The U.S. District Court for the Eastern District of New York recently granted summary judgment in favor of a debtor in his claim that a debt collector violated the FDCPA when the debt collector, in attempting to reach the debtor by telephone, left a message with a third party providing the debt collector’s callback information.
The Court held that because the undisclosed nature of the call may induce the debtor to contact a debt collector when he does not wish to do so, the debt collector must refrain from leaving callback information and attempt the call at a later time in order to avoid violating the FDCPA.
A copy of the opinion is available at: Link to Opinion.
A debt collector telephoned the debtor about his debt. An undisclosed person answering the phone responded that the debtor was not in yet and asked to take a message. The collection agent responded: "Name is Eric Panganiban. Callback number is 1-866-277-1877. . .direct extension is 6929. Regarding a personal business matter."
The debtor filed suit, alleging that the debt collector violated the FDCPA’s provisions addressing communications between a debt collector and a third party, at 15 U.S.C. § 1692c(b):
Except as provided in section 1692b of this title ...a debt collector may not communicate, in connection with the collection of any debt, with any person other than the consumer, his attorney, a consumer reporting agency if otherwise permitted by law, the creditor, the attorney of the creditor, or the attorney of the debt collector.
The reference to § 1692b allows the debt collector to confirm that it has the correct contact information for the debtor: "Any debt collector communicating with any person other than the consumer for the purpose of acquiring location information about the consumer shall ... identify himself, state that he is confirming or correcting location information concerning the consumer, and, only if expressly requested, identify his employer." 15 U.S.C. § 1692b(1).
The debtor also alleged that the debt collector violated the FDCPA’s so-called “mini-Miranda” disclosure requirement, which deems it a "false or misleading representation" if a debt collector fails to disclose:
in the initial written communication with the consumer and, in addition, if the initial communication with the consumer is oral, in that initial oral communication, that the debt collector is attempting to collect a debt and that any information obtained will be used for that purpose, and the failure to disclose in subsequent communications that the communication is from a debt collector. . . .
15 U.S.C. § 1692e(11).
Here, the Court held there was no need for the debt collector to confirm contact information as allowed under 15 U.S.C. § 1692b(1), as the third party who answered the telephone did it for him when he told the debt collector that the debtor “is not yet in." The Court also held that “§ 1692b(1) does not say anything about leaving a callback number. That is not part of the exempted information that the statute allows the debt collector to provide to the third party.”
The debt collector argued that the phone call did not fall under the statutory definition of a "communicat[ion] ... in connection with the collection of any debt ...", as used in 1692c(b). The debt collector reasoned that when its employee merely left his contact information with a third party, it was not collecting a debt.
The Court interpreted this argument as “inherently circular” – i.e., the Court restated the debt collector’s argument as being that the call was not a communication in connection with the collection of a debt because a communication in connection with the collection of a debt requires disclosures, and because the debt collector did not give disclosures, it was not a communication in connection with the collection of a debt. Stated differently, the Court noted that if the call to the third party is a "communication," then the debt collector had to give the § 1692e “mini-Miranda” disclosure, but if the debt collector gave those disclosures to the third party, or even mentioned that it was a debt collector, then it would be violating § 1692c(b).
The debt collector further argued that there was nothing wrong with placing the call as Congress expected, and the debtor had authorized the use of a telephone to collect debts. The debt collector urged that it would have been “rude to simply hang up.”
Although the Court agreed, the Court held that there is nothing in § 1692c(b) that permitted the debt collector to leave a response with the third party that will induce the debtor to call him back. More specifically, the Court held that “soliciting a call back to a collection agency unidentified as such through a third party is simply not a means of collection that is permitted under the restrictive statutory scope of a collector's efforts.”
The Court ruled that the debt collector “seized upon the opportunity presented by the third party to obtain a debtor-initiated contact, something the debtor may or may not have done on his own, or in response to a dunning letter with full disclosures, in contrast to an unadorned callback message about a ‘personal business matter.’ Nothing required [the debt collector] to seize that opportunity, and the prohibition on relaying information through a third party prohibited it.”
The Court ruled that the only way to avoid violating the FDCPA would have been for the debt collector to make a different decision by politely declining to leave a message, and perhaps trying again at some point in the future.