Pennsylvania Federal Court Holds Debt Collector's Communication With Vendor Could Violate FDCPA

• Published date: 18 February 2022
• Subject Matter: Finance and Banking, Consumer Protection, Debt Capital Markets, Financial Services, Consumer Law
• Law Firm: Riker Danzig Scherer Hyland & Perretti
• Author: Mr Michael O'Donnell, Michael Crowley and Desiree McDonald

The United States District Court for the Eastern District of Pennsylvania recently held that a debt collector's communication with a letter vendor could constitute an FDCPA violation. See Khimmat v. Weltman, Weinberg & Reis Co., LPA, 2022 U.S. Dist. LEXIS 21076 (E.D. Pa. Feb. 7, 2022). In the case, the defendant was retained to collect plaintiff's credit card debt. Before sending a letter, defendant hired a letter vendor and provided the vendor with personal information about plaintiff. Plaintiff then brought this action under 15 USC 1692c(b), which states that a "debt collector may not communicate, in connection with the collection of any debt, with any person other than the consumer, his attorney, a consumer reporting agency if otherwise permitted by law, the creditor, the attorney of the creditor, or the attorney of the debt collector," with certain exceptions. Plaintiff alleged that defendant violated this section by transmitting her personal information to the letter vendor. Defendant moved for a judgment on the pleadings.

The Court denied the motion. In doing so, it rejected defendant's argument that only a demand for payment could be a communication "in connection with the collection of any debt." The Court found that the Third Circuit already has found that an "'opening communication in an attempt to collect [the debtor's defaulted loan]'...