Heard: January 5, 2018.
actions commenced in the Superior Court Department on August
22 and December 30, 2014.After consolidation, the case was
heard by Janet L. Sanders, J., on motions for class
certification and for summary judgment.
Supreme Judicial Court granted an application for direct
Schultz (Andrew M. Schneiderman also present) for LVNV
Kenneth D. Quat (Josef C. Culik also present) for Tara
Dorrian & another.
Cohen & Philip Weinberg for Greater Boston Legal Services
Merrily S. Gerrish, Special Assistant Attorney General, &
Heather L. Bennett for division of banks of the Office of
Consumer Affairs and Business Regulation.
S. Maurice, Jr., & Brady J. Hermann for Receivables
Management Association International, Inc.
S. Blynn, Meredith L. Boylan, & Benjamin E. Horowitz, of
the District of Columbia, David L. Feinberg, Joseph L. Demeo,
& Lawrence S. Delaney for Cavalry SPV I, LLC.
Present: Gants, C.J., Lenk, Gaziano, Lowy, Budd, Cypher,
& Kafker, JJ.
primary issue presented is the definition of "debt
collector" under G. L. c. 93, § 24, particularly
its application to the statute's licensing requirement.
After being sued for the failure to pay debts, the
plaintiffs, Tara Dorrian and Virginia Newton, each
individually filed suit against the defendant, LVNV Funding,
LLC (LVNV), claiming unlicensed debt collection. The
plaintiffs also alleged violations of G. L. c. 93A, asserted
claims of unjust enrichment, and sought to proceed against LVNV
in a class action suit. A judge in the Superior Court
consolidated the cases and certified them as a class action.
On cross motions for summary judgment, the judge concluded
that LVNV violated G. L. c. 93, § 24A, because it
operated as a debt collector without a license and granted
summary judgment to the plaintiffs. On the claim that LVNV
violated G. L. c. 93A, the judge granted summary judgment to
LVNV because it met the exemption from liability in G. L. c.
93A, § 3, as the division of banks of the Office of
Consumer Affairs and Business Regulation (division) had
permitted LVNV to operate without a license.
appeal, LVNV argues that (1) the judge erred in certifying
the class because neither plaintiff is a proper class
representative; (2) the judge's remedy was improper, and
at most the judgments should merely be voidable; and (3) the
judge should have deferred to the division's
interpretation of the statute concluding that LVNV did not
require a license.
conclude that LVNV is not a debt collector under G. L. c. 93,
§ 24. The statute contains two separate
definitions of "debt collector, " neither of which
applies to LVNV, a "passive debt buyer, " which is
a company that buys debt for investment purposes and then
hires licensed debt collectors or attorneys to collect the
debt on its behalf. The first definition covers entities of
which the "principal purpose" is the
"collection of a debt." We conclude that this
definition does not apply to LVNV because LVNV has no contact
with consumers and the Legislature did not intend for these
entities to be treated as debt collectors under G. L. c. 93,
§ 24. The second definition covers entities that
"regularly collect or attempt to collect, directly
or indirectly, debts owed or due" to another. This
definition does not apply because LVNV deals only with its
own debts, not the debts of another. Because LVNV does not
meet either definition, it is not a debt collector under G.
L. c. 93, § 24. We therefore vacate the judgment and
remand the matter to the Superior Court for further
proceedings consistent with this opinion.
Overview of G. L. c. 93, §§ 24-28.
2003, the Legislature amended G. L. c. 93, §§
24-28. See St. 2003, c. 130. These provisions, modeled after
the Federal Fair Debt Collection Practices Act, 15 U.S.C.
§§ 1692-1692p (FDCPA), are often referred to as the
Massachusetts Fair Debt Collection Practices Act
(MDCPA). Congress passed the FDCPA to combat
abusive debt collection practices. 15 U.S.C. § 1692.
Although legislative history of the MDCPA is scant, it
appears to share the same purpose as the FDCPA.
MDCPA also largely follows the FDCPA's language. The term
relevant to this case, "debt collector, " is
defined substantively the same under both laws. Compare 15
U.S.C. § 1692a(6), with G. L. c. 93, § 24. Under
the MDCPA, an entity is a debt collector if (1) it is engaged
in a "business the principal purpose of which is the
collection of debt, " or (2) it "regularly collects
or attempts to collect, directly or indirectly, a debt owed
or due . . . another." G. L. c. 93, § 24.
Division of banks.
division is a State agency responsible for financial
regulation, including the regulation of debt collection. See
G. L. c. 93, § 24A (d). Through its regulations, the
division defines unlawful debt collection activities. 209
Code Mass. Regs. §§ 18.13-18.21 (2013). As part of
its regulatory oversight responsibilities, it issues licenses
to debt collectors and advisory opinions on which entities
meet the two-part statutory definition of "debt
collector." See G. L. c. 3OA, § 8. An entity that
meets either definition of "debt collector" must be
licensed by the commissioner of banks (commissioner) through
the division. See G. L. c. 93, § 24A. To acquire a
license, the applicant must establish to the
commissioner's satisfaction that its "financial
responsibility, character, reputation, integrity and general
fitness . . . are such as to command the confidence of the
public and to warrant the belief that the business . . . will
be operated lawfully, honestly and fairly." G. L. c. 93,
§ 24B (a.) . The applications for ...