United States District Court, D. Minnesota
David Coyne, on behalf of himself and all others similarly situated, Plaintiff,
Midland Funding, LLC, Midland Credit Management, and Messerli & Kramer, P.A., Defendants.
MEMORANDUM AND ORDER
A. Magnuson United States District Court Judge
matter is before the Court on Defendants' Motion to
Dismiss. For the following reasons, the Motion is granted.
David Coyne is an attorney licensed in Minnesota. At some
unspecified point in the past, Coyne defaulted on a Citibank
credit-card debt. Defendant Midland Funding bought the debt
and hired Defendant Messerli & Kramer to collect it.
Midland likely purchased Coyne's debt for pennies on the
dollar because it was an old debt. (Pl.'s Opp'n Mem.
(Docket No. 16) at 2-3.) Midland hoped to convince Coyne to
pay something on the debt, although Coyne was no longer
legally obligated to do so.
sent Coyne a letter about the debt on February 26, 2016. (Am.
Compl. (Docket No. 4) ¶¶ 35-42.) This letter does
not ask Coyne to take any action, but rather purports to
“provide some additional information pertaining to
[Coyne's] account.” (Id. Ex. A.) The
letter lists the charge-off balance of the debt as $13,
205.30, and the “current balance” as $17, 230.29.
(Id.) The letter explains that the account balance
“consists of the principal balance of $13, 205.30 and
interest of $3, 871.39 at the rate of 6.00% plus incurred
costs of $153.60.” (Id.)
to Coyne, this letter violated the Fair Debt Collection
Practices Act (“FDCPA”) in several
ways. First, the letter “did not disclose
what the additional ‘incurred costs' related
to.” (Id. ¶ 48.) Coyne contends that this
failure to explain the incurred costs and to collect them was
both an unfair or unconscionable means to collect a debt
under § 1692f and a false representation concerning the
character, amount, or legal status of a debt under §
1692e(2)(A). Coyne also contends that he did not owe Messerli
costs of $153.60, and thus the letter violated several
subsections of § 1692e and § 1692f. (Am. Compl.
¶¶ 55-60.) Second, the charge-off balance in the
letter allegedly included principal, fees, and contractual
interest and, according to Coyne, this violated the FDCPA in
multiple ways. (Id. ¶¶ 69-71.) Finally,
the letter violated the FDCPA because Messerli “did not
disclose the time period from which the interest at 6.00%
accrued” (id. ¶ 74), and the interest
amount listed constituted compounded statutory interest in
violation of Minnesota law. (Id. ¶ 80.)
then received a letter from Defendant Midland Credit
Management, dated September 28, 2016. (Id. ¶
102.) (The Amended Complaint does not specify what the
relationship is between Midland Funding and Midland Credit
Management.) This letter listed the “Charge-Off
Balance” as $13, 205.30, an interest rate of 6.00%, the
“MCM Interest Balance” as $214.82, and the
“Current Balance” as $13, 420.13. (Id.
Ex. B at 2.) The letter offered Coyne “Available
Payment Options” including paying 30% of the debt to
settle the account in full. (Id. at 1.) The letter
also told Coyne that, “[b]ecause of the age of your
debt, we will not sue you for it. If you do not pay the debt,
we may continue to report it to the credit reporting agencies
as unpaid.” (Id.) Coyne contends that this
letter misrepresented the principal balance because the
amount listed included principal, fees, and interest. (Am.
Compl. ¶ 111.) Coyne also contends that the amount
listed as “MCM interest” violated the FDCPA in
multiple ways. (Id. ¶¶ 126-46.)
November 10, 2016, Midland Credit Management sent Coyne
another letter, substantially the same as the September
letter, again offering to settle the debt by paying 30% of
the “current balance of $13, 420.13, ” or $4,
026.03. (Id. Ex. C.) Coyne contends that this letter
also violated §§ 1692e and 1692f in similar ways to
the other letters. (Am Compl. ¶¶ 156-57, 161-62,
171-76, 184-88.) Coyne does not allege that he took any
action in response to these letters, or that he was ever
contacted by any of the Defendants after these letters.
seeks to represent two subclasses of individuals with
“addresses within the state of Minnesota” who
received a communication similar to those he received from
Messerli and the Midland entities. (Id. ¶ 199.)
Amended Complaint raises a single claim for violation of the
FDCPA against all three Defendants. He alleges that the
statutory violations invaded his privacy, caused him
emotional distress and embarrassment, and that Defendants
intimidated and harassed him. (Id. ¶¶
195-97.) Coyne seeks both actual damages and statutory
damages under § 1692k, and attorney's fees and
Standard of Review
evaluating a motion to dismiss under Rule 12(b)(6), the Court
assumes the facts in the Complaint to be true and construes
all reasonable inferences from those facts in the light most
favorable to the non-moving party. Morton v. Becker,
793 F.2d 185, 187 (8th Cir. 1986). However, the Court need
not accept as true wholly conclusory allegations, Hanten
v. Sch. Dist. of Riverview Gardens, 183 F.3d 799, 805
(8th Cir. 1999), or legal conclusions that the plaintiff
draws from the facts pled. Westcott v. City of
Omaha, 901 F.2d 1486, 1488 (8th Cir. 1990).
survive a motion to dismiss, a complaint must contain
“enough facts to state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 545 (2007). Although a complaint
need not contain “detailed factual allegations, ”
it must contain facts with enough specificity “to raise
a right to relief above the speculative level.”
Id. at 555. “Threadbare recitals of the
elements of a cause of action, supported by mere conclusory
statements, ” will not pass muster under
Twombly. Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (citing Twombly, 550 U.S. at ...