1. The Eleventh Circuit Court of Appeals issued a concerning opinion last week wherein it reversed the Middle District Court of Florida’s dismissal of a borrower’s FDCPA and FCCPA claims against servicer Select Portfolio Servicing, Inc. (“SPS”). Daniels v. Select Portfolio Servicing, Inc., No. 19-10204, 2022 WL 1639012 (11th Cir. May 24, 2022). Daniels took out a loan with Countrywide in 2005, defaulted and entered into a loan modification agreement in March 2009 (“Modification” or “Agreement”). Wells Fargo obtained an interest in Daniels’ loan and refused to accept the interest-only payments provided for by the Modification. Daniels successfully moved to enforce the Modification against Wells Fargo.
  2. Thereafter, Wells Fargo’s servicer, SPS, sent Daniels a number of monthly statements which contained inaccurate information and indicated they were sent in an attempt to collect a debt. Daniels sued SPS claiming the monthly statements were “harassing, false, and misleading” and constituted “unfair practices in connection with the collection of a debt in violation of the FDCPA and the FCCPA.” SPS argued the statements were required by TILA therefore the statements could not form the basis for FDCPA and FCCPA claims. The Middle District of Florida agreed with SPS and dismissed the action. Daniels appealed to the Eleventh Circuit which reversed. The Court explained “[v]iewed holistically, a communication that expressly states that it is ‘an attempt to collect a debt,’ that asks for payment of a certain amount by a certain date, and that provides for a late fee if the payment is not made on time is plausibly ‘related to debt collection.’” The Court concluded Daniels’ pleading was sufficient to withstand dismissal.
  3. The Court pointed out it was not expressing an opinion on the merits of Daniels’ claims. The Court “only tackled the question of FDCPA and FCCPA coverage” while leaving for the district court to determine whether Daniels’ allegations demonstrate that SPS violated the FDCPA and FCCPA. The time for rehearing on this opinion does not expire until June 9, 2022, so the opinion it is not yet final. Additionally, even if there is no rehearing at the appellate level, on remand the Middle District may very well find the monthly statements did not violate the FDCPA or FCCPA when considered on the merits. Stay tuned for updates on this important issue.

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