Debt Collectors 1, Consumers 0: Marx v. General Revenue Corporation


In a recent 7-2 decision, the United States Supreme Court hurt consumers and helped debt collectors.  In Marx v. General Revenue Corporation, Justice Clarence Thomas authored the opinion which held that a debt collector who prevails in a Fair Debt Collection Practice Act (FDCPA) case brought by a consumer can seek an order that the consumer pay the debt collector’s costs in defending the case.  From the consumer’s perspective a devastating part of the opinion is the Court’s holding that plaintiffs that lose lawsuits Supreme Court of the United Statesinvolving violations of the FDCPA may be liable for costs even if the case was not brought in bad faith.

Many consumer law attorneys believe the Supreme Court’s decision in Marx was in error and departs from the spirit and even the plain meaning of the FDCPA.  But as they say nowadays “it is what it is”.  So what does this mean for consumers and debt collectors?  A few thoughts….

  • Consumers need to be more cautious in filing or asserting claims under the FDCPA
  • Some consumers will decide the risk outweighs the reward and opt against making FDCPA claims or counterclaims
  • Debt collectors may become more aggressive in seeking payment of costs in FDCPA case and possibly even state court actions involving similar debt collection laws—not sure if this will work
  • Note the Marx opinion does not allow for debt collectors to recover attorney’s fees in FDCPA cases they successfully defend

Only time will tell how the Marx decision affects the actions of debt collectors.  We can only hope the case is not a hammer to the rights of consumers as they deal with debt collectors.  If you are negotiating with debt collectors, dealing with harassing debt collectors, or have been sued by a debt collector get legal help right away!  Do not delay.  For a free consultation regarding your debt collection defense issue contact Attorney John O’Neal.

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