There’s a fine line between a lawful and an unlawful communication by a debt collector under the Fair Debt Collection Practices Act (“FDCPA”). In a recent opinion, the U.S. Court of Appeals for the Sixth Circuit upheld a lower court ruling that a debt collector, Van Ru Credit Corporation, did not cross the line when it left a voicemail message with a debtor’s business.
In William Brown III v. Van Ru Credit Corporation, the plaintiff Brown owed student loan debt which defendant Van Ru Credit Corporation (“Van Ru”) was retained to collect. Brown owned a business, and a Van Ru employee called the business and left a voicemail asking that someone from the business’s payroll department return her call. The voicemail, left in the business’s general mail box, identified the caller, where she was calling from (Van Ru), asked that someone from payroll return her call, and left a phone number and reference number. An employee at Brown’s business, who was aware that Van Ru is a debt collector, heard the message. Prior to leaving the voicemail, Van Ru mailed a letter to Brown’s business seeking Brown’s payroll information.
Brown brought suit against Van Ru alleging violations of the FDCPA, including that the voicemail was a communication “in connection with the collection of any debt” with a third party in violation of 15 U.S.C §1692c(b). Van Ru brought a motion for judgment on the pleadings, which the district court granted. The lower court ruled that the voicemail did not constitute a “communication” as defined by the FDCPA because the message did not "imply the existence of a debt." Brown appealed.
The Sixth Circuit affirmed the district court’s decision to grant Van Ru’s motion. As the Sixth Circuit explained, in order to bring a claim under §1692c(b) “a plaintiff must plausibly allege, in part, that the defendant “'communicate[d], 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.'” Under the FDCPA, “communication” is defined as “the conveying of information regarding a debt directly or indirectly to any person through any medium.” The Sixth Circuit noted that, “[t]o convey information regarding a debt, a communication must at a minimum imply the existence of a debt.” In affirming the lower court, the Sixth Circuit ruled that simply leaving a message requesting that someone from Brown’s business’s payroll department return a call did not imply the existence of a debt.
The Sixth Circuit considered, but rejected, arguments that the existence of the word “Credit” in defendant’s name refers to a debt collector, as well as that asking for someone in the payroll department suggests the call is regarding a debt. The Sixth Circuit also rejected the argument that, because the call was preceded by a letter, there was a context created that suggested that the voicemail was about Brown’s debt.
The opinion goes on to explain that this interpretation of “communication” is consistent with legislative intent as well as the non-binding commentary of the Federal Trade Commission, as well as the decisions of the U.S. Court of Appeals for the Tenth Circuit (the only other circuit to consider the issue) regarding the FDCPA.
While the courts ruled in favor of the debt collector in this case, it illustrates nonetheless the risks parties face when attempting to collect a debt. While the debt collector in this case “won,” it still lost in the sense that it likely spent significant time and resources defending against a claim based on a seemingly innocuous voicemail communication. It’s important that debt collectors understand and thoroughly train their staff on what to say, and not to say, when communicating regarding debts.