On August 19, 2019, on behalf of its members, RMAI filed an amicus curiae brief in the case Crown Asset Management, LLC v. Mary Barbato, supporting the defendant debt buyer’s petition to the U.S. Supreme Court for a Writ of Certiorari (defendant is asking the Supreme Court to review the decision of the lower court).

The appeal challenges the Third Circuit’s opinion, filed February 22, 2019 that expanded the definition of debt collector to include passive debt buyers.  However, as the plain language of the Fair Debt Collection Practices Act (FDCPA) makes clear, the term “debt collector” is defined as one whose “principal purpose . . . is the collection of any debts, or regularly collects or attempts to collect . . . debts owed or due or asserted to be owed or due another” (emphasis added). While the term “creditor” means “any person who offers or extends credit creating a debt or to whom a debt is owed, but such term does not include any person to the extent that he receives an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another” (emphasis added). Based on this language, it should be fairly clear that passive debt buyers should be treated as creditors under the FDCPA, as they are not actively attempting to collect any debt and certainly not any debt owed to another.

However, the court’s decision results in a different interpretation of the statute, at least in the area covered by the Third Circuit (Pennsylvania, New Jersey, and Delaware).  RMAI is a strong proponent of having a uniform interpretation of the FDCPA so that the law will be applied in the same manner regardless of the state or district where our members conduct business.  Due to the impact this case has on all RMAI members, RMAI filed a brief asking the court to overturn the decision of the Third Circuit.

It can take the Supreme Court several months to review Petitions for Certiorari. RMAI will be monitoring the docket and will update our members on the case.

RMAI certified businesses are reminded that RMAI certification was designed to go above and beyond the requirements of local, state, and federal laws and regulations by requiring those certified to comply with additional requirements not addressed by existing laws and regulations, which includes compliance with the FDCPA. However, just because RMAI has chosen to hold our certified members to a higher standard does not mean the law should be incorrectly applied.

This Alert is intended for Members of RMAI and is for informational purposes only; it is in no way intended to provide legal advice. Members are encouraged to consult with an attorney of their choice for legal advice concerning this matter.