Category: FDCPA

Church Provides No Sanctuary: Sixth Circuit’s FDCPA Decision May Breathe New Life into TCPA Spokeo Arguments

A number of Circuit Courts of Appeal have addressed Spokeo challenges to consumer protection statutes in the 646 days (and counting) since the U.S. Supreme Court handed down Spokeo, Inc. v. Robins in 2016. Most of those decisions have given the issue of standing short shrift, leapt to conclusions or—perhaps worst of all—shown a deep and unrelenting deference to Congressional legislative power in assessing Article III limits. The result has been languid opinions and squishy legal doctrine in the arena of standing, where only precision and intellectual rigor ought to prevail. Hagy v. Demers & Adams, No. 17-3696, 2018 U.S. App. LEXIS 3710 (6th Cir. Feb. 16, 2018) marks a stark departure from its soft-thinking predecessors, and represents the first intellectual tour-de-force of the post-Spokeo era.

The CFPB Says Fees and Fee-Related Disclosures For Payments-By-Phone May Constitute an Unfair and Deceptive Practice and Violate Federal Debt Collection Statutes

In a Compliance Bulletin released July 27, 2017, the CFPB cautioned covered persons and service providers that fees for pay-by-phone services may run afoul of “sections 1031 and 1036 of the [Dodd-Frank Act’s] prohibition on engaging in unfair, deceptive, or abusive acts or practices . . . when assessing phone pay fees.” The CFPB also provided guidance to debt collectors who receive phone pay fees about the possible consequences under the FDCPA.

Supreme Court Holds Debt Buyer Not Subject to FDCPA

In his first written opinion, Justice Neil Gorsuch wrote in Henson v. Santander Consumer USA, Inc. that the Fair Debt Collection Practices Act does not apply to debt buyers like Santander under one of the definitions for “debt collector.” This decision has potentially broad ramifications for financial institutions that purchase debts for collection as part of their business. At the same time, the decision leaves the door open to potential future disputes under the remaining definitions under the FDCPA.

Supreme Court Issues Midland Funding Decision

On May 15, 2017, the Supreme Court issued a 5-3 decision holding that it is not a violation of the Fair Debt Collection Practices Act to file a proof of claim in bankruptcy related to a debt for which the statute of limitations has expired, resolving a previous circuit court split regarding the issue.

Damned If You Do: Second Circuit Rules That Language Included In RESPA-Required Notice Begets FDCPA Violation

The Fair Debt Collection Practices Act (“FDCPA”) provides that, if a “debt collector” makes an “initial communication with a consumer in connection with the collection of any debt,” the debt collector must provide the consumer with certain information, such as the amount of the debt, the name of the creditor, and the consumer’s right to dispute the debt. See 15 U.S.C. § 1692g(a). However, the statute does not elaborate on the meaning of the phrase “in connection with the collection of any debt.” The U.S. Court of Appeals for the Second Circuit recently flagged a Section 1692g(a) tripwire.