SW Legal Educational Publishing

Debt Collector Stopped Short Under FDCPA
Due to Misleading Letterhead
Description Court of appeals reversed and remanded to trial court a summary judgment regarding the use of misleading name of a debt collector because it deemed the debt collector to have a competitive advantage due to use of the name.
Topic Consumer Protection
Key Words Fair Debt Collection Practices Act, Name of Debt Collector
C A S E   S U M M A R Y
Facts Uffman did business as "Collections Department, Credit Bureau of Baton Rouge" (Louisiana). He sent McKenzie a debt-collection notice requesting payment of a $244 medical debt. McKenzie sued Uffman, claiming he was in violation of the FDCPA because he did not operate a credit-reporting agency, so that the use of the term "Credit Bureau" was a misrepresentation in violation of the Act. Uffman provided evidence that he had been "affiliated" with the Credit Bureau of Baton Rouge and he was authorized to use its name in his collections business. He paid 5% of his revenue to the Credit Bureau for use of their name.
Lower Court Decision Uffman's motion for summary judgment granted. The court noted that there was an affiliation, so there was no deception. Even under the "least sophisticated consumer" standard, there was nothing to indicate that Uffman was a credit-reporting agency and he did not threaten McKenzie's credit rating. McKenzie appealed.
Court of Appeals Decision Reversed and remanded. The name Uffman used implied that "Collections Department" was a part of "Credit Bureau of Baton Rouge." There was no indication that these were separate entities. Uffman "enjoys a competitive advantage over collection agencies with less imposing letterheads." This is expressly prohibited by the FDCPA.
Citation McKenzie v. E.A. Uffman and Associates, F.3d--- (1997 WL 425948; 5th Cir.)
or
119 F. 3d 358 (5th Cird., 1997)

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