8th Circuit affirms dismissal of FDCPA claims, rules false or misleading statements must be material to be actionable

Courts Eighth Circuit Appellate FDCPA Debt Collection

On April 19, the U.S. Court of Appeals for the 8th Circuit affirmed a district court’s decision to grant a debt collector’s motion for judgment on the pleadings, concluding that false or misleading statements under the Fair Debt Collection Practices Act (FDCPA) must be material to be actionable. According to the opinion, the Conciliation Court for the 4th Judicial District of Minnesota previously issued a judgment finding that the debt collector failed to demonstrate “an entitlement to relief” when the debt collector sought payment (including statutory interest) for unpaid medical services. The plaintiff-appellant subsequently filed suit against the debt collector alleging that the debt collector’s conduct before the conciliation court violated the FDCPA. The district court issued a decision—which the 8th Circuit affirmed—holding that the debt collector’s “inadequate documentation of the assignment did not constitute a materially false representation” and, although the debt collector was ultimately unable to collect on the debt, loss of a collection action, standing alone, did not establish a violation of the FDCPA under the materiality standard. Additionally, the 8th Circuit held that the debt collector did not engage in unfair practices under the FDCPA when the debt collector attempted to collect interest on the debt under a Minnesota statute simply because the debtor may have had a legal defense to application of the statute.