August 21, 2012

Appellate Court Rules Debt Collection Letter Sent to Workplace Violates FDCPA

Lemberg & Associates, LLC announced that the U.S. Ninth Circuit Court of Appeals reversed the U.S. District Court, and has ruled that sending a debt collection letter to a consumer's workplace is a violation of the Fair Debt Collection Practices Act's prohibition on communications with third parties. In Evon v. Law Offices of Sidney Mickell, the defendant sent a debt collection letter to Catherine Evon in "care of" her employer, even though she had requested that they not contact her at work. As the appellate court's majority opinion noted, "The letter was opened and read by various individuals, including people in the legal department, before it found its way to Evon."

According to attorney Sergei Lemberg, whose firm Lemberg & Associates represents Ms. Evon, "The appellate court's decision is a resounding victory for consumers. All too often, debt collectors use tactics of embarrassment or humiliation to extract payments from people. This ruling establishes that sending correspondence to a person's place of employment is a violation of the law."

The court acknowledged that, while sending a debt collection letter to a consumer's workplace without consent is a violation of the Fair Debt Collection Practices Act (FDCPA), "The trickier question is whether sending a letter addressed to the debtor but using the debtor's employer's address constitutes a violation." Although the district court judge was adamant that the FDCPA doesn't explicitly prohibit sending correspondence to an employer, the appellate court cited a U.S. Senate report predating the 1968 enactment of the FDCPA that explicitly stated, "Collection abuse takes many forms, including...disclosing a consumer's personal affairs to friends, neighbors, or an employer..." Moreover, the appellate court noted that "the FDCPA is a remedial statute which should be interpreted 'liberally.'" The court opined, "Even if Mickell assumed that some debtors receive mail at their place of employment, it is not reasonable for Mickell to assume that all debtors' mail so received remains unopened and unseen before reaching the debtor. As a lawyer in the business of debt collecting, Mickell should have known of the real possibility that a letter to a debtor's place of employment, even one marked "Personal and Confidential," would be viewed by someone other than the debtor."

In the same opinion, the appellate court reversed the district court's denial of Evon's class certification motion on that issue, calling the district court's concern about whether or not consumers consented to having letters sent to their workplaces "a red herring." Going further, the opinion noted, "...there is nothing in the record that supports the district judge's conclusion that Sergei Lemberg was not qualified to represent the class." The appellate court further opined, "The FDCPA is a consumer protection statute and was intended to permit, even encourage, attorneys like Lemberg to act as private attorney generals to pursue FDCPA claims. Moreover, plaintiffs have already benefitted and will continue to benefit from this case."

In addition, the appellate court granted Evon's request to reassign the case to a different district court judge, noting that while honoring such requests demand "unusual circumstances" that "rarely exist," "the record reflects an unfortunate dismissive attitude by the district judge both toward Lemberg and the class Evon seeks to represent."

Lemberg concluded, "We are pleased that the Court of Appeals ruled in our client's favor, and that the Court clarified that debt collectors who send letters to consumers at their workplaces are in violation of the law. We also appreciate the court's recognition that consumer attorneys play an important role in holding debt collectors accountable. Finally, we welcome the opportunity to seek class certification for the more than 250 people who received similar letters from the Law Offices of Sidney Mickell at their workplaces."

This release references Evon v. Law Offices of Sidney Mickell (U.S. Court of Appeals for the Ninth Circuit, 310-16615, D.C. No. 2:09-cv-00760-JAM-KJN).

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