disclose that the balance may increase due
to interest and fees.” Id. at 76. We endorsed the following paragraph set out
in a Seventh Circuit case regarding compliance with section 1692g(a)(1):
As of the date of this letter, you owe $____ [the exact amount due].
Because of interest, late charges, and other charges that may vary from day
to day, the amount due on the day you pay may be greater. Hence, if you
pay the amount shown above, an adjustment may be necessary after we
receive your check, in which event we will inform you before depositing
the check for collection. For further information, write the undersigned or
call 1–800–[phone number].
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Id. at 77 (quoting Miller v. McCalla, Raymer, Padrick, Cobb, Nichols, & Clark,
L.L.C., 214 F.3d 872, 876 (7th Cir. 2000)).
No specific language is required, but in order to comply with section
1692e, a debt collection letter must “either accurately inform[] the consumer that
the amount of the debt stated in the letter will increase over time, or clearly
state[] that the holder of the debt will accept payment of the amount set forth in
full satisfaction of the debt if payment is made by a specified date.” Avila, 817
F.3d at 77; see Kolbasyuk v. Capital Management Services, LP, ‐‐ F.3d ‐‐‐, 2019
WL 1119191, at *4 (2d Cir. 2019). FMS’s letter advises that the debt may increase
over time, and therefore satisfies the requirements of section 1692e.
Corwise argues that section 1692g(a)(1), which requires statement of the
“amount of the debt,” means debt collectors must provide enough information to
allow the least sophisticated consumer to determine not only the amount owed
as of the date of the letter, but also how much must be paid to resolve the debt at
any given moment in the future. However, we considered and rejected this
exact argument in Kolbasyuk, 2019 WL 1119191 at *2‐3. Section 1692g(a)
requires a statement of “the total, present quantity of money that the consumer is
obligated to pay.” Id. at *2. “Nothing in section 1692g require[s]” disclosure
“of the constituent components of that debt or the precise rates by which it might
later increase.” Id.
As detailed in Kolbasyuk, our decision in Carlin v. Davidson Fink, LLP,
852 F.3d 207 (2d Cir. 2017), is inapposite. See Kolbasyuk, 2019 WL 1119191 at
*3. Carlin held that an initial debt collection letter inadequately discloses the
amount of the debt if it contains a payoff statement that includes unaccrued fees
and interest, unless it allows the customer to determine the minimum amount
owed at the time of the notice and an explanation of the fees that will cause the
balance to increase. 852 F.3d at 216. In other words, an estimated amount of
debt owed is not an accurate reflection of the “amount of the debt” if it includes
fees and interest not yet owed. See id. at 215‐16.
FMS’s letter did not contain a payoff statement estimating potential future
charges. It stated the actual total amount due on the date of mailing‐‐broken
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down by amount owed due to principal, interest, and fees‐‐and further informed
Corwise that the amount may increase due to interest and fees. Because the
total debt did not include unaccrued interest and fees, the letter accurately stated
the “amount of the debt.”
Accordingly, FMS’ letter complied with section 1692g(a)(1). Corwise’s
section 1692g claim fails as a matter of law.
We have considered Corwise’s remaining arguments and find them to be
without merit. For the foregoing reasons, we AFFIRM the judgment of the
district court.
FOR THE COURT:
CATHERINE O’HAGAN WOLFE, CLERK
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