Past Due

Developments and Insights Impacting the Consumer Credit Industry

On April 5, 2019, in Holzman v. Malcom S. Gerald & Assocs., Inc., 2019 WL 1495642, the Eleventh Circuit held that an express threat of litigation is not required to state a claim under the Fair Debt Collection Practices Act so long as an implicit threat can be reasonably inferred from the communication. The plaintiff claimed that a debt buyer and a debt collection law firm violated the FDCPA by (1) sending a collection letter…
The Southern District of Florida recently ruled that ringless voicemails (RVM) are “calls” under the Telephone Consumer Protection Act (TCPA). In Schaevitz v. Braman Hyundai, No. 1:17-cv-23890 (S.D. Fla. Mar. 25, 2019) the defendant sent a pre-recorded RVM to the plaintiff soliciting a return call regarding trading in the plaintiff’s car for a newer model. The technology used created an internet-based computer-to-computer connection direct from the sender to the recipient’s voicemail box without causing the…
In Obduskey v. McCarthy & Holthus LLP, No. 17-1307 (Sup. Ct. Mar. 20, 2019), the Supreme Court ruled unanimously that non-judicial foreclosure actions required by state law are not generally considered debt collection, and therefore are not subject to regulation under the FDCPA. The majority opinion, written by Justice Breyer, held that the firm’s foreclosure activities to enforce a valid mortgage security interest neither fell within the purview of section 1692f(6), which provides a limited…
The plaintiff in Mollberg v. Advanced Call Center Technologies, Inc., No. 18-1210, 2019 WL 288128 (E.D.Wis. Jan. 22, 2019) received a letter from Advanced Call Center Technologies (which I’ll refer to as ACCT) that attempted to collect a debt owed to Synchrony Bank.  The letter said that the “Total Account Balance” was $1,113.00 and that the “Amount Now Due” was $234.00.  Even though the letter didn’t itemize it, the “Amount Now Due” was the sum of the…
In Reyes v. Steeg Law, LLC, 2019 WL 258068, (5th Cir. Jan. 17, 2019), the Fifth Circuit considered whether a law firm was a debt collector under the FDCPA. Under the FDCPA, attorneys qualify as debt collectors when they regularly engage in consumer debt collection, including but not limited to litigation on behalf of a creditor client. The Fifth Circuit affirmed the District Court’s holding that Steeg Law, which specialized in real estate and condominium…
The least sophisticated consumer doesn’t need everything spelled out for him.  Or at least that’s what the Eleventh Circuit held recently in Conde v. Webcollex, LLC, No. 18-12551 — another case where a court finds that something means exactly what it says. The plaintiff in Conde filed suit after he got a validation letter from Webcollex telling him that: Unless you notify this office within 30 days after receiving this notice that you dispute the validity…
Few things under the Telephone Consumer Protection Act (TCPA) are subject to as much uncertainty as the definition of “automatic telephone dialing system” (ATDS). This year’s decision in ACA Int’l v. FCC, 885 F.3d 687 (D.C. Cir. 2018) seems to have raised more questions than it answered as courts and the FCC continue to grapple with this definitional component of the TCPA.  Courts are divided as to how to define an ATDS as demonstrated by…
The prospect of attorneys’ fees is often a major factor in strategy and, in particular, settlement.  Defendants sometimes pay more up front just to avoid “running up” plaintiff’s counsel’s fees.  On the flip side, some plaintiff’s counsel may continue to work a low-value case rather than settling, knowing that they may be awarded all of their fees later on.  A recent decision illustrates that neither side should assume that plaintiffs’ counsel will be awarded the…
Two weeks ago, we attended the ACA International Annual Convention in Nashville.  One of the more interesting discussions focused on compliance lessons creditors and debt collectors can take away from recent court decisions. Some of them were easy. For example, in Armata v. Target Corp., 2018 WL 3097094 (Mass. Sup. Ct. June 25, 2018), the Massachusetts Supreme Judicial Court held that, under Massachusetts law, a debt collector may only initiate two automated calls to a…
In Obduskey v. McCarthy & Holthus LLP, the Supreme Court has agreed to hear an appeal from the Tenth Circuit over whether the provisions of the Fair Debt Collection Practices Act apply to non-judicial foreclosures. The Tenth Circuit held that a foreclosure attorney was not a debt collector under the FDCPA because the FDCPA does not apply to non-judicial foreclosures, and it rejected the idea that every foreclosure was undertaken in an attempt to collect…