State Required Disclosure Violated the FDCPA

[David A. Szwak]

Various district courts have addressed the question of whether the disclosure of rights as required by state statute which are also available to all consumers pursuant to the FDCPA is done in such a way as to mislead consumers in other states. Cases finding the state required disclosure violated the FDCPA: Borcherding-Dittloff v. Transworld Systems, Inc., 58 F.Supp.2d 1006 (U.S.D.C. W.D. Wis. 1999); Withers v. Equifax Risk Management Services, 1999 WestLaw 118189 (U.S.D.C. N.D. Ill. 1999), Jenkins v. Union Corp., 999 F.Supp 1120, 1138-39 (U.S.D.C. N.D. Ill. 1998). Cases finding the state required disclosure did not violate the FDCPA: Brown v. ACB Business Serves, Inc., 1996 WestLaw 469588 (U.S.D.C. S.D. N.Y. 1996); White v. Goodman, 1998 WestLaw 850814 (U.S.D.C. N.D. Ill. 1998). The Seventh Circuit considered this issue and held that where the opening sentence made it clear that Colorado required the debt collector to furnish Colorado residents with the disclosure, the FDCPA was not violated. White v. Goodman, 205 F.3d 1016 (7th Cir. 2000). As the Seventh Circuit did not provide an analysis of its reasoning, the reasoning of the lower court was accepted. The district court recognized that the defendant debt collector in a similar case “would have had a better argument if the notice had said Colorado law required the creditor to notify the debtor of those rights, rather than just stating that Colorado residents had certain rights.â€