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Fair Debt Collection: 2.5.7.1 Importance of State Claims

State claims may offer punitive,73 multiple, or statutory damages in addition to the relief offered by the FDCPA. Even when the FDCPA applies to a case, local law may supplement it or be more favorable to the consumer.74 For example, a collector may violate a state law for which the FDCPA does not provide a parallel prohibition.

Fair Debt Collection: 2.5.7.2 Choice of Federal or State Court

The choice of filing in federal or state court is dominated by local considerations. In some locales, there is little reason to prefer federal judges over state judges, either for judicial ability or for sympathy in actions against debt collectors. State discovery and procedural rules are often so similar to federal rules as to eliminate this as a consideration. The relative backlog of cases on federal and state dockets varies greatly from locale to locale. Choice of forum will affect the rules and practice for drafting pleadings.76

Fair Debt Collection: 2.5.7.3 Specificity of Pleading

In pleading an FDCPA claim, the consumer attorney should consider two separate requirements. One is to establish concrete harm or injury in fact sufficient to meet the Article III federal court standing requirement. This requirement is discussed in detail at § 11.15, infra.

Fair Debt Collection: 2.5.7.4 Avoiding Dismissal

Failure to state a cause of action will result in the dismissal of the complaint and, when the court deems the claim entirely frivolous, sanctions.77 Failure to join an indispensable party may also result in the dismissal of the litigation.78 Section 11.6.1, infra, provides an analysis of the specificity of p

Fair Debt Collection: 2.5.7.5.2 FDCPA as a counterclaim

Consumers may decide that the better strategy is to raise their fair debt collection claim defensively as a counterclaim to a suit on the debt filed by the creditor or its collector.81 One advantage of this approach is that it may create more leverage in negotiating a reduced amount of the debt. Disadvantages may include that the FDCPA claims will not apply to the creditor and a state court judge may not be familiar with the FDCPA.

Fair Debt Collection: 2.5.7.5.4 Filing an FDCPA class action

The decision to file a complaint as a class action is often faced most squarely after the initial investigation and research are completed.82 If a class action is consistent with the client’s objectives and the program’s or firm’s priorities, additional inquiry should be made to determine if adequate legal and financial resources are available for the particular case. A lawyer without the necessary resources may need to bring in another firm to meet that need.

Fair Debt Collection: 2.6.5 Causation Is an Important Element in the Proof of Damages

Issues of causation must be considered in seeking actual damages in debt collection cases. Consumers suffering from abusive debt collection tactics are often in a financially distressed position which is stressful in itself. Injuries may have resulted from another traumatic event, such as illness, marital problems, or loss of employment.

Fair Debt Collection: 2.6.7 Establishing Deception

The Seventh Circuit has uniquely imposed a burden on consumers of proving deception by expert testimony, preferably supported by consumer survey testimony. Difficulties with conducting surveys are discussed at § 11.6.3, infra. Recent Seventh Circuit decisions have retreated from the survey requirement, and other Circuits have different views.

Fair Debt Collection: 2.7.1 Overview

While punitive damages awards may be unavailable for FDCPA violations, they are available in most states for certain tort claims. Such claims have special applicability to debt collection harassment and are considered at § 11.10.3, infra.

Fair Debt Collection: 2.11 Injunctions, Administrative Agency Complaints, and Community Education

There are situations involving debt collection abuse in which an action for damages is not appropriate. This may be because the consumer suffered no actionable damages or because the difficulty of establishing damages makes the probability of recovery slight. It may be that individual actions for damages are not among a program’s or lawyer’s priorities and successful referral to another lawyer is unlikely. The client may be unwilling to pursue damages. An award of damages may not seem likely to deter what appears to be a pattern of community-wide abuse.

Fair Debt Collection: 2.12 Careful Evaluation of Appealing Adverse Lower Court FDCPA Decisions

Some circuit court panels have little empathy for consumers who are struggling with debt, debt collectors, and the anxiety and other problems that are often associated with financial struggles. In considering the appeal of an adverse lower court decision, a fundamental consideration is how the consumer’s case will present to an appellate panel that does not come to the case with some empathy for a struggling consumer.

Fair Debt Collection: 2.13 Consumers Representing Themselves in Court

Consumers representing themselves in court must overcome tremendous hurdles. Unless the pro se consumer is legally trained, in addition to learning the FDCPA, they must master the Federal Rules of Civil Procedure, the Federal Rules of Evidence, the local court’s rules, and often other state and federal laws that are related to their claim. Unrepresented consumers lack the objectivity that a good lawyer could bring to their case. They cannot speak about the plaintiff in the third person, a serious handicap if there are emotional distress damages involved.