Greenwald Davidson Radbil PLLC obtains important pro-consumer ruling before the Sixth Circuit Court of AppealsJuly 30, 2018
In Macy v. GC Services Limited Partnership, --- F.3d. ----, 2018 WL 3614580 (6th Cir. July 30, 2018), the Sixth Circuit Court of Appeals affirmed the district court's decision to certify a class of consumers harmed by violations of the Fair Debt Collection Practices Act. In so doing, the Court found the plaintiffs to have Article III standing to bring their claims.
From the opinion:
Assuming arguendo that the language of GC’s letters constitutes a procedural violation of the FDCPA, Plaintiffs have demonstrated a sufficient “risk of real harm” to the underlying interest to establish concrete injury without the “need [to] allege any additional harm beyond the one Congress has identified.” Spokeo, 136 S.Ct. at 1549.
As the Second Circuit explained, “Section 1692g furthers th[e] purpose [of protecting debtors from abusive debt collection practices] by requiring a debt collector who solicits payment from a consumer to provide that consumer with a detailed validation notice, which allows a consumer to confirm that he owes the debt sought by the collector before paying it.” Papetti v. Does 1-25, 691 F. App’x 24, 26 (2d Cir. 2017). Importantly, “[t]he aim of § 1692g is to provide a period for the recipient of a collection letter to consider her options. It is also to make the rights and obligations of a potentially hapless debtor as pellucid as possible.” Jacobson v. Healthcare Fin. Servs., Inc., 516 F.3d 85, 95 (2d Cir. 2008); see also Zirogiannis v. Seterus, Inc., 707 F. App’x 724, 727 (2d Cir. 2017) (“We have no trouble concluding that § 1692g of the FDCPA ‘protect[s] an individual’s concrete interests. ... Congress plainly sought to protect consumers’ concrete economic interests by requiring debt collectors to comply with the notice provisions articulated in § 1692g.” (citation omitted) ).
GC’s letters present a risk of harm to the FDCPA’s goal of ensuring that consumers are free from deceptive debt-collection practices because the letters provide misleading information about the manner in which the consumer can exercise the consumer’s statutory right to obtain verification of the debt or information regarding the original creditor. In responding to a debt-collection notice, an oral inquiry or dispute of a debt’s validity has different legal consequences than a written one. See Camacho v. Bridgeport Fin. Inc., 430 F.3d 1078, 1082 (9th Cir. 2005) (noting that Section 1692g “assigns lesser rights to debtors who orally dispute a debt and greater rights to debtors who dispute it in writing”); Hooks v. Forman, Holt, Eliades & Ravin, LLC, 717 F.3d 282, 286 (2d Cir. 2013) (“Debtors can protect certain basic rights through an oral dispute, but can trigger a broader set of rights by disputing a debt in writing.”). If a consumer contests a debt by telephone rather than in writing, the consumer loses most of the protections for debtors set forth in Section 1692g; the debt-collection agency is under no obligation to verify the debt and to cease all collection efforts as required by § 1692g(b).
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Thus, Plaintiffs allege a risk of harm that is traceable to GC’s purported failure to comply with federal law, namely, the possibility of an unintentional waiver of FDCPA’s debt-validation rights, including suspension of collection of disputed debts under Section 1692g(b). Without the information about the in-writing requirement, Plaintiffs were placed at a materially greater risk of falling victim to “abusive debt collection practices.” 15 U.S.C. § 1692(e); see also Anarion Invs. LLC v. Carrington Mortg. Servs., LLC, 794 F.3d 568, 572 n.2 (6th Cir. 2015) (noting that debt-collector abuse takes many forms, “including ... misrepresentation of a consumer’s legal rights”). And, as the FDCPA declares, its purpose is to eliminate such abusive practices. 15 U.S.C. § 1692(e). To that end, the FDCPA grants a private right of action to a consumer who receives a defective communication. Id. § 1692k.
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In sum, Plaintiffs have satisfied the concreteness prong of the injury-in-fact requirement of Article III standing by alleging that GC’s purported FDCPA violations created a material risk of harm to the interests recognized by Congress in enacting the FDCPA.