As FY 2015 came to a close, the FTC asked for commentary on its Holder Rule for assignee liability. Consumers and Industry responded in early 2016. Three years in the making, the FTC finally responded, issuing its commentary today in the Federal Register, and it’s first official commentary since the Rule was promulgated in 1975. FTC Commentary on Holder Rule 5-2-19. The highlight of the Commentary, of course, is that the FTC decided not to make any alterations to the text of the Holder Rule, and affirmed the Holder Rule’s (and, inferentially, Lafferty‘s) cap on attorneys’ fees:
We conclude that if a federal or state law separately provides for recovery of attorneys’ fees independent of claims or defenses arising from the seller’s misconduct, nothing in the Rule limits such recovery. Conversely, if the holder’s liability for fees is based on claims against the seller that are preserved by the Holder Rule Notice, the payment that the consumer may recover from the holder—including any recovery based on attorneys’ fees—bcannot exceed the amount the consumer paid under the contract. Claims against the seller for attorneys’ fees or other recovery may also provide a basis for set off against the holder that reduces or eliminates the consumer’s obligation. The Commission does not believe that the record supports modifying the Rule to authorize recovery of attorneys’ fees from the holder, based on the seller’s conduct, if that recovery exceeds the amount paid by the consumer.