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Debt Collection Lawsuits Revisited: Seventh Circuit Rules Collectors Not Required To Go To Trial

The Seventh Circuit’s ruling stems from three consumers that brought suit against three debt collection agencies for violating the FDCPA’s broad prohibition on false, deceptive or misleading representations threatening to take action that collectors do not intend to actually take. 15 U.S.C. § 1692e(5). In each case, the agency had previously filed suit against the consumer in state court. The consumers argued in their lawsuits, however, that the suits against them violated the FDCPA because the agencies never had the intention of proceeding to trial; rather, the consumers alleged that the suits were brought solely to obtain a default judgment or settlement. The proof, the consumers argued, was the fact that each debt collector later moved for voluntary dismissal of their lawsuits.

Podcast: Do Consumers Need to Show “Concrete” Injury to Sue Debt Collectors?

The Supreme Court decision in Spokeo v. Robins was expected to provide clarity to debt industry defendants facing FDCPA and related consumer lawsuits where the Plaintiffs’ allege no actual harm. Unfortunately, the case did little to specify exactly what type of “concrete” harm a consumer must allege to pursue a claim, but did provide some excellent language that can be used to refute consumer lawsuits where no actual harm is or could be alleged.

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How Spokeo May Limit Consumer Financial Services Litigation

This week’s decision from the U.S. Supreme Court in Spokeo v. Robins should bolster the defense of companies subject to several federal consumer protection statutes. The ruling addresses lawsuits that claim an injury created solely by the violation of a federal statute and require the plaintiff to demonstrate not only that the statute was violated, but that the plaintiff herself suffered harm.

Opinion on Red Keyboard Button.

Debt Collection Litigation in the Cross Hairs: CFPB’s Consent Order Against New Jersey Law Firm Creates More Problems Than Solutions

This article originally appeared as an Alert on ClarkHill.com, and is republished here with permission. Lightning can strike twice. With the ink barely dry on the Consent Order against the Hanna Law Firm (Hanna) in Georgia, the Consumer Financial Protection Bureau (CFPB or Bureau) yesterday took action against another debt collection law firm for the filing […]

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Appellate Courts Hold Typical Collection Letters Violate FDCPA

The requirements for what debt collectors are required to provide in “snail mail” notices to consumers arises from a patchwork of Federal, State and local laws — as well as case law that often varies by jurisdiction — and many of the requirements are antiquated, dating back to the 1970s. Unfortunately, these dated and contradictory collection letter requirements continue to result in lawsuits and adverse Court decisions against debt collectors.

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Have You Been Sued by Todd Bank?

This post originally appeared on the blog of Klein Moynihan and is re-published here with permission. The article was co-authored by David O. Klein and Joshua Wueller. The Federal Communications Commission (the “FCC” or “Commission”) is currently seeking comment on whether it should establish a bright-line rule for telephone lines in residential homes that are used for business […]

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Convenience Fees: Potential for Mischief?

Two attorneys — one for collections, one for consumers — talk through urgency channels, convenience fees, and due dates. It’s another example of how language that, on the surface, seems helpful and clarifying for a collection agency, can also be seen as deceptive, by a consumer attorney, to the Least Sophisticated Consumer.

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Headline The ARM Industry Should Like to See: “Closing Time for a Fake Debt Collector”

Yesterday, at the request of the FTC and Illinois AG, a federal court has shut down a network of businesses and operators that falsely claimed to be debt collectors collecting real payday loan debts. The first paragraph in the FTC’s Blog about the event was perfect: “It’s fine to play ‘let’s pretend’ when you’re young; you can be an astronaut today and an inventor tomorrow. But grown-ups who pretend to be debt collectors and lie to get peoples’ money are headed for trouble.”