The U.S. Court of Appeals for the Third Circuit has vacated the district court's decision in Bock v. Pressler & Pressler, LLP in which the district court ruled that a debt collection law firm violated the Fair Debt Collection Practices Act (FDCPA) by filing a complaint without "meaningful attorney involvement." The Third Circuit remanded the case to the district court to consider whether the plaintiff had standing under Article III of the Constitution under the standard established by the U.S. Supreme Court in Spokeo, Inc. v. Robins, which was rendered after the district court's summary judgment decision.

The Third Circuit had asked the parties in Bock to address Spokeo at oral argument and requested supplemental briefing. In Spokeo, the Supreme Court ruled that a plaintiff alleging a violation of a statute must be able to establish "an injury-in-fact" to have standing under Article III to sue for statutory damages in federal court. The Supreme Court indicated that, to satisfy the "injury-in-fact" requirement, a plaintiff must show that he or she suffered "an invasion of a legally protected interest" that is both "concrete" and "particularized." To be particularized, an injury must affect the plaintiff "in a personal and individual way." To be concrete, an injury must "actually exist;" it must be "real."

In its decision, the Third Circuit observed that Spokeo acknowledged that intangible injuries can satisfy the concrete injury standard and that in some cases an injury-in-fact can exist by virtue of a statutory violation. However, the Third Circuit read Spokeo to require consideration of whether an alleged injury-in-fact has traditionally been regarded as providing a basis for a lawsuit and whether Congress made a judgment that the particular harm should be sufficient to institute a lawsuit. Accordingly, the Third Circuit vacated the district court's decision and remanded the case for the district court to specifically address whether the plaintiff could show that both a concrete and particularized injury resulted from the defendant's alleged FDCPA violation.

The Third Circuit's decision represents a rejection of the position taken by the Consumer Financial Protection Bureau (CFPB), which had filed a supplemental amicus brief in Bock in which it urged the Third Circuit to conclude that the plaintiff had suffered concrete harm sufficient to establish Article III standing. In addition, the CFPB has relied on the district court’s decision in Bock in seeking to apply a "meaningful attorney involvement" standard to debt collection complaints in its own proceedings against collection firms, such as its enforcement action against Frederick J. Hanna & Associates, a debt collection law firm.

Attorneys in Ballard Spahr's Consumer Financial Services Group regularly advise clients on compliance with the FDCPA and state debt collection laws and defend clients in FDCPA lawsuits and enforcement matters. Attorneys in the Group also prepare clients for CFPB examinations.


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