Supreme Court rejects CFPB position in FDCPA case


Supreme Court rejects CFPB position in FDCPA case

By Barbara S. Mishkin on March 4th, 2013Posted in Debt Collection

A prevailing defendant in a Fair Debt Collection Practices Act case can recover costs even without a court finding that the plaintiff filed suit in bad faith and for the purpose of harassment, the U.S. Supreme Court has ruled in Marx v. General Revenue Corp.  The Supreme Court rejected the plaintiff’s argument that a court’s authority to award costs under Federal Rule of Civil Procedure 54(d) was superseded by the FDCPA’s cost provision to only allow a court to award costs if such a finding is made. For a more detailed summary of the decision, see our legal alert

The decision represents a defeat for the CFPB, which, jointly with the Federal Trade Commission and U.S. Department of Justice, had filed an amicus brief in the Supreme Court supporting the plaintiff’s position. The brief was filed as part of the CFPB’s amicus program. Other amicus briefs filed by the CFPB have included briefs filed in several federal circuit courtson the question of whether a borrower must file a lawsuit seeking rescission under TILA within three years of loan consummation. In all of the amicus briefs it has filed so far, the CFPB has aligned itself against the industry and supported the consumer’s position.

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