Obduskey v. McCarthy & Holthus LLP

(Slip Opinion) OCTOBER TERM, 2018 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U.S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
OBDUSKEY v. MCCARTHY & HOLTHUS LLP
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE TENTH CIRCUIT
No. 17–1307. Argued January 7, 2019—Decided March 20, 2019
Law firm McCarthy & Holthus LLP was hired to carry out a nonjudicial
foreclosure on a Colorado home owned by petitioner Dennis Obdus-
key. McCarthy sent Obduskey correspondence related to the foreclo-
sure. Obduskey responded with a letter invoking a federal Fair Debt
Collection Practices Act (FDCPA or Act) provision, 15 U.S. C.
§1692g(b), which provides that if a consumer disputes the amount of
a debt, a “debt collector” must “cease collection” until it “obtains veri-
fication of the debt” and mails a copy to the debtor. Instead, McCar-
thy initiated a nonjudicial foreclosure action. Obduskey sued, alleg-
ing that McCarthy failed to comply with the FDCPA’s verification
procedure. The District Court dismissed on the ground that McCar-
thy was not a “debt collector” within the meaning of the FDCPA, and
the Tenth Circuit affirmed.
Held: A business engaged in no more than nonjudicial foreclosure pro-
ceedings is not a “debt collector” under the FDCPA, except for the
limited purpose of §1692f(6). Pp. 6–14.
(a) The FDCPA regulates “‘debt collector[s].’” §1692a(6). Relevant
here, the definition of debt collector has two parts. The Act first sets
out the primary definition of the term “debt collector”: a “ ‘debt collec-
tor,’ ” it says, is “any person . . . in any business the principal purpose
of which is the collection of any debts, or who regularly collects or at-
tempts to collect, directly or indirectly, debts.” Ibid. The Act then
sets forth the limited-purpose definition, which states that “[f]or the
purpose of section 1692f(6) . . . [the] term [debt collector] also includes
any person . . . in any business the principal purpose of which is the
enforcement of security interests.” It is undisputed that McCarthy is,
by virtue of its role enforcing security interests, at least subject to the
specific prohibitions contained in §1692f(6). But only if McCarthy
2 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Syllabus
falls within the primary definition’s scope do the Act’s other provi-
sions, including those at issue here, apply. Pp. 6–7.
(b) Three considerations lead to the conclusion that McCarthy is
not subject to the Act’s main coverage. First, and most decisive, is
the text of the Act itself. The limited purpose definition says that
“[f]or the purpose of section 1692f(6)” a debt collector “also includes” a
business, like McCarthy, “the principal purpose of which is the en-
forcement of security interests.” §1692a(6) (emphasis added). This
phrase, particularly the word “also,” strongly suggests that security-
interest enforcers do not fall within the scope of the primary defini-
tion. If they did, the limited purpose definition would be superfluous.
By contrast, under a reading that gives effect to every word of the
limited-purpose definition, the FDCPA’s debt-collector-related prohi-
bitions (with the exception of §1692f(6)) do not apply to those who,
like McCarthy, are engaged in no more than security-interest en-
forcement. Second, Congress may well have chosen to treat security-
interest enforcement differently from ordinary debt collection in
order to avoid conflicts with state nonjudicial foreclosure schemes.
Third, this Court’s reading is supported by legislative history, which
suggests that the Act’s present language was the product of a com-
promise between competing versions of the bill, one which would
have totally excluded security-interest enforcement from the Act, and
another which would have treated it like ordinary debt collection.
Pp. 7–10.
(c) Obduskey’s counterarguments are unconvincing. First, he sug-
gests that the limited-purpose definition is not superfluous because it
was meant to cover “repo men”—a category of security-interest en-
forcers who he says would not otherwise fall within the primary defi-
nition of “debt collector.” The limited-purpose definition, however,
speaks broadly of “the enforcement of security interests,” §1692a(6),
not “the enforcement of security interests in personal property.” Sec-
ond, Obduskey claims that the Act’s venue provision, §1692i(a),
which covers legal actions brought by “debt collectors” to enforce in-
terests in real property, only makes sense if those who enforce securi-
ty interests in real property are debt collectors subject to all prohibi-
tions and requirements that come with that designation. The venue
provision, however, does nothing to alter the definition of a debt col-
lector. Third, Obduskey argues that McCarthy engaged in more than
security-interest enforcement by sending notices that any ordinary
homeowner would understand as an attempt to collect a debt. Here,
however, the notices sent by McCarthy were antecedent steps re-
quired under state law to enforce a security interest, and the Act’s
(partial) exclusion of “the enforcement of security interests” must also
exclude the legal means required to do so. Finally, Obduskey fears
Cite as: 586 U. S. ____ (2019) 3
Syllabus
that this Court’s decision will permit creditors and their agents to
engage in a host of abusive practices forbidden by the Act. But the
Court must enforce the statute that Congress enacted, and Congress
is free expand the FDCPA’s reach if it wishes. Pp. 10–14.
879 F.3d 1216, affirmed.
BREYER, J., delivered the opinion for a unanimous Court. SO-
TOMAYOR,J., filed a concurring opinion.
Cite as: 586 U. S. ____ (2019) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash-
ington, D. C. 20543, of any typographical or other formal errors, in order
that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 17–1307
_________________
DENNIS OBDUSKEY, PETITIONER v.
MCCARTHY & HOLTHUS LLP
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE TENTH CIRCUIT
[March 20, 2019]
JUSTICE BREYER delivered the opinion of the Court.
The Fair Debt Collection Practices Act regulates “ ‘debt
collector[s].’ ” 15 U.S. C. §1692a(6); see 91 Stat. 874, 15
U.S. C. §1692 et seq. A “ ‘debt collector,’ ” the Act says, is
“any person . . . in any business the principal purpose of
which is the collection of any debts, or who regularly
collects or attempts to collect, directly or indirectly, debts.”
§1692a(6). This definition, however, goes on to say that
“[f]or the purpose of section 1692f(6)” (a separate provision
of the Act), “[the] term [debt collector] also includes any
person . . . in any business the principal purpose of which
is the enforcement of security interests.” Ibid.
The question before us concerns this last sentence. Does
it mean that one principally involved in “the enforcement
of security interests” is not a debt collector (except “[f ]or
the purpose of section 1692f(6)”)? If so, numerous other
provisions of the Act do not apply. Or does it simply rein-
force the fact that those principally involved in the en-
forcement of security interests are subject to §1692f(6) in
addition to the Act’s other provisions?
In our view, the last sentence does (with its §1692f(6)
2 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Opinion of the Court
exception) place those whose “principal purpose . . . is the
enforcement of security interests” outside the scope of the
primary “debt collector” definition, §1692a(6), where the
business is engaged in no more than the kind of security-
interest enforcement at issue here—nonjudicial foreclo-
sure proceedings.
I
A
When a person buys a home, he or she usually borrows
money from a lending institution, such as a bank. The
resulting debt is backed up by a “mortgage”—a security
interest in the property designed to protect the creditor’s
investment. Restatement (Third) of Property: Mortgages
§1.1 (1996) (Restatement). (In some States, this security
interest is known as a “deed of trust,” though for present
purposes the difference is immaterial. See generally ibid.)
The loan likely requires the homeowner to make monthly
payments. And if the homeowner defaults, the mortgage
entitles the creditor to pursue foreclosure, which is “the
process in which property securing a mortgage is sold to
pay off the loan balance due.” 2 B. Dunaway, Law of
Distressed Real Estate §15:1 (2018) (Dunaway).
Every State provides some form of judicial foreclosure: a
legal action initiated by a creditor in which a court super-
vises sale of the property and distribution of the proceeds.
Id., §16:1. These procedures offer various protections for
homeowners, such as the right to notice and to protest the
amount a creditor says is owed. Id., §§16:17, 16:20; Re-
statement §8.2. And in the event that the foreclosure sale
does not yield the full amount due, a creditor pursuing a
judicial foreclosure may sometimes obtain a deficiency
judgment, that is, a judgment against the homeowner for
the unpaid balance of a debt. National Consumer Law
Center (NCLC), Foreclosures and Mortgage Servicing
§§12.3.1–2 (5th ed. 2014).
Cite as: 586 U. S. ____ (2019) 3
Opinion of the Court
About half the States also provide for what is known as
nonjudicial foreclosure, where notice to the parties and
sale of the property occur outside court supervision. 2
Dunaway §17:1. Under Colorado’s form of nonjudicial
foreclosure, at issue here, a creditor (or more likely its
agent) must first mail the homeowner certain preliminary
information, including the telephone number for the Colo-
rado foreclosure hotline. Colo. Rev. Stat. §38–38–102.5(2)
(2018). Thirty days later, the creditor may file a “notice of
election and demand” with a state official called a “public
trustee.” §38–38–101. The public trustee records this
notice and mails a copy, alongside other materials, to the
homeowner. §§38–38–102, 38–38–103. These materials
give the homeowner information about the balance of the
loan, the homeowner’s right to cure the default, and the
time and place of the foreclosure sale. §§38–38–101(4),
38–38–103. Assuming the debtor does not cure the default
or declare bankruptcy, the creditor may then seek an
order from a state court authorizing the sale. Colo. Rule
Civ. Proc. 120 (2018); see Colo. Rev. Stat. §38–38–105.
(Given this measure of court involvement, Colorado’s
“nonjudicial” foreclosure process is something of a hybrid,
though no party claims these features transform Colora-
do’s nonjudicial scheme into a judicial one.) In court, the
homeowner may contest the creditor’s right to sell the
property, and a hearing will be held to determine whether
the sale should go forward. Colo. Rules Civ. Proc.
120(c), (d).
If the court gives its approval, the public trustee may
then sell the property at a public auction, though a home-
owner may avoid a sale altogether by curing the default up
until noon on the day before. Colo. Rev. Stat. §§38–38–
110, 38–38–104(VI)(b). If the sale goes forward and the
house sells for more than the amount owed, any profits go
first to lienholders and then to the homeowner. §38–38–
111. If the house sells for less than what is owed, the
4 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Opinion of the Court
creditor cannot hold the homeowner liable for the balance
due unless it files a separate action in court and obtains a
deficiency judgment. See §38–38–106(6); Bank of America
v. Kosovich, 878 P.2d 65, 66 (Colo. App. 1994). Other
States likewise prevent creditors from obtaining deficiency
judgments in nonjudicial foreclosure proceedings. Re-
statement §8.2. And in some States, pursuing nonjudicial
foreclosure bars or curtails a creditor’s ability to obtain a
deficiency judgment altogether. NCLC, Foreclosures and
Mortgage Servicing §12.3.2.
B
In 2007, petitioner Dennis Obduskey bought a home in
Colorado with a $329,940 loan secured by the property.
About two years later, Obduskey defaulted.
In 2014, Wells Fargo Bank, N. A., hired a law firm,
McCarthy & Holthus LLP, the respondent here, to act as
its agent in carrying out a nonjudicial foreclosure. Accord-
ing to the complaint, McCarthy first mailed Obduskey a
letter that said it had been “instructed to commence fore-
closure” against the property, disclosed the amount out-
standing on the loan, and identified the creditor, Wells
Fargo. App. 37–38; see id., at 23. The letter purported to
provide notice “[p]ursuant to, and in compliance with,”
both the Fair Debt Collection Practices Act (FDCPA) and
Colorado law. Id., at 37. (The parties seem not to dispute
that this and other correspondence from McCarthy was
required under state law. Because that is a question of
Colorado law not briefed by the parties before us nor
passed on by the courts below, we proceed along the same
assumption.) Obduskey responded with a letter invoking
§1692g(b) of the FDCPA, which provides that if a con-
sumer disputes the amount of a debt, a “debt collector” must
“cease collection” until it “obtains verification of the debt”
and mails a copy to the debtor.
Yet, Obduskey alleges, McCarthy neither ceased collect-
Cite as: 586 U. S. ____ (2019) 5
Opinion of the Court
ing on the debt nor provided verification. App. 22–23.
Instead, the firm initiated a nonjudicial foreclosure action
by filing a notice of election and demand with the county
public trustee. Ibid.; see id., at 39–41. The notice stated
the amount due and advised that the public trustee would
“sell [the] property for the purpose of paying the indebted-
ness.” Id., at 40.
Obduskey then filed a lawsuit in federal court alleging
that the firm had violated the FDCPA by, among other
things, failing to comply with the verification procedure.
Id., at 29. The District Court dismissed the suit on the
ground that the law firm was not a “debt collector” within
the meaning of the Act, so the relevant Act requirements
did not apply. Obduskey v. Wells Fargo, 2016 WL
4091174, *3 (D Colo., July 19, 2016).
On appeal, the Court of Appeals for the Tenth Circuit
affirmed the dismissal, concluding that the “mere act of
enforcing a security interest through a non-judicial fore-
closure proceeding does not fall under” the Act. Obduskey
v. Wells Fargo, 879 F.3d 1216, 1223 (2018).
Obduskey then petitioned for certiorari. In light of
different views among the Circuits about application of the
FDCPA to nonjudicial foreclosure proceedings, we granted
the petition. Compare ibid. and Vien-Phuong Thi Ho v.
ReconTrust Co., NA, 858 F.3d 568, 573 (CA9 2016) (hold-
ing that an entity whose only role is the enforcement of
security interests is not a debt collector under the Act),
with Kaymark v. Bank of America, N. A., 783 F.3d 168,
179 (CA3 2015) (holding that such an entity is a debt
collector for the purpose of all the Act’s requirements),
Glazer v. Chase Home Fin. LLC, 704 F.3d 453, 461 (CA6
2013) (same), and Wilson v. Draper & Goldberg,
P. L. L. C., 443 F.3d 373, 376 (CA4 2006) (same).
6 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Opinion of the Court
II
A
The FDCPA’s definitional section, 15 U.S. C. §1692a,
defines a “debt” as:
“any obligation or alleged obligation of a consumer to
pay money arising out of a transaction in which the
money, property, insurance, or services which are the
subject of the transaction are primarily for personal,
family, or household purposes.” §1692a(5) (emphasis
added).
The Act then sets out the definition of the term “debt
collector.” §1692a(6). The first sentence of the relevant
paragraph, which we shall call the primary definition,
says that the term “debt collector”:
“means any person . . . in any business the principal
purpose of which is the collection of any debts, or who
regularly collects or attempts to collect, directly or in-
directly, debts owed or asserted to be owed or due an-
other.” Ibid.
The third sentence, however, provides what we shall call
the limited-purpose definition:
“For the purpose of section 1692f(6) [the] term [debt
collector] also includes any person . . . in any business
the principal purpose of which is the enforcement of
security interests.” Ibid.
The subsection to which the limited-purpose definition
refers, §1692f(6), prohibits a “debt collector” from:
“Taking or threatening to take any nonjudicial action
to effect dispossession or disablement of property if—
“(A) there is no present right to possession of the
property . . . ;
“(B) there is no present intention to take possession
of the property; or
Cite as: 586 U. S. ____ (2019) 7
Opinion of the Court
“(C) the property is exempt by law from such dis-
possession or disablement.”
The rest of the Act imposes myriad other requirements
on debt collectors. For example, debt collectors may not
use or threaten violence, or make repetitive annoying
phone calls. §1692d. Nor can debt collectors make false,
deceptive, or misleading representations in connection
with a debt, like misstating a debt’s “character, amount, or
legal status.” §1692e. And, as we have mentioned, if a
consumer disputes the amount of a debt, a debt collector
must “cease collection” until it “obtains verification of the
debt” and mails a copy to the debtor. §1692g(b).
No one here disputes that McCarthy is, by virtue of its
role enforcing security interests, at least subject to the
specific prohibitions contained in §1692f(6). The question
is whether other provisions of the Act apply. And they do
if, but only if, McCarthy falls within the scope of the Act’s
primary definition of “debt collector.”
B
Three considerations lead us to conclude that McCarthy
is not subject to the main coverage of the Act.
First, and most decisive, is the text of the Act itself. As
a preliminary matter, we concede that if the FDCPA
contained only the primary definition, a business engaged
in nonjudicial foreclosure proceedings would qualify as a
debt collector for all purposes. We have explained that a
home loan is an obligation to pay money, and the purpose
of a mortgage is to secure that obligation. See supra, at 2.
Foreclosure, in turn, is “the process in which property
securing a mortgage is sold to pay off the loan balance
due.” 2 Dunaway §15:1. In other words, foreclosure is a
means of collecting a debt. And a business pursuing non-
judicial foreclosures would, under the capacious language
of the Act’s primary definition, be one that “regularly
collects or attempts to collect, directly or indirectly, debts.”
8 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Opinion of the Court
§1692a(6).
It is true that, as McCarthy points out, nonjudicial
foreclosure does not seek “a payment of money from the
debtor” but rather from sale of the property itself. Brief
for Respondent 17 (emphasis added). But nothing in the
primary definition requires that payment on a debt come
“from a debtor.” The statute speaks simply of the “collec-
tion of any debts . . . owed or due.” §1692a(6). Moreover,
the provision sweeps in both “direc[t]” and “indirec[t]” debt
collection. Ibid. So, even if nonjudicial foreclosure were
not a direct attempt to collect a debt, because it aims to
collect on a consumer’s obligation by way of enforcing a
security interest, it would be an indirect attempt to collect
a debt.
The Act does not, however, contain only the primary
definition. And the limited-purpose definition poses a
serious, indeed an insurmountable, obstacle to subjecting
McCarthy to the main coverage of the Act. It says that
“[f]or the purpose of section 1692f(6)” a debt collector “also
includes” a business, like McCarthy, “the principal pur-
pose of which is the enforcement of security interests.”
§1692a(6) (emphasis added). This phrase, particularly the
word “also,” strongly suggests that one who does no more
than enforce security interests does not fall within the
scope of the general definition. Otherwise why add this
sentence at all?
It is logically, but not practically, possible that Congress
simply wanted to emphasize that the definition of “debt
collector” includes those engaged in the enforcement of
security interests. But why then would Congress have
used the word “also”? And if security-interest enforcers
are covered by the primary definition, why would Con-
gress have needed to say anything special about §1692f(6)?
After all, §1692f(6), just like all the provisions applicable
to debt collectors, would have already applied to those who
enforce security interests. The reference to §1692f(6)
Cite as: 586 U. S. ____ (2019) 9
Opinion of the Court
would on this view be superfluous, and we “generally
presum[e] that statutes do not contain surplusage.” Ar-
lington Central School Dist. Bd. of Ed. v. Murphy, 548
U.S. 291, 299, n. 1 (2006). By contrast, giving effect to
every word of the limited-purpose definition narrows the
primary definition, so that the debt-collector-related pro-
hibitions of the FDCPA (with the exception of §1692f(6))
do not apply to those who, like McCarthy, are engaged in
no more than security-interest enforcement.
Second, we think Congress may well have chosen to
treat security-interest enforcement differently from ordi-
nary debt collection in order to avoid conflicts with state
nonjudicial foreclosure schemes. As Colorado’s law makes
clear, supra, at 3–4, state nonjudicial foreclosure laws
provide various protections designed to prevent sharp
collection practices and to protect homeowners, see 2
Dunaway §17:1. And some features of these laws are in
tension with aspects of the Act. For example, the FDCPA
broadly limits debt collectors from communicating with
third parties “in connection with the collection of any
debt.” §1692c(b). If this rule were applied to nonjudicial
foreclosure proceedings, then advertising a foreclosure
sale—an essential element of such schemes—might run
afoul of the FDCPA. Given that a core purpose of publiciz-
ing a sale is to attract bidders, ensure that the sale price is
fair, and thereby protect the borrower from further liabil-
ity, the result would hardly benefit debtors. See 2 Duna-
way §17:4. To be sure, it may be possible to resolve these
conflicts without great harm to either the Act or state
foreclosure schemes. See Heintz v. Jenkins, 514 U.S. 291,
296–297 (1995) (observing that the FDCPA’s protections
may contain certain “implici[t] exception[s]”). But it is
also possible, in light of the language it employed, that
Congress wanted to avoid the risk of such conflicts
altogether.
Third, for those of us who use legislative history to help
10 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Opinion of the Court
interpret statutes, the history of the FDCPA supports our
reading. When drafting the bill, Congress considered a
version that would have subjected security-interest en-
forcers to the full coverage of the Act. That version de-
fined a debt collector as “any person who engages in any
business the principal purpose of which is the collection of
any debt or enforcement of security interests.” S. 918, 95th
Cong., 1st Sess., §803(f ) (1977) (emphasis added). A dif-
ferent version of the bill, however, would have totally
excluded from the Act’s coverage “any person who enforces
or attempts to enforce a security interest in real or per-
sonal property.” S. 1130, 95th Cong., 1st Sess., §802(8)(E)
(1977). Given these conflicting proposals, the Act’s pre-
sent language has all the earmarks of a compromise: The
prohibitions contained in §1692f(6) will cover security-
interest enforcers, while the other “debt collector” provi-
sions of the Act will not.
These considerations convince us that, but for §1692f(6),
those who engage in only nonjudicial foreclosure proceed-
ings are not debt collectors within the meaning of the Act.
III
Obduskey makes several arguments to the contrary.
But, on balance, we do not find them determinative.
First, Obduskey acknowledges that unless the limited-
purpose definition is superfluous, it must make some kind
of security-interest enforcer a “debt collector” who would
not otherwise fall within the primary definition. Reply
Brief 11–13. But, according to Obduskey, “repo men”—
those who seize automobiles and other personal property
in response to nonpayment—fit the bill. See Black’s Law
Dictionary 1493 (10th ed. 2014) (explaining that “repo” is
short for “repossession,” which means “retaking property;
esp., a seller’s retaking of goods sold on credit when the
buyer has failed to pay for them”). This is so, he says,
because repossession often entails only “limited communi-
Cite as: 586 U. S. ____ (2019) 11
Opinion of the Court
cation” with the debtor, as when the repo man sneaks up
and “tows a car in the middle of the night.” Brief for
Petitioner 25–26, and n. 13. And because, according to
Obduskey, the language of §1692f(6), which forbids
“[t]aking or threatening to take any nonjudicial action to
effect dispossession or disablement of property,” applies
more naturally to the seizure of personal property than to
nonjudicial foreclosure. (Emphasis added.)
But we do not see why that is so. The limited-purpose
provision speaks broadly of “the enforcement of security
interests,” §1692a(6), not “the enforcement of security
interests in personal property”; if Congress meant to cover
only the repo man, it could have said so. Moreover, Ob-
duskey’s theory fails to save the limited-purpose definition
from superfluity. As we have just discussed, supra, at 7–
8, if the Act contained only the primary definition, en-
forcement of a security interest would at least be an indi-
rect collection of a debt. The same may well be true of
repo activity, a form of security-interest enforcement, as
the point of repossessing property that secures a debt is to
collect some or all of the value of the defaulted debt. And
while Obduskey argues that the language of §1692f(6) fits
more comfortably with repossession of personal property
than nonjudicial foreclosure, we think it at least plausible
that “threatening” to foreclose on a consumer’s home
without having legal entitlement to do so is the kind of
“nonjudicial action” without “present right to possession”
prohibited by that section. §1692f(6)(A). (We need not,
however, here decide precisely what conduct runs afoul of
§1692f(6).)
We are also unmoved by Obduskey’s argument that
repossession would not fall under the primary definition
because it generally involves only limited communication
with the debtor. For one thing, while some of the
FDCPA’s substantive protections apply where there has
been a “communicat[ion]” with a consumer, see, e.g.,
12 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Opinion of the Court
§1692c, the primary definition of debt collector turns on
the “collection of . . . debts,” without express reference to
communication, §1692a(6). For another, while Obduskey
imagines a silent repo man striking in the dead of night,
state law often requires communication with a debtor
during the repossession process, such as notifying a con-
sumer of a sale. NCLC, Repossessions §10.4 (9th ed.
2017).
Second, Obduskey points to the Act’s venue provision,
15 U.S. C. §1692i(a), which states that “[a]ny debt collec-
tor who brings any legal action on a debt against any
consumer shall . . . in the case of an action to enforce an
interest in real property securing the consumer’s obliga-
tion, bring such action only in a judicial district” where the
“property is located.” (Emphasis added.) This provision,
he says, makes clear that a person who judicially enforces
a real-property-related security interest is a debt collector;
hence, a person who nonjudicially enforces such an inter-
est must also be a debt collector. Indeed, he adds, this
subsection “only makes sense” if those who enforce secu-
rity interests in real property are debt collectors subject to
all prohibitions and requirements that come with that
designation. Brief for Petitioner 21.
This argument, however, makes too much of too little.
To begin with, the venue section has no direct application
in this case, for here we consider nonjudicial foreclosure.
And whether those who judicially enforce mortgages fall
within the scope of the primary definition is a question we
can leave for another day. See 879 F.3d, at 1221–1222
(noting that the availability of a deficiency judgment is a
potentially relevant distinction between judicial and non-
judicial foreclosures).
More to the point, the venue provision does nothing to
alter the definition of a debt collector. Rather, it applies
whenever a “debt collector” brings a “legal action . . . to
enforce an interest in real property.” §1692i(a)(1). In
Cite as: 586 U. S. ____ (2019) 13
Opinion of the Court
other words, the provision anticipates that a debt collector
can bring a judicial action respecting real property, but it
nowhere says that an entity is a debt collector because it
brings such an action. Obduskey suggests that under our
interpretation this provision will capture a null set. We
think not. A business that qualifies as a debt collector
based on other activities (say, because it “regularly collects
or attempts to collect” unsecured credit card debts,
§1692a(6)) would have to comply with the venue provi-
sion if it also filed “an action to enforce an interest in
real property,” §1692i(a)(1). Here, however, the only
basis alleged for concluding that McCarthy is a debt
collector under the Act is its role in nonjudicial foreclosure
proceedings.
Third, Obduskey argues that even if “simply enforcing a
security interest” falls outside the primary definition,
McCarthy engaged in more than security-interest en-
forcement by sending notices that any ordinary homeowner
would understand as an attempt to collect a debt backed
up by the threat of foreclosure. Brief for Petitioner 15–16;
see Reply Brief 13. We do not doubt the gravity of a letter
informing a homeowner that she may lose her home un-
less she pays her outstanding debts. But here we assume
that the notices sent by McCarthy were antecedent steps
required under state law to enforce a security interest.
See supra, at 4. Indeed, every nonjudicial foreclosure
scheme of which we are aware involves notices to the
homeowner. See 2 Dunaway §17:4 (describing state pro-
cedures concerning notice of sale). And because he who
wills the ends must will the necessary means, we think
the Act’s (partial) exclusion of “the enforcement of security
interests” must also exclude the legal means required to
do so. This is not to suggest that pursuing nonjudicial
foreclosure is a license to engage in abusive debt collection
practices like repetitive nighttime phone calls; enforcing a
security interest does not grant an actor blanket immunity
14 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
Opinion of the Court
from the Act. But given that we here confront only steps
required by state law, we need not consider what other
conduct (related to, but not required for, enforcement of a
security interest) might transform a security-interest
enforcer into a debt collector subject to the main coverage
of the Act.
Finally, Obduskey fears that our decision will open a
loophole, permitting creditors and their agents to engage
in a host of abusive practices forbidden by the Act. States,
however, can and do guard against such practices, for
example, by requiring notices, review by state officials
such as the public trustee, and limited court supervision.
See supra, at 3–4, 9. Congress may think these state
protections adequate, or it may choose to expand the reach
of the FDCPA. Regardless, for the reasons we have given,
we believe that the statute exempts entities engaged in no
more than the “enforcement of security interests” from the
lion’s share of its prohibitions. And we must enforce the
statute that Congress enacted.
For these reasons, the judgment of the Court of
Appeals is
Affirmed.
Cite as: 586 U. S. ____ (2019) 1
SOTOMAYOR, J., concurring
SUPREME COURT OF THE UNITED STATES
_________________
No. 17–1307
_________________
DENNIS OBDUSKEY, PETITIONER v.
MCCARTHY & HOLTHUS LLP
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE TENTH CIRCUIT
[March 20, 2019]
JUSTICE SOTOMAYOR, concurring.
I join the Court’s opinion, which makes a coherent whole
of a thorny section of statutory text. I write separately to
make two observations: First, this is a close case, and
today’s opinion does not prevent Congress from clarifying
this statute if we have gotten it wrong. Second, as the
Court makes clear, “enforcing a security interest does not
grant an actor blanket immunity from the” mandates of
the Fair Debt Collection Practices Act (FDCPA), 15
U.S. C. §1692 et seq. See ante, at 13–14.
This case turns on two sentences that, put together,
read in relevant part:
“[1] The term ‘debt collector’ means any person . . . in
any business the principal purpose of which is the col-
lection of any debts, or who regularly collects or at-
tempts to collect, directly or indirectly, debts . . . . [2]
For the purpose of section 1692f(6) of this title, such
term also includes any person . . . in any business the
principal purpose of which is the enforcement of secu-
rity interests.” §1692a(6).
As the Court recognizes, if the first sentence were the only
text before us, nonjudicial foreclosure plainly would qual-
ify as debt collection—after all, foreclosure itself “is a
means of collecting a debt,” ante, at 7, whether “directly or
2 OBDUSKEY v. MCCARTHY & HOLTHUS LLP
SOTOMAYOR, J., concurring
indirectly,” §1692a(6). That may be because a house can
be sold—thus satisfying the debt with the proceeds—but it
may also be because the initiation of a foreclosure itself
sends a clear message: “[P]ay up or lose your house.” Brief
for Petitioner 17; see Alaska Trustee, LLC v. Ambridge,
372 P.3d 207, 217–218 (Alaska 2016); Glazer v. Chase
Home Finance LLC, 704 F.3d 453, 461 (CA6 2013).
The problem for Obduskey’s reading, as the Court ex-
plains, is the second sentence, which then becomes super-
fluous if all security-interest enforcement is already cov-
ered by sentence one. See ante, at 8–9. To be clear, there
is a reasonable argument that the second sentence covers
security-interest enforcers who are not already covered by
the first sentence: Under this argument, those additional
security-interest enforcers are “people who engage in the
business of repossessing property, whose business does not
primarily involve communicating with debtors in an effort
to secure payment of debts,” Piper v. Portnoff Law Assoc.,
Ltd., 396 F.3d 227, 236 (CA3 2005); see also Alaska Trus-
tee, 372 P.3d, at 219–220; Glazer, 704 F.3d, at 463–464,
such as “the repo man [who] sneaks up and ‘tows a car in
the middle of the night,’ ” ante, at 11. But, as the Court
explains, that reading does not resolve the surplusage
problem, because even such repossession agencies engage
in a means of collecting debts “indirectly”—which means
that they are similarly situated to entities pursuing non-
judicial foreclosures after all. See ante, at 10–12.
All the same, this is too close a case for me to feel cer-
tain that Congress recognized that this complex statute
would be interpreted the way that the Court does today.
While States do regulate nonjudicial foreclosures, see ante,
at 9, the extent and method of those protections can vary
widely, and the FDCPA was enacted not only “to eliminate
abusive debt collection practices” but also “to promote
consistent State action to protect consumers against debt
collection abuses,” §1692(e); see also §1692n (pre-empting
Cite as: 586 U. S. ____ (2019) 3
SOTOMAYOR, J., concurring
inconsistent state laws while exempting state consumer
protections that are “greater than the protection provided
by [the FDCPA]”). Today’s opinion leaves Congress free to
make clear that the FDCPA fully encompasses entities
pursuing nonjudicial foreclosures and regulates security-
interest enforcers like repossession agencies in only the
more limited way addressed in §1692f(6). That too would
be consistent with the FDCPA’s broad, consumer-
protective purposes. See §1692(e).
Separately, I note that the Court’s opinion recognizes
that the question before us involves “no more than the
kind of security interest enforcement at issue here,” ante,
at 2, which means an entity that takes “only steps re-
quired by state law,” ante, at 14. The Court rightly notes,
therefore, that nothing in today’s opinion is “to suggest
that pursuing nonjudicial foreclosure is a license to engage
in abusive debt collection practices like repetitive
nighttime phone calls; enforcing a security interest does
not grant an actor blanket immunity from the Act.” Ante,
at 13–14. Indeed, in addition to the unnecessary and
abusive practices that the Court notes, I would see as a
different case one in which the defendant went around
frightening homeowners with the threat of foreclosure
without showing any meaningful intention of ever actually
following through. There would be a question, in such a
case, whether such an entity was in fact a “business the
principal purpose of which is the enforcement of security
interests,” see §1692a(6), or whether it was simply using
that label as a stalking horse for something else.
Because the Court rightly cabins its holding to the kinds
of good-faith actions presented here and because we are
bound to apply Congress’ statutes as best we can under-
stand them, I concur in the Court’s opinion.