Federal District Court grants summary judgment for debt buyer client of Simmonds & Narita
The United States District Court for the District of Oregon granted a motion for summary judgment for Simmonds & Narita’s debt buyer client, and denied Plaintiff’s motion for summary judgment, rejecting Plaintiff’s Fair Debt Collection Practices Act claims arising out of the filing of a lawsuit in Oregon state court by the debt buyer seeking to recover Plaintiff’s unpaid credit card obligation on an account stated theory. In a matter of first impression, the Court concluded that Oregon’s courts would allow debt collectors to assert claims for account stated to recover credit card debts. Second, the Court concluded it was not misleading for a collector to sue for account stated rather than breach of contract. Next, the Court concluded there was nothing improper about the debt collector seeking voluntary payment from the debtor of a greater amount than the collector ultimately sued to collect, as both amounts were valid. The collector was free to sue for less than it initially sought from the debtor, and there was nothing material about doing so. Fourth, the Court rejected the debtor’s argument that, under the choice-of-law provision in the cardholder agreement between the debtor and the original creditor, Virginia’s shorter statute of limitations applied to the debt collector’s account sated claim, rather than Oregon’s statute of limitations. The Court concluded the choice of law provision in the cardholder agreement did not apply to the account stated claim, because the claim was not based on the cardholder agreement, and therefore Oregon’s statute of limitations applied. It was undisputed that the account stated claim was timely under Oregon law. Finally, although not pled in Plaintiff’s complaint, the Court rejected his claim that the state-court complaint improperly sought an award of court costs, ruling that such a request would not mislead the least sophisticated debtor, as it was simply a prayer for relief that was dependent on the Court’s ultimate ruling.