Maria Hernandez v. Williams, Zinman & Parham Pc

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
MARIA HERNANDEZ, on No. 14-15672
behalf of herself and all
others similarly situated, D.C. No.
Plaintiff-Appellant, 2:12-cv-00731-SMM
v.
OPINION
WILLIAMS, ZINMAN &
PARHAM PC,
Defendant-Appellee.
Appeal from the United States District Court
for the District of Arizona
Stephen M. McNamee, District Judge, Presiding
Argued and Submitted March 17, 2016
San Francisco, California
Filed July 20, 2016
Before: John T. Noonan, Ronald M. Gould,
and Michelle T. Friedland, Circuit Judges.
Opinion by Judge Friedland
2 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
SUMMARY *
Fair Debt Collection Practices Act
The panel reversed the district court’s summary
judgment in favor of the defendant in an action under the
Fair Debt Collection Practices Act.
The Act requires that within five days of “the initial
communication” with a consumer about the collection of a
debt, a debt collector must send the consumer a notice
containing specific disclosures. The panel held that this
requirement, set forth in 15 U.S.C. § 1692g(a), does not
apply only to the initial debt collector that tries to collect, but
also applies to subsequent collectors that communicate about
the same debt.
COUNSEL
Aaron D. Radbil (argued), Greenwald Davidson PLLC,
Boca Raton, Florida, for Plaintiff-Appellant.
Victoria Orze (argued), Anne L. Tiffen, and Charles H.
Oldham, Dickinson Wright PLLC, Phoenix, Arizona, for
Defendant-Appellee.
Kristin Bateman (argued), Attorney; Nandan M. Joshi,
Senior Litigation Counsel; To-Quyen Truong, Deputy
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 3
General Counsel; Meredith Fuchs, General Counsel;
Consumer Financial Protection Bureau, Washington, D.C.;
for Amicus Curiae Consumer Financial Protection Bureau.
Burke W. Kappler, Colin Hector, and Thomas E. Kane,
Attorneys; David C. Shonka, Principal Deputy General
Counsel; Jonathan E. Nuechterlein, General Counsel;
Federal Trade Commission, Washington, D.C.; for Amicus
Curiae Federal Trade Commission.
OPINION
FRIEDLAND, Circuit Judge:
The Fair Debt Collection Practices Act (“FDCPA”)
requires that within five days of “the initial communication”
with a consumer about the collection of a debt, a debt
collector must send the consumer a notice containing
specified disclosures. 15 U.S.C. § 1692g(a). The question
presented here is whether the phrase “the initial
communication” as used in the FDCPA means the first
communication from the initial debt collector that tries to
collect, or whether it means the first communication a
consumer receives from any collector about a debt, including
subsequent collectors that communicate about the same debt.
Applying well-established tools of statutory
interpretation and construing the language in § 1692g(a) in
light of the context and purpose of the FDCPA, we hold that
the phrase “the initial communication” refers to the first
communication sent by any debt collector, including
collectors that contact the debtor after another collector
already did. In other words, if there are multiple debt
collectors that try to collect a debt, each one must send the
4 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
required notice after its first communication with the alleged
debtor about the debt. Because the district court held
otherwise, we reverse and remand for further proceedings.
I.
This case began with a loan that Maria Hernandez took
out to finance an automobile purchase. After Hernandez
stopped making payments on the loan, Thunderbird
Collection Specialists, Inc. (“Thunderbird”), a debt
collector, sent her a letter seeking to collect the debt.
Hernandez did not respond to the letter.
Following Thunderbird’s unsuccessful attempt to collect
Hernandez’s debt, Thunderbird retained the law firm
Williams, Zinman & Parham PC (“WZP”) as counsel to
assist in its collection efforts. In December 2011, WZP sent
Hernandez a collection letter, which was its initial
communication with her. The letter notified Hernandez that
WZP, a debt collector, represented Thunderbird regarding a
debt incurred by Hernandez with the original creditor. 1
1
The parties agree that WZP qualifies as a debt collector under the
FDCPA. In addition to identifying itself as a “debt collector” in its
December letter, WZP conceded in its briefing and at oral argument that,
when communicating with Hernandez, it was acting as a “debt collector”
for purposes of the FDCPA. WZP’s concession accords with the
Supreme Court’s recognition that the FDCPA “applies to attorneys
who,” like WZP, “‘regularly’ engage in consumer-debt-collection
activity.” Heintz v. Jenkins, 514 U.S. 291, 299 (1995). This is so even
if the attorney is acting on behalf of a debt-collector client. See Fox v.
Citicorp Credit Servs., Inc., 15 F.3d 1507, 1513 (9th Cir. 1994) (holding
that “[a]ttorneys, like all other persons, are subject to the definition of
‘debt collector’ in 15 U.S.C. § 1692a(6)” and concluding that the
defendant attorney acting on behalf of a client debt collector was subject
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 5
While it informed Hernandez that she could dispute the debt
or request additional information about the original creditor,
it did not tell her that she could do so only in writing.
Hernandez filed the instant lawsuit against WZP in the
United States District Court for the District of Arizona as a
putative class action, alleging that WZP violated the FDCPA
by sending a debt collection letter that lacked the disclosures
required under § 1692g(a) of the FDCPA. That section
provides in full:
(a) Notice of debt; contents
Within five days after the initial
communication with a consumer in
connection with the collection of any debt, a
debt collector shall, unless the following
information is contained in the initial
communication or the consumer has paid the
debt, send the consumer a written notice
containing—
(1) the amount of the debt;
(2) the name of the creditor to whom the debt
is owed;
(3) a statement that unless the consumer,
within thirty days after receipt of the
notice, disputes the validity of the debt, or
to the FDCPA’s requirements). WZP has not argued either before the
district court or on appeal that it was exempt from § 1692g(a)’s
requirements because it was acting as an agent for Thunderbird, so we
need not address that question.
6 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
any portion thereof, the debt will be
assumed to be valid by the debt collector;
(4) a statement that if the consumer notifies
the debt collector in writing within the
thirty-day period that the debt, or any
portion thereof, is disputed, the debt
collector will obtain verification of the
debt or a copy of a judgment against the
consumer and a copy of such verification
or judgment will be mailed to the
consumer by the debt collector; and
(5) a statement that, upon the consumer’s
written request within the thirty day
period, the debt collector will provide the
consumer with the name and address of
the original creditor, if different from the
current creditor.
15 U.S.C. § 1692g(a). 2 We refer herein to the written notice
containing these disclosures as a “validation notice.”
Hernandez alleged that WZP’s failure to notify her that
any dispute about the debt had to be in writing to obtain
verification of it, or that any request had to be in writing to
2
Pursuant to § 1692g(b), if a consumer exercises her rights by
disputing the debt in writing or sending a written request under
§§ 1692g(a)(4) or (5), the debt collector must “cease collection of the
debt” until it “obtains verification of the debt . . . or the name and address
of the original creditor” and mails this information to the consumer.
15 U.S.C. § 1692g(b).
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 7
obtain the name and address of the original creditor, violated
§§ 1692g(a)(4) and (a)(5), respectively.
The parties filed cross-motions for summary judgment
on Hernandez’s FDCPA claims. In its motion, WZP did not
address whether its letter lacked the content required by
§ 1692g(a). Rather, it contended that it was not required to
comply with that provision because Thunderbird’s March
letter was the “initial communication” sent to Hernandez
with respect to the debt at issue and therefore the sole
communication triggering § 1692g(a)’s requirements. The
district court agreed and granted summary judgment in favor
of WZP.
Hernandez timely appealed, contending that § 1692g(a)
imposes the requirement to send a validation notice on each
and every debt collector that communicates with a consumer
about a given debt. 3
3
Hernandez is joined in this interpretation by the Consumer Financial
Protection Bureau, which has delegated rulemaking authority under the
FDCPA, and the Federal Trade Commission, which shares concurrent
authority to enforce the FDCPA with the Bureau. See 15 U.S.C. § 1692l
(setting forth administrative enforcement and rulemaking authority
under the FDCPA); see also 12 U.S.C. §§ 5491(a), 5512(b)(1)
(establishing the Bureau to regulate the provision of consumer financial
products and services and delegating authority to the Bureau to
promulgate rules as necessary to administer consumer financial laws).
In their brief as amici curiae, these agencies argue that § 1692g(a) should
be interpreted to apply to WZP’s initial communication to Hernandez,
and they urge us to defer to their interpretation should we find the
statutory text to be ambiguous.
8 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
II.
We review de novo the district court’s interpretation of
§ 1692g(a), as well as its rulings on cross-motions for
summary judgment based on that interpretation. Clark v.
Capital Credit & Collection Servs., Inc., 460 F.3d 1162,
1168 (9th Cir. 2006).
III.
The sole dispute on appeal is whether the phrase “the
initial communication” as used in § 1692g(a) refers only to
the very first communication sent about a debt or instead to
the first communication sent by each and every debt
collector that seeks to collect it, including those collectors
that take over collection efforts from a prior debt collector.
Although this question has divided the district courts, it is an
issue of first impression for this court, and it has not yet been
addressed in a published opinion by any of our sister
circuits. 4
In answer to this question, we hold that although the
sentence in § 1692g(a) in which the phrase “the initial
communication” appears is ambiguous when read in
isolation, when the sentence is read in the context of the
FDCPA as a whole and in light of the statute’s remedial
4
Two of our sister circuits declined to apply § 1692g’s requirements
to a subsequent debt collector, but they did so in unpublished decisions
without explaining the basis for their construction of the statute. See Lee
v. Cohen, McNeile & Pappas, P.C., 520 F. App’x 649 (10th Cir. 2013)
(unpublished); Oppong v. First Union Mortg. Corp., 326 F. App’x 663
(3d Cir. 2009) (per curiam) (unpublished).
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 9
purpose, it is clear that the validation notice requirement
applies to each debt collector that attempts to collect a debt.
A.
In ascertaining the meaning of § 1692g(a), we begin, as
always, with the statutory text. BedRoc Ltd., LLC v. United
States, 541 U.S. 176, 183 (2004). Because we must
“presume that [the] legislature says in a statute what it means
and means in a statute what it says there,” id. (quoting Conn.
Nat’l Bank v. Germain, 503 U.S. 249, 253–54 (1992)), if we
find that the statutory meaning is plain and unambiguous,
then our “sole function . . . is to enforce it according to its
terms,” United States v. Ron Pair Enters., 489 U.S. 235, 241
(1989) (quoting Caminetti v. United States, 242 U.S. 470,
485 (1917)).
In deciphering the meaning of a statute, we “do not look
at its words in isolation.” Int’l Ass’n of Machinists, Local
Lodge 964 v. BF Goodrich Aerospace Aerostructures Grp.,
387 F.3d 1046, 1051 (9th Cir. 2004). Rather, we determine
“[t]he plainness or ambiguity of statutory [text] . . . by
reference to the [text] itself, the specific context in which
that [text] is used, and the broader context of the statute as a
whole.” Ileto v. Glock, Inc., 565 F.3d 1126, 1133 (9th Cir.
2009) (all but first alteration and ellipses in original)
(quoting Robinson v. Shell Oil Co., 519 U.S. 337, 341
(1997)). To that end, we “pursue consistency not only within
a particular provision but also among the provisions of the
FDCPA,” Clark v. Capital Credit & Collection Servs., Inc.,
460 F.3d 1162, 1175 (9th Cir. 2006), in order to produce an
understanding of “the statute ‘as a symmetrical and coherent
regulatory scheme’ and to ‘fit, if possible, all parts into a
harmonious whole,’” Am. Bankers Ass’n v. Gould, 412 F.3d
1081, 1086 (9th Cir. 2005) (alteration omitted) (quoting
10 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120,
133 (2000)).
If the operative text is ambiguous when read alongside
related statutory provisions, we “must turn to the broader
structure of the Act,” King v. Burwell, 135 S. Ct. 2480, 2492
(2015), and to its “object and policy[] to ascertain the intent
of Congress,” United States v. Real Prop. Located at 475
Martin Lane, Beverly Hills, Cal., 545 F.3d 1134, 1141 (9th
Cir. 2008) (quoting United States v. Mohrbacher, 182 F.3d
1041, 1048 (9th Cir. 1999)); see also Dolan v. U.S. Postal
Serv., 546 U.S. 481, 486 (2006) (“Interpretation of a word or
phrase depends upon reading the whole statutory text,
considering the purpose and context of the statute, and
consulting any precedents or authorities that inform the
analysis.”). “The words of a statute are, of course, dead
weights unless animated by the purpose of the statute.”
Favish v. Office of Indep. Counsel, 217 F.3d 1168, 1171 (9th
Cir. 2000).
When an examination of “the plain language of the
statute, its structure, and purpose” clearly reveals
congressional intent, “our ‘judicial inquiry is complete.’”
Real Prop., 545 F.3d at 1143 (quoting Campbell v. Allied
Van Lines, Inc., 410 F.3d 618, 622 (9th Cir. 2005)). But if
the plain meaning of the statutory text remains unclear after
consulting internal indicia of congressional intent, we may
then turn to extrinsic indicators, such as legislative history,
to help resolve the ambiguity. BF Goodrich, 387 F.3d at1051–52 (explaining that only if holistic analysis of the
statutory text “leaves ambiguity—or, indeed, if it reveals
it—may we turn to extrinsic indicia of legislative intent.”);
see also Benko v. Quality Loan Serv. Corp., 789 F.3d 1111,
1118 (9th Cir. 2015) (“If the statutory text is ambiguous, we
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 11
employ other tools, such as legislative history, to construe
the meaning of ambiguous terms.”).
B.
The text of § 1692g(a) does not alone reveal which
party’s interpretation is correct. In the FDCPA, Congress
did not define the term “the initial communication” or the
word “initial.” Congress did define “communication” to
mean “the conveying of information regarding a debt
directly or indirectly to any person through any medium.”
15 U.S.C. § 1692a(2). This definition of “communication”
is broad enough to sweep into its ambit both the March letter
from Thunderbird and the December letter from WZP.
WZP argues that, regardless of the lack of formal
definition in the FDCPA, the meaning of § 1692g(a)’s
phrase “the initial communication” is clear. WZP contends
that by using the definite article “the” preceding “initial
communication,” Congress plainly contemplated that only
one initial communication with a debtor about a given debt
would trigger the validation notice requirement. According
to WZP, under this definition, it was not obligated to send a
validation notice because, as the second collector to attempt
to collect the debt, it did not send Hernandez the very first
(i.e., “the initial”) communication about the debt.
When the phrase “the initial communication” is viewed
in isolation, WZP is correct that the use of “[t]he definite
article ‘the’ instead of the indefinite ‘a’ or ‘an’” preceding
initial communication appears to “indicate[] that Congress
meant for a single” communication to trigger the validation
notice requirement. Onink v. Cardelucci (In re Cardelucci),
285 F.3d 1231, 1234 (9th Cir. 2002); see also United States
v. Barron, 172 F.3d 1153, 1163 (9th Cir. 1999) (en banc)
(“Congress’[s] use of the definite article ‘the,’ when
12 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
referring to ‘the judgment,’ carries the message that there is
one identifiable document.”). This is because the definite
article “the” “particularizes the subject spoken of,”
suggesting that Congress meant to refer to a single object
(here, a single initial communication). Black’s Law
Dictionary 1647 (4th ed. 1968) (providing as an example that
“‘[t]he’ house means only one house”).
The meaning of the phrase “the initial communication”
is less clear, however, when the phrase “the initial
communication” is read in conjunction with the phrase “a
debt collector” that follows in the same sentence. Gale v.
First Franklin Loan Servs., 701 F.3d 1240, 1244 (9th Cir.
2012) (refusing to take a “blindered view of” a statute by
construing its language “in isolation”); see also Sturgeon v.
Frost, 136 S. Ct. 1061, 1070 (2016) (“Statutory language
‘cannot be construed in a vacuum.’” (quoting Roberts v. Sea-
Land Servs., Inc., 132 S. Ct. 1350, 1357 (2012))). Congress
provided that within five days of “the initial communication,
. . . a debt collector” must send a validation notice.
15 U.S.C. § 1692g(a) (emphases added). In contrast with its
particularization of “initial communication,” Congress’s use
of the indefinite article “a” preceding “debt collector” gives
that term “generalizing force,” Gale, 701 F.3d at 1246
(quoting In re Cardelluci, 285 F.3d at 1234), and thus
suggests that Congress may have intended to impose the
validation notice requirement on any debt collector subject
to FDCPA requirements. See Black’s Law Dictionary 3 (4th
ed. 1968) (providing that “[t]he article ‘a’ . . . is often used
in the sense of ‘any’”); see also Levi Strauss & Co. v.
Abercrombie & Fitch Trading Co., 633 F.3d 1158, 1171 (9th
Cir. 2011) (explaining that by using “the indefinite article
‘a’” in the phrase “a mark or trade name in commerce that is
likely to cause dilution,” Congress “indicate[d] that any
number of unspecified, junior marks may be likely to dilute
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 13
the senior mark” (emphasis added) (quoting 15 U.S.C.
§ 1225(c)).
Ultimately, nothing in § 1692g(a) limits its application
to only the first debt collector that communicates about a
debt. At the same time, nothing in the section clarifies
whether “the initial communication” refers to the first
communication ever sent about the debt or the first
communication sent by each and every debt collector
seeking to collect it. As WZP argues, Congress’s use of the
phrase “a debt collector” could mean that whichever debt
collector sends the very first communication about a debt
must comply with § 1692g. Or, as Hernandez argues, it
could mean that each debt collector must comply with
§ 1692g upon sending its first communication about the
debt. Either interpretation is consistent with the language of
§ 1692g(a), and the section is therefore ambiguous when
viewed apart from its statutory context. 5 See Ileto, 565 F.3d
at 1134 (looking to statutory context to clarify ambiguity
because the term in question, viewed in isolation, “ha[d] a
spectrum of meanings”).
C.
Because the text of § 1692g(a) is ambiguous when read
alone, “we must turn to the broader structure of the
[FDCPA]” to determine which initial communication
5
The operative dictionary definition of “initial” does not clarify this
ambiguity. The word “initial” simply means “[t]hat which begins or
stands at the beginning.” Black’s Law Dictionary 923 (4th ed. 1968). In
this context, it could demarcate either the first communication ever sent
(i.e., the beginning of collection efforts on a given debt) or the first
communication sent by each and every debt collector (i.e., the beginning
of each individual debt collector’s efforts).
14 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
triggers the validation notice requirement—the first ever
sent or the first sent by any debt collector, whether first or
subsequent. King, 135 S. Ct. at 2492. “A provision that may
seem ambiguous in isolation is often clarified by the
remainder of the statutory scheme . . . because only one of
the permissible meanings produces a substantive effect that
is compatible with the rest of the law.” Id. (alteration in
original) (quoting United Sav. Ass’n of Tex. v. Timbers of
Inwood Forest Assocs., Ltd., 484 U.S. 365, 371 (1988)).
Viewing the text of § 1692g(a) in the context of the FDCPA
as a whole makes clear that the validation notice requirement
applies to each debt collector that tries to collect a given
debt. This interpretation is the only one that is consistent
with the rest of the statutory text and that avoids creating
substantial loopholes around both § 1692g(a)’s validation
notice requirement and § 1692g(b)’s debt verification
requirement—loopholes that otherwise would undermine
the very protections the statute provides. See King, 135 S.
Ct. at 2492–93 (rejecting an interpretation that would create
the problem Congress designed the statute to avoid).
Examining the full text of the FDCPA reveals that
Congress used the phrase “a debt collector” throughout the
statute to impose obligations and restrictions on all debt
collectors throughout the entire debt collection process. For
instance, the FDCPA:
 regulates the time and place at which “a debt
collector” may communicate with a consumer,
15 U.S.C. § 1692c(a);
 bars “a debt collector” from communicating with
third-parties about a debt, 15 U.S.C. § 1692c(b);
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 15
 proscribes harassment and abuse by “A debt
collector,” 15 U.S.C. § 1692d;
 bars “A debt collector” from using “false, deceptive,
or misleading representation[s]” in connection with
the collection of any debt, 15 U.S.C. § 1692e; and
 prevents “A debt collector” from using “unfair or
unconscionable means” to collect a debt, 15 U.S.C.
§ 1692f.
None of these provisions contains any language suggesting
that Congress intended to exempt successive debt collectors
from their requirements. And the FDCPA’s broad definition
of “debt collector” plainly encompasses those persons who
take over debt collection efforts from another. See 15 U.S.C.
§ 1692a(6) (defining “debt collector” to include, with
specified exceptions, “any person . . . who regularly collects
or attempts to collect, directly or indirectly, debts owed . . .
or due another” (emphasis added)).
Had Congress intended to distinguish between the
obligations that attach to initial and subsequent debt
collectors, “it would have said so explicitly.” Trs. for Alaska
v. U.S. Dep’t of Interior, 919 F.2d 119, 122 (9th Cir. 1990).
Instead, Congress made clear the broad reach of these
obligations by imposing civil liability on “any debt collector
who fails to comply with any provision” of the FDCPA.
15 U.S.C. § 1692k(a) (emphasis added).
WZP attempts to show that Congress intended to cabin
§ 1692g(a)’s requirements to the initial communication sent
by the initial debt collector, but those attempts are
unavailing. First, WZP argues that Congress’s use of the
definite article in the phrase “the thirty-day period” in
16 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
subsections (a)(4) and (a)(5) of § 1692g demonstrates “that
the statute contemplated one ‘initial communication’ and
one thirty-day period for dispute.” WZP’s argument is
unpersuasive because the phrase “the thirty-date period”
must be looked at in relation to subsection (a)(3). In
subsection (a)(3), Congress provided that the validation
notice must contain “a statement that unless the consumer,
within thirty days after receipt of the notice, disputes the
validity of the debt, . . . the debt will be assumed to be valid
by the debt collector.” 15 U.S.C. § 1692g(a)(3). The term
“the thirty-day period” logically refers back to the term
“thirty days after receipt of the notice” in subsection (a)(3),
while “the notice” refers back to the validation notice that
must be sent by “a debt collector” following “the initial
communication.” See Gale, 701 F.3d at 1246 (looking at the
preceding sentence to determine what was meant by “[t]he
use of the definite article” in a statutory provision); see also
Oxford English Dictionary 258 (1st ed. 1884) (providing that
the word “the” “[m]ark[s] an object as before mentioned or
already known, or contextually particularized (e.g. ‘We keep
a dog. We are all fond of the dog.’)”); Webster’s New Int’l
Dictionary of the English Language Unabridged 2368 (3d
ed. 1976) (defining “the” as “a function word to indicate that
a following noun . . . refers to someone or something
previously mentioned or clearly understood from the context
of the situation ”). Thus, Congress’s use of the definite
article in the term “the thirty-day period” serves as an
internal reference to other statutory subsections, not as an
indicator of the total number of dispute periods that
Congress intended to provide debtors. Congress’s use of the
term “the thirty-day period” therefore does not shed light on
whether there can be only one notice and one period for
dispute.
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 17
Next, WZP contends that Congress’s distinction between
“the initial written communication” and “subsequent
communications” in § 1692e(11)—the only other FDCPA
provision that uses a term similar to “the initial
communication”—shows that Congress knew how to
impose requirements on communications after the first one
had that been its intent. Section 1692e(11) prohibits “[a]
debt collector” from “fail[ing] to disclose in the initial
written communication with the consumer . . . that the debt
collector is attempting to collect a debt and that any
information obtained will be used for that purpose, and
[from] fail[ing] to disclose in subsequent communications
that the communication is from a debt collector.” 15 U.S.C.
§ 1692e(11) (emphases added). Contrary to WZP’s
contention, the fact that Congress chose to regulate both
“initial” and “subsequent communications” in § 1692e(11)
in no way suggests that it intended to limit the term “the
initial communication” to the first communication ever sent
about a debt. Section 1692e(11) can readily be interpreted
to regulate the initial and subsequent communications sent
by each and every debt collector that communicates about a
debt. Indeed, the language of § 1692e(11) supports that
interpretation because the fact that it plainly differentiates
between “initial” and “subsequent” communications
suggests Congress knew how to distinguish between initial
and subsequent debt collectors had that been its intent. See
United States v. Rojas-Contreras, 474 U.S. 231, 235 (1985)
(discerning from statutory language that Congress “knew
how to provide for the computation of time periods under the
[Speedy Trial] Act relative to the date of an indictment” and
that it would have so provided in the statutory section in
question had that been its intent). That Congress chose not
to is consistent with the FDCPA’s broad imposition of
requirements on all debt collectors throughout the lifecycle
of a debt.
18 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
WZP’s restrictive interpretation that there is only a single
“initial communication” about a debt also creates a
significant structural problem in the Act. As several district
courts have pointed out, restricting the validation notice
requirement to the initial debt collector produces a loophole
that would, in practice, undermine consumers’ efforts to
verify their debts and Congress’s mandate that collection
efforts halt until verification occurs. See, e.g., Janetos v.
Fulton Friedman & Gullace, LLP, No. 12-C-1473, 2013 WL
791325, at *5 (N.D. Ill. Mar. 4, 2013); Stair ex rel. Smith v.
Thomas & Cook, 254 F.R.D. 191, 197 (D. N.J. 2008); Turner
v. Shenandoah Legal Grp., No. 3:06-CV-045, 2006 WL
1685698, at *11 (E.D. Va. June 12, 2006). “Congress’[s]
intent in enacting § 1692g was to provide an alleged debtor
with 30 days to question and respond to the initial
communication of a collection agency.” Camacho v.
Bridgeport Fin. Inc., 430 F.3d 1078, 1082 (9th Cir. 2005).
Once a consumer disputes the validity of an alleged debt or
requests information about the original creditor in writing in
response to a debt collector’s validation notice, the debt
collector must “cease collection of the debt” until
verification has been provided. 15 U.S.C. § 1692g(b). But
nothing in the statute prevents the debt collector from
passing the debt on to a subsequent debt collector in lieu of
responding to the verification demand. This is so because
§ 1692g(b) gives a debt collector a choice upon receiving a
request for validation: “the collector ‘may provide the
requested validations and continue [its] debt collection
activities, or it may cease all collection activities.’”
Guerrero v. RJM Acquisitions LLC, 499 F.3d 926, 940 (9th
Cir. 2007) (per curiam) (alteration omitted) (quoting Jang v.
A.M. Miller & Assocs., 122 F.3d 480, 483 (7th Cir. 1997)).
If a debt collector determined that collecting on a debt was
“not worth the effort,” the collector would be at liberty to
“sell the account.” Id. And if the collector did sell the debt,
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 19
the debt collector that purchased it, on WZP’s reading,
would be permitted to collect free from § 1692g’s strictures,
and the consumer would be effectively unable to obtain the
information necessary to verify or dispute her debt. Such a
loophole would render § 1692g almost a nullity, and we
therefore decline to endorse WZP’s interpretation. See N.Y.
State Dep’t of Soc. Servs. v. Dublino, 413 U.S. 405, 419–20
(1973) (“We cannot interpret federal statutes to negate their
own stated purposes.”).
WZP argues that this loophole could be closed by other
provisions of the FDCPA. That argument is not persuasive.
Although WZP cites a range of FDCPA provisions, it fails
to explain how any of them would allow a consumer to
verify and effectively dispute a passed-on debt. Congress
must have believed that those other provisions were not
sufficient; otherwise, it would not have separately enacted
the validation notice and debt verification requirements.
Indeed, the implication of WZP’s argument is that § 1692g
is superfluous. We decline to interpret the Act in a way that
renders one of its central consumer-protective provisions
inoperative. See TRW, Inc. v. Andrews, 534 U.S. 19, 31
(2001) (“It is ‘a cardinal principle of statutory construction’
that ‘a statute ought, upon the whole, to be so construed that,
if it can be prevented, no clause, sentence, or word shall be
superfluous, void, or insignificant.’” (quoting Duncan v.
Walker, 533 U.S. 167, 174 (2001))).
WZP also predicts that the loophole would be closed by
judicial interpretation. It contends that courts faced with the
loophole would likely hold that any subsequent debt
collector found to be in privity with a previous collector must
itself halt collection efforts until verifying the debt. That
argument is flawed in several respects. First, it presumes the
existence of a privity relationship between the collectors.
20 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
Even if WZP is correct that a subsequent debt collector must
respect any dispute received by a previous one with which it
is in privity, this proposition provides no assistance when a
privity relationship between the initial and subsequent
collectors does not exist. Furthermore, WZP points to no
interpretation of any provision in the Act that would require
courts to hold that subsequent collectors must respect
disputes received by prior ones. We know of no statutory
interpretation principle that would allow us to interpret a
statute in a manner that creates a nonsensical loophole just
because courts might be able to apply a common law
principle to close the loophole in a subset of cases. Rather
than resorting to speculative stopgaps, we adopt the
interpretation that itself maintains the Act’s intrinsic
structural integrity. 6
6
WZP’s interpretation that only the very first communication about a
given debt triggers the validation notice requirement causes additional
problems if that first communication comes from the original creditor
rather than a debt collector. A creditor’s letter to a debtor appears to fall
within the FDCPA’s broad definition of a “communication.” 15 U.S.C.
§ 1692a(2) (defining “communication” as “the conveying of information
regarding a debt directly or indirectly to any person through any
medium”). Because “a ‘creditor’ is not a ‘debt collector’ under the
FDCPA,” Rowe v. Educ. Credit Mgmt. Corp., 559 F.3d 1028, 1031 (9th
Cir. 2009) (citing 15 U.S.C. § 1692a(6)(A)), however, the creditor is not
required to send a validation notice following that initial communication.
As a consequence, it is possible that under WZP’s interpretation, no one
would be required to send the consumer a validation notice if the original
creditor were the first entity to communicate about the debt, because the
sole “initial communication” triggering the validation notice
requirement would have been sent by an entity exempt from the Act’s
requirements. Our interpretation of the statute avoids this problem
because each debt collector would be required to send a validation notice
with its own first communication about the debt irrespective of whether
the original creditor previously communicated about the debt.
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 21
D.
Interpreting “the initial communication” to refer to the
first communication by any debt collector is also more in
keeping with the FDCPA’s declared purpose of protecting
consumers from abusive debt collection practices. Congress
enacted the FDCPA in 1977 against a backdrop of “abundant
evidence of the use of abusive, deceptive, and unfair debt
collection practices by many debt collectors.” 15 U.S.C.
§ 1692(a). As the Act itself states, Congress’s goal was “to
eliminate abusive debt collection practices by debt
collectors, to insure that those debt collectors who refrain
from using abusive debt collection practices are not
competitively disadvantaged, and to promote consistent
State action to protect consumers against debt collection
abuses.” 15 U.S.C. § 1692(e). As a “broad remedial
statute,” Gonzales v. Arrow Fin. Servs., LLC, 660 F.3d 1055,
1060 (9th Cir. 2011), the FDCPA must be liberally construed
in favor of the consumer in order to effectuate this goal of
eliminating abuse. See Clark, 460 F.3d at 1176; accord
Johnson v. Riddle, 305 F.3d 1107, 1117 (10th Cir. 2002)
(“Because the FDCPA . . . is a remedial statute, it should be
construed liberally in favor of the consumer.”).
Contrary to WZP’s arguments, the remedial purpose of
the FDCPA is furthered by giving consumers updated
information about their debts and renewed opportunities to
verify them as the debts change hands. Each time a debt is
resold between collectors, information about the debt may
be lost and misinformation introduced. See Fed. Trade
Comm’n, The Structure and Practices of the Debt Buying
22 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
Industry 42 (2013) 7 (“[T]he information that collectors have
about these debts may become less accurate over time,
making it more likely that collectors will seek to recover
from the wrong consumer, recover the wrong amount, or
both.”). Records of consumers’ disputes are among the
information that may be lost in transfer. See Gov’t
Accountability Office, Credit Cards—Fair Debt Collection
Practices Act Could Better Reflect the Evolving Debt
Collection Marketplace and Use of Technology 44 (2009) 8
(explaining that “important account information—such as
results of disputed account investigations . . . —may not
always be transferred to debt buyers”). As a consequence,
the likelihood that a debt collector will seek to collect from
the wrong consumer or in the wrong amount increases as the
debt is resold. And the corresponding need for collectors to
inform consumers of their validation rights and to respond to
requests for verification becomes more acute as the debt
changes hands. WZP is therefore incorrect when it argues
that there is no salutary benefit to be gained by requiring
each successive debt collector to send a new validation
notice with its first communication.
Restricting the validation notice obligation to the first
communication by the first debt collector would also restrict
consumers’ ability under § 1692g(b) to dispute the validity
of their debts, obtain information to verify them, and protect
themselves against the collection of invalid debts. This is
because the rights provided under § 1692g(b) can only be
7
Available at http://www.ftc.gov/sites/default/files/documents/
reports/structure-and-practices-debt-buying-
industry/debtbuyingreport.pdf.
8
Available at http://www.gao.gov/new.items/d09748.pdf.
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 23
exercised during the thirty-day period provided under
§ 1692g(a) and linked to “the initial communication” as used
in that provision. See 15 U.S.C. § 1692g(b) (setting forth the
consumer’s rights upon notifying “the debt collector in
writing within the thirty-day period described in subsection
(a)”). WZP’s interpretation would consequently restrict
consumers to a single window of opportunity to halt
collection efforts in order to verify their debts. That window
would be of no assistance to a consumer who later suspects
she is being improperly dunned by a misinformed successive
collector.
We decline to read the Act in a way that is antithetical to
Congress’s express intent to protect consumers from abusive
debt collection practices.
E.
Because Congress’s intent to require each debt collector
to send a validation notice with its initial communication is
clear from the statutory text, we believe it is unnecessary to
resort to external sources to interpret § 1692g(a). See BF
Goodrich, 387 F.3d at 1051–52. But to the extent that any
ambiguity remains, the external indicia of Congress’s intent
eliminate it.
The Senate Report’s description of the validation notice
provision suggests that Congress intended it to apply to each
debt collector’s first communication. The Report provides
that “[a]fter initially contacting a consumer, a debt collector
must sen[d] him or her written notice” with the required
information. S. Rep. No. 95-382, 95th Cong. 1st Sess. 4
(1977). The Senate Report’s use of the prepositional phrase
“[a]fter initially contacting a consumer”—along with the use
of “a” before “debt collector”—removes any doubt created
by § 1692g(a)’s use of the definite article “the” to qualify
24 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
“initial communication” by making clear that a debt
collector’s validation notice obligation attaches after it
“initially contact[s] a consumer.” Construing “the initial
communication” to exclude initial communications by
subsequent debt collectors would conflict with this
expression of legislative intent.
Consistent with the FDCPA’s remedial nature, the
legislative history also shows that Congress’s sole goal in
enacting § 1692g(a) was consumer protection. The Senate
Report projected that § 1692g would “eliminate the
recurring problem of debt collectors dunning the wrong
person or attempting to collect debts which the consumer has
already paid.” S. Rep. No. 95-382 at 4. Calling it a
“significant feature” of the FDCPA, id., Congress “added the
validation of debts provision specifically to ensure that debt
collectors gave consumers adequate information concerning
their legal rights,” Swanson v. S. Or. Credit Serv., Inc.,
869 F.2d 1222, 1225 (9th Cir. 1989) (per curiam) (citing S.
Rep. No. 95-382 at 4). Nothing in this legislative history
suggests that Congress thought consumers needed less
protection from successive debt collectors or less
information as their debts passed from hand to hand.
Congress also gave no indication that anything in
§ 1692g was intended to minimize the burden that the
validation notice requirement would impose on debt
collectors. To the contrary, Congress appeared to believe
that the validation requirement would impose no burden at
all. The Senate Report stated that requiring debt validation
would “not result in additional expense or paperwork”
because “the current practice of most debt collectors is to
send similar information to consumers.” S. Rep. No. 95-382
at 4. Requiring all debt collectors (without differentiation as
to their initial or successive status) to send the same required
HERNANDEZ V. WILLIAMS ZINMAN & PARHAM 25
information in their initial communications is consistent
with these legislative expressions because it would provide
continuing protection for consumers without disadvantaging
an ethical collector.
WZP does not attempt to counter this legislative history,
and we generally view an official committee report as a
reliable indicator of congressional intent. See Hertzberg v.
Dignity Partners, Inc., 191 F.3d 1076, 1082 (9th Cir. 1999)
(“This circuit relies on official committee reports when
considering legislative history.”). Although the Senate
Report does not expressly define the meaning of “the initial
communication,” its discussion of § 1692g’s purpose
extinguishes any doubt that Congress intended the validation
notice provision to protect consumers throughout the entire
lifecycle of a debt. 9
IV.
Having applied the tools of statutory construction, we
hold that the FDCPA unambiguously requires any debt
collector—first or subsequent—to send a § 1692g(a)
9
Because application of the tools of statutory construction yields a
clear answer to the question presented in this case, our inquiry is at an
end without consideration of the interpretation advanced by the
Consumer Financial Protection Bureau and the Federal Trade
Commission. See Chevron, USA, Inc. v. Nat. Res. Def. Council, Inc.,
467 U.S. 837, 843 n.9 (1984) (“If [by] employing traditional tools of
statutory construction, [we are able to] ascertain[] that Congress had an
intention on the precise question at issue, that intention is the law and
must be given effect.”). Indeed, because the interpretation proffered by
those agencies is the same interpretation that we arrive at in “interpreting
the statute from scratch,” “there is no occasion to defer and no point in
asking what kind of deference, or how much” deference is owed.
Edelman v. Lynchburg Coll., 535 U.S. 106, 114 (2002).
26 HERNANDEZ V. WILLIAMS ZINMAN & PARHAM
validation notice within five days of its first communication
with a consumer in connection with the collection of any
debt. The district court thus erred in concluding that,
because WZP was not the first debt collector to
communicate with Hernandez about her debt, it had no
obligation to comply with the statutory validation notice
requirement.
REVERSED and REMANDED.