Fair Debt Collection: 11.15.5.1 Generally
FDCPA § 1692g gives consumers the right to identifying information about the debt and the debt collector at the beginning of a debt collector’s work:
FDCPA § 1692g gives consumers the right to identifying information about the debt and the debt collector at the beginning of a debt collector’s work:
The rights and obligations established by FDCPA § 1692g were considered by the Senate at the time of passage to be a “significant feature” of the Act.1920 “This provision [FDCPA § 1692g] will eliminate the recurring problem of collectors dunning the wrong person or attempting to collect debts which the consumer has already paid.”1921 Congress enacted section 1692g to protect debtors’ concrete interest in avoiding abusive debt collection practices.1922
Prior to the Supreme Court’s decision in Ramirez, a number of courts held that a violation of the disclosure requirements of FDCPA § 1692g was a concrete injury.
The Supreme Court’s 2021 decision in TransUnion L.L.C. v. Ramirez1939 appears to reject some of the theories on which courts had relied to find Article III standing for violation of FDCPA § 1692g’s disclosure requirements.
FDCPA § 1692g requires collectors not only to make various disclosures to consumers, but also to perform affirmative duties upon receipt of a dispute.
Many provisions of the FDCPA protect the consumer’s privacy and relationships from harm by prohibiting third-party contacts or disclosure of information about the debt in a public way. FDCPA § 1692c(b) generally prohibits debt collector calls to friends, parents, children, other relatives, neighbors, and employers. FDCPA § 1692d(3) prohibits the publication of shame lists of consumers alleged to be refusing to pay their debts, and section 1692d(4) prohibits advertising debts for sale in order to coerce their payment.
With limited exceptions, FDCPA § 1692c(a)(2) prohibits a collector from communicating with a consumer who is represented by an attorney. It recognizes the consumer’s right to retain and be represented by counsel, protects consumers’ relationship with their attorneys, and protects the attorney’s authority to effectively represent the consumer.2033
FDCPA § 1692d prohibits conduct that serves to harass, oppress, or abuse any person in connection with the collection of a debt. It includes both a general prohibition and prohibitions of six specific practices. This section discusses standing to assert claims regarding the general prohibition and the specific prohibitions of threats of violence or other criminal means (§ 1692d(1)); obscene, profane, or abusive language (§ 1692d(2)); and calls without meaningful disclosure of the caller’s identity (§ 1692d(6)).
FDCPA § 1692f prohibits unfair or unconscionable collection methods, including several specifically enumerated acts, such as misuse of postdated checks (section 1692f(2), (3), (4)), causing charges for communications to be made to a person while concealing their true purpose (section 1692f(5)), and wrongful repossession or threats of repossession (section 1692f(6)). This section discusses Article III standing to assert claims regarding violation of these provisions.
FDCPA § 1692i prohibits venue abuse—the collection tactic whereby the collector sues the consumer in an inconvenient forum where it will be easy to obtain a default judgment.2103 In some cases involving FDCPA § 1692i violations, the concreteness requirement will be easily established by demonstrating tangible harm as a result of a collection lawsuit filed in the wrong venue.
The preceding sections have focused on the Article III requirement of a concrete injury.
The party invoking federal jurisdiction bears the burden of establishing standing.2131 For a case filed in federal court, the burden of establishing standing thus falls on the plaintiff.2132 However, when a defendant removes a case from state court to federal court, it is the defendant who is invoking federal jurisdiction, so the defendant bears the burden of showing the plaintiff’s standing.2133
When a defendant removes a case from state court to federal court, it is the defendant who is invoking federal jurisdiction, so the defendant bears the burden of showing the plaintiff’s standing.2149 Any doubts regarding the propriety of removal should be resolved in favor of the plaintiff’s choice of forum in state court.2150
Section 1692n states:
Where the FDCPA regulates practices also regulated by other federal statutes, questions arise as to whether both statutes are applicable.
The Supreme Court’s 2021 decision in TransUnion L.L.C. v. Ramirez,1531 deals only with claims under the Fair Credit Reporting Act, but has profound implications for FDCPA litigation. How the Circuits apply Ramirez to FDCPA decisions is of critical importance.
Before filing an FDCPA claim, the consumer’s attorney must carefully evaluate whether the claim meets the case or controversy requirements of Article III—in particular, whether the consumer has suffered a concrete injury. The attorney should consider not only the intricacies of Spokeo and Ramirez, but also whether the complaint smacks of something serious or something trivial.
The FDCPA places four restrictions on contacts with consumers at inconvenient times or places.1967 Section 1692c(a)(1) prohibits debt collector calls at times and places that are inconvenient for the consumer. Section 1692c(a)(3) prohibits debt collector calls to consumers at their workplaces if such calls are prohibited. Section 1692c(c) allows the consumer to stop most future debt collector phone calls and letters altogether. And section 1692d(5) prohibits repeated calls with the intent to annoy or abuse any person.
This chapter discusses the specific requirements which the Fair Debt Collection Practices Act (FDCPA) imposes on debt collectors under 15 U.S.C. §§ 1692b and 1692c. Most of this chapter considers FDCPA § 1692c and Regulation F § 1006.6 (effective November 30, 2021), addressing debt collector communications with the consumer and also generally prohibiting communications about the debt with third parties.
The Supreme Court has made it clear that a small harm is sufficient to create standing: even “an identifiable trifle is enough for standing.”1751 For example, temporary deprivation of money will likely be sufficient, even if the amount is small.1752 Courts have held that the drain on a cell phone’s battery from receipt of a single call or text message,175
When the federal court has jurisdiction because of a federal question, it can also exercise supplemental jurisdiction over state law claims as long as they “are so related to [the federal claims] that they form part of the same case or controversy under Article III of the United States Constitution.”60 This test turns on whether there is a “common nucleus of operative facts” between the federal and state law claims.61
Courts have generally rejected arguments for complete preemption based on the Home Owners’ Loan Act (HOLA),92 the Alternative Mortgage Transaction Parity Act (AMTPA),93 the appraisal fraud provisions of Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA),94 and other banking laws that are not part of the National Bank Act.95 None of these laws completely preempt state
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Special issues arise when a servicer acts on behalf of a loan owner that is a federal governmental entity. Most often, this occurs when one of the government-sponsored enterprises (GSEs), such as Fannie Mae or Freddie Mac, owns the borrower’s mortgage loan. In these situations, a court-created rule known as the Merrill doctrine may limit application of otherwise controlling agency principles.
By statute any civil action to which the Federal Home Loan Mortgage Corporation (Freddie Mac) is a party is automatically deemed to arise under federal law.100 As a result, federal courts have original jurisdiction over cases involving Freddie Mac, regardless of the claim or amount in controversy, and Freddie Mac is entitled to remove cases from state to federal court.101