The 9th Circuit of Appeals[1] ruled that sending a collection letter to a consumer at her workplace, addressed "personal and confidential," "in care of" her employer was an automatic violation of Fair Debt Collection Practices Act §1692c(b). This section prohibits debt collectors from communicating with any person except those listed in that section, and that list does not include employers.
Invasions of privacy and embarrassment caused by third-party disclosures are injuries that the FDCPA was designed to prevent. Disclosing a consumer's personal affairs to her employer is a form of collection abuse, ruled the court.
The defendant collection lawyer's reason for sending those communications to consumers' workplaces was grounded in his assumption that consumers in "work mode" are better communicators. This "reason" ignored the requirement that consent is first necessary under § 1692c(b) before communicating through an employer.
The court held, "permitting debt collectors to send letters addressed to the debtor "in care of" the debtor's employer absent the debtor's consent would allow debt collectors to circumvent the protection inherent in section § 1692c(b); it would also impermissibly place the burden on the consumer to affirmatively contact the debt collector to notify it that communications to third parties are unacceptable."
In reversing the District Court's denial of class certification, the appeals court analyzed the following, proposed class:
All consumers to whom, according to Defendants' records, within one year prior to filing this action the Defendants sent a collection letter at their place of employment identical to or substantially similar to the letter sent to Plaintiff.
The district court correctly found that the first criteria, numerosity, to exist as 262 class members were identified.
The second criteria, commonality (common core of factual or legal issues within class), was met as the court narrowly defined the aggrieved group: those who received this "in care of" letter to their workplace without giving consent. The district court abused its discretion for injecting factual inquiries in an otherwise straightforward inquiry. "The commonality linking the class members is the dispositive question in the lawsuit," the court held. "It is not necessary that members of the proposed class "share every fact in common."
The third criteria, typicality – where the named parties have suffered the same injury as the remainder of the class – was easily met: embarrassment in the workplace caused by third-party communications.
The last criteria needed for a class action, adequacy, is met where 1) the named plaintiffs possess no conflict of interest with other class members and 2) the named plaintiffs and their counsel will prove to prosecute the action vigorously on behalf of the class. The court found no problem here either.
In debt collection, workplace harassment is nothing new. Systematic collection abuses causing multiple, similar injuries are nothing new. Collection abuses are well suited for class action treatment to remedy repeated, small injuries and to deter future misconduct.