Mary T. Janetos, et al., Plaintiffs-Appellants,
Fulton Friedman & Gullace, LLP and Asset Acceptance, LLC, Defendants-Appellees.
Argued January 12, 2016
Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 12 C 1473 - Thomas M. Durkin, Judge.
Before Bauer and Hamilton, Circuit Judges, and Peterson, District Judge. [*]
Hamilton, Circuit Judge.
Section 1692g(a)(2) of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq., requires a debt collector to disclose to a consumer "the name of the creditor to whom the debt is owed, " either in its initial communication with the consumer or in a written notice sent within the next five days. When defendant Fulton Friedman & Gullace, LLP set out to collect debts from the plaintiffs on behalf of creditor Asset Acceptance, LLC, it sent them letters that identified Asset Acceptance as the "assignee" of the original creditors but said that the plaintiffs' accounts had been "transferred" from Asset Acceptance to Fulton. No- where in the letters did Fulton explicitly identify Asset Acceptance as the current creditor.
Plaintiffs brought suit alleging that Fulton had violated §§ 1692e, 1692e(10), and 1692g(a)(2) of the Act by failing to disclose the current creditor's name and that Asset Acceptance was vicariously liable for Fulton's violations. The district court granted defendants' motion for summary judgment. The court held that the letters were ambiguous as to the identity of the current creditor but that plaintiffs needed to present extrinsic evidence of confusion, like a consumer survey, to survive summary judgment. The court also held that even if plaintiffs had presented such evidence, their claims would still fail because the ambiguity about the identity of the current creditor was immaterial, meaning it would neither contribute to nor undermine the Act's objective of providing "information that helps consumers to choose intelligently." See Hahn v. Triumph Partnerships LLC, 557 F.3d 755, 757–58 (7th Cir. 2009).
We reverse. The district court correctly found that the letters were unclear, but it erred in finding that additional evidence of confusion was necessary to establish a § 1692g(a)(2) violation. Section 1692g(a) requires debt collectors to disclose specific information, including the name of the current creditor, in certain written notices they send to consumers. If a letter fails to disclose the required information clearly, it violates the Act, without further proof of confusion. Section 1692g(a) also does not have an additional materiality requirement, express or implied. Congress instructed debt collectors to disclose this information to consumers, period, so these validation notices violated § 1692g(a). Finally, because Asset Acceptance is itself a debt collector, it is liable for the violations of the Act by its agent. We remand this case to the district court for further proceedings consistent with this opinion.
Factually speaking, this case is a simple one. Asset Acceptance is a debt collector that acquired, or claimed to have acquired, consumer debts purportedly owed by the various plaintiffs. Later, pursuant to § 1692g, Fulton sent its initial collection notices to the plaintiffs (or, for those plaintiffs with legal representation, to their attorneys). The letters followed essentially the same template. We quote the letter sent to plaintiff Erik King, but there are no meaningful differences among the letters. Before the salutation, each letter had a heading in roughly the following form:
Re: Asset Acceptance, LLC Assignee of AMERISTAR
Original Creditor Acct #: XX0682
Fulton, Friedman & Gullace, LLP Acct #: XXXXXX2109
Balance Due: $17479.24
Letters sent to attorneys rather than directly to the consumers had the consumer's name in the first line followed by the reference to Asset Acceptance as assignee in the second. The letters began: "Please be advised that your above referenced account has been transferred from Asset Acceptance, LLC to Fulton, Friedman & Gullace, LLP." They also said that if the consumer had "already entered into a payment plan or settlement arrangement with Asset Acceptance, LLC, " Fulton was "committed to honoring the same, " and instructed consumers to direct all future contact, including any questions they had, to Fulton's offices. ...