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From Banking and Finance Law Daily, August 9, 2016

Prior dealings meant explicit identification as debt collector not required

By Richard A. Roth, J.D.

The Fair Debt Collection Practices Act does not require a debt collector to explicitly say "this communication is from a debt collector" when the communication, in the context of previous contact with the consumer, makes that fact clear, the U.S. Court of Appeals for the Ninth Circuit has decided. The FDCPA does not impose liability based on a consumer’s "bizarre or unreasonable" interpretation of a voicemail (Davis v. Hollins Law, Aug. 8, 2016, Ikuta, S.).

Hollins Law, a debt-collecting law firm, first called the consumer about a credit card account on July 23, 2015. Numerous contacts between the consumer and the law firm’s employees took place after that, by telephone and email, including two weeks of settlement negotiation emails. Among the contacts was a September 25 voicemail message that included the statement "Hello, this is a call for Michael Davis from Gregory at Hollins Law."

The consumer later sued, asserting that the voicemail violated the FDCPA because the caller did not state that the communication was from a debt collector.

FDCPA requirements. The FDCPA bans false, deceptive, or misleading representations. Included as part of the ban is:

  • failing to disclose in the first communication with a consumer that the communication is an effort to collect a debt and that any information gathered will be used for that purpose, and
  • failing to disclose in each subsequent communication that the communication is from a debt collector (15 U.S.C. §1692e(11)).

The court noted that in interpreting a communication under the FDCPA the standard is the effect on the least sophisticated consumer, but that a "bizarre or unreasonable" interpretation will not be credited. Also, a debt collector’s error will not be a violation unless it is material.

No violation. A consumer with only a basic level of understanding would have known that the voicemail was from a debt collector, the court said. The extensive earlier communications between the consumer and the law firm’s employees made any other conclusion "bizarre or idiosyncratic." The FDCPA requires a debt collector to disclose that a communication is from a debt collector, but it does not require the use of any specific language. Any statement that makes the fact clear is adequate, the court concluded.

The case is No. 14-16437.

Attorneys: Kathleen Mary Kushi Carter (Hollins Law) for Hollins Law. Aaron D. Radbil (Greenwald Davidson Radbil PLLC) for Michael Davis.

Companies: Hollins Law

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