Third Party Communication Under Fair Debt Collection Practices Act

Two (2) recent opinions provide guidance on acceptable "third party communication" under the Fair Debt Collection Practices Act, 15 U.S.C. §§1592, et seq.  ("Act") barring collection letters addressed to a debtor's employer but easing restrictions on "dunning voicemails".

"Fair Debt Collection Practices Act" 3rd Party Communications Bar   

The Act regulates "debt collection activity" on "family, personal or household purposes" transactions.  15 U.S.C. §1692(a).

The Act defines a “communication” as the “conveying of information regarding a debt directly or indirectly to any person through any medium.”  Id.

The Act prohibits a debt collector, without debtor's consent, from communicating about collecting a debt with one other than a debtor and his attorney, consumer reporting agencies, a creditor and its attorney, or a debt collector's attorney.  15 U.S.C. §1692c(b).

Prohibition on Addressing Collection Letters to Debtor's Employers 

In Evon v. Law Offices of Sidney Mickell, 688 F.3d 1015 (9th Cir. 2012), the U.S. Court of Appeals for the Ninth Circuit ruled that sending a collection letter to debtor's employer's address addressed to debtor "in care of" employer without debtor's consent forms a per se violation of the Act's third-party communications bar.

The Evon plaintiff's employer had opened the letter addressed to her, the envelope for which listed defendant "law office" as the return address.

The Ninth Circuit ruled that the debt collector "knew or could reasonably anticipate" that a letter sent to a debtor's employer "might be opened and read by someone other than the debtor", because of the return address, someone handling plaintiff's mail would know that she "was receiving legal mail, a fact many people would prefer be kept private", and "disclosing a consumer's personal affairs to his or her employer is a form of collection abuse."  688 F.3d at 1019.

Non Specific Dunning Voice-Mail Permitted

In Zortman v. J.C. Christensen & Associates, Inc., No. 10-3086 (D. Minn. May 2, 2012), the Minnesota District Court held that a voicemail containing caller’s name and identifying him as a debt collector with “an important message” was not a prohibited “communication” under the Act.

The message, left on plaintiff’s cellular phone, included the debt collector’s phone number but did not identify a consumer or a debt and was heard by plaintiff's children to whom she had lent her phone.

Because the voicemail message was not directed to the plaintiff by name and did not identify a debt, the Zortman Court message ruled that it would not convey that the plaintiff was being called in connection with a debt and was unwilling to find “indirect communications” based on “inferences or assumptions by an unintended listener” that the plaintiff was the intended recipient or that the call, because it was from a debt collector, was necessarily to collect a debt.

The District Court also found that the “important message” language did not “convert [the debt collector’s] simple self-identification and telephone number into an indirect conveyance of information about a debt” and use of “important” conveyed no substantive information about the call’s purpose.

According to the Zortman Court, the Act as imposes no "third party communication" liability based on a voicemail message revealing no more than a hang-up call, a cellular phone’s “missed call” log, caller ID, or an Internet search for caller’s phone number.

Impact of Evon and Zortman Opinions

Beyond barring collection letters addressed to a debtor's employer and easing non specific "dunning voicemail" restrictions, the Evon and Zortman opinions provide guidance on acceptable "third party communications" under the Act.

First, the Evon Court based its ruling on the Federal Trade Commission's Act Staff Commentary providing that a debt collector cannot "send a written message that is easily accessible to third parties" or use an "in care of" letter unless the consumer "lives at, or accepts mail at, the other party's address." 

Thus, the lesson of Evon is that communications' easy access by a third party is a heavily weighed factor in deeming it a wrongful third party communication.

Second, the Zortman opinion eases the "collection voicemail restrictions" imposed by the Foti v. NCO Financial Systems, Inc., 424 F.Supp.2d 643 (2006) of requiring a debt collector to either hang up or leave an awkward, elaborately scripted message. 

Pursuant to Zortman, voice-mails that are not directed to the plaintiff by name nor identify a debt do not form a wrongful communications under the Act.