Recently in Hunstein v. Preferred Collection and Management Services, Inc., the Eleventh Circuit issued a ground breaking decision concerning application Section 1692c(b) of the Fair Debt Collection Practices Act (“FDCPA”). A recent case suggests this decision may have broader application beyond its specific facts.
First, let’s take a look at Hunstein. In Huntstein, Plaintiff incurred a debt to a hospital arising out of his son’s medical treatment. The hospital then assigned the debt to a debt collector. The debt collector in turn hired a California-based commercial mail vendor to handle the collection. The debt collector transmitted certain information about Plaintiff to the mail vendor. This included, among other categories of information: (1) his status as a debtor, (2) the exact balance of his debt, (3) the entity to which he owed the debt, (4) that the debt concerned his son’s medical treatment, and (5) his son’s name. The mail vendor used that information to generate and send a dunning letter to Plaintiff.
Plaintiff filed suit, alleging violations of Florida consumer protection law and the Fair Debt Collection Practices Act (“FDCPA”). The district court, however, dismissed the Complaint for failure to state a claim, concluding that Plaintiff had not sufficiently alleged that the debt collector’s transmittal to the mail vendor violated Section 1692c(b) of the FDCPA. According to the court, this was because it did not qualify as a communication “in connection with the collection of a[ny] debt.”
The Eleventh Circuit reversed.
In a case of first impression, the Court first held that Plaintiff had alleged a concrete statutory injury under Section 1692c(b) for purposes of satisfying Article III, even where he had not alleged a “risk of real harm” or a “tangible harm,” such as a financial loss or emotional distress.
The Court additionally held that a debt collector’s transmittal of a consumer’s personal information to its letter vendor constituted a prohibited third-party communication “in connection with the collection of any debt” as used in the FDCPA. Why?
This determination was based on the plain meaning of the phrase “in connection with” and its cognate word, “connection.” In light of the information about Plaintiff that was transmitted, the Eleventh Circuit found it “inescapable” that the communication at issue “at least ‘concerned,’ was ‘with reference to,’ and bore a ‘relationship [or] association’ to its collection of [Plaintiff’s] debt.” As such, Plaintiff had alleged a communication “‘in connection with the collection of any debt’ as that phrase is commonly understood.”
For more developments on data privacy litigations, stay tuned. CPW will be there.