District Court (Or.) Finds Consumer Consented to Be Called on Cellular Telephone under TCPA; Finds Aviation Educational Loan was “Consumer” Debt under FDCPA

In Smith v. Progressive Financial Services, Inc., 2013 WL 3995004 (D.Or. 2013), Judge McShane found that a student loan taken out to attend an aviation academy was still a ‘consumer’ debt under the FDCPA.

Contrary to defendant’s argument, “education” encompasses something broader than mere investment in pursuit of profit.   Brown v. Bd. of Ed. Of Topeka, Shawnee Cnty, Kan., 347 U.S. 483, 493 (1954) (“… our recognition of the importance of education to our democratic society…. It is the very foundation of good citizenship.”); Meyer v. Nebraska, 262 U.S. 390, 400 (1923) (“The American people have always regarded education and acquisition of knowledge as matters of supreme importance which should be diligently promoted .”). Education, unlike venture capital, cannot be taken by creditors upon default and remains with the consumer throughout his or her life; any skill or knowledge acquired by plaintiff is hers and hers alone. In contrast, if plaintiff invested her loan in a business and then defaulted, defendant would be provided with ample opportunities to reach such an interest. These factors, when viewed “as a whole,” indicate that plaintiff’s educational services were primarily for personal purposes. Thus, plaintiff’s student loan is “debt” subject to the FDCPA. See, e.g., Brumberger v. Sallie Mae Servicing Corp., No. Civ.A. 02–2909, 2003 WL 1733548, at *3 (E.D.La. Mar. 28, 2003); Skerry v. Massachusetts Higher Educ. Assistance Corp., 73 F.Supp.2d 47, 51 (D.Mass.1999); Pelfrey v. Educ. Credit Mgmt. Corp., 71 F.Supp.2d 1161, 1166 (N.D.Al.1999); Carrigan, 494 F.Supp. at 826.

The Court also found that the Plaintiff consented to receive collection calls on his cellular telephone under the TCPA.

The TCPA makes it unlawful to make automated calls to cell phones without prior consent except if for emergency purposes. 47 U.S.C. § 227(b)(1)(A)(iii) (2012). Plaintiff contends that (1) she did not give express consent to Sallie Mae to contact her at the (772) xxx-xx46 number, but merely to contact her at the (772) xxx-xx73 number, and (2), she did not give express consent to defendant to contact her cell phone by automated call.  ¶  First, plaintiff expressly consented to the use of automated telephone dialing equipment.FN7 Plaintiff’s express consent extended to the “loan application,” to “other documents,” or more generally, “in connection with this loan or loan application.” Decl. of Mary Kay Mauer, Apr. 22, 2013, ECF No. 30, Ex. 103 at § XII(14). Plaintiff provided the (772) xxx-xx46 num-ber pursuant to § XII(1) of the loan application on October 23, 2008 as a subsequent change in information.FN8 Thus, plaintiff provided express consent to Sallie Mae to contact her at the (772) xxx-xx46 number either in the “loan application,” “other document,” or more generally, “in connection with this loan or loan application.” In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, Request of ACA Int’l for Clarification and Declaratory Ruling, 23 F.C.C.R. 559, 564–65 (2008) (“We emphasize that prior express consent is deemed to be granted only if … such number was provided during the transaction that resulted in the debt owed.”); see also Meyer v. Portfolio Recovery Associates, LLC, 707 F.3d 1036, 1042 (9th Cir.2012) (applying FCC declaratory ruling). Second, plaintiff’s express consent extended to defendant “in connection with this loan or application,” as a valid assignment under the loan application FN9 and explicitly under the terms of the application.FN10 Accordingly, summary judgment is granted in favor of defendant on plaintiff’s TCPA claim.  [FN7. “14. Use of Automated dialing Equipment; Calls to Cellular Telephone; I consent to your use of automated telephone dialing equipment or an artificial or prerecorded voice message to contact me in connection with this loan or loan application. You may contact me any telephone number provided in the loan application or in other documents, even if any such number is a cellular telephone number.” Decl. of Mary Kay Mauer, Apr. 22, 2013, ECF No. 30, Ex. 103 at § XII(14).]