Source: https://case-law.vlex.com/vid/559-U-S-573-2010-08-1200-Jerman-v-Carlisle-606078138
Timestamp: 2019-04-19 20:45:19+00:00

Document:
Party Name: Karen L. JERMAN, Petitioner, v. CARLISLE, McNELLIE, RINI, KRAMER & ULRICH LPA, et al.
CARLISLE, McNELLIE, RINI, KRAMER & ULRICH LPA, et al.
On writ of certiorari to the united states court of appeals for the sixth circuit.
The Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §1692 et seq., imposes civil liability on "debt collector[s]" for certain prohibited debt collection practices. A debt collector who "fails to comply with any [FDCPA] provision . . . with respect to any person is liable to such person" for "actual damage[s], " costs, "a reasonable attorney's fee as determined by the court, " and statutory "additional damages." §1692k(a). In addition, violations of the FDCPA are deemed unfair or deceptive acts or practices under the Federal Trade Commission Act (FTC Act), §41 et seq., which is enforced by the Federal Trade Com­mission (FTC). See §1692l. A debt collector who acts with "actual knowledge or knowledge fairly implied on the basis of objective cir­cumstances that such act is [prohibited under the FDCPA]" is subject to civil penalties enforced by the FTC. §§45(m)(1)(A), (C). A debt col­lector is not liable in any action brought under the FDCPA, however, if it "shows by a preponderance of evidence that the violation was not intentional and resulted from a bona fide error [176 L.Ed.2d 525] notwithstanding the maintenance of procedures reasonably adapted to avoid any such er­ror." §1692k(c).
Respondents, a law firm and one of [176 L.Ed.2d 523] its attorneys (collectively Car­lisle), filed a lawsuit in Ohio state court on behalf of a mortgage com­pany to foreclose a mortgage on real property owned by petitioner Jerman. The complaint included a notice that the mortgage debt would be assumed valid unless Jerman disputed it in writing. Jerman's lawyer sent a letter disputing the debt, and, when the mort­gage company acknowledged that the debt had in fact been paid, Car­lisle withdrew the suit. Jerman then filed this action, contending that by sending the notice requiring her to dispute the debt in writing, Carlisle had violated §1692g(a) of the FDCPA, which governs the contents of notices to debtors. The District Court, acknowledging a division of authority on the question, held that Carlisle had violated §1692g(a) but ultimately granted Carlisle summary judgment under §1692k(c)'s "bona fide error" defense. The Sixth Circuit affirmed, holding that the defense in §1692k(c) is not limited to clerical or fac­tual errors, but extends to mistakes of law.
The bona fide error defense in §1692k(c) does not apply to a viola­tion resulting from a debt collector's mistaken interpretation of the legal requirements of the FDCPA. Pp. 1611-1625, 176 L.Ed.2d, at 527-542..
(a) A violation resulting from a debt collector's misinterpretation of the legal requirements of the FDCPA cannot be "not intentional" un­der §1692k(c). It is a common maxim that "ignorance of the law will not excuse any person, either civilly or criminally." Barlow v. United States, 32 U.S. 404, 7 Pet. 404, 411, 8 L.Ed. 728.[130 S.Ct. 1607] When Congress has intended to provide a mistake-of-law defense to civil liability, it has often done so more ex­plicitly than here. In particular, the administrative-penalty provi­sions of the FTC Act, which are expressly incorporated into the FDCPA, apply only when a debt collector acts with "actual knowledge or knowledge fairly implied on the basis of objective circumstances" that the FDCPA prohibited its action. §§45(m)(1)(A), (C). Given the absence of similar language in §1692k(c), it is fair to infer that Con­gress permitted injured consumers to recover damages for "inten­tional" conduct, including violations resulting from a mistaken inter­pretation of the FDCPA, while reserving the more onerous administrative penalties for debt collectors whose intentional actions reflected knowledge that the conduct was prohibited. Congress also did not confine FDCPA liability to "willful" violations, a term more of­ten understood in the civil context to exclude mistakes of law. See, e.g., Trans World Airlines, Inc. v. Thurston, 469 U.S. 111, 125-126, 105 S.Ct. 613, 83 L.Ed.2d 523. Section 1692k(c)'s requirement that a debt collector maintain "proce­dures reasonably adapted to avoid any such error" also more natu­rally evokes procedures to avoid mistakes like clerical or factual er­rors. Pp. 1611-1615, 176 L.Ed.2d, at 527-531.
to be broader than TILA's, and Congress has not expressly included mistakes of law in any of the parallel bona fide error defenses elsewhere in the U.S. Code. Carlisle's reading is not supported by Heintz v. Jenkins, 514 U.S. 291, 292, 115 S.Ct. 1489, 131 L.Ed.2d 395, which had no occasion to address the overall scope of the FDCPA bona fide error defense, and which did not depend on the premise that a misinterpretation of the requirements of the FDCPA would fall under that provision. Pp. 1615-1620, 176 L.Ed.2d, at 531-536.
(c) Today's decision does not place unmanageable burdens on debt-collecting lawyers. The FDCPA contains several provisions expressly guarding against abusive lawsuits, and gives courts discretion in cal­culating additional damages and attorney's fees. Lawyers have re­course to the bona fide error defense in §1692k(c) when a violation results from a qualifying factual error. To the extent the FDCPA im­poses some constraints on a lawyer's advocacy on behalf of a client, it is not unique; lawyers have a duty, for instance, to comply with the law and standards of professional conduct. Numerous state con­sumer protection and debt collection statutes contain bona fide error defenses that are either silent as to, or expressly exclude, legal [130 S.Ct. 1608] errors. To the extent lawyers face liability for mistaken interpretations of the FDCPA, Carlisle and its amici have not shown that "the result [will be] so absurd as to warrant" disregarding the weight of textual authority. Heintz, 514 U.S., at 295, 115 S.Ct. 1489, 131 L.Ed.2d 395. Absent such a showing, arguments that the FDCPA strikes an undesirable balance in assigning the risks of legal misinterpretation are properly addressed to Congress. Pp. 1620-1625, 176 L.Ed.2d, at 537-542.
538 F.3d 469, reversed and remanded.
SOTOMAYOR, J., delivered the opinion of the Court, in which ROBERTS,C. J., and STEVENS, THOMAS, GINSBURG, and BREYER, JJ., joined. BREYER, J., filed a concurring opinion. SCALIA, J., filed an opinion concurring in part and concurring in the judgment. KENNEDY, J., filed a dissenting opinion, in which ALITO, J., joined.
Kevin K. Russell, Bethesda, MD, for petitioner, by William M. Jay, for United States as amicus curiae, by special leave of the Court, supporting the petitioner.
George S. Coakley, Cleveland, OH, for respondents.
George S. Coakley, Counsel of Record, Clifford C. Masch, Brian D. Sullivan, Martin T. Galvin, James O'Connor, Reminger Co., L.P.A., Cleveland, OH, for respondents.
Stephen R. Felson, Cincinnati, OH, Edward Icove, Icove Legal Group, Ltd., Cleveland, OH, Kevin K. Russell, Counsel of Record, Amy Howe, Howe & Russell, P.C., Bethesda, MD, Pamela S. Karlan, Jeffrey L. Fisher, Stanford Law School, Supreme Court Litigation Clinic, Stanford, CA, for petitioner.
the question whether the "bona fide error" defense in §1692k(c) applies to a violation resulting from a debt collector's mistaken interpretation of the legal requirements of the FDCPA. We conclude it does not.

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