A Wisconsin Appeals Court has affirmed a ruling dismissing counterclaims against a collection operation, accusing it of violating the Fair Debt Collection Practices Act and Wisconsin state law for, among other claims, its attorney not being meaningfully involved.
The background: The case started as a small claims action to recover a defaulted credit card debt. The plaintiff filed suit in May 2023. The defendant responded with counterclaims under the Wisconsin Consumer Act and the FDCPA, arguing the collection operation and its attorney violated multiple statutes.
- After the parties stipulated to dismiss the original collection action, the plaintiff moved to dismiss the counterclaims. The trial court granted that request. The defendant appealed, raising three core arguments:
- that the attorney who prepared demand letters and pleadings was not “meaningfully involved,”
- that alleged failures to follow Wisconsin’s pleading requirements should create liability under the WCA, and
- that filing suit without first providing a notice of right to cure constituted an FDCPA violation.
The ruling: The Appeals Court noted the case raised the same issues addressed in Plaza Services LLC v. Burton, a published decision issued earlier this year, and applied that ruling directly, affirming dismissal of all counterclaims.
- On the “meaningful involvement” allegation, the court held that Wisconsin’s statute governing misleading attorney-authored communications cannot be expanded to include the FDCPA’s federal meaningful involvement requirement. As the court put it, “[t]he meaningful involvement requirement found in 15 U.S.C. § 1692e simply cannot likewise be read into [Wisconsin law] because the language of the FDCPA and the WCA are not the same.”
- On the alleged violations of Wisconsin’s pleading requirements, the court relied heavily on the state Supreme Court’s earlier Kirsch decision, reiterating that failing to meet the pleading standards does not automatically create a claim for damages. Attorney fees may be possible in limited circumstances, but only if the consumer can prove the noncompliance was intentional. Merely alleging that an attorney “should know” the rules was not enough.
- Finally, the court rejected the defendant’s FDCPA claim based on the lack of a notice of right to cure. The panel concluded, following Plaza Services, that failure to provide a right-to-cure notice does not change the legal status of the debt and therefore does not create an FDCPA violation. The Wisconsin Supreme Court previously held that missing this step entitles the consumer to dismissal of the lawsuit but does not eliminate the underlying right to payment.
