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6th Circuit Court of Appeals Joins 7th Circuit in Rejecting “Benign” Language Exception to 15 USC § 1692f(8), Contrary to the 5th and 8th Circuits.

by Laszlo Ladi, Jr. |

In Donovan v. FirstCredit, Inc., No. 20-3485, 2020 U.S. App. LEXIS 39798 (6th Cir. Dec. 18, 2020) the Court of Appeals for the 6th Circuit reversed the trial court’s ruling granting FirstCredit’s motion for judgment on the pleadings and in doing so, rejected a “benign language” exception to 15 U.S.C. § 1692f(8) of  the Fair Debt Collection Practices Act (“FDCPA”).… Read More

District Court (Cal.) Says Medical Debt is “Consumer Credit Transaction” Under Rosenthal Act; that Bona Fide Error Must Be “Reasonable”; that FDCPA and Rosenthal Act Combine to Permit Three Penalties

by Scott J. Hyman |

In Hanrahan v. Statewide Collection, Inc., No. 19-cv-00157-MMC, 2020 U.S. Dist. LEXIS 242290 (N.D. Cal. Dec. 23, 2020), Judge Chesney granted partial summary judgment to a Rosenthal Act Plaintiff.  She held that the bond fide error rule can apply to mistakes of fact, but not where the mistake occurred with respect to a well-publicized error made by the debt collector.… Read More

Well that’s interesting. 7th Cir. Refuses to Grant Petition to Compel Arbitration of FDCPA Claim Because Plaintiff Lacked Art. III Jurisdiction to Start.

by Scott J. Hyman |

In Nettles v. Midland Funding LLC, No. 19-3327, 2020 U.S. App. LEXIS 40012 (7th Cir. Dec. 21, 2020), the Court of Appeals for the 7th Circuit declined to address arbitration of an FDCPA case because of lack of Art. III jurisdiction to start. Most of the briefing concerns the arbitration issue, but the parties also identify a possible problem with… Read More

CFPB Issues December 2020 Debt Collection Final Rule

by Laszlo Ladi, Jr. |

On the heels of the October 2020 Debt Collection Final Rule issued by the Consumer Finance Protection Bureau (CFPB), on December 18, 2020, the CFPB issued an additional final rule implementing the Fair Debt Collection Practices Act. The December 2020 final rule and an executive summary are available here: https://www.consumerfinance.gov/compliance/compliance-resources/other-applicable-requirements/debt-collection/. The December 2020 final rule primarily addresses the (1) requirements… Read More

8th Cir. Says Debt Buyer is Subject to FDCPA Post-Henson; Says Debt Buyer Might Not Be Vicariously Liable for Activities of Debt Collector It Hired

by Scott J. Hyman |

In Reygadas v. DNF Assocs., LLC, No. 19-3167, 2020 U.S. App. LEXIS 38989 (8th Cir. Dec. 14, 2020), the Court of Appeals held that a debt buyer was subject to the FDCPA. Emphasizing that the Supreme Court in Henson overruled the so-called "default test," DNF argues that the debt buyer is a creditor -- a person "to whom a debt… Read More

District Court (Cal.) Says Itemization of Fees as “$0.00” With Language that Fees May Accrue Was Not Deceptive

by Scott J. Hyman |

In Maclean v. Collection Bureau of Am., Ltd., No. 3:20-cv-00426-JLS-DEB, 2020 U.S. Dist. LEXIS 233508 (S.D. Cal. Dec. 11, 2020), Judge Sammartino dismissed an FDCPA claim based on language in a validation letter regarding fee accrual. Defendant contends that the language included in the collection letter is appropriate and is nearly identical to the language relied on by multiple circuits… Read More

District Court (Cal.) Says Rosenthal Act’s Embedded Federal Claim Does Not Confer Federal Jurisdiction

by Scott J. Hyman |

In Dollaga v. Specialized Loan Servicing Llc, No. 20-cv-07472-JSC, 2020 U.S. Dist. LEXIS 233610 (N.D. Cal. Dec. 11, 2020), Magistrate Judge Corley remanded a Rosenthal Act claim for wont of federal question jurisdiction. Plaintiff's complaint seeks damages and injunctive relief for: (1) breach of contract; (2) breach of the implied covenant of good faith and fair dealing; (3) intentional interference… Read More

District Court (Ohio) Says ID Theft Victim Has Lesser Standard in Proving “Consumer” Element of Debt under FDCPA; Says Checks Are Subject to FDCPA; Finds Collection Law Firm’s Continued Collection Following Withdrawal of Authority from Client Violates FDCPA

by Scott J. Hyman |

In Woodard v. O'Brien, No. 2:18-cv-1523, 2020 U.S. Dist. LEXIS 228608 (S.D. Ohio Dec. 4, 2020), Judge Marbley addressed the standards for an ID theft victim to prove an FDCPA claim. When determining if an individual is a "consumer" under the FDCPA, the typical inquiry is to ask whether the debt was for "personal, family, or household purposes." Martin v.… Read More

1st Cir. Says Debt Buyers and their Law Firms Could Enforce Arbitration Clauses in Credit Card Agreements to Defend FDCPA Class Action Based On Customer Prevailing in Underlying Debt Collection Suit

by Scott J. Hyman |

In Barbosa v. Midland Credit Mgmt., No. 19-1896, 2020 U.S. App. LEXIS 37174 (1st Cir. Nov. 25, 2020), the First Circuit Court of Appeal affirmed referring a matter to arbitration. A resident of Massachusetts, Barbosa opened a credit card account with Barclays Bank Delaware ("Barclays") in April 2011. The last payment she made on the account was in November 2012.… Read More

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