Let's set the stage. A plaintiff, represented by a plaintiffs' firm well-known in this industry, files a putative class action in the Eastern District of Wisconsin--a hot spot for FDCPA litigation--back in early 2019. For the next year and a half, extensive litigation occurs: lots of motions practice, attempts to get a class certified, and discovery disputes. In other words, a lot of money and attorney hours thrown into the ring by both sides. Then, all of a sudden, plaintiff fails to file a response to a motion for summary judgment. That's what happened in Nagan v. Optio Solutions, LLCand this caused the court to end the case in defendant's favor.


The underlying case

Putting procedural issues aside for a moment, let's discuss the claims alleged in the complaint. Defendant sent a collection letter to plaintiff which listed a settlement offer that "expires in 45 days" and also provided an itemization of the debt. The itemization mirrored the information provided to defendant by the creditor: principal, fees, interest, and balance due.

Plaintiff filed a putative class action in Eastern District of Wisconsin alleging that the letter violated both the FDCPA and California's Rosenthal Act (likely because plaintiff claims defendant has a principal place of business in California). Plaintiff claimed that the settlement offer was false and misleading because it causes a false sense of urgency for the consumer to pay the debt despite defendant having flexibility with the settlement offer (e.g., ability to extend the due date, ability to offer more of a discount later). Regarding the debt itemization, plaintiff claims that it gives a false impression that the balance would increase.

Procedural history

Since this case was filed in February 2019, there has been extensive litigation. This includes a motion to certify a class, several motions for summary judgment, modifications to scheduling orders, and discovery disputes. This culminated in telephone conference held on June 11 of this year, where plaintiff's counsel discussed several open discovery issues that still needed to be remedied. During this conference, the judge provided 30 days to hold the depositions that plaintiff's counsel said were needed, and then 30 days after the deposition is held for plaintiff to file its response to defendant's motion for summary judgment. 

According to the court, plaintiff failed to do the latter.

The court's decision

Procedurally, since plaintiff did not file a response to defendant's motion, the court was to consider the statement of facts provided by defendant to be true. Based on this, the court found that summary judgment was appropriate for defendant.

Right off the bat, the court rejected the California Rosenthal Act claim since there was no evidence presented that plaintiff was ever a resident of California.

Regarding the settlement offer, the court found that the letter did not contain the Evory safe harbor language ("we are not obligated to renew this offer"), but that's okay. This is because: 

[The letter] did not represent that no future settlement offers would be available or that it was Plaintiff’s only opportunity to settle the debt. Instead, the letter represented an amount that Defendant was willing to settle Plaintiff’s account for at that time and included an invitation to Plaintiff to discuss the debt. 

The court also found no issue with the debt itemization for two reasons. First, the debt itemization in the letter appeared exactly how defendant received it from the creditor. Second, the letter on its face provides no indication that the amount due is different than the balance listed. 

Although Plaintiff argues that the phrase “balance due” falsely implies that the debt is or could be increasing, stating the balance due without implying that it is different than the stated amount does not constitute a violation of § 1692e.

For these reasons, the court granted summary judgment for defendant.


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