Last month, the United States Appellate Court, 10th Circuit,
handed down its opinion in Marx v. General Revenue Corporation, and
it does not bode well for consumers. In this case, the debt
collector sent a fax to Marx’s employer seeking information on her
employment status. Under the
Fair Debt Collection Practices Act,
Section 1692c(b) a debt collector cannot have any communication
with any third party in connection with the collection of the
debt. At the heart of the case was whether the faxing of the
request for employment information was a “communication” for
purposes of the
FDCPA.
The court reasoned that the definition of “communication” under
the FDCPA included the “conveying of information regarding a debt
directly or indirectly to any person through any medium.”
15 U.S.C. § 1692a(2). The court stated that “[A]
third-party “communication,” to be such, must indicate to the
recipient that the message relates to the collection of a debt;
this is simply built into the statutory definition of
“communication.” The particular fax did not mention any debt
owed by Marx and did not indicate that the information sought was
in order to collect a debt. Moreover, there was absolutely no
evidence provided by Marx to suggest that the recipient of the fax
took it to mean that a debt was being collected.
Therefore, in this case, faxing an employment verification to a
debtor’s employer was not found to be a third party
communication.
This is a harsh decision for consumers, and a large victory for
the debt collection industry. It can be expected that
there will be an increase in volume of faxes to employers.
Consumers have the very real apprehension that at any given point a
debt collector will fax an employment verification to their
employer. Is the decision is shortsighted in that it does not
consider the obvious response of recipients of these faxes?
In many smaller office settings, the receipt of such a fax would
necessarily lead to some discussion as to what it means. It
could easily lead to a discussion with the debtor, which forces the
debtor to admit their debt problem to their employer. This
can lead to adverse consequences at the employment. Or,
was this decision a message about developing a case under the FDCPA
with the proper evidence, or using the proper statute.
A particular point the court made was that there was no evidence
provided by Plaintiff to show that the fax was taken to mean that
the company that sent the fax was collecting a debt. Perhaps
a different decision would result of there were evidence presented
that the recipient of the fax did not just respond to the request
for information, but looked further into why this information was
being sought.
Also, this particular conduct by the collector can be a
form of harassment. Consider the situation where the
collector has already communicated with the debtor at their place
of employment, or otherwise received information about where the
debtor was employed. There would be no need to obtain the
information they are seeking. It is a common situation where
a collector has called the debtor at the place of employment.
Sending the fax is just turning the pressure up a notch. The
collector hopes that the fear the consumer has of the employer
finding out about their debt woes will push the consumer into
paying the debt. As such, perhaps tackling this set of facts
a different way would render different results and provide
consumers the protection needed from this practice.
If you have debt collection questions, contact SmithMarco, P.C.
SmithMarco, P.C., has over 30 years of combined experience
practicing law protecting the rights of consumers around the
country. Contact us today for your free case review!