United States: Rhode Island Federal Court Holds That Use Of Local Area Code Phone Numbers By Out-Of-State Debt Collector Does Not Violate The FDCPA

On September 21, the United States District Court for the District of Rhode Island held that an out-of-state debt collector did not violate the Fair Debt Collection Practices Act when it called the debtor using two phone numbers with a local area code.

In Bien v. Stellar Recovery, Inc., Plaintiff argued that Stellar's practice of causing a Rhode Island area code to be displayed on her caller ID when the call was initiated outside of Rhode Island constituted a false, misleading, or deceptive representation or means in violation of § 1692e(10) of the FDCPA.  In its motion for summary judgment, Stellar argued first that Plaintiff could not prove that the debt at issue was a consumer debt within the meaning of the Act, and second, that its use of the Rhode Island area code was not a false, misleading, or deceptive means to collect the debt.

As a preliminary matter, the Court assumed without deciding that the record contained enough evidence to create a genuine issue of material fact regarding whether Plaintiff's debt constituted a consumer debt.  Applying the First Circuit's "unsophisticated consumer" standard (see Pollard v. Law Office of Mandy L. Spaulding, 766 F.3d 98, 103 (1st Cir. 2014)), the Court then considered whether the use of the local phone numbers was either (a) false, or (b) deceptive and misleading.

The undisputed facts showed that Stellar owned the use of the local numbers and that its name appeared on Plaintiff's caller ID.  Stellar had contracted with a third-party company, LiveVox, to provide its dialing services.  When Plaintiff called the numbers back, a recorded message indicated that she had reached "Stellar Recovery."  The Court held that these facts defeated Plaintiff's claim that Stellar used "false" representations or means to collect a debt.

Regarding the claim of deception, the Court noted that Stellar did not display any fictitious or familiar name in an attempt to trick Plaintiff into answering the calls – its own name appeared on Plaintiff's caller ID.  These practices would not "render an unsophisticated consumer unable to make an informed decision as to whether to answer the call."  Finding that there was no deception, the Court granted Defendant's motion for summary judgment.

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