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St. Pierre v. Retrieval-Masters Creditors Bureau, Inc.

United States District Court, D. New Jersey

March 24, 2017

THOMAS E. ST. PIERRE, in his own right and on behalf of all those similarly situated, Plaintiff,
v.
RETRIEVAL-MASTERS CREDITORS BUREAU, INC., Defendant.

          OPINION

          Honorable Freda L. Wolfson United States District Judge

         In this putative class action, Plaintiff Thomas E. St. Pierre (“Plaintiff”) alleges that defendant Retrieval-Masters Creditors Bureau, Inc. (“Defendant”) violated the Fair Debt Collection Practices Act (the “FDCPA” or the “Act”), 15 U.S.C. § 1692, et seq., because Defendant, a debt collector, mailed Plaintiff, and other similarly situated debtors, envelopes with glassine windows through which their account number and other personal information was visible. Presently before this Court is Defendant's motion to dismiss the Amended Complaint, pursuant to Fed. R. of Civ. P. 12(b)(1) and 12(b)(6). For the reasons set forth below, Defendant's motion to dismiss is GRANTED.

         I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

         The allegations in the Amended Complaint are straightforward.[1] Plaintiff alleges that he contracted with New Jersey E-ZPass (“E-ZPass”) to participate in its electronic toll payment program (the “Agreement”), which allows tolls to be collected from an E-ZPass account through an electronic transponder. See Am. Compl. ¶¶ 19-20; Ex. A. Plaintiff alleges that, pursuant to the Agreement, he was required to maintain a prepaid balance, and, at the moment he passed through a lane accepting the electronic payment, E-ZPass would automatically deduct the required toll charge from his account balance.[2] Id. at ¶ 19; Ex. A. Plaintiff further alleges that, when he passed through a lane with insufficient funds in his account, he was subject to penalties for nonpayment of the toll. Id. at ¶¶ 23, 25; Ex. A.

         Plaintiff asserts that Defendant sent him a collection letter, dated November 11, 2013, attempting to recover $60.06, which “constituted a combination of unpaid tolls and associated penalties….” Id. at ¶ 23. In the letter, Defendant advised Plaintiff that, because he had not “maintain[ed] a sufficient prepaid balance, ” E-ZPass revoked his privileges and assigned the unpaid obligation to Defendant for collection. Id. at Ex. B. Defendant warned Plaintiff that the [c]ontinued use of your New Jersey E-ZPass tag will result in toll evasion violations and administrative fees.” Id. In addition, Plaintiff alleges that, nearly seven months later, Defendant sent him another collection letter, dated June 16, 2014, attempting to recover “the amount of $1, 200.75, which represented a combination of unpaid tolls and associated penalties.” Id. at ¶ 25; Ex. C. Defendant also notified Plaintiff that “[t]he New Jersey Turnpike Authority retains the right to issue a summons for violating N.J.A.C. 19:9-9.2.” Id. at Ex. C.

         Plaintiff does not challenge the validity of the underlying obligation to pay outstanding tolls and penalties. Rather, in his single-count Amended Complaint, Plaintiff asserts that Defendant violated § 1692f(8) of the FDCPA “by sending E-ZPass collection letters to Plaintiff and members of the putative Class in envelopes with glassine windows through which their account numbers were made visible.”[3] Id. at ¶ 42; see id. at ¶ 27. According to Plaintiff, the “disclosure of the account numbers… constitutes an invasion of privacy, a core concern animating the FDCPA, ” since it disseminates information about his “status as alleged debtor[], as well as [Defendant's] debt collection efforts.” Id. at ¶ 44. Based on that alleged violation, and pursuant to § 1692k(a) of the FDCPA, Plaintiff seeks statutory damages plus costs and attorney's fees.

         On March 2, 2015, Plaintiff filed the instant action in the Superior Court of New Jersey, Law Division, Ocean County. On April 10, 2015, Defendant removed the action to this Court. Shortly after Defendant filed a motion to dismiss the Complaint, Plaintiff filed an Amended Complaint on June 22, 2015. On August 17, 2015, Defendant filed a motion to dismiss the Amended Complaint, or, in the alternative, stay the action pending the outcome of the Supreme Court's decisions in Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016) and/or Spokeo, Inc. v. Robins, 136 S.Ct. 1540 (2016). On January 6, 2016, this Court ordered a stay of the proceedings. After the Supreme Court decided Spokeo, Plaintiff filed a motion to vacate the stay of proceedings. On June 16, 2016, this Court ordered that the stay be lifted, but administratively terminated the pending motion to dismiss. On August 19, 2016, at the instruction of the Court, Defendant renewed its motion to dismiss the Amended Complaint, which Plaintiff has opposed.

         II. STANDARD OF REVIEW

         Under Rule 12(b)(6), a complaint may be dismissed for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). When reviewing a motion to dismiss on the pleadings, courts “accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief.” Phillips v. Cnty. of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008) (internal quotation marks omitted). Under such a standard, the factual allegations set forth in a complaint “must be enough to raise a right to relief above the speculative level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). Indeed, “the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “[A] complaint must do more than allege the plaintiff's entitlement to relief. A complaint has to ‘show' such an entitlement with its facts.” Fowler v. UPMC Shadyside, 578 F.3d 203, 211 (3d Cir. 2009).

         However, Rule 12(b)(6) only requires a “short and plain statement of the claim showing that the pleader is entitled to relief” in order to “give the defendant fair notice of what the… claim is and the grounds upon which it rests.” Twombly, 550 U.S. at 555. The complaint must include “enough factual matter (taken as true) to suggest the required element. This does not impose a probability requirement at the pleading stage, but instead simply calls for enough facts to raise a reasonable expectation that discovery will reveal evidence of the necessary element.” Phillips, 515 F.3d at 234 (internal quotation marks and citation omitted); Covington v. Int'l Ass'n of Approved Basketball Officials, 710 F.3d 114, 118 (3d Cir. 2013) (“[A] claimant does not have to set out in detail the facts upon which he bases his claim. The pleading standard is not akin to a probability requirement; to survive a motion to dismiss, a complaint merely has to state a plausible claim for relief.”) (internal quotation marks and citation omitted).

         In sum, under the current pleading regime, when a court considers a dismissal motion, three sequential steps must be taken: first, “it must take note of the elements the plaintiff must plead to state a claim.” Connelly v. Lane Const. Corp., 809 F.3d 780, 787 (3d Cir. 2016) (internal quotations marks and brackets omitted). Next, the court “should identify allegations that, because they are no more than conclusions, are not entitled to the assumption of truth.” Id. (internal quotation marks omitted). Lastly, “when there are well-pleaded factual allegations, the court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.” Id. (internal quotation marks and brackets omitted).

         III. DISCUSSION

         Defendant argues that the Amended Complaint should be dismissed because Plaintiff has failed to allege a concrete harm sufficient to establish Article III standing. In the alternative, Defendant contends that the obligation it seeks to recover - the delinquent toll charges and penalties - is not a “debt” as defined by the FDCPA. In response, Plaintiff contends that he has alleged sufficient concrete harm because Defendant disclosed his private information by sending two collection letters that made visible his account number. Moreover, Plaintiff argues that Defendant was attempting to collect a “debt” within the meaning of the FDCPA, because the obligation to pay the outstanding tolls and penalties arose from the E-ZPass Agreement, which is a consensual transaction. I turn first to the standing question.

         a. ARTICLE III STANDING

         Article III of the United States Constitution limits the scope of federal courts to actual “cases” or “controversies.” See U.S. Const., art. III, § 2. “The [standing] doctrine developed in our case law to ensure that federal courts do not exceed their authority as it has been traditionally understood, ” and, as a result, “[t]he doctrine limits the category of litigants empowered to maintain a lawsuit in federal court to seek redress for a legal wrong.” Spokeo, Inc., 136 S.Ct. at 1547; see Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992). Article III standing consists of three irreducible elements: “[t]he plaintiff must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” Spokeo, Inc., 136 S.Ct. at 1547 (citing Lujan, 504 U.S. at 560-61).

         Here, Defendant's argument centers entirely on the injury-in-fact element, and more specifically, the requirement that an injury be concrete. Generally speaking, to demonstrate an injury-in-fact, “a plaintiff must show that he or she suffered ‘an invasion of a legally protected interest' that is ‘concrete and particularized' and ‘actual or imminent, not conjectural or hypothetical.'” Id. at 1548 (quoting Lujan, 504 U.S. at 560). In order for an injury to be particularized, “it ‘must affect the plaintiff in a personal and individual way.'” Id. (quoting Lujan, 504 U.S. at 560 n.1). In addition, “[a]n injury in fact must also be ‘concrete.'” Id. While courts have sometimes conflated the particularization and concreteness requirements of standing, the Supreme Court in Spokeo explained that “[a] ‘concrete' injury must be ‘de facto'; that is, it must actually exist.” Id. (citation omitted). The Court continued, “[w]hen we have used the adjective ‘concrete, ' we have meant to convey the usual meaning of the term - ...


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