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Federal Courts Have Jurisdiction Over Telephone Consumer Protection Act Claims - Mims v. Arrow Financial Services

July 12, 2013

Vincent Howard and our Moreno Valley consumer protection attorneys have written here recently about cases brought under the Telephone Consumer Protection Act. This federal law makes it illegal to repeatedly call phone numbers with an automatic dialer or a prerecorded voice with a commercial message, as well as to send junk faxes. Our recent posts have focused on decisions analyzing consumers' rights under the statute, usually made by federal appeals courts. But federal appeals courts might not be considering these issues in the first place if it weren't for the U.S. Supreme Court's decision in Mims v. Arrow Financial Services, handed down in January of last year. Marcus Mims sued Arrow for repeatedly calling his cell phone with an automated system, trying to collect a debt. The federal district court in Florida and the Eleventh Circuit held that TCPA claims are exclusively in state court, but the U.S. Supreme Court disagreed.

Mims alleged in his lawsuit that Arrow repeatedly used an automatic dialing system or an automatic or prerecorded voice to call his cell phone, without consent, in order to collect a debt. He sued in federal court for the southern district of Florida, invoking the court's jurisdiction to decide federal questions. The district court dismissed, saying that Congress vested jurisdiction to decide TCPA claims exclusively in state courts. In so deciding, it reasoned that the act expressly says "a person or entity may, if otherwise permitted by the laws and rules of court of a state, bring in an appropriate court of that state" a lawsuit. The Eleventh U.S. Circuit Court of Appeals upheld that ruling, adhering to its own precedent. The issue had divided the federal appeals courts, with those in opposition to the Eleventh ruling that federal courts have federal-question jurisdiction.

The U.S. Supreme Court reversed the Eleventh, agreeing with the opposed circuits that Congress did not erect "any barrier to the U.S. district courts' exercise of the general federal-question jurisdiction they have possessed since 1875." It first observed that a TCPA case clearly arises under federal law. This is generally sufficient to establish federal-question jurisdiction. Arrow argued that the TCPA's language displaced the presumption of concurrent state and federal jurisdiction, but the court disagreed that the language of the TCPA made this intention express or clear. Nowhere does the Act say that private cases must be brought only or exclusively in state court, the majority said--a sharp contrast with the Act's instructions to state attorneys general to use federal courts. It dismissed Arrow's various arguments seeking to read the rule in by implication, then reversed and remanded the case.

Vincent Howard and our Tustin fair debt collection lawyers were pleased to see this case because it provides more forums for victims of telemarketing and harassment by debt collectors. It's also interesting that the case was brought against debt collectors, showing that the TCPA can be another tool for victims of overreaching debt collectors. The Fair Debt Collection Practices Act permits consumers who are harassed, lied to or otherwise abused by collection agencies to sue for violation of a variety of rules, but not every circumstance fits into the statute. A TCPA claim can provide more money than the outdated statutory damages of the FDCPA, and can open up claims even when the harasser doesn't fit the definition of a debt collector. At Howard Law, P.C., we use every option available to protect our clients from abusive debt collection practices.

If you have received numerous annoying or harassing phone calls, including automated ones, don't hesitate to call Vincent Howard and the San Bernardino consumer protection attorneys at Howard Law. You can reach us through our website or call toll-free at 1-800-872-5925.

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