District Court (Tex.) Says Commercial Loan and Personal Guaranty Was Outside the FDCPA

Plaintiffs allege that they are “consumers” and that defendant Fora is a “debt collector” as defined by the FDCPA. Fora argues, however, that the debt at issue is not a “debt” as defined by the statute.¹² The FDCPA defines “debt” as “any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for personal, family, or household purposes ….” 15 U.S.C. § 1692a(5). Plaintiffs do not allege that the transaction at issue was primarily for personal, family, or household purposes. And the Agreement states that “Borrower certifies that the Loan proceeds will be used for business purposes only and will not be used for personal, family or household purposes.”¹³ The court therefore concludes that the obligation is not a “debt” under the FDCPA, that the cited FDCPA provisions do not apply, and that Plaintiffs’ FDCPA claims therefore fail as a matter of law.