FDCPA Lawsuits Filed Against Collectors Decline 10 Percent in 2013

Consumers and the attorneys representing them filed 10 percent fewer cases in 2013 seeking remedy under the Fair Debt Collection Practices Act (FDCPA). It is the second straight year of declines in the number of lawsuits filed.

According to data provided by WebRecon LLC, 10,320 FDCPA lawsuits were filed in federal district courts in 2013, down 10.2 percent from 2012 following a 6.8 percent decline from 2011 to 2012.

FDCPA lawsuits filed against ARM firms rose rapidly from 2005 to their peak of 12,330 in 2011. But over the past two years, fewer cases claiming FDCPA violations have showed up in the court system.

WebRecon thinks the two-year trend is due to correction in the total number of FDCPA cases, but the correction should slow, beginning as early as this year. The case tracking service said that it expects the range of annual suits to stabilize somewhere between 9,000 and 10,000.

While FDCPA suits decline, cases claiming violations of the Telephone Consumer Protection Act (TCPA) continued their explosive growth in 2013.

TCPA cases were up nearly 70 percent compared to 2012. Consumers filed nearly 1,900 suits seeking remedy under the statute intended for telemarketers.

In 2008, there were only 14 such cases filed, followed by just 31 the following year. But beginning in 2010, consumers and their attorneys saw an opportunity and began focusing on TCPA cases. While the total number of cases is still dwarfed by FDCPA cases, the trend in filings has caused many ARM firms to shift legal resources.