Collector – August 2019 - 26

Note that Section 809(a)(3) does not
include a requirement that a dispute be "in
writing" regarding the validity of the debt,
whereas Sections 809(a)(4) and 809(a)(5)
both require the consumer to notify the debt
collector "in writing" in order to trigger a
debt collector's duty to send verification of
the debt and/or the name and address of the
original creditor.
A majority of courts, including several
U.S. Courts of Appeals, have interpreted
Section 809(a)(3) as allowing a consumer to
dispute the validity of the debt orally or in
writing, while Sections 809(a)(4) and 809(a)
(5) require a consumer to send a written
dispute to the debt collector. However, not
all courts agree with the majority opinion on
Section 809.

CASE LAW WITHIN THE THIRD
CIRCUIT

ACA's Industry
Advancement Program
is engaging with
members to identify
appropriate cases
to appeal to the
Third Circuit on this
important issue.

26

In contrast to the well-reasoned consensus
of the majority of courts noted above, the
U.S. Court of Appeals for the Third Circuit
held in Graziano v. Harrison that "given the
entire structure of [Section 809], subsection
(a)(3) must be read to require that a dispute,
to be effective, must be in writing."
While many courts outside the
Third Circuit have rejected this flawed
interpretation of Section 809, district courts
within the Third Circuit are bound by this
precedent, resulting in some ill-founded
court decisions.
In some of these cases consumers take
issue with the language of the validation
notice itself, while in other cases consumers
allege that including a telephone number
or an invitation to call overshadows the
validation notice by implying a consumer
could call to dispute a debt. However, the
common thread in all of these cases is that
consumers allege their validation rights
were overshadowed because the letter could
be read to allow a consumer to dispute a
debt orally, which violates the Third Circuit
precedent established by Graziano.
For example, in Cadillo v. Stoneleigh
Recovery Associates, LLC, the U.S. District
Court for the District of New Jersey recently
held that a validation notice closely tracking

the language of the FDCPA violated Section
809(a)(3) because it failed to properly
inform the least sophisticated consumer that
to effectively dispute the alleged debt, the
dispute must be in writing. 
The district court explained that "although
[the debt collector's] collection letter puts the
least sophisticated debtor on notice of her
right to dispute the debt by stating, 'Unless
you notify this office within thirty (30) days
after receiving this notice that you dispute
the validity of this debt or any portion
thereof, this office will assume this debt is
valid,' it does not adequately inform her that
she must do so in writing. Rather, the first
sentence [Section 809(a)(3)] merely informs
her of the timeframe in which she may
contest the debt; it does not clearly indicate
that her dispute must be written. Nor do the
two sentences that follow [Sections 809(a)
(4) and 809(a)(5)] clearly establish that
requirement.
"Instead, the subsequent sentences can
be read in two distinct ways. First, they
could be understood to modify the first
sentence, such that the least sophisticated
debtor would be on notice that she must
memorialize her dispute in writing. . .
Alternatively, those sentences could be read
to present a consumer with two independent
options to obtain additional information
about the alleged debt-options that are
separate and apart from the obligation to
dispute the debt itself." 
Noting that federal district court judges
across the Third Circuit have divided on
the best reading of this validation notice,
the district court concluded that surely
the least sophisticated debtor would be
similarly confused. 
The district court also immediately
certified its decision for interlocutory appeal
"[b]ecause the validation notice at issue has
engendered inconsistent legal decisions."  
Like the decision in Cadillo, other
courts within the Third Circuit have
taken issue with validation notices and
have found violations of Section 809
despite the letters precisely tracking the
language of the statute. For example, in
Durnell v. Stoneleigh Recovery Associates,

ACAINTERNATIONAL.ORG


https://scholar.google.com/scholar_case?case=11605716733754768874&q=Graziano+v.+Harrison&hl=en&as_sdt=6,24&as_vis=1 https://www.acainternational.org/industry-advancement-program/federal-circuit-court-certifies-for-immediate-appeal https://www.acainternational.org/industry-advancement-program/federal-circuit-court-certifies-for-immediate-appeal https://www.acainternational.org/industry-advancement-program/validation-notice-mirroring-statutory-language-does-not-comply-with-fdcpa http://www.ACAINTERNATIONAL.ORG

Collector – August 2019

Table of Contents for the Digital Edition of Collector – August 2019

President’s Page
Industry News
Best Practices
FYI
Collection Tips
How a background in making people laugh has helped Roger Weiss, ACA’s new president, educate and engage an industry.
No Good Option
“You’ve got to be a compliance cheerleader for the organization, and that takes a lot of energy.”
Protecting Health Care Data
Calendar
Honor Roll
Education Spotlight
ACA SearchPoint
Ad Index
Membership
Last Word
Collector – August 2019 - Cover1
Collector – August 2019 - Cover2
Collector – August 2019 - 1
Collector – August 2019 - 2
Collector – August 2019 - 3
Collector – August 2019 - 4
Collector – August 2019 - President’s Page
Collector – August 2019 - Industry News
Collector – August 2019 - 7
Collector – August 2019 - 8
Collector – August 2019 - 9
Collector – August 2019 - Best Practices
Collector – August 2019 - 11
Collector – August 2019 - FYI
Collector – August 2019 - 13
Collector – August 2019 - Collection Tips
Collector – August 2019 - 15
Collector – August 2019 - How a background in making people laugh has helped Roger Weiss, ACA’s new president, educate and engage an industry.
Collector – August 2019 - 17
Collector – August 2019 - 18
Collector – August 2019 - 19
Collector – August 2019 - 20
Collector – August 2019 - 21
Collector – August 2019 - 22
Collector – August 2019 - 23
Collector – August 2019 - No Good Option
Collector – August 2019 - 25
Collector – August 2019 - 26
Collector – August 2019 - “You’ve got to be a compliance cheerleader for the organization, and that takes a lot of energy.”
Collector – August 2019 - 28
Collector – August 2019 - 29
Collector – August 2019 - Protecting Health Care Data
Collector – August 2019 - 31
Collector – August 2019 - 32
Collector – August 2019 - 33
Collector – August 2019 - Calendar
Collector – August 2019 - Honor Roll
Collector – August 2019 - Education Spotlight
Collector – August 2019 - 37
Collector – August 2019 - 38
Collector – August 2019 - 39
Collector – August 2019 - 40
Collector – August 2019 - 41
Collector – August 2019 - 42
Collector – August 2019 - 43
Collector – August 2019 - 44
Collector – August 2019 - 45
Collector – August 2019 - 46
Collector – August 2019 - 47
Collector – August 2019 - ACA SearchPoint
Collector – August 2019 - Ad Index
Collector – August 2019 - Membership
Collector – August 2019 - 51
Collector – August 2019 - Last Word
Collector – August 2019 - Cover3
Collector – August 2019 - Cover4
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