THIRD-PARTY VENDORS CONSTITUTE A CONCRETE INJURY FOR PURPOSES | Key Points

  1. Multiple courts throughout the United states are addressing claims brought against debt collectors for alleged violations of § 1692c(b) of the Fair Debt Collections Practices Act (“FDCPA” or the “Act”) and reaching conflicting conclusions. On rehearing, the Eleventh Circuit in Hunstein again concluded that both legislative history and the judgment of Congress favored a finding that providing a debtor’s private information to a third-party vendor solely for the purpose of mailing out a letter constituted an “injury in fact” under an Article III analysis. That decision, issued October 28, 2021, has just recently been vacated in light of a vote by the Eleventh Circuit judges to rehear the matter en banc. The dissenting opinion of Judge Tjoflat in the vacated October opinion, may carry the day on rehearing.
  2. Federal courts out of Illinois and New York disagreed with the earlier Hunstein opinion and both concluded that the US Supreme Court’s holding in TransUnion was instructive on the issue of Article III standing in the context of § 1692c(b) violations. Both the Illinois and New York federal courts found the “mailing vendor theory” to be “unavailing” since neither “intra-company disclosures” nor “disclosures to printing vendors” have historically been recognized as “actionable publications.” Both courts refused to accept jurisdiction based on the plaintiff’s lack of an injury in fact which would give the plaintiff Article III standing to bring suit in federal court.
  3. The Eleventh Circuit’s decision to vacate its October 28, 2021 opinion and rehear the matter en banc demonstrates the importance of this issue. Article III standing in the context of § 1692c(b) violations has been the subject of much litigation, but not at the appellate level where it would carry precedential value, i.e., be binding on other courts. Until a precedential decision is reached, we are sure to see continued litigation on this topic especially if the Eleventh Circuit sticks to its prior ruling in favor of Article III standing. We will continue to keep you apprised of important developments.

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