Carlsen v. Global Client Solutions, LLC
256 P.3d 321
Wash.2011Background
- Washington consumers filed a class action against Global Client Solutions (GCS) and Rocky Mountain Bank & Trust (RMBT) over alleged debt adjusting practices.
- The federal district court certified four questions about Washington’s debt adjusting statute, RCW 18.28, for state Supreme Court review.
- Consumers’ special purpose accounts were held at RMBT and structured as subaccounts of a custodial GCS account; funds auto-transferred for payments and settlements.
- GCS operated as processor, initiating automatic transfers and charging various processing fees; RMBT held the custodial funds at non-interest while benefiting from the arrangement.
- FDIC issued a 2009 cease-and-desist order requiring reform, prompting GCS to move most accounts to an Oklahoma bank, altering the arrangement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is GCS a debt adjuster under RCW 18.28.010(1)? | Carlsens: GCS’s custodial role constitutes debt adjusting. | GCS: Not a debt adjuster due to structure and control. | GCS is a debt adjuster under the statute. |
| Does RCW 18.28.010(2)(b) exempt GCS as related to banks or regulated entities? | GCS argues exemption applies via bank-related status and regulation. | GCS claims exemption extends through related regulatory oversight. | Exemption does not apply; only listed entities exempt. |
| Do fee limitations in RCW 18.28.080 apply to debt settlement companies? | Debt settlement firms are debt adjusters and subject to fee caps. | Not all are debt adjusters; depends on services provided. | Depends on whether the firms are debt adjusters; likely subject if so. |
| Does RCW 18.28.190 imply a civil action for aider and abettor under RCW 18.28.185 CPA remedy? | Aiding-and-abetting violation supports CPA remedy via 18.28.185. | Implied action unnecessary; explicit CPA remedy suffices. | RCW 18.28.185 provides direct CPA remedy; no implied action needed. |
Key Cases Cited
- Department of Ecology v. Campbell & Gwinn, LLC, 146 Wash.2d 1 (2002) (statutory interpretation using plain meaning; related to RCW 18.28)
- Kelleher v. Minshull, 11 Wash.2d 380 (1941) (exemption construed as applying to listed entities, not broader groups)
- State v. Pike, 118 Wash.2d 585 (1992) (remedial statutes construed liberally in consumer protection context)