During these unusual political times, it is rare to talk about rational policy choices made by Congress. However, the United States Court of Appeals for the Seventh Circuit does just that in Preston v. Midland Credit Mgmt., 2020 U.S. App. LEXIS 1775 *; ___F.3d ___; 2020 WL 290451 (7th Cir. Jan. 21, 2020).
The court in Preston was faced with the issue of whether sending a debt collection letter in which the envelope is stamped as a “Time Sensitive Document” violated Section 1692f(8) of the Fair Debt Collections Practice Act because it was language other than Midland’s (i.e. the debt collector) address on an envelope containing a debt collection letter. Preston also alleged that the envelope itself constituted a false representation of the character, amount, or legal status of a debt as well as a false or deceptive means to collect a debt. Preston, 2020 U.S. App. LEXIS 1775 *4.
In response, Midland alleged that the complaint should be dismissed because the purpose of Section 1692f(8), as set forth in legislative history, was to prohibit debt collectors from using language or symbols that revealed that the letter concerned debt collection. Midland argued that it was not intended to “bar the use of harmless words or symbols.” Preston, 2020 U.S. App. LEXIS 1775 *5. Midland also made reference to opinions in the Courts of Appeals for the Fifth (my circuit) and Eighth Circuits that adopted a “benign language exception” to Section 1692f(8)’s absolute prohibition of the use of any symbol or language on the the envelope of the debt collection letter. Preston, 2020 U.S. App. LEXIS 1775 *5; see Goswami v. American Collections Enterprise Inc., 377 F.3d 488 (5th Cir. 2004) and Strand v. Diversified Collection Service, Inc., 380 F.3d 316 (8th Cir. 2004). Because “Time Sensitive Document” did not suggest that the contents involved debt collection, Midland argued that the benign language exception applied and there was no violation.
The district court agreed with Midland and dismissed the complaint by Preston relying on the benign language exception. Preston appealed to the Seventh Circuit and the Seventh Circuit reversed. In construing a statute, the Seventh Circuit held that one always begins with the language of the statute and if the statutory language is unambiguous and the statutory scheme is coherent and consistent, the inquiry ceases. Preston, 2020 U.S. App. LEXIS 1775 *8, citing, Kingdomware Techs, Inc. v. United States, 136 S.Ct. 1969, 1976, 195 L.Ed.2d 334 (2016) (quoting Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450, 122 S. Ct. 941, 151 L.Ed. 2d 908 (2002).
Here, Section 1692f(8) prohibits “(8) Using any language or symbol, other than the debt collector’s address, on any envelope when communicating with a consumer by use of the mails or by telegram, except that a debt collector may use his business name if such name does not indicate that he is in the debt collection business.” Preston, 2020 U.S. App. LEXIS 1775 *11. Rejecting adoption of the holdings by sister courts of the benign language exception, the Seventh Circuit held to a strict interpretation and stated that the meaning of Section 1692f(8) is clear that when a debt collector communicates with consumers through the mails, it may not use any language or symbol on the envelope except for its business name or address, as long as the name does not indicate that he is in the debt collection business. Preston, 2020 U.S. App. LEXIS 1775 *18. Because the language “Time Sensitive Document” appears on the envelope and does not fail within one of the itemized exceptions of Section 1692f(8) and is not language or symbol required for use of the mails (i.e. overnight mail, pre-printed postage or envelopes from postal service), the inclusion of the phrase ‘Time Sensitive Document” violates Section 1692f(8). Preston, 2020 U.S. App. LEXIS 1775 *18.
The moral of this story is to comply with the Fair Debt Collection Practices Act, debt collectors should try and follow the plain language of the statute. Deviations to the itemized exceptions or taking a license to try and collect or indirectly mislead the consumer into thinking that they have to act now or lose the ability to ever act can only lead to trouble for the debt collector. The opinions in this blog are solely the author’s and any comments, suggestions, or replies can be sent to john@jrjoneslaw.com. Thank you to all the loyal readers of this blog. Happy Leap Year!