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Bro-in-law called me last night and told me that he has to go to court on

Friday...being sued on a debt that was never validated prior to his recieving the summons (no validation, Mini Mirada attached to the suit either), and the debt is out of SOL (10 yrs old). I have been looking for Kimber vs Federal Financial Corp to print out for him, plus I have a couple of FTC opinion letters concerning filing suits on time-barred debts. I suck at searching for case laws...could be cause I'm not a lawyer 8-) . So can someone help me as far as where I should go to look for Kimber vs FFC?

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668 F. Supp. 1480

Cindy Ann KIMBER, individually and on Behalf of all other persons similarly situated, Plaintiff,


FEDERAL FINANCIAL CORPORATION, d/b/a Regional Accounts Corporation, Defendant.

Civ. A. No. 86-T-023-E.

United States District Court, M.D. Alabama, E.D.

August 18, 1987.

William Z. Messer, Legal Services Corp. of Alabama, Phenix

City, Ala., and James Opp Smith, and David S. Yen, Legal Services

Corp. of Alabama, Opelika, Ala., for plaintiff.

Steven K. Champlin, Dorsey & Whitney, Minneapolis, Minn., and

Richard H. Gill, Copeland, Franco, Screws & Gill, Montgomery,

Ala., for defendant.


MYRON H. THOMPSON, District Judge.

In this class-action lawsuit, plaintiff Cindy Ann Kimber

charges defendant Federal Financial Corporation (FFC) with

violating the Fair Debt Collection Practices Act, 15 U.S.C.A. §§

1692-1692o, in the following ways: by attempting to collect debts

from her and other Alabama residents without first giving the

debtors the notice required by the Act; and by threatening to

sue, and suing, Kimber and others to collect on some of these

debts even though, as far as FFC knew, it was not entitled to

recover in the suits because the debts were stale. This court has

jurisdiction over this case pursuant to 15 U.S.C.A. § 1692k(d).

This lawsuit is now before the court on Kimber's and FFC's

cross-motions for summary judgment on the sole issue of FFC's

liability to Kimber. For reasons that follow, the court concludes

that Kimber's motion should be granted in part and denied in

part, and that FFC's motion should be denied in full.


In 1976, W.T. Grant Company filed for bankruptcy and sold its

accounts receivable to defendant FFC, a corporation formed for

the sole purpose of collecting on these accounts. About 8,000 of

the accounts sold were personal charge accounts held by Alabama

residents with W.T. Grant. Kimber alleges that the Alabama

accounts, including hers, were already delinquent or in default

when W.T. Grant assigned them to FFC. According to FFC's records,

Kimber's account with W.T. Grant was "seriously delinquent" as of

September 1975, with no payments received since May 3, 1975, and

with a balance due of $150.70. Upon assignment of Kimber's debt,

according to FFC, it notified her that the account had been

transferred and the payment was overdue; other reminders that

payment was due then followed, but by 1979 all such contact

between FFC and Kimber ceased.

Five years later, in March 1984, FFC referred the account to an

Alabama attorney for collection. The attorney did not contact

Kimber, however, until early 1985, when someone in his office

telephoned Kimber's grandmother and left a number for Kimber to

call. When Kimber returned the call, she was told by a woman

there that her bill must be paid or she would be sued. Kimber

told the woman that she believed the account had been paid years

ago. Kimber admits today that, because the debt is so old, she

cannot now remember whether she in fact paid the debt, and she

has no documents indicating one way or the other.

On January 24, 1985, FFC's attorney filed suit against Kimber

in the Small Claims Court for Russell County, Alabama; the judge

dismissed the suit. FFC then appealed the case to the Russell

County Circuit Court for a trial de novo, where Kimber — this

time represented by counsel — raised the statute of limitations

defense. The action was dismissed with prejudice as untimely.

FFC's attorney has filed about 200 similar suits.

Kimber, on behalf of herself and all other Alabama residents

similarly situated, has now brought this federal lawsuit against

FFC charging that its attempts to collect stale debts from them

violated the Fair Debt Collection Practices Act. Kimber and FFC

have, however, agreed that, before the court determines whether a

plaintiff class should be certified pursuant to Fed.R.Civ.P. 23

and whether the class should recover, the court should first

decide whether Kimber's individual claims have merit.

Apparently, identifying each member of the putative plaintiff

class and determining whether the member's circumstances are

sufficiently similar to Kimber's to warrant redress should Kimber

prevail, could be a very expensive and time-consuming project;

Kimber and FFC have therefore agreed that it would be much more

efficient for the court to determine first whether Kimber herself

is entitled to prevail. If the court should decide that Kimber is

not entitled to prevail, the case would be over; but, if the

court should decide that she should prevail, the court would then

later determine, after appropriate additional discovery, what

relief Kimber should receive; whether a plaintiff class should be

certified; whether the class, if certified, should recover; and

what relief, if any, the class should receive. The parties have

also agreed that, if a plaintiff class is later certified, the

class should not be in any manner prejudiced by the delay in


In accordance with these agreements, Kimber and FFC have each

filed a motion for summary judgment addressing only whether

Kimber herself should prevail.


Congress passed the Fair Debt Collection Practices Act for the

purpose of eliminating "the use of abusive, deceptive, and unfair debt collection practices by many debt collectors." 15

U.S.C.A. § 1692(a). As previously stated, Kimber maintains that

FFC has violated this Act. First, she claims that FFC has

threatened to file, and has filed, legal proceedings against her

to collect on a stale debt, in violation §§ 1692e and 1692f; and,

second, she charges that the corporation has attempted to collect

a debt from her without first giving her the notice required

under the Act, in violation of § 1692g(a).

A lawsuit may be resolved on summary judgment only if "there is

no genuine issue as to any material fact and . . . the moving

party is entitled to a judgment as a matter of law." Fed.R.Civ.P.

56©. In deciding whether summary judgment is appropriate, a

court must liberally construe all evidence and the inferences to

be drawn therefrom in favor of the party against whom the

judgment is sought. As demonstrated below, the undisputed

material facts reveal that Kimber is entitled to prevail as a

matter of law on her `stale debt' claims. However, neither Kimber

nor FFC is entitled to prevail on Kimber's `notice' claim,

because the claim presents disputed issues of fact.


The first matter the court must address in considering Kimber's

claims is FFC's argument that it is not a "debt collector"

subject to the Fair Debt Collection Practices Act; the parties

agree that, as far as this case is concerned, the statute's

coverage is limited to activities of debt collectors.


FFC contends that it does not fall within the Act's definition

of debt collector, and, to support this contention, the

corporation makes essentially two interrelated arguments. First,

FFC observes that the Act offers a general definition of debt

collector as any person whose "principal purpose . . . is the

collection of any debts, or who regularly collects or attempts to

collect, directly or indirectly, debts owed or due or asserted to

be owed or due another." 15 U.S.C.A. § 1692a(6).[fn1] FFC's first

argument is that § 1692a(6) limits a debt collector to one who collects or

attempts to collect debts "owed or due another," and that,

because FFC does not collect debts for another but for itself, it

does not fall within the general definition.

FFC's second argument is a bit more complex, but nonetheless

related to its first. The corporation correctly points out that,

after offering a general definition of debt collector, § 1692a(6)

expressly excludes several types of persons or transactions from

the definition. The section provides that a debt collector does

not include "any officer or employee of a creditor while, in the

name of the creditor, collecting debts for such creditor." §

1692a(6)(A). Kimber and the corporation agree that it is apparent

from the statute's legislative history that Congress intended the

creditor exclusion to cover not only officers and employees of

creditors but creditors themselves. See S.Rep. No. 95-382, 95th

Cong., 1st Sess., reprinted in 1977 U.S.Code Cong. & Admin.News

1695. A creditor is defined by § 1692a(4) of the Act as

any person who offers or extends credit creating a

debt or to whom a debt is owed, but such term does

not include any person to the extent that he receives

an assignment or transfer of a debt in default solely

for the purpose of facilitating collection of such

debt for another.

FFC's second argument is that it is an excluded creditor within

§ 1692a(4)'s definition because it is a person "to whom a debt is


Kimber counters that FFC is not a creditor, because it falls

within the `assignee exception' to the definition of creditor —

that is, it is a person who received "an assignment or transfer

of a debt in default solely for the purpose of facilitating

collection of such debt for another." Kimber argues that FFC

falls within this exception because when the company received her

debt, the debt was already in default. The corporation

re-counters that it does not fall within the assignee exception

because the exception applies only when the purpose of the debt

assignment is to collect the debt "for another." FFC's two

arguments therefore both whittle down to the contention that the

Act's coverage is limited to instances where a person is

collecting a debt "for another," which FFC says it is not doing.

Whether the Act's coverage is limited to instances where a

person is collecting a debt for another may not be determined

solely from the face of the statute; the statute is far from a

model of drafting clarity. On the one hand it could be argued, as

indeed Kimber does, that a "debt collector" is defined in §

1692a(6) with alternative phrasing, as a business that either has

as its principal purpose debt collection or that regularly

collects debts for another. Since it is undisputed that FFC's

principal purpose is debt collection, Kimber asserts that the

corporation clearly falls under the first prong of the

definition, regardless of whether the collection is undertaken

for the corporation itself or for another. But, on the other

hand, this court is unaware of, and Kimber has not offered, any

rationale for parsing the definition into two disjunctive parts;

Kimber has not offered any logical explanation for why Congress

would intend to cover "any debts" by a business whose "principal

purpose" is debt collecting, but only "debts owed or due another"

where the business "regularly" collects debts.

Similarly, the definition given for creditor in the Act does

not on first blush offer clear guidance on whether FFC falls within the assignee exception to the definition. The exception clearly appears to apply to a person to whom a debt in default has been assigned. Since an

assignment is generally defined as the "transfer by a party of

all of its rights to some kind of property, usually intangible,"

Black's Law Dictionary, 5th Ed., p. 109, any collection of a debt

by the assignee would generally be for itself. And yet, the

assignee exception refers to the assignee's collection as being

for another.

FFC argues that the term assignment as used in the assignee

exception means a "temporary assignment," where the assignor has

the right to recall any and all debts assigned; the corporation

contends that, where the assignment is temporary, the collection

by the assignee is "for another," the assignor. Such assignment

practices, according to FFC, are common-place in the collection

industry. FFC then argues that, because the debt assignments

between itself and W.T. Grant were permanent rather than

temporary, its collections are for itself and not another; thus,

it maintains, it does not fall within the assignee exception to

the definition of creditor.

The court cannot accept FFC's `temporary assignment'

explanation for two reasons. First, the Act does not refer to

`temporary assignments' but to `assignments' in general. Second,

to say that the statute's coverage extends to only a specific

form of contract, that is, a temporary assignment contract, would

be to limit the law severely and to leave it open to easy evasion

by simply adopting a different form of contract. FFC's temporary

assignment explanation is not the answer to the ambiguity evident

in the Act.

The court is convinced that the answer lies instead in a closer

analysis of the Act itself, in particular the definition of

creditor found in § 1692a(4). The first part of § 1692a(4)

defines the universe of creditors as either those who originate

a debt or those to whom a debt is owed; in either case, the

creditors are not collecting the debts for others. The second

part of § 1692a(4), the assignee exception, then purports to

exclude from this universe those persons who collect assigned or

transferred debts that are already in default when assigned or

transferred. To say that this exception applies only to those who

collect debts for others would be to render the exception

superfluous and meaningless; those who collect debts for others

are not in the original definitional universe, and there is

therefore no need to exclude them. Rather, the excluding factors

in the exception are that the debts are the result of an

assignment or transfer and that the debts were already in default

at the time of assignment or transfer. With the phrase "for

another" at the end of the exception, Congress merely intended

that the debts should have originally belonged to another and

that the creditor was therefore in effect a third-party or

independent creditor.

The phrase "owed or due another" has a similar meaning in the

Act's definition of "debt collector" in § 1692a(6). As stated,

the first part of § 1692a(4) defines the universe of creditors as

those who collect debts for themselves. Section 1692a(6)(A)

purports to exclude these creditors from the general definition

of debt collector. There would be no need to exclude creditors —

those who collect debts for themselves — from the general

definition of debt collector unless that general definition

included those who collect debts for themselves.

That this understanding of §§ 1692a(4) and 1692a(6) is correct

is apparent when the legislative history of the Act is

considered. This history reflects that the target and emphasis of

the Act are "third-party" or "independent" collectors of

"past-due" or "delinquent" debts. As the Senate Committee that

considered the Act wrote,

The committee intends the term "debt collector,"

subject to the exclusions discussed below, to cover

all third persons who regularly collect debts for

others. The primary persons intended to be covered

are independent debt collectors.

S. Report No. 95-382, 95th Cong., 1st Sess., reprinted in 1977

U.S.Code Cong. & Admin.News 1695, 1697 (emphasis added).

The Committee explained that it limited the Act's coverage to

third-party collectors of past due debts because,

Unlike creditors, who generally are restrained by the

desire to protect their good will when collecting

past due accounts, independent collectors are likely

to have no future contact with the consumer and often

are unconcerned with the consumer's opinion of them.

Id., at 1696.

With §§ 1692a(4) and 1692a(6)(A), Congress clearly sought to

exclude creditors — that is, those who extend credit and collect

their own debts — from the Act's coverage; such persons are, in

the words of the Senate Report, "restrained by the desire to

protect their good will." But, when these so-called creditors are

in effect merely in the business of collecting stale debts rather

than extending credit, they are no longer true creditors but debt

collectors who, in the words of the Senate Report, "are likely to

have no future contact with the consumer and often are

unconcerned with the consumer's opinion of them"; they are simply

independent collectors of past due debts and thus clearly fall

within the group Congress intended the Act to cover.

This understanding of §§ 1692a(4) and 1692a(6) is also implicit

in the opinion of another court. In Perry v. Stewart Title Co.,

756 F.2d 1197 (5th Cir. 1985), a mortgagor sued the assignee of a

mortgage and the original mortgagee, who continued to service the

mortgage after assignment. The court held that the Act did not

apply to either defendant due to their coverage by the creditor

exclusion. As to the assignee, the court noted that the debt had

not been in default on assignment: "The legislative history of

section 1692a(6) indicates conclusively that a debt collector

does not include the consumer's creditors, a mortgage servicing

company or an assignee of a debt, as long as the debt was not in

default at the time it was assigned." Id., at 1208 (emphasis


For the above reasons, the court must therefore conclude that,

even though FFC collects debts for itself, it is still a debt

collector within the meaning of §§ 1692a(4) and 1692a(6) of the

Act, because the corporation regularly collects debts and debt

collection is its principal purpose, and because the debts the

corporation collects were already in default when they were

assigned to the corporation and thus the corporation falls within

the assignee exception to the definition of creditor.


Next, FFC argues that it cannot be held liable under the Act

for the misconduct alleged by Kimber, because all actions

complained of were perpetrated by the corporation's attorney,

rather than the corporation itself. The court disagrees.

The corporation rightly notes that the statute expressly

exempts from its reach "any attorney-at-law collecting a debt as

an attorney on behalf of and in the name of a client." 15

U.S.C.A. § 1692a(6)(F). This provision, however merely creates an

immunity for the attorney, not for the client on whose behalf the

collection is undertaken. To interpret § 1692a(6)(F) otherwise

would severely undermine the Act and frustrate the intent of

Congress, for a debt collector could simply evade the Act by

hiring an attorney to do what it could not do itself. This

understanding of § 1692a(6)(F) is also consistent with Alabama's

general rule that "omissions and commissions of an attorney at

law are to be regarded as acts of the client whom he represents."

Lawrence v. Gayle, 294 Ala. 91, 312 So.2d 385, 387 (1975); see

also Massey v. Educators Investment Corp. of Alabama, Inc.,

420 So.2d 77 (Ala. 1982).


Having found that FFC is covered by the Fair Debt Collection

Practices Act, the court now turns to Kimber's claims that the

corporation violated the Act. In the Act, Congress set out

several specific practices as impermissible, as well as generally

proscribing harassing, oppressive or abusive conduct, 15 U.S.C.A.

§ 1692d, false, deceptive, or misleading representations, §

1692e, and unfair or unconscionable collection methods, § 1692f.

To help ensure the most complete protection possible, determinations as to whether conduct violates the Act are made in keeping with the

standard of the "least sophisticated consumer." Jeter v. Credit

Bureau, Inc., 760 F.2d 1168, 1172-75, 1179 (11th Cir. 1985).

Thus, in applying the law to this case, the court must decide

whether FFC's actions were unfair or unconscionable, or whether

the least sophisticated of consumers would have been deceived,

misled, or harassed by such practices.


Kimber claims that FFC's filing of the lawsuit against her

violated § 1692f. That section states simply that, "A debt

collector may not use unfair or unconscionable means to collect

or attempt to collect any debt." Kimber argues that filing a

lawsuit to collect on a debt that appears time-barred, without

first determining after a reasonable inquiry that the limitations

period is due to be tolled, constitutes an unfair and

unconscionable practice offensive to § 1692f. The court agrees

with Kimber.

"Statutes of limitations are not simply technicalities. On the

contrary, they have been long respected as fundamental to a

well-ordered judicial system." Board of Regents v. Tomanio,

446 U.S. 478, 487, 100 S.Ct. 1790, 1796, 64 L.Ed.2d 440 (1980). They

reflect a strong public policy, as determined by legislative

bodies and courts, that "it is unjust to fail to put the

adversary on notice to defend within a specified period of time

and that `the right to be free of stale claims in time comes to

prevail over the right to prosecute them.'" United States v.

Kubrick, 444 U.S. 111, 117, 100 S.Ct. 352, 356-57, 62 L.Ed.2d 259

(1979) (emphasis added), quoting Railroad Telegraphers v. Railway

Express Agency, 321 U.S. 342, 349, 64 S.Ct. 582, 586, 88 L.Ed.

788 (1944). These statutes therefore "afford[] plaintiffs what

the legislature deems a reasonable time to present their claims,"

while at the same time "protect[ing] defendants and the courts

from having to deal with cases in which the search for truth may

be seriously impaired by the loss of evidence, whether by death

or disappearance of witnesses, fading memories, disappearance of

documents, or otherwise." Kubrick, 444 U.S. at 117, 100 S.Ct. at


However, because these statutes are based on concepts of what

is just and fair, "most courts and legislatures have recognized

that there are factual circumstances which justify an exception

to these strong policies of repose. For example, defendants may

not, by tactics of evasion, prevent the plaintiff from litigating

the merits of a claim, even though on its face the claim is

time-barred." Tomanio, 446 U.S. at 487-88, 100 S.Ct. at 1797.

These exceptions to the statutes are generally referred to as

"tolling." Id.

The court agrees with Kimber that a debt collector's filing of

a lawsuit on a debt that appears to be time-barred, without the

debt collector having first determined after a reasonable inquiry

that that limitations period has been or should be tolled, is an

unfair and unconscionable means of collecting the debt. As

previously demonstrated, time-barred lawsuits are, absent

tolling, unjust and unfair as a matter of public policy, and this

is no less true in the consumer context. As with any defendant

sued on a stale claim, the passage of time not only dulls the

consumer's memory of the circumstances and validity of the debt,

but heightens the probability that she will no longer have

personal records detailing the status of the debt. Indeed, the

unfairness of such conduct is particularly clear in the consumer

context where courts have imposed a heightened standard of care

— that sufficient to protect the least sophisticated consumer.

Because few unsophisticated consumers would be aware that a

statute of limitations could be used to defend against lawsuits

based on stale debts, such consumers would unwittingly acquiesce

to such lawsuits. And, even if the consumer realizes that she can

use time as a defense, she will more than likely still give in

rather than fight the lawsuit because she must still expend

energy and resources and subject herself to the embarrassment of

going into court to present the defense; this is particularly

true in light of the costs of attorneys today.

FFC asserts, nevertheless, that because a statute of

limitations is an affirmative defense which is waived if not

raised, a plaintiff may not be penalized for knowingly filing a

time-barred suit; indeed, according to FFC, its attorney was

ethically authorized, if not bound, to pursue such a suit in

light of the defensive posture of the limitations statute.

Although the staleness issue has not been previously considered

in relation to unfairness under the Fair Debt Collection

Practices Act, the propriety of bringing a lawsuit to which there

appears to exist a complete defense, without first making a

reasonable inquiry as to whether the defense is in fact not

complete, has been discredited elsewhere. Rule 11 of the Federal

Rules of Civil Procedure demands that an attorney conduct a

reasonable investigation into whether a claim is well grounded in

law and fact, and not inspired by an improper purpose, before

signing a pleading. Sanctions against attorney and client under

the rule have been imposed where the attorney knew or should have

known a claim was time-barred. Steinle v. Warren, 765 F.2d 95

(7th Cir. 1985); Van Berkel v. Fox Farm and Road Machinery,

581 F. Supp. 1248 (D.Minn. 1984). Further, the fact that a defense is

affirmative has not relieved counsel of their Rule 11

responsibilities in other contexts. See, e.g., Southern Leasing

Partners, Ltd. v. Bludworth, 109 F.R.D. 643 (S.D.Miss. 1986)

(suit barred by res judicata); Hasty v. Paccar, Inc., 583 F. Supp. 1577

(E.D.Mo. 1984) (lack of personal jurisdiction.) In view of

these holdings, FFC's argument that its attorney was ethically

authorized to pursue the collections in case the debtors failed

to raise the statute of limitations defense lacks authority.

The court must therefore conclude that FFC violated § 1692f

when it filed suit against Kimber. There is no question that the

debt FFC sought from Kimber was barred as stale. Two limitations

periods were applicable. Where a stated account or simple

contract is at issue, the Alabama Code of 1975, § 6-2-34(5) and

(9) provides for a six year period; on an open account, a three

year period applies, pursuant to § 6-2-37(1). Regardless of which

statute is applied to Kimber's alleged debt, the limitations

period has run, since her debt was assigned by W.T. Grant in

1976, or nine years before FFC sued her, and the debt was in

default at the time of assignment. There is also no question that

FFC's attorney did not, prior to filing the lawsuit, make a

determination after a reasonable inquiry that the limitations

period was due to be tolled. Under these circumstances, FFC's

conduct was unjust and unfair, and in violation of public policy

as well as the Fair Debt Collection Practices Act. Kimber is

entitled to summary judgment on her claim that FFC violated §

1692f of the Act.


Kimber argues next that FFC made false, deceptive and

misleading representations in violation of § 1692e of the Fair

Debt Collection Practices Act by threatening to sue her on a

claim the corporation knew was barred. Section 1692e provides

that, "A debt collector may not use any false, deceptive, or

misleading representation or means in connection with the

collection of any debt." Among the tactics specifically

prohibited are:

(2) The false representation of —

(A) the character, amount, or legal status of any

debt; [and]

* * * * * *

(10) The use of any false representation or deceptive

means to collect or attempt to collect any

debt. . . .

Kimber claims that when viewed through the eyes of the least

sophisticated consumer, FFC's practices were false, deceptive,

and misleading, in violation of the above provisions. She alleges

that by threatening her with a lawsuit which the corporation knew

or reasonably should have known was time-barred, the corporation

falsely represented the legal status of her debt, misled her as

to what action might be legally taken against her, and

deceptively used this threat in attempting to collect on her

alleged debt. In so doing, Kimber argues, FFC preyed upon the

ignorance of an unsophisticated consumer. Threats to sue

communicated through an attorney would only naturally represent

to the least sophisticated consumer that a lawsuit was viable, even when in fact it was not, Kimber contends.

FFC answers that since it was clearly possible to file a

lawsuit against Kimber — whether or not it was possible to win

one — there was no deception as to the legal status of the debt,

nor any false threat of legal action used to coerce payment. FFC

asserts that ordinary statutes of limitations bar only the

remedy, not the underlying right.

Whether it is true that a statute of limitations defense does

not erase the right underlying a lawsuit but rather prevents

success on a claim is immaterial, for the court cannot agree with

FFC that this legal principle, even if true, lends approval to

the practice of threatening and undertaking lawsuits for which

the statute of limitations has clearly run and for which there is

no evidence that would warrant tolling. The dispositive fact is

that a debt collector could not legally prevail in such lawsuit,

and for the debt collector to represent otherwise is fraudulent.

By threatening to sue Kimber on her alleged debt, FFC violated

§ 1692e(2)(A) & (10); by threatening to sue her, FFC implicitedly

represented that it could recover in a lawsuit, when in fact it

cannot properly do so. To be sure, FFC did not expressly state to

Kimber that her suit was not time-barred; nor did the corporation

expressly tell Kimber that she had no legal defenses to its

claim. But to be deceptive a representation need not be expressed

and it need not be obvious to everyone; rather, as previously

observed, the representation is deceptive and in violation of

1692e(2)(A) & (10), if it has the mere "tendency or capacity to

deceive" the "least sophisticated consumer," Jeter, 760 F.2d at

1172. The vantage point from which FFC's threat should be viewed

is not that of a lawyer or judge versed in law, but that an

unsophisticated consumer. As the Eleventh Circuit stated in


That law was not "made for the protection of experts,

but for the public — that vast multitude which

includes the ignorant, the unthinking, and the

credulous," Florence Mfg. Co. v. J.D. Dowd & Co., 2

Cir., 178 F. 73, 75 [(1910)]; and the "fact that a

false statement may be obviously false to those who

are trained and experienced does not change its

character, nor take away its power to deceive others

less experienced." Federal Trade Commission v.

Standard Education Soc., 302 U.S. 112, 116 [58 S.Ct.

113, 115, 82 L.Ed. 141 (1937]. . . .

Id., at 1172-73, quoting Charles of the Ritz Distributors Corp.

v. FTC, 143 F.2d 676, 679 (2d Cir. 1944).

Here, it is obvious to the court that by employing the tactics

it did, FFC played upon and benefitted from the probability of

creating a deception. Honest disclosure of the legal

unenforceability of the collection action due to the time lapsed

since the debt was incurred would have foiled FFC's efforts to

collect on the debt. So instead, the corporation implicitly

misrepresented to Kimber the status of the debt, and thereby

misled her as to the viability of legal action to collect. As

such, FFC's conduct was false and deceptive and in violation of

provisions (2)(A) and (10) of § 1692e. Kimber is therefore

entitled to summary judgment on her claim that FFC violated §

1692e by threatening to sue her.


Lastly, Kimber charges that FFC violated § 1692g(a) of the Fair

Debt Collection Practices Act by failing to notify her of, among

other things, her right to dispute the validity of the debt at

issue and to obtain verification thereof. This section requires

that within five days of a debt collector's initial contact with

a debtor, the debt collector must send written notice to the

debtor identifying the amount of the debt and the original

creditor's name, and providing a statement of the debtor's rights

to challenge and request verification of the debt.[fn2]

The evidence is disputed as to whether FFC provided this notice

to Kimber as required. Therefore, neither Kimber nor FFC is

entitled to summary judgment on this claim.


In conclusion, Kimber is entitled to summary judgment as to

liability on her claims that FFC threatened to sue her and sued

her on a stale debt in violation of §§ 1692e and 1692f of the

Fair Debt Collection Practices Act; but neither she nor FFC is

entitled to summary judgment on her claim that FFC failed to give

her the notice required by § 1692g(a) of the Act. An appropriate

order will be entered.

[fn1] Throughout this part of its memorandum opinion, the court

discusses various provisions in § 1692a. Section 1692a was

amended in 1986 in ways irrelevant to these proceedings, but

during the time at issue here the section provided in relevant

part as follows:

As used in this subchapter —

* * * * * *

(3) The term "consumer" means any natural person

obligated or allegedly obligated to pay any debt.

(4) The term "creditor" means any person who offers

or extends credit creating a debt or to whom a debt

is owed, but such term does not include any person to

the extent that he receives an assignment or transfer

a debt in default solely for the purpose of

facilitating collection of such debt for another.

(5) The term "debt" means any obligation or alleged

obligation of a consumer to pay money arising out of

a transaction in which the money, property,

insurance, or services which are the subject of the

transaction are primarily for personal, family, or

household purposes, whether or not such obligation

has been reduced to judgment.

(6) The term "debt collector" means any person who

uses any instrumentality of interstate commerce or

the mails in any business the principal purpose of

which is the collection of any debts, or who

regularly collects or attempts to collect, directly

or indirectly, debts owed or due or asserted to be

owed or due another. Notwithstanding the exclusion

provided by clause (G) of the last sentence of this

paragraph, the term includes any creditor who, in the

process of collecting his own debts, uses any name

other than his own which would indicate that a third

person is collecting or attempting to collect such

debts. For the purpose of section 1692f(6) of this

title, such term also includes any person who uses

any instrumentality of interstate commerce or the

mails in any business the principal purpose of which

is the enforcement of security interests. The term

does not include —

(A) any officer or employee of a creditor while, in

the name of the creditor, collecting debts for such


(B) any person while acting as a debt collector for

another person, both of whom are related by common

ownership or affiliated by corporate control, if the

person acting as a debt collector does so only for

persons to whom it is so related or affiliated and if

the principal business of such person is not the

collection of debts;

© any officer or employee of the United States or

any State to the extent that collecting or attempting

to collect any debt is in the performance of his

official duties;

(D) any person while serving or attempting to serve

legal process on any other person in connection with

the judicial enforcement of any debt;

(E) any nonprofit organization which, at the

request of consumers, performs bona fide consumer

credit counseling and assists consumers in the

liquidation of their debts by receiving payments from

such consumers and distributing such amounts to


(F) any attorney-at-law collecting a debt as an

attorney on behalf of and in the name of a client;


(G) any person collecting or attempting to collect

any debt owed or due or asserted to be owed or due

another to the extent such activity (i) is incidental

to a bona fide fiduciary obligation or a bona fide

escrow arrangement; (ii) concerns a debt which was

originated by such person; (iii) concerns a debt

which was not in default at the time it was obtained

by such person; or (iv) concerns a debt obtained by

such person as a secured party in a commercial credit

transaction involving the creditor.

* * * * * *

[fn2] Section 1692g(a) provides:

Within five days after the initial communication

with a consumer in connection with the collection of

any debt, a debt collector shall, unless the

following information is contained in the initial

communication or the consumer has paid the debt, send

the consumer a written notice containing —

(1) the amount of the debt;

(2) the name of the creditor to whom the debt is


(3) a statement that unless the consumer, within

thirty days after receipt of the notice, disputes the

validity of the debt, or any portion thereof, the

debt will be assumed to be valid by the debt


(4) a statement that if the consumer notifies the

debt collector in writing within the thirty-day

period that the debt, or any portion thereof, is

disputed, the debt collector will obtain verification

of the debt or a copy of a judgment against the

consumer and a copy of such verification or judgment

will be mailed to the consumer by the debt collector;


(5) a statement that, upon the consumer's written

request within the thirty-day period, the debt

collector will provide the consumer with the name and

address of the original creditor, if different from

the current creditor.

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