Fifth Circuit Reverses Dismissal of Fair Debt Collection Practices Act Claim Based Upon Demand Letter Seeking Collection of Time-Barred Debt

The Fifth Circuit recently joined the more expansive view of prohibited collection activity under the Fair Debt Collection Practices Act. On September 8, 2016, the Court rendered its decision in Daugherty v. Convergent Outsourcing, holding: “a collection letter seeking payment on a time-barred debt (without disclosing its unenforceability) but offering a “settlement” and inviting partial payment (without disclosing the possible pitfalls) could constitute a violation of the FDCPA.” The opinion expressly sided with the 6th and 7th Circuit Courts of Appeal on this issue, in disagreement with the 3rd and 8th Circuit Courts of Appeal.

The full opinion can be read here: