Lesher v. Law Offices of Mitchell N. Kay, No. 10-3194 (3d Cir. June 21, 2011)
The Kay law firm sent Lesher two letters on lawyer letterhead concerning his home equity debt. Both letters contained these disclaimers on the back:
This communication is from a debt collector and is an attempt to collect a debt. Any information obtained will be used for that purpose.
At this point in time, no attorney with this firm has personally reviewed the particular circumstances of your account.
Lesher sued the Kay law firm in the District Court for the Middle District of Pennsylvania under the Fair Debt Collection Practices Act. Finding that the letters were false and misleading, the district court granted summary judgment to Lesher and awarded him $1,000. The Kay law firm appealed this decision to the Third Circuit.
Because a grant of summary judgment is a question of law, the Third Circuit exercised a de novo standard of review. [The question of whether Kay's letters are false and misleading in violation of the FDCPA is a mixed question of law and fact. The Court noted that the district court proceeded as if it were a question of law, and neither party challenged this or the application of a de novo standard of review on appeal. -cv]
The Court began by identifying the FDCPA as a remedial statute that should be interpreted broadly and applying the least sophisticated debtor standard in its analysis.
The Court found that the disclaimer that the letters were “from a debt collector” is merely a statutorily required notification that does not nullify the implication that the letter is from an attorney. It pointed out that the roles of attorney and debt collector are not mutually exclusive.
It further found that the disclaimer stating, “[a]t this point in time, no attorney with this firm has personally reviewed the particular circumstances of your account,” was ineffective because it completely contradicted the message on the front of the letter that an attorney had been retained to collect a debt.
[W]e believe that it was misleading and deceptive for the Kay Law Firm to raise the specter of potential legal action by using its law firm title to collect a debt when the firm was not acting in its legal capacity when it sent the letters.
In affirming the district court, the Third Circuit concluded that Kay’s letters falsely implied that an attorney was acting in his legal capacity. It stated that upon receiving the letters, the least sophisticated consumer may reasonably believe that an attorney reviewed the file and determined legal action may be required.