Friday, July 20, 2018

Statement that Debt Collector Would Call Overshadows 1692g Notice

A recent case from a Wisconsin district court serves as a reminder that the best approach to a 1692g notice is that it stands alone.  In Maniaci v. The Receivable Management Services Corp., 2018 U.S. Dist. LEXIS 109087 (E.D. Wisc. June 29, 2018), the agency’s 1692g notice included a statement that

If you have not yet been contacted by an RMS representative, you will be receiving a call to bring this matter to a resolution.  Should you receive this letter after a discussion with our representative, we thank you for your cooperation.

Maniaci at *2. 

In determining the collection agency’s motion to dismiss, the court considered whether the above statement overshadowed the 1692g notice, leading the unsophisticated consumer to believe he could wait until he received a call to dispute the debt. 

The agency contended that the statement did not overshadow the remainder of the notice because it “clearly and unequivocally directs the consumer to provide the dispute in writing.”  Id. at * 5.  The court, however, disagreed.  In doing so, the court made two points.  First, the court concluded that a statement that the debt collector would be calling might lead the unsophisticated consumer to conclude that he would be receiving the call within the thirty-day debt validation window, at which time he could “bring this matter to a resolution” by disputing the debt.  Second, the court found the debt collector’s contention that it did not make calls within the thirty-day validation troubling because it presented the possibility that consumers would forfeit their rights under §1692g. 

Despite denying the motion to dismiss, however, the court was quick to point out that the threshold for motions to dismiss is high because “dismissal is only appropriate in cases involving statements that plainly, on their face, are not misleading or deceptive.”

The key take away from this, of course, is that 1692g notices are best when they contain no extraneous language which might obscure the notice.

Tuesday, July 10, 2018

Aftershocks Being Felt: The TCPA After ACA International v. FCC

The aftershocks from the D.C. Circuit’s opinion in ACA International v. FCC are beginning to be felt.  In ACA International, the D.C. Circuit set aside several elements of the FCC’s 2015 Declaratory Ruling.  A recent opinion by the Third Circuit demonstrates some of the repercussions of that decision.

In Dominguez v. Yahoo, Inc., 2018 U.S. App. LEXIS 17436 (3rd Cir. June 26, 2018), the Third Circuit affirmed a judgment in favor of Yahoo despite the fact that the consumer received 27,800 unwanted text messages.  In Dominguez, the consumer purchased a cell phone with a reassigned number.  The prior owner of the number had a subscription with Yahoo’s Email SMS Service which sent a text every time the prior owner received an email.  Because the prior owner of the number never cancelled the subscription, Mr. Dominguez became the recipient of 27,800 unwanted text messages.  Mr.  Dominguez filed a putative class action against Yahoo asserting violations of the TCPA.  The problem?  The district court concluded that the Email SMS Service did not qualify as an automated telephone dialing system (“ATDS”) because it did not have the capacity to store or produce telephone numbers using a random or sequential number generator.  On remand from a prior appeal, the consumer amended his complaint to take advantage of the FCC’s 2015 Declaratory Ruling and alleged that the Email SMS Service had the “latent or potential capacity” to store or produce telephone numbers using a random or sequential number generator.  The trial court again concluded that the Email SMS Service did not qualify as an ATDS.

On appeal, the Third Circuit relied upon the D.C. Circuit’s holding in ACA International to support its conclusion that the statutory definition of an ATDS requires the present capacity to function as an autodialer. In doing so, the court relied upon two key findings: first, that the Email SMS Service only sent messages to numbers that had been individually and manually inputted into its system by a user; and secondly, that the messages were sent because the previous owner of the message affirmatively opted to receive them and not because of a random number generation.  Dominguez, *9. 

The opinion is a positive for the ARM industry because it demonstrates the potential impact of the D.C. Circuit’s decision and will likely to be followed by others that will more narrowly define the meaning of an ATDS.