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By Chris Bruce

A federal appeals court Aug. 18 reinstated a Fair Debt Collection Practices Act suit against a law firm that misstated the principal and interest due on a credit card loan in a collection effort ( Afewerki v. Anaya Law Group , 9th Cir., 15-cv-56510, 8/18/17 ).

Although the FDCPA bars debt collectors from making false statements when collecting debts, any such false statement must be “material” — a term the FDCPA itself doesn’t define. The ruling by the U.S. Court of Appeals for the Ninth Circuit focused on that question in connection with efforts by the Anaya Law Group of Westlake Village, Calif., to collect on a debt owed by Robel Afewerki, who owed $26,916.08 on a loan with a 9.65 percent interest rate.

The Anaya Law Group sued Afewerki in state court, saying he owed $29,916.08 ($3,000 too much). The firm also misstated the interest rate, saying incorrectly that it was 9.965 percent (0.315 percent too high). Afewerki sued the firm under the FDCPA, but a district court held for the firm on summary judgment, saying the misstatements weren’t material.