In Bennett v. Cielo Homeowners Ass’n, No. 19-cv-2131-WQH-BLM, 2020 U.S. Dist. LEXIS 78850, at *17-20 (S.D. Cal. May 4, 2020), Judge Hayes addressed principal/agent liability under the FDCPA.
“Seeking somewhat to level the playing field between debtors and debt collectors, the FDCPA prohibits debt collectors ‘from making false or misleading representations and from engaging in various abusive and unfair practices.'” Donohue v. Quick Collect, Inc., 592 F.3d 1027, 1030 (9th Cir. 2010) (quoting Heintz v. Jenkins, 514 U.S. 291, 292, 115 S. Ct. 1489, 131 L. Ed. 2d 395 (1995)). “Because [the FDCPA‘s] prohibitions apply only to ‘debt collector[s]’ as defined by the FDCPA, the complaint must plead ‘factual content that allows the court to draw the reasonable inference’ that [the defendant] is a debt collector.” Schlegel v. Wells Fargo Bank, NA, 720 F.3d 1204, 1208 (9th Cir. 2013) (second alteration in original) (quoting Iqbal, 556 U.S. at 678). Under the FDCPA, the term “debt collector” means “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.” 15 U.S.C. § 1692a(6). The term “debt collector” does not include a “creditor”— “any person . . . to whom a debt is owed”—unless the creditor “uses any name other than his own which would indicate that a third person is collecting or attempting to collect [a] debt[ ].” 15 U.S.C. § 1692a(4), (6). In this case, Plaintiffs allege that the debt at issue–the HOA fees–was owed to Defendant Cielo. The state court complaint and judgment that Plaintiffs attach to the FAC show that Cielo was awarded damages against Pamela Bennett for the unpaid HOA fees. (See Ex. 8, ECF No. 9 at 79 (“It is hereby ordered, adjudged, and decreed that Plaintiff, [Cielo] have judgment by default which may be enforced by money judgment against Defendant, Pamela Bennett . . . .”)). Plaintiffs do not allege that Cielo “use[d] any name other than [its] own” to collect or attempt to collect the debt owed to it. 15 U.S.C. § 1692a(6). Taking Plaintiffs’ allegations as true, and considering the exhibits attached to the FAC, Cielo is a “creditor” and is not a “debt collector” subject to the FDCPA. Plaintiffs assert that Cielo is vicariously liable for Defendants TJLF, Judge, and Mangikyan’s actions as debt collectors. However, various circuit courts, and courts in this district, have held that vicarious liability may only be imposed if both the principal and the agent are debt collectors as defined by the FDCPA. See Muhammad v. Reese Law Grp., APC, No. 16cv2513-MMA (BGS), 2017 U.S. Dist. LEXIS 64274, at *12 (S.D. Cal. Apr. 27, 2017) (“[T]he Court is persuaded by the weight of authority restricting FDCPA [vicarious] liability to entities that fit the statutory definition of ‘debt collector’ as set forth in § 1692a(6).”); Breidenbach v. Experian, No. 3:12-cv-1548-GPC-BLM, 2013 U.S. Dist. LEXIS 35807, at *10 (S.D. Cal. Mar. 13, 2013) (dismissing FDCPA claim with prejudice where the plaintiff failed to allege that the defendant “is itself a debt collector as required to impose vicarious liability”); see also Fox v. Citicorp Credit Servs., 15 F.3d 1507, 1513 (9th Cir. 1994) (imposing vicarious liability on a company for acts of its attorney where the company was also a debt collector); Wadlington v. Credit Acceptance Corp., 76 F.3d 103, 108 (6th Cir. 1996) (declining to impose vicarious liability on non-debt collectors). Plaintiffs fail to allege facts that support an inference that Cielo is a “debt collector” within the meaning of the FDCPA. Cielo is not vicariously liable for the alleged [*20] FDCPA violations of its attorneys. Defendants’ Motion to Dismiss the FDCPA claims against Defendant Cielo is granted.