It’s not often that both sides in a Fair Debt Collection Practices Act lawsuit get their motions granted at the same time, but a District Court judge in New Jersey pulled off the feat, ultimately remanding the case back to state court after the defendant was accused of attempting to collect on a debt without being properly licensed to collect in the state.
The background: The plaintiff claimed that the defendant attempted to collect a debt that it had purchased from the original creditor. The debt was then transferred to the defendant for collection. According to the plaintiff, the defendant sent her a collection letter despite the purchaser not being properly licensed under the New Jersey Consumer Finance Licensing Act. The plaintiff argued that the defendant’s actions deprived consumers of truthful, non-misleading information about the debt collection attempt, as required by the FDCPA.
- After the complaint was filed in state court, the defendant removed the case to federal court. The defendant then filed a motion to dismiss the complaint, arguing that the plaintiff lacked standing to sue in federal court because no actual harm was alleged. The plaintiff, in response, filed a motion to remand the case back to state court.
The ruling: Judge Jamel K. Semper of the District Court for the District of New Jersey, ultimately granted both motions: the motion to dismiss for lack of subject matter jurisdiction and the motion to remand.
- Judge Semper’s ruling emphasized that, under Article III of the Constitution, federal courts can only hear cases involving a concrete injury.
- The plaintiff had not alleged any specific financial or physical harm resulting from the collection letter — only that the information provided was misleading due to licensing issues.
- Without a tangible injury, Judge Semper found that the plaintiff lacked standing to bring the case in federal court, leading to the dismissal of the complaint. Since the case could not proceed federally, the judge also granted the plaintiff’s motion to remand the case back to state court.
