District Court grants motion to approve settlement under federal and CA FDCPA

Courts FDCPA Debt Collection California

On November 16, the U.S. District Court of the Northern District of California granted the parties’ motion for preliminary approval of a proposed class action settlement and provisional class certification. The plaintiffs sued under both the federal FDCPA and California’s Rosenthal Fair Debt Collection Practices Act. The class action comprises a lead plaintiff as well as approximately 300 individuals.

The plaintiffs alleged that the defendant, a debt collector, left numerous voicemails and text messages between June and October 2021 that failed to disclose the defendant’s identity, and nature of business, and that the communication was an attempt to collect a debt. The plaintiffs also alleged that the communications instilled a “false sense of urgency… by falsely representing or implying that a civil lawsuit would be filed… to collect a defaulted consumer debt” when none was actually filed.

During mediation, the parties agreed to settle the case. Under the terms of the proposed settlement approved by the court, the defendant will pay $51,975 to the plaintiffs, and up to $123,000 in attorney’s fees and costs. The plaintiffs will each receive no less than $175, while the leading plaintiff will receive $2,000.