Opinion ID: 614136
Heading Depth: 3
Heading Rank: 1

Heading: Class Actions Under the Rosenthal Act

Text: As originally enacted, the Rosenthal Act did not permit class actions. Rather, it provided that any debt collector who willfully and knowingly violates this title with respect to any debtor shall. . . be liable to the debtor only in an individual action . . . for a penalty . . . not [] less than one hundred dollars ($100) nor greater than one thousand dollars ($1,000). CAL. CIV. CODE § 1788.30(b). In 1999, however, the California legislature amended the Rosenthal Act to permit class actions. The 1999 amendment states: Notwithstanding any other provision of this title, every debt collector collecting or attempting to collect a consumer debt shall comply with the provisions of Sections 1692b to 1692j, inclusive, of, and shall be subject to the remedies in Section 1692k of, Title 15 of the United States Code. CAL. CIV. CODE § 1788.17 (emphasis added). Section 1692k of the FDCPA provides for class recovery of (1) actual damages up to $1,000 and (2) statutory damages not to exceed the lesser of $500,000 or 1 per centum of the net worth of the debt collector. 15 U.S.C. § 1692k(a)(2). By use of the phrase notwithstanding any other provision, [8] the 1999 amendment unambiguously supercedes any provision of the Rosenthal Act inconsistent with the referenced provisions of the FDCPA, including those subjecting debt collectors to class actions. The 1999 amendment did not delete the individual action provision, but by permitting class actions, it nullified the provision's effect. Further, the legislative history contains ample evidence that the 1999 amendment was intended to permit class actions. The Bill Analysis prepared by the California Senate Judiciary Committee stated that existing law does not provide for class actions and that absent the threat of a class action, there is no incentive to abort an illegal continuing course of conduct. S. JUDICIARY COMM., REPORT ON A.B. 969 at 2, 4 (Cal. 1999-2000). [9] It explained that the 1999 amendments would provide that violators shall be subject to the remedies in [the FDCPA, including]. . . [a]ll actual damages and an amount not to exceed the lesser of up to $500,000 or 1 percent of the net worth penalty together with costs of suit and attorney's fees to the prevailing plaintiff(s) for class actions. Id. at 2-3 (emphasis added). Similarly, the Bill Analysis prepared by the Assembly Committee on Banking and Finance notes that the bill subjects debt collectors to the remedies of actual damages and up to $1,000 for an individual and/or for violation affecting a class composed of numerous debtors.  ASS. COMM. ON BANKING AND FINANCE, REPORT ON A.B. 969, at 1-2 (Cal. 1999-2000) (emphasis added). [10] Every court to have considered the issue has held that class actions may proceed under the amendment to the Rosenthal Act, notwithstanding the contradictory individual action language in § 1788.30. See Palmer v. Stassinos, 233 F.R.D. 546, 548 (N.D.Cal.2006); Abels v. JBC Legal Grp., P.C., 227 F.R.D. 541, 548 (N.D.Cal.2005); Edstrom v. All Servs. & Processing, No. C04-1514 BZ, 2005 WL 645920, at  (N.D.Cal. Feb. 22, 2005); McDonald v. Bonded Collectors, LLC, 233 F.R.D. 576, 577 (S.D.Cal.2005). In addition, although not expressly considering the issue, this court and at least two California courts have entertained class actions brought under the Rosenthal Act. See Irwin v. Mascott, 370 F.3d 924, 927-28 (9th Cir.2004); Fireside Bank v. Super. Ct., 40 Cal.4th 1069, 56 Cal.Rptr.3d 861, 155 P.3d 268, 271 (2007); Asset Acceptance, LLC v. Hanson, No. B208548, 2009 WL 840047 (Cal.Ct. App. Apr. 1, 2009). In light of the clear statutory language, unequivocal legislative history, and the unanimous agreement of the courts, we hold that the Rosenthal Act permits class actions.