” Id. at *2-3. The consumer filed suit alleging that the envelope created a risk that third parties would recognize that she was receiving mail from a debt collector and asserting, among other things, a violation of 15 U.S.C. § 1692f(8). After pleadings closed, the district court granted the debt collector’s motion for judgment on the pleadings concluding that Section 1692f(8) should be read to include a “benign language” exception, relying upon 2004 decisions from the Fifth and Eighth Circuits.On appeal, the Sixth Circuit reversed and sided with the more recent and contrary positions of the Third and Seventh Circuits.
Douglass v. Convergent Outsourcing, 765 F.3d 299 (3d Cir. 2014). The Fair Debt Collection Practices Act, 15 U.S.C. §1692f(8) (“FDCPA”), forbids debt collectors from putting on the envelopes of debt collection letters “any language or symbol, other than the debt collector’s address.” In this putative class action case, defendant sent plaintiff a collection letter that contained plaintiff’s account number with defendant, and that account number showed through the clear glass window of the envelope.
Thompson v. Five Bros. Mortg. Co., 2020 U.S. App. LEXIS 2881 (6th Cir. Jan. 27, 2020).In Thompson, the consumer alleged that Defendant, a property preservation and maintenance company, violated 15 U.S.C. §1692f(6) by dispossessing her of her personal property when there was no legal right to possession. Central to the court’s determination was whether the defendant was a debt collector for the limited purposes set forth in Section 1692(f)(6).
gov/documents/2022/07/05/2022-14230/debt-collection-practices-regulation-f-pay-to-pay-fees 15 U.S.C. §1692 et seq. (Pub. L. 90–321, title VIII, § 808, as addedPub. L. 95–109,Sept. 20, 1977,91 Stat. 879.) 87 FR 39734. 15 U.S.C. §1692f. 12 CFR §1006.22(b).
Although state and federal regulators have scrutinized convenience fees in the past, the recent overt hostility at the state and federal level creates risk for creditors, servicers, and debt collectors who might ask a customer to pay those fees.By way of background, the federal Fair Debt Collection Practices Act ("FDCPA") and its implementing regulation, Regulation F ("Reg F") prohibit a debt collector from collecting any amount (including any interest, fee, charge, or expenses incidental to the principal obligation) unless the amount is expressly authorized by the agreement creating the debt or permitted by law. 15 U.S.C. § 1692f(1), 12 C.F.R. § 1006.22(b). It is uncommon for credit agreements to expressly contract for convenience fees.
When scanned, the QR code revealed the debt collector’s internal account number. The consumer filed suit asserting the envelope violated 15 U.S.C. §1692f(8) which prohibits debt collectors from “using any language or symbol, other than the debt collector’s address, on any envelope when communicating with the consumer by use of the mails. . .” The district court granted the plaintiff’s summary judgment motion on liability based on the reasoning in Douglass.
In a precedential opinion, DiNaples v. MRS BPO, LLC, the Third Circuit held that adding an unencrypted "quick response" or "QR" code to an envelope containing a debt collection letter violates 15 U.S.C. § 1692f(8) of the Fair Debt Collection Practices Act ("FDCPA").i That section limits what collection agencies can include on envelopes, prohibiting "language or symbols" other than the debt collector’s address.
Relying on Ninth Circuit Court of Appeals precedent in Doyle v. Chrysler Group, LLC, 663 Fed Appx. 56, 578, (9th Cir. 2016), the Court found it immaterial that the fee was optional, determining that “plaintiffs have standing when they spend money that, absent defendants’ actions, they would not [otherwise] have spent.” The Court noted that Plaintiffs paid the Speedpay fee over forty times and thus, alleged a concrete injury for purposes of Article III.The Speedpay Payments Violated 15 U.S.C. 1692f(1) and the Rosenthal Act The Rosenthal Act is California’s version of the federal Fair Debt Collections Practices Act (“FDCPA”) and, just like its federal counterpart, is meant to protect consumers from unfair and abusive debt collection practices. The Rosenthal Act incorporates by reference the FDCPA’s requirements.
[6]ReconTrust, 2016 WL 6091564, at *3 (citing 15 U.S.C. §1692a(5)).[7]Id.[8]Id.[9] 15 U.S.C. § 1692f(6). Section 1692f(6) provides liability for “unfair practices” including “[t]aking or threatening to take any nonjudicial action to effect dispossession or disablement of property if (A) there is no present right to possession of the property claimed as collateral through an enforceable security interest.”
On September 3, Judge Edmond E. Chang of the Northern District of Illinois issued a decision stating that the display of a series of letters and numbers – in which the debtor’s account number was allegedly embedded – through an envelope window does notviolated the Fair Debt Collection Practices Act. In Schmid v. Transworld Systems, the plaintiff filed a class action lawsuit alleging that Transworld Systems violated 15 U.S.C. § 1692f(8) by making visible through the window of its collection envelopes a string of about twenty letters and digits. Plaintiff claimed his Transworld Systems account number was embedded within this string of letters and digits and, therefore, the display of this sequence of letters and digits violated the FDCPA.