Justice Gorsuch’s First Majority Opinion Is A Win For Debt Purchasers

In Henson v. Santander Consumer USA, Inc., Justice Gorsuch authored the unanimous decision in a decidedly conversational tone, holding that an entity that purchases another’s debt and then seeks to collect that debt is not a “debt collector” under the Fair Debt Collection Practices Act, and thus is not beholden to that Act’s strictures for debt collection. The Act defines a “debt collector” as anyone who “regularly collects or attempts to collect . . . debts owed to or due . . . another.” In this case, Santander purchased a series of defaulted loans from CitiFinancial and sought collection against the debtors. The debtors filed suit, alleging that Santander violated the restrictions of the Act. Resolving a split among the Circuits, the opinion sided with the Fourth Circuit that the plain language of the Act excluded a debt buyer like Santander, which was collecting for itself and not “another,” and rejected the debtors’ argument that new practices in modern debt collection warranted overriding Congress’ plain language. A link to the opinion is here.