Second Circuit - Fair Debt Collections Act: Cortez v. Forster & Garbus

Daily Record Staff//July 13, 2021//

Listen to this article

United States Court of Appeals for the Second Circuit

Fair Debt Collections Act

Account balance disclosure requirements – Offers of settlement

Cortez v. Forster & Garbus

20-1134

Judges Livingston, Cabranes, and Lynch

Background: At issue on appeal is the holding Avila v. Riexinger & Assoicates, LLC, 817 F.3d 72 (2d Cir 2016) case wherein the Second Circuit previously held that the Fair Debt Collection Practices Act requires debt collectors, when they notify consumers of their account balance, to disclose that the balance may increase due to interest and fees. Specifically, the defendant request clarification as to whether the disclosure requirement applies to collection notices.

Ruling: The Second Circuit reversed. The court held that the disclosure requirements set forth in Avila do not apply to collection notices that extend offers to settle outstanding debt.

David M. Barshay and Craig B. Sanders, of Barshay Sanders, for the plaintiff-appellee; Robert L. Arleo, of Forster & Garbus, for the defendant-appellant.