No Private Cause of Action for a Debt Collector’s Failure to File Notification with the State

Posted on: December 3rd, 2015

On November 25, 2015, the Iowa Court of Appeals issued a decision holding that Iowa law does not provide a private cause of action for a debt collector’s failure to file notification with the Iowa Attorney General.  This issue arises out of Iowa Code section 537.5201(1), which provides that:

The consumer . . . has a cause of action to recover actual damages and in addition a right . . . to recover from the person violating this chapter a penalty in an amount determined by the court, but not less than one hundred dollars nor more than one thousand dollars, if a person has violated the provisions of this chapter relating to:

. . . .

            (y)        Prohibitions against unfair debt collection practices under

section 537.7103.

The debtor in this case claimed that the debt collector had violated this statute by failing to file a notification with the Iowa Attorney General under Iowa Code section 537.6202.  The Iowa Court of Appeals, relying on a decision from the United States District Court for the Northern District of Iowa, noted that Iowa law provides two means for enforcing violation of the notification requirements of Iowa Code section 537.6202: (1) the Iowa Attorney General may bring a civil action against a person for failure to file the notification or (2) it may constitute a simple misdemeanor under Iowa Code section 537.5301.  It noted that sections 537.5201(1)(y) and 537.7103 do not provide a private cause of action because failure to file a notification was not expressly recognized by the legislature as an “unfair debt collection practice” or a prerequisite for collecting debt in Iowa.

Capital One Bank (USA), N.A. v. Taylor, No. 13-2043 (Iowa Ct. App. Nov. 25, 2015).

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