Are you as surprised as I was to see that consumers are still trying to get Hunstein cases through the courts? A New Jersey Appeals Court has upheld a lower court’s ruling in a Fair Debt Collection Practices Act case, holding that sharing the personal information of consumers when using a vendor to print and mail collection letters is not a violation of the statute.
The background: The case stems from a consumer who alleged that a collection agency violated section 1692c(b) of the FDCPA by transmitting her personal information, including the fact that she owed a debt, to a third-party letter vendor. The consumer argued this amounted to an impermissible “communication with a third party” under the statute.
- The lawsuit, filed in 2022 in the wave of suits that followed the original Hunstein ruling, claimed that the use of letter vendors constituted an abusive or unfair practice prohibited by the FDCPA.
- The lower court granted summary judgment in favor of the defendant, finding the conduct did not rise to the level of an FDCPA violation.
- On appeal, the consumer argued that the court should have relied strictly on the plain text of the statute, given more weight to federal case law, and interpreted the law in the consumer’s favor.
The ruling: The Appellate Division disagreed, affirming the dismissal. It reasoned that sending information to a letter vendor to prepare and mail a debt collection letter does not, in itself, constitute a prohibited third-party communication. Rather, it is “an internal step to facilitate the mailing of a collection letter,” not a communication made “in connection with the collection of any debt.”
- The court noted that the FDCPA’s purpose is to prevent abusive practices that lead to “personal bankruptcies, marital instability, loss of jobs, and invasions of individual privacy” and that the mere use of a mail vendor has no such connection.
- The panel also rejected the argument that federal appellate court decisions interpreting the FDCPA are binding, stating that only Supreme Court rulings hold such authority in New Jersey.
- In perhaps the most telling passage, the court concluded that transmitting encrypted data to a vendor “who does not have access to the confidential records when generating the letter” does not violate the FDCPA, saying, “we are convinced it does not constitute prohibited third-party communication under the statute.”
- This is the second such suit the plaintiff has appealed to the New Jersey Appeals Court and the second time she has lost.
