Court of Appeal (Cal.) Says Type-Size Violation was “Able to be Cured” under the Rosenthal Act, But Defendant Could Not Pick Off Class Representative

In Timlick v. Nat’l Enter. Sys., No. A154235, 2019 Cal. App. Unpub. LEXIS 3198 (May 7, 2019), the California Court of Appeal found that a type-size error was able to be cured under the Rosenthal Act’s safe harbor.

While, strictly speaking, the legislative history of the Consumer Collection Notice law has no bearing in discerning the legislative intent of section 1788.17, these statements cannot reasonably be reconciled with Timlick’s assertion that the 1999 enactment of section 1788.17 repealed section 1788.30(d). Timlick also contends that NES’s violation of section 1812.701 was not “a violation which is able to be cured” within the meaning of section 1788.30(d). We disagree. The aforementioned statements in the floor analyses of Senate Bill No. 1022 demonstrate that a violation of the type-size requirement was intended to be a Rosenthal Act violation subject to the 15-day correction period. It necessarily follows that the violation is “able to be cured” despite the correction being made in a writing subsequent to the first written communication to the debtor.6 Finally, we reject Timlick’s contention that section 1788.30(d) does not apply to a violation of a statutory provision contained in title 2.97. True, the cure provision pertains to liability under “this title” (title 1.6C). But title 2.97 makes clear that a violation of section 1812.701(b)’s type-size requirement “shall be considered a violation of the [Rosenthal [*15]  Act] (Title 1.6C).” (§ 1812.702.) In sum, we conclude the cure provision of section 1788.30(d) was available to NES to cure its violation of section 1812.701(b)’s type-size requirement.

The Court of Appeal held, however, that the Rosenthal Act permits class actions for all Rosenthal Act violations, not just those incorporated by Civil Code 1717, and that trial court erred in dismissing the class action based on the defendant’s cure of the class representative’s error.

We conclude the statutory language of section 1788.17 does not purport to limit the incorporated FDCPA remedies to FDCPA violations. Section 1788.17 broadly states that, “[n]otwithstanding any other provision” of the Rosenthal Act, “every debt collector collecting or attempting to collect a consumer debt . . . shall be subject to the remedies in Section 1692k.” It does not say or otherwise imply that debt collectors are subject to the remedies in section 1692k of the FDCPA only if they violate the provisions of sections 1692b to 1692j. Nor does the statutory language make any distinction among the types of claims for which class action remedies would be available in state Rosenthal Act suits. . .NES argues it did not pick off the named plaintiff within the meaning of these authorities, but rather, it substantively prevailed on the merits of Timlick’s individual claim based upon the cure defense provided by section 1788.30(d). On this score, the critical issues are whether the defendant’s actions are voluntary and relief is provided to the plaintiff alone. (Schoshinski, supra, 9 Cal.App.5th at p. 804.) Here, NES’s victory was only made possible by its voluntary correction of the type-size violation. NES did not prevail against Timlick in the sense that her allegations were disproven or shown to be meritless. On the contrary, her allegation that NES violated section 1812.701(b)’s type-size requirement was implicitly conceded. Moreover, NES does not argue or point to any evidence in the record that it corrected the alleged violations as to the rest of the putative class. Therefore, just as in a typical pick off scenario, NES voluntarily gave special treatment to the named plaintiff only, resulting in the elimination of her standing to maintain a putative class action. (Schoshinski, supra, 9 Cal.App.5th at p. 804.) Finally, the policy concerns [*26]  underlying the pick off exception are implicated here. The effect of the trial court’s dismissal of the action is that putative class members who do not have the financial means to initiate or join the litigation will not obtain any 15 redress. And any relief for the putative class members would require multiple individual suits, resulting in the kind of revolving door litigation that wastes judicial resources. (LaSala, supra, 5 Cal.3d at p. 873.) For these reasons, we conclude the pick off exception applies to the circumstances of this case. Accordingly, the trial court erred in dismissing the entire putative class action without first affording Timlick the opportunity to amend her complaint, redefine the putative class, or locate a suitable class representative, and without giving notice to the putative class. (La Sala, supra, 5 Cal.3d at p. 872.)