Collector - September 2016 - (Page 42)
ACA Industry Advancement Support Helps Secure
Victory for Collection Industry in FDCPA Case
Rejecting the Eleventh Circuit's decision in Crawford, the Eighth Circuit ruled that filing a proof of claim
in a bankruptcy proceeding based on an out-of-statute debt does not violate the FDCPA.
By Karen Scheibe Eliason
he credit and collection industry
got some good news in July when
the Eighth Circuit Court of
Appeals entered a 3-0 decision in the case
of Nelson v. Midland Credit Management,
Inc., No. 15-2984, 2016 WL 3672073 (8th
Cir. July 11, 2016).
The ruling affirmed the district court's
decision to toss out the consumer's Fair
Debt Collection Practices Act action that
challenged the debt collector's filing of a
proof of claim in the consumer's Chapter 13
bankruptcy case based on an out-of-statute
"The Nelson decision raised the number of industryfavorable decisions ... achieve[d] for ACA members
through the Industry Advancement Program to a
total of 19 in a little less than three years."
debt as a false, deceptive or misleading
debt collection practice. ACA assisted in
successfully defeating the consumer's appeal
by providing amicus brief support in the
case, leading to a significant FDCPA ruling
positively impacting ACA members.
In Nelson, the consumer filed for Chapter
13 bankruptcy relief. The debt collector
then filed a proof of claim in the consumer's
bankruptcy case for the amount the
consumer defaulted on eight years earlier.
The consumer filed an objection to the
debt collector's claim in the bankruptcy
proceeding, arguing it was time-barred. The
bankruptcy court sustained the consumer's
objection, ordering the debt collector's claim
disallowed in its entirety.
The consumer subsequently sued the debt
collector, alleging that the debt collector
violated the FDCPA by filing the proof of
claim on the time-barred debt. The district
court granted the debt collector's motion to
dismiss the FDCPA claim, ruling that the
FDCPA is not implicated by a debt collector
filing an accurate and complete claim on a
time-barred debt. The consumer appealed.
On Dec. 14, 2015, ACA International
submitted a "friend of the court" brief to
the Eighth Circuit in Nelson to support
the debt collector's position and to protect
its members' ability to recovery rightfully
owed obligations-including debts that
remain valid under the law even after the
statute of limitations has expired. In its
amicus brief, ACA urged the Eighth Circuit
to decide that filing a bankruptcy proof of
Table of Contents for the Digital Edition of Collector - September 2016
5 Ways to Get Electronic Payments Right
Making the Connection
Curious About Amicus Curiae?
Know the Score
What Creditors Need to Know About the TCPA
ACA Industry Advancement Support Helps Secure Victory for Collection Industry in FDCPA Case
Collector - September 2016