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Supreme Court Holds that Law Firms' Use of State Attorney General Letterhead did not Violate FDCPA

On May 16, 2016, the Supreme Court unanimously held that an attorney's authorized use of the Ohio State Attorney General's letterhead as part of debt collection efforts was not a false or misleading communication in violation of the Fair Debt Collection Practices Act (FDCPA).  See Sheriff v. Gillie, No. 15-338. 

In Sheriff v. Gillie, the consumer-debtors received communications from two law firms that were retained as "Special Counsel" under Ohio Law to assist and pursue debt collection efforts on behalf of the State of Ohio.  Although the attorneys were independent contractors, they were retained pursuant to Ohio statutory authority and were further authorized and instructed to use specific Attorney General letterhead in their communications as Special Counsel. The consumer-debtors claimed, inter alia, that the attorneys violated Section 1692e of the FDCPA by falsely implying that their communications were from the Ohio State Attorney General.  Further, they argued that, as independent contractors, the attorneys did not fall within the FDCPA's state officer exception. 

The United States District Court for the Southern District of Ohio granted summary judgment and dismissed the putative class action complaint finding that the attorneys were state officers by virtue of their special counsel designation and, further, that their communications on Attorney General letterhead were not false or misleading.  In a split decision, The Sixth Circuit Court of Appeals vacated the District Court's finding holding that, as independent contractors, the attorneys did not qualify as state officers.  It further held that a genuine issue of fact existed as to whether a consumer would be misled by the issuance of communications on Attorney General letterhead.  Judge Sutton dissented on both points and argued that by "deputizing" the attorneys, they qualified as state officers. He further argued that attorney letters accurately described their role and were not false or misleading.

On review, the Supreme Court elected not to address the issue of whether the attorneys qualified as state officers and assumed, arguendo, that they were not protected by the FDCPA's exception.  Nonetheless, echoing Judge Sutton's reasoning, the Court found that there was nothing misleading about the attorney's letters that would support a claim under Section 1692e of the FDCPA. Specifically, the attorneys were required to use the Attorney General letterhead and accurately conveyed their role as special counsel.  In reaching this determination, the Court noted federalism concerns by permitting a claim to proceed in the face of a state statutory authorization and mandate.  Further, the Court provided language that appears to curtail some of the widespread use of the FDCPA by advantageous litigants holding that Section 1692e "bars debt collectors from deceiving or misleading consumers: it does not protect consumers from fearing the actual consequences of their debt." (emphasis added)

Although the facts and issues within Sheriff v. Gillie are limited to claims involving Section 1692e of the FDCPA, it nonetheless provides sound guidance and some favorable language for use in defense of FDCPA litigations.  

A copy of the Supreme Court's holding can be found here.

  • Partner

    Andrew Sayles defends financial institutions and their service partners in complex litigation and class actions, with a particular emphasis on issues related to consumer financial services regulation. He also advises clients in ...

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