Class Action News

Law Firm Not ‘Debt Collector’ for Class Suit Purposes

Jan. 18, 2019, 4:27 PM

A law firm that helped a client collect condominium assessments doesn’t qualify as a “debt collector” for a Fair Debt Collection Practices Act class action, the Fifth Circuit affirmed in a Jan. 17 unpublished opinion.

A lower court properly granted summary judgment to Steeg Law LLC, the U.S. Court of Appeals for the Fifth Circuit said. It left untouched the lower court’s order decertifying the class action.

Steeg Law represented Julia Place Condominiums, where Nicole Reyes owned a unit. Reyes filed a class action against Steeg Law after it sent collection letters that demanded payment within seven days instead of the 30 days allowed under the FDCPA.

The lower court certified a class of condominium owners who received lien letters from Steeg Law in the previous year.

Steeg Law successfully sought dismissal of some members of the class and other defendants reached settlement agreements with Reyes. The lower court then decertifed the class and granted summary judgment to Steeg Law.

The Fifth Circuit affirmed, finding Steeg Law wasn’t a debt collector for purposes of the act because it wasn’t “regularly” engaged in debt collection activity.

The firm sent only 36 letters, related to 34 liens, in the year before Reyes filed her complaint.

“Neither this court’s precedent nor common sense compel a determination that these circumstances constitute regularly engaging in debt collection activity,” the court said.

Judges Edith H. Jones, Edith Brown Clement, and Leslie H. Southwick joined the opinion.

Fowler Rodriguez and Scialdone Law Firm PLLC represented the consumers.

Deutsch Kerrigan LLP represented Steeg Law.

The case is Reyes v. Steeg Law, LLC, 2019 BL 16691, 5th Cir., No 17-30849, unpublished 1/17/19.

To contact the reporter on this story: Perry Cooper in Washington at pcooper@bloomberglaw.com

To contact the editors responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com

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