On Friday, the Eastern District of Missouri decided a case in favor of a debt collector pertaining to a collection letter that stated the creditor may offer less favorable terms in the future if the consumer satisfies the amount for less than the full balance owed. The case in question is Lantry v. Client Services, Inc., No. 4:18-cv-1694 (E.D. Mo. Aug. 2, 2019).

Client Services, Inc. (CSI) sent a collection letter to plaintiff for a defaulted Chase account. The letter included a disclosure that stated, "If we settle this debt with you for less than the full outstanding balance, Chase may offer you less favorable terms in the future for some Chase products or services, or may deny your application." 

Plaintiff filed a slew of FDCPA claims related to this disclosure, but the court was not convinced and, instead, granted CSI's motion for judgment on the pleadings. 

The Court's Decision

First and foremost, the court found that the statement is true, and therefore not false and misleading. Plaintiff attempted to argue that the statement means the inverse of what it actually says: that paying the full amount will lead to more favorable terms in the future. The court was not persuaded, stating:

The letter never states that full payment of the outstanding debt will result in more favorable terms from Chase in future dealings. It offers to settle Lantry's balance due for $443.00, and it contains a warning conveying to Lantry that if she accepts the offer, Chase may offer her less favorable terms in the future or deny her application. To an unsophisticated consumer, this statement does not imply that paying the full balance would put a person in the position to receive more favorable terms. Indeed, as Lantry alleges, Chase has already "charged off her outstanding debt of $2,212.73. Rather, the statement conveys what it says: settling the balance due will not necessarily return Lantry to good standing with Chase. 

The court concluded that "[a]n unsophisticated consumer would not be misled into paying the full amount in hopes of securing better future terms with Chase, especially given the opportunity to settle the debt at an 80% discount."


Plaintiff attempted to argue that this disclosure's proximity to the mini-Miranda somehow implies that the disclosure is also legally required. But, again, the court was not convinced. 

With this, the court granted the motion for judgment on the pleading and dismissed the claims.


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