The Federal Trade Commission (FTC), the U.S. Department of Justice, and the Consumer Financial Protection Bureau (CFPB) recently filed a joint amicus curiae, or friend-of-the-court, brief with the Supreme Court of the United States. The brief urges the court to protect consumer’s rights under the Fair Debt Collection Practices Act (FDCPA).
Brief Overview of the FDCPA
The FDCPA protects consumers from abusive, deceptive or unfair debt collection practices. The law applies to debt collection agencies, lawyers who regularly collect debts and companies that purchase debt to attempt to collect it from consumers.
The law bars collection agencies from calling consumers at odd hours, calling at work if consumers are not allowed calls there or continuing to call consumers who have given them written instructions to stop contact. However, debt collectors may continue to call consumers even if they have received a desist letter in order to notify consumers that they will cease contact or if they are taking legal action against the consumer.
The FDCPA also prohibits certain debt collection practices. These include harassing consumers, issuing false statements to consumers and threatening consumers with arrest or wage garnishment.
Also included in the FDCPA is a consumer’s right to sue a debt collector for what the consumer believes are unfair collection practices. The FDCPA states that if a consumer loses the court case, he or she will only have to pay the court costs of the defendant if she or he sued in bad faith. The amicus brief argued that the Supreme Court needs to support this consumer right unequivocally.
History of the Case
The agencies filed the amicus brief in support of an appeal to the Supreme Court by a woman who was ordered to pay a debt collection agency’s court costs by a circuit court after the court ruled against the woman in her lawsuit. She had claimed that the agency violated her rights under the FDCPA when the company called her employer to ask about her employment status.
However, the circuit court ruled against her, deciding that the agency’s actions did not violate her rights. It then ordered her to pay the debt collection agency $4,500 for court costs even though she had brought the case in good faith. The circuit court stated that it believed the FDCPA only applied to a debtor not having to pay attorney’s fees if he or she lost the case and brought it in good faith, but that court costs were not subject to the FDCPA.
In the amicus brief, the agencies argued that the circuit court’s decision violated the FDCPA, and that court costs are meant to be included within the FDCPA’s provisions. If the Supreme Court upholds the circuit court decision, it may have a chilling effect on consumers pursuing their rights under the FDCPA since they will be concerned about paying court costs if they lose their lawsuits against debt collection agencies.
If you believe a debt collector has violated your rights under the FDCPA, it would be wise to contact an experienced bankruptcy attorney.