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Debt Collection Debt Buyers

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Indiana Appeals Court Rules That a Passive Debt Buyer Is a Debt Collector under the FDCPA and State Law

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The Court of Appeals of Indiana recently upheld a lower court’s decision that a debt buyer who purchased a portfolio of defaulted student loans and placed an account with a collection agency qualifies as a “debt collector”...more

Ballard Spahr LLP

Third Circuit Rules Pennsylvania Consumer Discount Company Act Does Not Regulate Collection of Charged-Off Debts

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On February 7, 2024, the U.S. Court of Appeals for the Third Circuit affirmed the district court’s Order granting a motion for judgment on the pleadings and holding that a charged-off loan made by a lender licensed under the...more

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Florida Bankruptcy Court Sanctions Debt Buyer for Seeking to Collect Debt that Consumer Failed to Schedule in Bankruptcy Case

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The debt purchaser in In re McIntosh argued that because it was enforcing a debt that was not listed correctly on the debtor’s bankruptcy schedules, it was entitled to assume the debt had not been discharged. The U.S....more

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Judge Dismisses FDCPA Case Alleging Violations Based on Undated Model Validation Notice

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On November 20, a judge for the Southern District of New York granted a motion to dismiss a Fair Debt Collection Practices Act (FDCPA) class-action holding that a simple lack of a date on a model validation notice did not...more

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Illinois Federal District Court Grants Summary Judgment Holding Use of a Local Area Code by a Non-Local Debt Collector Does Not...

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In Brown v. MRS BPO, LLC, the Northern District of Illinois, acting on its own motion, granted summary judgment in favor of the defense on claims asserting violations of the Fair Debt Collections Practices Act (FDCPA)....more

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Second Circuit Affirms Dismissal of FDCPA Case Holding Plaintiff Prompted Communication at Issue

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The U.S. Court of Appeals for the Second Circuit issued a summary order affirming a district court’s holding that an emailed response to the plaintiff’s email did not constitute an “initial communication” under the Fair Debt...more

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Undated Model Debt Violation Notice Does Not Violate the FDCPA

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Last week, a district court in Nevada held that an undated, model form debt validation notice does not violate the Fair Debt Collection Practices Act (FDCPA). In Bergida v. PlusFour, Inc., the defendant sent a debt validation...more

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$225,000 Punitive Damages Award Upheld Where Creditor Repeatedly Contacted Customer After Being Notified of Attorney...

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Earlier this year, a district court for the Middle District of Florida upheld a jury award of $225,000 in punitive damages in a debt collection case finding the defendant’s conduct “reprehensible” based on the physical harm...more

Orrick, Herrington & Sutcliffe LLP

Utah Court of Appeals affirms ruling for debt buyer engaged in unlicensed collection efforts

The Utah Court of Appeals affirmed a lower court’s ruling against a debt buyer that acquired a portfolio of bad debts from borrowers all over the country, including residents of Utah. The debt buyer collected on the portfolio...more

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Utah State Court Rejects Claim Based on Debt Collector’s Alleged Failure to Register Under Collection Agency Act

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The Utah court of appeals has recently affirmed the dismissal of a plaintiff’s suit against a debt buyer based on its alleged failure to register as a collection agency prior to filing collection lawsuits. The court’s...more

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NJ Appellate Division Finds No Private Right of Action for Debt Purchaser’s Alleged Failure to Obtain State License

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Recently, the New Jersey appellate division held that a debt purchaser is not liable under the New Jersey Consumer Fraud Act (NJ Fraud Act) for failing to obtain a license under the New Jersey Consumer Finance Licensing Act...more

Ballard Spahr LLP

NY federal court denies motion to dismiss CFPB lawsuit against debt buyer companies and their owners/officers for unlawful debt...

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A New York federal district court has denied a motion to dismiss the lawsuit filed in January 2022 by the CFPB against three companies that purchase portfolios of defaulted debts (Corporate Defendants) and three individuals...more

Orrick, Herrington & Sutcliffe LLP

District Court denied motion to dismiss CFPA and FDCPA claims against debt buyers

On August 22, the U.S. District Court for the Western District of New York refused to dismiss CFPA and FDCPA claims brought by the CFPB that alleged violations related to misrepresentations made to debtors by debt collectors....more

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Tenth Circuit Affirms Summary Judgment in Favor of Defendant in FDCPA Case on the Basis of Claim Preclusion

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On August 1, the U.S. Court of Appeals for the Tenth Circuit upheld a trial court’s order granting summary judgment in favor of a debt buyer holding that claim preclusion barred the plaintiff’s claims brought under the Fair...more

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Nevada Significantly Amends Its Collection Agency Licensing Act

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On June 16, Nevada Governor Joe Lombardo signed into law Senate Bill 276, which significantly amended Nevada Revised Statute 649, otherwise known as the Nevada Collection Agencies Licensing Act (the Act). The Act regulates...more

Orrick, Herrington & Sutcliffe LLP

Nevada expands collection agency licensing requirements

On June 16, the Nevada governor signed SB 276 (the “Act”) to revise certain provisions relating to debt collection agencies and make amendments to the state’s collection agency licensing law. While existing law requires...more

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Seventh Circuit rules $3.95 in postage spent by plaintiff to respond to second validation notice sufficient to establish FDCPA...

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The U.S. Court of Appeals for the Seventh Circuit has ruled that a plaintiff in a putative class action had standing to assert FDCPA claims against the purchaser of her debt and the purchaser’s servicer based on the $3.95 she...more

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CFPB Issues Advisory Opinion on “Zombie Debt”

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On April 26, the Consumer Financial Protection Bureau (CFPB or Bureau) issued an advisory opinion reminding the industry that a debt collector who brings or threatens to bring a foreclosure action to collect a time-barred...more

Orrick, Herrington & Sutcliffe LLP

Wyoming to regulate debt buyers as collection agencies

On February 27, the Wyoming governor signed HB 284, which requires debt buyers to be licensed as “collection agencies” beginning July 1. Under the act, a collection agency now includes any person who operates as a debt buyer,...more

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“Life takes Visa” but debt collectors don’t? New debt repayment rules are coming for collection agencies on April 15, 2023

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Move over, Tax Day!  This year, April 15 falls on a Saturday so the IRS moved the tax filing deadline to April 18.  What will you do with all that extra time?  Don’t worry, Visa’s got you covered....more

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New Wyoming Bill Requires Licensure for Debt-Buyers

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On February 27, Wyoming Governor Mark Gordon signed into law House Bill 284, which requires debt buyers be licensed as “collection agencies” starting July 1, 2023....more

Brownstein Hyatt Farber Schreck

Hunstein Decision Informs Financial Services Industry Use of Third Party Vendors

More than a year ago on April 21, 2021, the 11th Circuit Court of Appeals issued an opinion in Hunstein v. Preferred Collection and Management Services Inc. that rocked the world of the debt collection industry, and the...more

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Court Finds Entity Partnering With Medical Provider Does Not Qualify as a Debt Collector Under the FDCPA

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In Palacio v. Med. Fin. Sols., No. 21 CV 1288 (N.D. Ill. June 14, 2022), the court granted summary judgment in favor of the defendant, finding that it did not qualify as a “debt collector” under the Fair Debt Collections...more

Venable LLP

Debt Buyer Sued for Deceptive Practices of Downstream Third-Party Collectors; CFPB Uses Its Substantial Assistance Authority

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On January 10, 2022, the Consumer Financial Protection Bureau (CFPB) filed a complaint in federal district court against three affiliated debt-buying businesses and the individuals who founded and operated them for "knowingly...more

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CFPB sues debt buyer companies and their owners/officers for unlawful debt collection practices based on third-party conduct

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The CFPB filed a complaint earlier this week in a New York federal district court against three companies that purchase defaulted debts (Corporate Defendants) and three individuals who are owners and/or officers of the...more

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