A New Jersey man has filed a proposed class action claiming defendant Sunrise Credit Services, Inc. violated the Fair Debt Collection Practices Act (FDCPA) with its debt collection practices. According to the plaintiff, the defendant sent collection letters to consumers that included the following language:
“As a result of this settlement, if the amount cancelled on this debt equals or exceeds $600, the IRS may require the creditor to report the amount cancelled on a form 1099-C.”
The lawsuit argues that the defendant unlawfully failed to tell proposed class members that there are “other exceptions beyond the $600 threshold amount that affect whether cancellation of debt is reportable.” Semantically, the complaint continues, the defendant’s use of the word “may” in the language in question is a key sticking point, since it may lead consumers to be confused as to whether the debt cancellation needs to be reported.
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