Todd v. Collecto, Inc., 731 F.3d 734

Background

Plaintiff Michael Todd received a recorded message from Collecto and, when he called, a Collecto representative told him Todd’s mother (Terry) owed AT&T money. Todd said he was not Terry but the collector continued discussing the alleged debt.
Todd alleges emotional harm and contends the disclosure was intended to prompt him to pay or persuade his mother to pay.
Todd sued under the Fair Debt Collection Practices Act (FDCPA), invoking 15 U.S.C. § 1692b(2) (prohibiting disclosure of a consumer’s debt to third parties) and § 1692f (prohibiting unfair or unconscionable collection practices).
The district court dismissed for failure to state a claim, holding Todd lacked standing because he was not the debtor whose information was disclosed.
The Seventh Circuit evaluated (1) whether § 1692b(2) protects non-debtors and (2) whether non-debtors can sue under § 1692f; it affirmed dismissal but on split grounds: no standing under § 1692b(2), standing under § 1692f but no plausible § 1692f claim on the facts.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether § 1692b(2) grants standing to a non-debtor who heard disclosure of another’s debt	Todd: §1692b(2) protects any aggrieved recipient of a disclosure, so he may sue	Collecto: §1692b(2) is a privacy protection for the consumer whose debt was disclosed, not third parties	Held: No — §1692b(2) protects only the consumer (debtor); Todd lacks standing under §1692b(2)
Whether § 1692f permits suits by non-debtors injured by unfair collection practices	Todd: §1692f’s broad prohibition on unfair or unconscionable practices covers any aggrieved person	Collecto: FDCPA claims should be limited to consumers or those who stand in their shoes	Held: Yes — §1692f can protect any person aggrieved by unfair practices; Todd has standing under §1692f
Whether Todd’s allegations plausibly state an unfair or unconscionable practice under §1692f	Todd: Disclosure and implied solicitation to get him to pay/pressure his mother suffice as unfair conduct	Collecto: The facts show only a disclosure; no demand, threat, or unconscionable conduct toward Todd	Held: No — the alleged single disclosure, without request for payment or coercion, fails to plausibly state a §1692f violation against Todd
Whether O’Rourke bars FDCPA claims by non-consumers generally	Todd: O’Rourke should not foreclose non-consumer claims across the FDCPA	Collecto/District Court: Interpreted O’Rourke broadly to bar non-consumer FDCPA claims	Held: O’Rourke limited — it does not categorically bar non-consumer claims; each FDCPA provision’s scope must be assessed individually

Key Cases Cited

O'Rourke v. Palisades Acquisition XVI, LLC, 635 F.3d 938 (7th Cir.) (contextualized; broad language about consumers should not be overread)
Montgomery v. Huntington Bank, 346 F.3d 693 (6th Cir.) (analysis distinguishing provisions that protect "any person" from those that protect only consumers)
Turner v. J.V.D.B. & Assoc., Inc., 330 F.3d 991 (7th Cir.) (standard for when collection practices are objectively unfair or unconscionable)
FTC v. Check Investors, Inc., 502 F.3d 159 (3d Cir.) (describing egregious practice of contacting family members and demanding payment)
Zemeckis v. Global Credit & Collection Corp., 679 F.3d 632 (7th Cir.) (applying Iqbal pleading standard to FDCPA claims)
Beler v. Blatt, Hasenmiller, Leibsker & Moore, LLC, 480 F.3d 470 (7th Cir.) (describing §1692f’s catch-all as vague)
Harzewski v. Guidant Corp., 489 F.3d 799 (7th Cir.) (standing limited to plaintiff within statute’s zone of interests)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard cited for plausibility review)