A California Appeals Court has reversed a lower court’s ruling in favor of a collection law firm and debt collection operation that were sued for violating the Fair Debt Collection Practices Act (FDCPA), ruling that the public interest exception to the state’s anti-SLAPP law applies to the case.
The background: The plaintiff, who had defaulted on student loans, was sued by a collection law firm. That lawsuit was eventually dismissed after the plaintiff indicated her intent to file a cross complaint. The defendants then reinitiated attempts to collect on the defaulted debt.
- The plaintiff filed a class-action lawsuit against the defendants, accusing them of engaging in unfair and deceptive practices in their attempts to collect the debt. These practices included filing numerous lawsuits without the intent or ability to prove their claims, falsifying evidence, and engaging in other unethical behaviors.
- The plaintiff pointed out that the defendants were the subject of enforcement actions by the Consumer Financial Protection Bureau and multiple state attorneys general.
- The defendants filed an anti-SLAPP (Strategic Lawsuit Against Public Participation) motion to strike the complaint, arguing that their collection activities were protected under the First Amendment as acts in furtherance of their right of petition or free speech. Anti-SLAPP laws are designed to prevent people from using courts, and potential lawsuits, to intimidate or silence others who are exercising their First Amendment rights on matters of public interest.
- The trial court sided with the defendants, ruling that the public interest exception did not apply to the case because the plaintiff was seeking monetary damages, which, according to the trial court, indicated that the lawsuit was not solely brought in the public interest.
The ruling: The Appeals Court, however, disagreed, ruling that the public interest exception to the anti-SLAPP law did apply. The Court noted that the plaintiff’s complaint sought to address widespread abusive practices and that the relief sought was not solely for the plaintiff’s benefit but for a class of similarly affected individuals.
- The Court also noted that the fact the plaintiff sought damages in addition to injunctive relief did not automatically disqualify the action from being considered in the public interest.
