Last month, the CFPB, jointly with the FTC, filed an amicus brief in Sykes v. Mel S. Harris and Associates LLC, a Fair Debt Collection Practices Act case on appeal to the Second Circuit. This represents the third FDCPA case in which the CFPB has filed an amicus brief, with the previous two briefs filed last year in the Tenth and Eleventh Circuits.
The case is on interlocutory appeal from the district court’s grant of class certification. The complaint included claims that the debt collector defendants violated the FDCPA by obtaining default judgments in the New York City civil court through the use of affidavits falsely claiming that the debtors had been served when they had not, and that the affiant had personal knowledge of the relevant facts relating to the claims when the affiant did not.
More specifically, the plaintiff alleged that the debt collectors violated 15 U.S.C. Section 1692f which prohibits a debt collector from using “unfair or unconscionable means to collect or attempt to collect any debt” and 15 U.S.C. Section 1692e(8) which prohibits “[c]ommunicating… to any person credit information which is known or which should be known to be false.” In denying the defendants’ motion to dismiss the FDCPA claims, the district court rejected the defendants’ argument that their alleged conduct was not actionable under the FDCPA because the allegedly false communications were directed to the court and not consumers.
In its amicus brief, the CFPB argues that, under their plain language, the FDCPA provisions at issue do not require that false communications or other misconduct be directed at the consumer. The Second Circuit, in Kropelnick v. Siegel, 290 F.3d 118 (2nd Cir. 2002), had previously indicated that alleged misrepresentations to a debtor’s attorney cannot constitute FDCPA violations. Other circuits have reached conflicting conclusions on whether communications to third parties can be actionable under the FDCPA. For example, the Fourth Circuit, in Sayyed v. Wolpoff & Abramson, 485 F.3d 226 (4th Cir. 2007), held that false statements made to a debtor’s attorney were actionable under the FDCPA while the Ninth Circuit reached an opposite conclusion in Guerrero v. RJM Acquisitions LLC, 499 F.3d 926 (9th Cir. 2007).