United States District Court, District of Maryland
BIRCHARD B. ALLEN, III AND CANDYCE GOLDEN
SILVERMAN THEOLOGOU, LLP
J. Frederick Motz United States District Judge
Plaintiffs Birchard B. Allen III (“Allen”) and Candyce Golden (“Golden”) (collectively “plaintiffs”) bring this putative class action lawsuit against Silverman Theologou LLP (“Silverman”), alleging that its debt-collection practice violated the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq. and the Maryland Consumer Debt Collection Act (“MCDCA”), Md. Code Ann., Com. Law § 14-201 et seq. Now pending is a motion to dismiss all but one of plaintiffs’ claims. The motion is fully briefed, and no oral argument is necessary. See Local Rule 105.6. For the reasons set forth below, the motion is granted in part and denied in part.
Silverman is a limited liability partnership that was formed in Maryland in 2009. (Am. Compl., ECF No. 18 ¶ 14). It has several practice areas, including “Consumer and Commercial Collections.” Id. Plaintiffs claim that Silverman is a “collection agency” as defined by the Maryland Collection Agency Licensing Act (“MCALA”), Md. Code Ann., Bus. Reg. § 7-101(c), but does not have an active collection agency license as required by § 7-301(a). (Id. ¶¶ 17–19). One of Silverman’s clients is SECU Credit Union (“SECU”), who employed Silverman to collect on debts owed to SECU by plaintiffs Allen and Golden.
Allen defaulted on a debt held by SECU for money he used to purchase personal items and services including “gasoline purchases, lunch and breakfast purchases . . . and payments for auto repairs.” (Id. ¶ 12). SECU hired Silverman “on or around July 28, 2014” to collect the Allen debt, and Silverman first contacted Allen by sending a letter dated July 31, 2014. (Id. ¶¶ 22, 24). Silverman allegedly identified itself in those emails as collecting a debt, required by 15 U.S.C. § 1692(e)(11). Id. Allen also alleges that a “non-attorney debt collector” named Donald “Mike” Everette called several times, including on August 5, 12, 14, 22, and 26, 2014. (Id. ¶¶ 26, 52). Everette did not, however, disclose that he was calling on behalf of a debt collector as required by § 1692(e)(11). Eventually Allen spoke with Everette, who provided Allen with “three options for payment to avoid a lawsuit, ” and then followed up with several more “curtesy calls” that he claimed were “final.” (Id. ¶¶ 33–37). Allen does not allege that he ever made any payments on his SECU debt to Silverman.
Golden alleges she similarly incurred and later defaulted on a debt owed to SECU “that was primarily for personal, family and/or household purposes.” (Id. ¶ 40). SECU employed Silverman in February 2014 to collect Golden’s debt, and Silverman began contacting her. (Id. ¶¶ 42–44). For example, Golden received a call from SECU agent Brian Baker-allegedly not a licensed lawyer-asking her to set up a repayment plan. (Id. ¶ 48). Golden did, and began making regular payments under the plan to Silverman. (Id. ¶¶ 49–51). Despite those payments, Golden claims that she also received “harassing phone calls and voicemails from” Everette, who did not disclose he was calling on behalf of a debt collector. (Id. ¶ 52). Everette would allegedly make incorrect statements on these calls, such as stating Golden’s payment was due on a specific date and that she was behind in her payments. (Id. ¶¶ 53–63). Everette also told Golden that “We can sue you in the morning. We can garnish you in the morning up to 27 percent, ” even though Silverman lacks that authority. (Id. ¶ 62).
Allen filed a complaint in the United States District Court for the District of Maryland on October 17, 2014, and an amended complaint (which added Golden as co-plaintiff) on November 17, 2014. (ECF No. 18). Plaintiffs’ amended complaint contains two counts. In Count I, they allege Silverman has violated three provisions of the FDCPA: (1) 15 U.S.C. § 1692e(11), which requires a debt collector to disclose that it is “attempting to collect a debt and that any information obtained will be used for that purpose”; (2) § 1692e(5), which prohibits a debt collector from threatening “to take any action that cannot legally be taken or that is not intended to be taken”; and (3) § 1692f(1), which prohibits a debt collector from collecting an amount owed on a debt “unless such amount is expressly authorized by the agreement creating the debt.” Count II of plaintiffs’ amended complaint alleges that Silverman violated § 14-202(8) of the MCDCA, which prohibits a debt collector from claiming, attempting, or threatening “to enforce a right with knowledge that the right does not exist.” Md. Code Ann., Com. Law § 14-202(8).
Silverman filed a renewed motion to dismiss the amended complaint on December 11, 2014. (ECF No. 21). It seeks to dismiss all of plaintiffs’ claims except their 15 U.S.C. § 1692e(11) claim in Count I.
When ruling on a motion brought under Rule 12(b)(6), the court must “accept the well-pled allegations of the complaint as true, ” and “construe the facts and reasonable inferences derived therefrom in the light most favorable to the plaintiff.” Ibarra v. United States, 120 F.3d 472, 474 (4th Cir. 1997). “Even though the requirements for pleading a proper complaint are substantially aimed at assuring that the defendant be given adequate notice of the nature of a claim being made against him, they also provide criteria for defining issues for trial and for early disposition of inappropriate complaints.” Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. 2009). “The mere recital of elements of a cause of action, supported only by conclusory statements, is not sufficient to survive a motion made pursuant to Rule 12(b)(6).” Walters v. McMahen, 684 F.3d 435, 439 (4th Cir. 2012) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). To survive a motion to dismiss, the factual allegations of a complaint “must be enough to raise a right to relief above the speculative level . . . on the assumption that all the allegations in the complaint are true (even if doubtful in fact).” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal citations and alterations omitted). “To satisfy this standard, a plaintiff need not ‘forecast’ evidence sufficient to prove the elements of the claim . . . . However, the complaint must allege sufficient facts to establish those elements.” Walters, 684 F.3d at 439 (internal citations and quotation marks omitted). “Thus, while a plaintiff does not need to demonstrate in a complaint that the right to relief is ‘probable, ’ the complaint must advance the plaintiff’s claim ‘across the line from conceivable to plausible.’” Id. (quoting Twombly, 550 U.S. at 570).
Plaintiffs’ claims under the FDCPA and MCDCA are premised on the same theory: Silverman attempted to collect debts without obtaining the license required by Maryland law. Accordingly, this opinion first discusses whether Silverman is a “collection agency” as defined by MCALA § 7-101(c) and § 7-102(b)(9) and thus subject to its licensing regulations. Silverman’s arguments regarding the sufficiency of Golden’s pleading and the merits of plaintiffs’ claims under the MCDCA and FDCPA are then addressed in turn.
I. Silverman is a “Collection Agency” Governed by the MCALA.
The first issue is a question of statutory interpretation: is Silverman-a law firm with several practice groups, one of which is debt collection-a “debt collector” governed by MCALA’s licensing requirements, or instead exempt pursuant to an exception for lawyers. Based on the standard at the motion to dismiss stage and the detail in plaintiffs’ amended complaint, I am persuaded that Silverman is a “debt collector” not subject to the lawyer exception. Silverman argues in the alternative that if it is governed by the MCALA, the statute is ...