In McAdory v. DNF Associates, LLC (9th Cir. 2020), the Court of Appeals for the 9th Circuit followed the Third Circuit’s decision in Barbato v. Greystone All., LLC (3d Cir. 2019) 916 F.3d 260, to find that a company whose principal business activity is buying defaulted debts from creditors is a “debt collector” for purposes of the FDCPA even if the company hires third parties to collect the debts it buys. Since a debt buyer can profit from its purchases only by collecting the debts it purchases, a business principally engaged in buying debt is principally engaged in the collection of those debts. And, since the debt buyer is subject to the FDCPA, the debt buyer can be held vicariously liable under the FDCPA for the debt collectors’ violations under normal theories of vicarious liability such as agency theories.
A copy of the decision can be found here.