Maxwell & Morgan, P.C., et al. v. Martha A. McNair

The Fair Debt Collection Practices Act (“FDCPA”) regulates the conduct of, and communications made by, “debt collectors” who regularly attempt to collect “debts” due another from “consumers.” 15 U.S.C. §§ 1692a(3), (5) & (6). This case presents a clear example of an important issue on which the circuit courts are deeply divided: whether foreclosure activity is subject to the FDCPA if it does not seek payment of money from the consumer. In the decision below, the Ninth Circuit held that a law firm violated the FDCPA when it filed with the clerk of an Arizona state court an application for a writ as required to judicially foreclose on real property in Arizona. The law firm never served the writ on the property owner, and its contents did not seek money from the owner. The writ sought only to enforce the client’s security interest in the property. This case is therefore an ideal vehicle for resolving the widespread conflict over this important issue. This Court is already considering this term a case that raises closely related issues, Obduskey v. McCarthy & Holthus, LLP, Case No. 17- 1307. There, the question presented is whether the FDCPA applies to non-judicial foreclosure proceedings. Here, the question presented is: Whether the FDCPA applies to foreclosure activity that does not seek payment of money from a consumer.