Midland Funding, LLC v. Johnson

Summarized by:

  • Court: United States Supreme Court
  • Area(s) of Law: Remedies
  • Date Filed: May 15, 2017
  • Case #: No. 16–348
  • Judge(s)/Court Below: BREYER, J., delivered the opinion of the Court, in which ROBERTS, C. J., and KENNEDY, THOMAS, and ALITO, JJ., joined. SOTOMAYOR, J., filed a dissenting opinion, in which GINSBURG and KAGAN, JJ., joined. GORSUCH, J., took no part in the consideration or decision of the case.
  • Full Text Opinion

A “proof of claim” filed by a creditor in a bankruptcy proceeding that is determined to be unenforceable pursuant to a statute of limitations is not “false,” “deceptive,” “misleading,” “unconscionable,” or “unfair” under the Fair Debt Collection Practices Act, 15 U. S. C. §1692k.

Petitioner’s “proof of claim” filed in Respondent’s bankruptcy proceeding was denied pursuant to a 6-year statute of limitations. Respondent filed a lawsuit under the Fair Debt Collection Practices Act, 15 U. S. C. §1692k, (the “Act”) arguing that the proof of claim was “false,” “deceptive,” “misleading,” “unconscionable,” or “unfair” under the Act. The Eleventh Circuit reversed the district court’s dismissal of the lawsuit, holding that the proof of claim violated the Act. The U.S. Supreme Court held that the proof of claim barred by the statute of limitations did not violate the Act, because the Act's relevant language did not apply. The expired proof of claim was not false, deceptive, or misleading, because it was still a “claim” under the Act, even if it was unenforceable. The Court further reasoned that the proof of claim was not unconscionable or unfair, because the Act was not intended to provide a civil remedy to matters regulated by bankruptcy code, rules, and procedures; such as those presented by Respondent’s lawsuit. REVERSED.

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