MARK A. KEARNEY, District Judge.
An alleged debtor on a car loan successfully dismissed a collection action in state court in 2017. He now turns around and sues the company who sought to collect a car loan debt. He sues his former adversary and its lawyer under the Fair Debt Collection Practices Act. The alleged debtor's claim is based on the company's failure to disclose its ownership by the lawyer representing it and the lawyer violates the Rules of Professional Conduct by representing his company in filing a case. The alleged debtor fails to sufficiently plead the company seeking the debt is a debt collector under the Act. The alleged debtor also decided not to answer the motions to dismiss to explain why the company seeking to recover a debt needs to disclose its ownership when seeking repayment. He also fails to explain why a lawyer who allegedly owns a company seeking repayment cannot file the complaint. Absent opposition, we grant the motions to dismiss.
In December 2017, Keystone Acceptance Portfolio, LLC, as represented by Demetrius Tsarouhis, Esq., and the Tsarouhis Law Group, LLC, sued Barry Wyche in Philadelphia Municipal Court to collect a $7,679.85 debt arising from an auto loan.
Keystone is not licensed in Philadelphia or Pennsylvania as a collector-repossessor to collect auto loan debts.
Keystone, Attorney Tsarouhis, and his law firm move to dismiss.
To state a claim under the Fair Debt Collection Practices Act ("the Act"), Mr. Wyche must allege "(1) he is a consumer, (2) (the defendants) (are) debt collector(s), (3) (the defendant)'s challenged practice involves an attempt to collect a `debt' as the Act defines it, and (4) (the defendants have) violated a provision of the FDCPA in attempting to collect the debt."
A. Mr. Wyche fails to sufficiently plead Keystone is a debt collector under the Act.
A "debt collector" under the Act is "any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect directly or indirectly, debts owed or due or asserted to be owed or due another."
Mr. Wyche's claim arises out of Keystone's collection action against him in Philadelphia Municipal Court. Mr. Wyche alleges Keystone is the buyer and successor in interest to the original creditor. "All that matters is whether the target of the lawsuit regularly seeks to collect debts for its own account or does so for another."
B. Even if Keystone is a debt collector, Mr. Wyche failed to sufficiently plead the absence of a collector-repossessor license violates the Act.
Mr. Wyche claims Keystone is not a licensed collector-repossessor in Philadelphia or Pennsylvania as he believes is required under the Pennsylvania Commercial Code. He then claims this alleged failure to register, renders its collection efforts as deceptive. He then leaps to claim this failure to register violates Sections 1692e, 1692e(10), 1692f, and 1692f(1) of the Act. Even assuming Keystone needs to register, and did not, we are not aware of authority transforming this registration requirement into a deceptive collection claim.
"A debt collector may not use any false, deceptive or misleading representation or means in connection with the collection of any debt."
Our Court of Appeals directs not all violations of state law constitute a per se violation of the Act.
The only possible deception may be if Keystone represented having a license and did not. Mr. Wyche has not sufficiently plead Keystone asserted it had a collector-repossessor license when it did not. Mr. Wyche also failed to sufficiently plead the Defendants misrepresented the amount of debt owed. We dismiss the deceptive-based claim against Keystone.
C. An alleged violation of Pennsylvania Rules of Professional Conduct is not "deception" under the Act.
Mr. Wyche alleges Attorney Tsarouhis and his law firm's representation of his wholly-owned company Keystone violates the Act because the representation violates Pennsylvania Rule of Professional Conduct 3.7(a). "A lawyer shall not act as an advocate in a trial in which the lawyer is likely to be a necessary witness(.)"
Mr. Wyche did not allege Attorney Tsarouhis advocated for Keystone at trial. He does not plead a trial. He alleged the Philadelphia Municipal Court dismissed the collection action against him. There is no basis to find Attorney Tsarouhis and his firm violated the Rules of Professional Conduct.
Even if Attorney Tsarouhis did advocate at an unplead trial, we found no law establishing such a violation is deceptive to anyone creating a cause of action under the Act. Mr. Wyche knew Attorney Tsarouhis represented Keystone. We cannot find authority suggesting a lawyer cannot represent a company he owns or such a representation is somehow deceptive under the Act. We grant Attorney Tsarouhis's motion to dismiss.
In the accompanying Order, we grant the Defendants' motions to dismiss without prejudice if Mr. Wyche can timely plead a plausible claim consistent with his good faith obligations under Federal Rule of Civil Procedure 11.