Tomio is a partner of Simmonds & Narita LLP, www.snllp.com, a California law firm specializing in defending claims arising under the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, and the Rosenthal Act. He has served as lead counsel defending scores of class actions and representative actions in state and federal courts in California and across the country. A member of the California Bar, Tomio is also admitted to the United States Supreme Court, the Second, Third and Ninth Circuit Courts of Appeals and all District Courts of California. Tomio is regularly invited to speak at collection industry events, discussing issues arising under the FCRA and FDCPA. He is a member of the American Bar Association (Vice Chair, Debt Collection Practices and Bankruptcy Subcommittee of Consumer Financial Services Committee), ACA International (Chair of the MAP Committee, 2009-10), the National Association of Retail Collection Attorneys (Associate Member; Member of the Amicus Committee), and the Bar Association of San Francisco.
Beginning in 1995, when the Supreme Court issued Heintz v. Jenkins, lawyers have known that if they seek to collect consumer debts for clients – even when doing so through litigation – they might qualify as a “debt collector” under the FDCPA. But how often must a lawyer or a law firm engage in consumer debt collection activities before they are subject to the Act?
A new law in California focused on debt buyers imposes a series of new requirements on purchasers that start before any collection letter is sent to a consumer, and that continue throughout the collection process, including during any collection litigation.
Although the law was designed to protect consumers and increase the information available to them, a likely result will be to decrease the level of communication between debt buyers and consumers, while increasing the amount of collection litigation.
The lengthy report describes a comprehensive study conducted by the FTC over a three-year period using data obtained from the nation’s largest debt buyers. Many will view the Report as another chance to engage in debt-buyer bashing, which has become a favorite pastime for mainstream media and consumer advocates. But a close reading reveals how wrong this report is.
When a consumer disputes their debt, an accepted and conservative practice is for the data furnisher to promptly report the dispute to the consumer reporting agencies. But under what circumstances will the failure to report a dispute give rise to a violation of section 1692e(8) of the FDCPA?
For example, what if a consumer or their attorney simply calls or writes and states, “I dispute this,” without providing the collector with any substantive information regarding the basis for the dispute? Does the collector violate section 1692e(8) if it fails to report that “dispute” to the consumer reporting agencies? The answer must be “no.”
Does the Consumer Financial Protection Bureau (CFPB) have the power to tell debt collectors to turn over their attorney-client privileged communications? The answer may depend on who you ask. The CFPB certainly seems to think it does, while federal courts tell a different story. In our top story, we check in with Tomio Narita, who goes into this topic at greater length.
Consumers and their attorneys are constantly seeking to expand the pool of potential FDCPA defendants using principles of vicarious liability. Debt buyers are being sued based on the conduct of their agencies and law firms. Lawyers and agency owners are being sued based on the conduct of their clients and their collectors. Even original creditors, who are not subject to the FDCPA, are being drawn into FDCPA litigation under various theories of recovery.
What are the limits of vicarious liability under the FDCPA? How can debt collectors avoid liability for the conduct of others?
The National Association of Retail Collection Attorneys (NARCA) recently filed an amicus brief in the United States Supreme Court to overturn a case NARCA says improperly interferes with the attorney-client relationship.
Thousands of FDCPA lawsuits are filed in federal courts across the country each year, and in most cases, the plaintiff has not suffered any actual damages resulting from the alleged violation. A case before the Supreme Court may give some guidance on the standing of those cases.
Any debt collector faced with an FDCPA class action should read the Supreme Court’s recent decision in Wal-Mart Stores, Inc. v. Dukes with care, because it provides a framework for potential challenges to class certification in FDCPA cases.
If collection attorneys were looking for guidance on how to draft their collection letters without violating the FDCPA, a recent decision by the Third Circuit Court of Appeals definitely will not help them.