Failure to register as a collection agency under state law may also violate FDCPA

In LeBlanc v. Unifund CCR Partners, 08-16031, 2010 WL 1200691 (11th Cir. Mar. 2010) the Court of Appeals for the 11th Circuit held as matter of first impression that a debt collector may violate the FCCPA by failing to register as an out-of-state consumer collection agency and returned the case to the jury. Specifically, the court considered whether a federal cause of action pursuant to Section 1692e of the FDCPA for threatening to take an action that cannot legally be taken is cognizable when premised upon the failure to register as a consumer collection agency under Florida’s consumer debt collection statute. The court’s stated that its goal in construing the state and federal statutes is to provide the consumer with the most protection possible under either statute. The remedies under the statutes are cumulative suggesting a broad reach. Further, Florida has demonstrated the seriousness with which it intends to address violations of the FCCPA by the fact that a debt collector’s failure to register as a debt collector and subsequent pursuit of unauthorized debt collection activity is a misdemeanor criminal act. These facts compelled the court to find that a violation of the FCCPA for failure to register may support a federal cause of action under the FDCPA prohibition on threatening to take an action it could not legally take. Importantly, the court said its holding should not be read to mean that all activities that violate state law constitute per se FDCPA violations. The court also found there was a question of fact as to whether the dunning letter could reasonably be perceived as a threat to take legal action under the least-sophisticated consumer standard. The letter stated: If we are unable to resolve this issue within 35 days we may refer this matter to an attorney in your area for legal consideration. If suit is filed and if judgment is rendered against you, we will collect payment utilizing all methods legally available to us, subject to your rights below. The court rejected the debt collector’s argument that no reasonable jury, viewing the letter through the eyes of a least-sophisticated consumer, and making all reasonable inferences in the debt collector’s favor, could find that the letter was merely informative as opposed to threatening.

Download Related Document