Pennsylvania Federal Court Rules Collection Agent’s Communication With Vendor May Violate FDCPA

United States: Pennsylvania Federal Court Rules Debt Collector’s Communication with Supplier May Violate FDCPA

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The United States District Court for the Eastern District of Pennsylvania recently ruled that a debt collector‘s communication with a letter seller could be a violation of the FDCPA. To see Khimmat vs. Weltman, Weinberg & Reis Co., LPA, 2022 US Dist. LEXIS 21076 (ED Pa. 7 February 2022). In the case, the defendant was retained to collect the plaintiff’s credit card debt. Before sending a letter, the defendant hired a letter seller and provided the seller with personal information about the plaintiff. Plaintiff then brought this action under 15 U.S.C. consumer, his or her attorney, a consumer reporting agency if otherwise authorized by law, the creditor, creditor’s attorney, or debt collector‘s attorney”, with certain exceptions. Plaintiff alleged that Defendant violated this article by forwarding his personal information to the seller of the letter. The defendant requested a judgment on the pleadings.

The court dismissed the motion. In doing so, he rejected the Respondent’s argument that only a demand for payment could be a communication “in connection with the collection of any debt”. The Court found that the Third Circuit had already found that an “opening communication for the purpose of gathering [the debtor’s defaulted loan]’ . . . is characterized as a communication in the context of an attempt to collect a debt” and that “a letter which is not in itself an attempt to collect, but which is intended to . . . such an attempt is more likely to succeed, is the one with the required connection.”
Simon vs. FIA Card Servs., NA, 732 F.3d 259, 266 (3d Cir. 2013). The Court also concluded that, even if the seller were considered the defendant’s agent, the law does not provide an exception for communications with agents and agents would still be considered “any person other than the consumer, his lawyer, a consumer intelligence agency”. Accordingly, the Court dismissed the petition, holding that “[o]Of course, the best insight into the purpose of any law is the words Congress used. Where Congress has used plain language, as it has done here, a court should not set aside that language to achieve what it believes to be Congress’s purpose, except in the most exceptional circumstances.”

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Tana T. Thorsen