Supreme Court rules debt collection law allows attorney’s fees for good faith filing

Supreme Court rules debt collection law allows attorney’s fees for good faith filing

Supreme Court

[JURIST] The US Supreme Court [official website] ruled [opinion, PDF] 7-2 Tuesday in Marx v. General Revenue Corp. [JURIST report] that Federal Rule of Civil Procedure 54(d)(1) allows fees to be awarded in Fair Debt Collection Practices Act (FDCPA) [PDF; 15 USC § 1692k(a)(3) text] even if the suit was brought in good faith. Petitioner Olivea Marx had a student loan debt through EdFund, which hired General Revenue Corp. [official websites] to collect her debt. GRC subjected Marx to harassing phone calls, threats of wage garnishment and removing funds directly from her bank account, and contacting Marx’s employer to assess her employment status. Marx filed suit against them and lost and was ordered to pay GRC $4,543.03 in fees. The Supreme Court held that the fee did not violate the FDCPA. Justice Clarence Thomas delivered the opinion:

The argument of Marx and the United States depends critically on whether §1692k(a)(3)’s allowance of costs creates a negative implication that costs are unavailable in any other circumstances. The force of any negative implication, however, depends on context. We have long held that the expressio unius canon does not apply “unless it is fair to suppose that Congress considered the unnamed possibility and meant to say no to it,” and that the canon can be overcome by “contrary indications that adopting a particular rule or statute was probably not meant to signal any exclusion.” In this case, context persuades us that Congress did not intend §1692k(a)(3) to foreclose courts from awarding costs under Rule 54(d)(1).

The Court affirmed the decision [text] of the US Court of Appeals for the Tenth Circuit.

Justices Sonia Sotomayor and Elena Kagan dissented from the opinion. “Accordingly, to displace Rule 54(d)(1), a federal statute need only address costs in a way different from, but not necessarily inconsistent with, the default. The reason is straightforward. If Congress has enacted a provision with respect to costs in a statute, there is no longer any need for the default, so it gives way. This design of the Rule is sensible, because many statutes contain specific costs provisions. … While purporting to interpret the ‘ordinary meaning’ of Rule 54(d)(1) the majority immediately abandons the ordinary meaning. The majority concludes that a statute provides otherwise for purposes of Rule 54(d)(1) only if it is ‘contrary’ to the default.”