DNF Associates is a debt collection company that makes its profits by buying defaulted consumer debts from creditors for pennies on the dollar, and then hiring third-party contractors to contact consumers to collect those debts. DNF bought a debt owed by Jillian McAdory, and hired at least two different companies to try to collect that debt. The second such company, M.N.S. & Associates, engaged in a pattern of deceptive and misleading conduct in its interactions with Ms. McAdory. Ms. McAdory sued both DNF and MNS for violations of the Fair Debt Collection Practices Act, but the district court dismissed the claims against DNF, arguing that the statutory definition of “debt collector” only applies to entities that directly interact with consumers. Public Citizen represents Ms. McAdory in her appeal of that decision, arguing that the statutory definition of businesses with a “principal purpose” of “the collection of any debts,” applies to DNF and companies like it, as there is no direct interaction requirement.
In March 2020, the Ninth Circuit issued a decision in Ms. McAdory’s favor, agreeing that entities like DNF can be considered debt collectors under the FDCPA, even when they hire third parties to perform their debt collection activities. DNF then filed a petition for en banc review, which was denied without dissent.