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5th Cir. Holds Call That Did Not Mention Debt Not FDCPA ‘Communication’

debt collection phone callThe U.S. Court of Appeals for the Fifth Circuit recently affirmed the dismissal of a debtor’s claims against a debt collector alleging that a telephone call placed to his sister constituted an improper third-party communication in connection with the collection of a debt, in violation of the federal Fair Debt Collection Practices Act (FDCPA).  

In so ruling, the Fifth Circuit concluded that the conversation between the debtor’s sister and the debt collector representative was not a “communication” subject to the FDCPA, 15 U.S.C. § 1692, et seq., because the representative’s mere identification of the debt collector’s name and mentioning of “an important personal business matter” did not convey any information regarding a debt or suggest its existence.

A copy of the opinion in Fontana v. HOVG LLC is available at:  Link to Opinion.

After failing to reach a debtor to discuss a consumer debt allegedly owed, a telephone representative of a debt collection agency dialed a phone number owned by the debtor’s sister, who answered. 

The representative asked if she was speaking to the debtor and was informed that the dialed phone number belonged to the debtor’s sister.  The representative then identified herself as calling on behalf of the debt collector, without conveying any information regarding the debt at issue, and requested that the debtor call the debt collector back at the number that appeared on the sister’s caller ID. 

When the debtor called back, the debt collector attempted to collect the debtor’s medical debt at issue.

Feeling “concerned and harassed” by the debt collector’s call to his sister, the debtor filed suit in federal court alleging that the debt collector violated subsection 1692c(b), which prohibits debt collectors from “communicat[ing], in connection with the collection of any debt, with any person other than the consumer” or certain other prescribed parties to the debt “without the prior consent of the consumer.” 15 U.S.C. § 1692c(b).

The debt collector moved to dismiss the complaint for failure to state a claim, and the motion was granted with prejudice.  The instant appeal followed.

On appeal, the debtor argued that the debt collector violated § 1692c(b) when it left a message with his sister asking her to have him return the collector’s call.  The debtor further contended that the debt collector called his sister intending to contact him, not merely to confirm his phone number, because the representative asked to speak with him and requested that the debtor return its call, rather than merely seek to update the debtor’s contact information.

Accordingly, the debtor argued that the exception under section 1692b that permits debt collectors to communicate with third parties “for the purpose of acquiring location information about the consumer” — his “place of abode… telephone number… or [] place of employment” — did not apply.  § 1692b; § 1692a(7).

Before addressing whether the alleged conversation was a permissible attempt to obtain the debtor’s location information, the Fifth Circuit analyzed whether the call even constituted a “communication” subject to the purview of the FDCPA. 

Reviewing the transcript of the call at issue, the Court noted that the debt collector representative did not mention the debt or provide any information about it, instead merely mentioning that she was calling for “an important personal business matter” and providing the debt collector’s name.  Although the debt collector’s name includes the word “Credit,” other courts have held that knowing the name of a debt collector does not imply the existence of a debt.  Brown v. Van Ru Credit Corp., 804 F.3d 740, 742 (6th Cir. 2015) (“the word ‘credit’ refers to a category of financial activities far broader than debt collection”). 

The Fifth Circuit further noted that the limited information provided by the debt collector’s representative during the call did not indirectly convey any information that a debt existed or imply that the call was in connection with the debt, and was thus distinguishable from the Eleventh Circuit’s ruling in Hart v. Credit Control, LLC, wherein a message stating, “This call is from a debt collector” qualified as a “communication” because it “indicated that a debt collector was seeking to speak with [the person] as a part of its efforts to collect a debt.”  Hart v. Credit Control, LLC, 871 F.3d 1255, 1256, 1258 (11th Cir. 2017); see also, Lavallee v. Med-1 Sols., LLC, 932 F.3d 1049, 1055 (7th Cir. 2019) (holding that a message that contained only the name of the debt collector was not a “communication” under the Act); accord Marx v. Gen. Revenue Corp., 668 F.3d 1174, 1177 (10th Cir. 2011) (holding that a fax that contained the name of the debt collector and the debtor’s account number was not a “communication” because it could not “reasonably be construed to imply a debt”).

Because the debt collector’s call did not convey “information regarding a debt,” nor even imply the existence of a debt to constitute a “communication” under the FDCPA, the Fifth Circuit held that the debtor failed to plead sufficient facts to establish an FDCPA violation and affirmed the trial court’s dismissal.

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The attorneys of Maurice Wutscher are seasoned business lawyers with substantial experience in business law, financial services litigation and regulatory compliance. They represent consumer and commercial financial services companies, including depository and non-depository mortgage lenders and servicers, as well as mortgage loan investors, financial asset buyers and sellers, loss mitigation companies, third-party debt collectors, and other financial services providers. They have defended scores of putative class actions, have substantial experience in federal appellate court litigation and bring substantial trial and complex bankruptcy experience. They are leaders and influencers in their highly specialized area of law. They serve in leadership positions in industry associations and regularly publish and speak before national audiences.

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