CEB Prac. Guide § 2A.34 -- Communications with the Debtor -- False or Misleading Representations

In Moscona v. California Business Bureau, Inc., 2011 WL 5085522 (S.D.Cal. 2011), Judge Benitez granted summary judgment in favor of a debtor and against a debt collection agency on a number claims arising out of collection and reporting on a debt. Judge Benitez held that the debt collector’s reporting of the Account to the credit reporting agencies before it verified… Read More

Contrasting with Judge Nguyen's recent decision in Greenberg v. Hunt and Henriques, 2011 WL 4639833 (C.D.Cal. 2011), Judge Thurston in Moriarity v. Henriques, 2011 WL 4769270 (E.D.Cal. 2011) allowed an in pro per plaintiff to proceed against a debt collection law firm under the FDCPA and Rosenthal Act for filing and proceeding to default judgment in a state court collection… Read More

In Corby v. American Exp. Co., 2011 WL 4625719 (C.D.Cal. 2011), Judge Wright found that, under Nelson, a consumer can only recover under FCRA for a section 1681s-2(b) claim – meaning, the consumer must first dispute the claim with the credit reporting agency.  Judge Wright as a corollary therefore held that a consumer can not recover for wrongful or inaccurate… Read More

In Vester v. Asset Acceptance, L.L.C., 2011 WL 4591948 (D.Colo. 2011), Judge Krieger was asked to reconsider an FDCPA ruling adverse to the consumer on the basis that the 9th Circuit’s decision in McCullough v. Johnson, Rodenburg & Lauinger, LLC, 637 F.3d 939 (9th Cir.2011) and its holding regarding the evidentiary value of generic credit card agreements to prove-up a… Read More

In Gonzales v. Arrow Financial Services, LLC, --- F.3d ----, 2011 WL 4430844 (9th Cir. 2011), the Court of Appeals for the Ninth Circuit found that a debt collector’s dunning letters violated the FDCPA, and that recovery could be awarded under both the Rosenthal Act and the FDCPA.    In 2002, Arrow purchased a portfolio of debts owed to health… Read More

In Zimmerman v. Portfolio Recovery Associates, LLC. --- F.R.D. ----, 2011 WL 4349355 (S.D.N.Y. 2011), Judge Gardephe found a debt collector’s ‘Pre-suit ackage” to violate the FDCPA because it simulated documents authorized by a Court, and certified a class action. The “Pre-Suit Package” was described as follows:   Enclosed please find a copy of the lawsuit our local counsel in… Read More

In Grden v. Leikin Ingber & Winters PC, --- F.3d ----, 2011 WL 2518901 (6th Cir. 2011), the Court of Appeals found that certain statements provided by a debt collector to a debtor about the status of an account were not subject to the FDCPA, particularly when made in response to a consumer inquiry.   The text of § 1692e makes… Read More

In Lesher v. Law Offices Of Mitchell N. Kay, PC, --- F.3d ----, 2011 WL 2450964 (3d Cir. 2011), the Court of Appeals for the Third Circuit held that a law firm’s use of its letterhead in collection activities implied potential legal action, notwithstanding disclaimers to the contrary on the back of the letter.    Nor do we believe that… Read More

In Hasbrouck v. Arrow Financial Services LLC, 2011 WL 1899250 (N.D.N.Y. 2011), Judge D’Agostino held that merely filing suit on a debt without documentation to support the debt at the time of the lawsuit does not violate the FDCPA, because a false or misleading representation requires materiality. The majority of district and appellate courts have routinely held that, “the filing… Read More

In Freid v. National Action Financial Services, Inc., Slip Copy, 2011 WL 1547257 (D.N.J. 2011), Judge Chesler denied class certification in an FDCPA claim alleging that debtors were conveyed a false sense of urgency in communications from the debt collectors.  Judge Chesler found that secondary evidence of ‘scripts’ from the debt collector did not create uniformity, and questioned whether the… Read More

In Taylor v. Pinnacle Credit Services, LLC, 2011 WL 1303430 (N.D.Cal. 2011), Judge Spero applied Iqbal/Twombly to find that (1) determination of whether a form letter violates the FDCPA/Rosenthal Act can be decided as a matter of law, and (2) the debt collector’s letter, which stated that defendant was represented by an attorney from New Jersey who was not licensed… Read More

In O'Rourke v. Palisades Acquisition, LLC, here, the Court of Appeals for the Seventh Circuit held that since the FDCPA protected only consumers (and not third parties), a state court pleading that arguably would have deceived the state court judge in a collection action was not actionable under the FDCPA.  In O'Rourke, the debt collector sought but failed to collect… Read More

In Johnson v. Cabinsky, here, Judge Rykamp held that merely filing a collection action that loses does make an FDCPA claim.  Citing past precedent, Judge Rykamp explained:   Granting Defendant's Motion for Summary Judgment is consistent with this Court's decisions in Gonzalez v. Erskine, No. 08-20893-CIV-SEITZ, 2008 WL 6822207 (S.D. Fla. Aug. 7, 2008) and Sierra v. Rubin & Debski,… Read More

Courts have addressed the issue of whether misrepresentation or 'spoofing' of Caller IDs in collection calls can violate the FDCPA, and we have reported on such cases previously. Yesterday, the FCC issued a Notice of Proposed Rulemaking, with a comment deadline of April 18, 2011, regarding its implementation of regulatory and enforcement rules for the Truth in Caller ID Act… Read More

In Walsh v. Hannah & Assoc., here, Judge Burrell of the USDC for the Eastern District of California found that an attorney disclaimer in a collection letter that no attorney had reviewed the file negated a claim that the letter was a 'false representation or implication that . . .any communication was from an attorney" under 15 U.S.C. 1692(e)(5).  The District… Read More

In the context of debt collection, non-disclosure, blocking, or misrepresentation through telephone caller identification equipment has received attention from the FTC and courts. For example, one FTC complaint pleaded: 19. In numerous instances, including in connection with newly-acquired loans, [collector] has made collection calls to borrowers repeatedly and with excessive frequency under the circumstances. In addition, in numerous instances, [collector]… Read More

In Owings v. Hunt & Henriques, 2010 WL 3489342 (S.D.Cal. 2010), Judge Lorenz found that a debt collector violated the Rosenthal Act in the collection of a debt from a National Guardsman called into military service.    The definition of “debt collector” under California Civil Code Section 1788.2(c) expressly excludes “an attorney or counselor at law.” FN2 A creditor's counsel… Read More

In Sohns v. Bramacint, L.L.C., Judge Ericksen held that spoofing a caller identification identity to falsely represent the source of the call violates the FDCPA.  Judge Ericksen explained:  In Knoll, the plaintiff claimed that the defendant debt collector had violated §§ 1692d-1692f by “transmitting the false name of ‘Jennifer Smith’ via a caller identification device to consumers to lure them… Read More

In McNall v. Credit Bureau of Josephine County, Inc., 2010 WL 3306899 (D.Or.) Judge Clarke affirmed that 15 U.S.C. § 1692e(8) requires a sequence before credit reporting obligations arise, but nevertheless granted summary judgment to a plaintiff against a debt collector, explaining:   In this case, as shown in the pleadings, Defendant CBJC made a conscious decision not to report… Read More

In Riggs v. Prober & Raphael, 2010 WL 3238969 (N.D.Cal.), Judge Fogel held that, under Iqbal and Twombly, an FDCPA plaintiff failed to state a claim for lack of meaningful attorney involvement or for violating the Camacho  standard for debt validation warnings.  As to the former, Judge Fogel explained,   Plaintiff contends that her allegations that (1) Defendants sent the… Read More