Wednesday, November 18, 2015

FYI: 6th Cir Holds Voicemail to Third Party Did Not Convey Info as to Debt, and Thus Did Not Violate FDCPA

The U.S. Court of Appeals for the Sixth Circuit recently affirmed judgment on the pleadings in favor of a debt collector because the voicemail in question, which was left at the plaintiff's business, was not a "communication" as defined by the federal Fair Debt Collection Practices Act ("FDCPA") because it did not convey information about the debt.


A copy of the opinion is available at:


A debt collector sent a letter to the debtor's business requesting payroll information and later left a voicemail at the debtor's business that stated the caller's name, the name of the company on whose behalf she was calling, asked if someone in the payroll department could return the call, and left a reference number and call back phone number.


The debtor filed suit, alleging that the voicemail supposedly violated section 1692c(b) of the FDCPA by communicating with a third party regarding the debt, and supposedly violated section 1692g(a) "by failing to provide required written notices after an 'initial communication with a consumer.'"


The debt collector answered then moved for judgment on the pleadings. The debtor responded and also moved to amend the complaint to add an allegation that the person that heard the voicemail "knew that calls to [debtor's] business were intended for [the debtor]."


The district court granted the debt collector's motion for judgment on the pleadings, and denied the debtor's motion to amend as futile, reasoning that because the voicemail message did not imply the existence of a debt, it was not a "communication" as defined by the FDCPA and the complaint thus failed to state a claim under the FDCPA.


On appeal, the debtor argued that he stated a claim under 15 U.S.C. § 1692c(b), the FDCPA's prohibition on certain communications with third parties.


The Sixth Circuit disagreed, holding that "[t]he district court properly granted [the debt collector's] motion for judgment on the pleadings, because [the debtor] failed to plead a communication by [the debt collector] under the FDCPA."


The Court reasoned that "[i]n order to state a claim under 15 U.S.C. § 1692c(b), a plaintiff must plausibly allege, in part, that the defendant 'communicate[d], in connection with the collection of any debt, with any person other than the consumer, his attorney, a consumer reporting agency if otherwise permitted by law, the creditor, the attorney for the creditor, or the attorney for the debt collector. 15 U.S.C. § 1692c(b). The FDCPA defines 'communication' as 'the conveying of information regarding a debt directly or indirectly to any person through any medium.'" 15 U.S.C. § 1692a(2). To convey information regarding a debt, a communication must at a minimum imply the existence of a debt. Otherwise, whatever information is conveyed cannot be understood as 'regarding a debt.'"


The Sixth Circuit found that the subject voicemail did not convey information regarding the plaintiff's debt because it did little more than ask for a return call from the called business' payroll department. Nothing in the message suggested that any kind of debt existed.


The Court rejected the plaintiff's argument that the word "credit" as part of the debt collector's corporate name referred to debt collection because "the word 'credit' refers to a category of financial services far broader than debt collection."


The other information in the voicemail only gave the impression that the debt collector had some kind of business relationship with plaintiff's business, someone employed by plaintiff's business, or that the caller sought to establish a business relationship. The fact that the voicemail asked for a return call from the payroll department suggested only that the caller was seeking "some sort of payroll information, whether about an individual employee or the business as a whole."


The Sixth Circuit acknowledged that "[w]hat information a message conveys depends party on context," but noted that the plaintiff did "not plead circumstances in which [the debt collector's] message would mean more than what the words say." Because the plaintiff did not plead that anyone saw the letter that preceded the voicemail or that it did anything other than inquire about the debtor's payroll information, the Court did not deem it "appropriate to treat it as part of the context of the voicemail." Regardless, the letter did "not create a context in which the voicemail suggests anything about [the plaintiff's] debt."


In short, because the voicemail did not convey information about a debt, it was not a "communication" under the FDCPA.


The Court pointed out that its "application of the definition of 'communication' under the FDCPA is consistent with the FDCPA's purposes, the [Federal] Trade Commission's commentary, and the decision of the Tenth Circuit in Marx v. General Revenue Corp., 668 F.3d 1174 (10th Cir. 2011)."


Citing the Tenth Circuit's ruling in Marx, the Sixth Circuit reasoned that "[t]he ban on communicating with third parties like employers is meant to protect debtors from harassment, embarrassment, loss of job, [and] denial of promotion." This, in turn, "suggests that FDCPA does not cover communications that do not refer to or imply the existence of a debt and thus do not reveal information about the debtor's debts."


"The non-binding commentary of the Federal Trade Commission" further supported the Court's conclusion because the FTC rejected "an interpretation that would categorically exclude from the definition of 'communication' all communications that do not directly refer to the existence of a debt," insisting instead on "a common sense approach" under which messages may imply the existence of a debt in some situations, and they are 'communication' in exactly those situations." "Thus, 'communication' under the FDCPA 'does not include situations in which the debt collector does not convey information regarding the debt, such as … [a] request to a third party for information about the consumer's assets, if the debt collector does not reveal the existence of a debt." Although in the case at bar "the debt collector's request concerned income rather than assets … it similarly did not directly or indirectly reveal the existence of [plaintiff's] debt or any information about his debt."


In concluding, the Sixth Circuit reasoned that "requiring that a communication at a minimum imply or refer to the existence of a debt is consistent with the text of the FDCPA as a whole."


The district court's judgment was affirmed.





Ralph T. Wutscher
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