UDAAPCouncil

Every week, courts around the United States issue decisions addressing aspects of civil UDAAP claims.

In an effort to illuminate the UDAAP standards, below is a sampling of some of this week’s UDAAP decisions on the meaning of unfair, deceptive, and abusive.

Unfair

  • A plaintiff stated claims under Sections 1692e(5) and 1692e(2)(A) of the Fair Debt Collection Practices Act (FDCPA) when a debt buyer misrepresented the amount of the debt owed  in a state lawsuit filed against her. The court held that the FDCPA governs debt collection in or out of court and does not allow debt collectors to use litigation as a vehicle for abusive and unfair practices. Stratton v. Portfolio Recovery Associates, LLC, United States Court of Appeals for the Sixth Circuit.
  • A plaintiff’s claims under Sections 1692c(a)(3) and 1692d of the FDCPA survived summary judgment when he provided sworn discovery stating that a debt collector continued to call him at work even after the plaintiff informed the debt collector that he was prohibited from receiving these calls at his place of employment.   The discovery alone was enough to establish a material genuine dispute of fact.  Wells v. Healthcare Financial Services, LLC, United States District Court for the Southern District of Mississippi.
  • Plaintiffs stated claims under the FDCPA and the California Rosenthal Fair Debt Collection Practices Act when they alleged that defendants continued to improperly attempt to collect a debt on a mortgage loan.  Plaintiffs alleged that defendants continued to attempt collection after being notified that the plaintiffs were challenging the debt in a lawsuit, that defendants continued to contact them after being notified that plaintiffs were represented by counsel, and that defendants failed to indicate that the debt was disputed in reports to credit reporting agencies.  The court rejected the claim that lenders cannot be debt collectors under the FDCPA, finding that the alleged conduct did not involve any statutorily mandated communication for non-judicial foreclosure and there was no apparent connection between one specific defendant’s communications with credit reporting agencies and the non-judicial foreclosure process.  Lohse v. Nationstar Mortgage, United States District Court for the Northern District of California.
  • Plaintiffs did not state claims under Sections of the FDCPA,  the North Carolina Debt Collection Act, and the Fair Credit Reporting Act. Plaintiff alleged that the defendants improperly retrieved their credit report and failed to properly integrate their electronic system for making online payments following a merger, causing the plaintiffs to incur late fees and other penalties.  Plaintiffs’ claims failed under various statutory exemptions in each statute, including the exemption of debt originators from the definition of debt collector in the FDCPA.  Campbell v. Wells Fargo Bank, N.A., United States District Court for the Eastern District of North Carolina.

Note that this Weekly UDAAP Standards Report serves to highlight only some of the many weekly developments in the law around these standards.

Please feel free to contact me for more information or to discuss these cases or any other UDAAP developments.

Looking for the latest in UDAAP Developments and Best Practices? Foley has an event for you:

On Wednesday, November 5, Foley Partner Marty Bishop will be presenting UDAAP: The Latest Developments and Best Practices, a complimentary, 1 hour webinar starting at 2:00 pm EST. Some topics include:

  • UDAAP (and UDAP) in the consumer mortgages, including the Consumer Financial Protection Bureau’s (“CFPB”) new mortgage rules (both those implemented early this year and those the Bureau plans to implement in the near future).
  • An examination of how the CFPB can take an existing statute like (e.g., the Fair Debt Collection Act) and expand it through UDAAP.
  • The unique investigatory, litigation, and settlement workings of state Attorneys General.

Register now!