Sharolyn Charles wrote a check for $17.93 to a Poncho’s Restaurant on July 4, 1996, as payment for a meal she had there. The check was returned for insufficient funds. Poncho’s forwarded the check to Check Rite for collection. On July 19, Check Rite sent a letter to Charles, stating that “[t]his is an attempt to collect a debt” and requesting total payment of $42.93—the amount of the check plus a service charge of $25. On August 7, Check Rite sent a second letter, requesting payment of $42.93 and advising Charles that failure to pay the total amount due might result in additional liability for damages and attorneys’ fees, estimated at $242.93.
Check Rite subsequently referred the matter to the law firm of Lundgren & Associates for collection. On September 8, Lundgren sent a letter to Charles offering to settle within 10 days for a total amount of $127.93—the amount of the check plus a settlement amount of $110. Lundgren further advised that it had made no decision to file suit, that it could later decide to do so, and that Charles’s potential liability was $317.93. Charles immediately sent to Lundgren a money order in the amount of $17.93. On September 13, Lundgren sent a second letter, repeating the settlement offer made in the September 8 letter.
Lundgren then returned Charles’s payment on September 14, declining to accept it as payment in full and repeating the settlement offer. On September 19, Lundgren sent a fourth letter to Charles, repeating the settlement offer. On October 15, 1996, Charles filed suit in federal district court alleging violations of the Fair Debt Collections Practices Act (FDCPA). Lundgren & Associates moved to dismiss the case on grounds that an attempt to collect on a check is not a “debt” governed by FDCPA. The district court dismissed the case; Charles appealed. Should Charles win? Is she protected under the FDCPA? [Charles v Lundgren & Associates, P.C., 119 F3d 739 (9th Cir)]