In Magdy v. I.C. Sys., Inc., No. 21-3010, 2022 WL 4075764, at *1 (8th Cir. Sept. 6, 2022), the Eighth Circuit Court of Appeals, faced with a matter of first impression, held that a non-consumer attorney could not bring an FDCPA claim.
The facts of the case are straightforward. On July 27, 2020, Andrew Madgy (“Madgy”), a bankruptcy attorney, received a debt collection letter from I.C. System, Inc. (“ICS”). The letter identified Madgy as the attorney for a consumer named in the letter. The only problem – Madgy was not the consumer’s lawyer and the consumer had neither identified Madgy as such nor given consent for ICS to contact Madgy about her debt. Madgy filed suit in Missouri state court, and ICS removed to federal District Court. The District Court held that Madgy lacked standing to sue under 15 U.S.C. 1692c – despite finding the letter violated 1692c(b) – and granted judgment on the pleadings in ICS’ favor.
Madgy appealed to the Eighth Circuit Court of Appeals, arguing that 1692c(b) provided a cause of action to anyone contacted by a debt collector in violation of the statute.
Madgy’s Reliance on 15 U.S.C. 1692k
Madgy’s argument relied on the language of 15 U.S.C. 1692k to establish his right to bring a cause of action. That provision states that “[e]xcept as otherwise provided by this section, any debt collector who fails to comply with any provision of this subchapter with respect to any person is liable to such person…” (emphasis added). Madgy argued that ICS failed to comply with 1692c(b) “with respect to” him by erroneously sending him the July 27, 2020 letter.
The Court, however, parsed the statute differently. Looking at 1692k in the context of the entire statute, the Court reasoned that it must look to the substantive “provision” that ICS “failed to comply with” to determine the category of “person[s]” covered by the provision. To accomplish this task, the Court applied the “zone of interests” test.
“Zone of Interests” Test
To determine whether Madgy, a third-party, could have a cause of action under 1692c(b), the Eighth Circuit applied the “zone of interests” test. The test dictates the Court must analyze a statute’s text to derive its “purposes” and thereby determine “whether a legislatively conferred cause of action encompasses a particular plaintiff’s claim.” The Eighth Circuit found that 1692c(b)’s plain language, particularly its inclusion of language “without the prior consent of the consumer[,]”, placed Madgy outside the scope of the statute’s protection. As the Court stated, “[a]s long as the debt collector has the consumer’s prior consent, it may send a relentless stream of letters to a third party without running afoul of § 1692c(b).” Thus, the violation was that the letter was sent against the interests of the consumer – not against any interests held by Madgy.
The Court, therefore, affirmed the District Court’s decision, stating “[w]e join the other circuits that have considered this issue in concluding that non-consumers cannot bring a claim under § 1692c(b).”
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