In its May 29, 2013 decision in Hooks v. Forman, Holt, Eliades & Ravin, LLC, the US Court of Appeals for the Second Circuit held that a collection notice that required consumers to object in writing to the validity of a debt violated Section 1692g(a)(3) of the Fair Debt Collection Practices Act (FDCPA). This was an issue of first impression in the Second Circuit.

Plaintiffs Karen Hooks and Geraldine Moore signed an agreement with Wyndham for a vacation timeshare. They did not realize that the agreement was a mortgage, and neither plaintiff made any payments on the mortgage. Wyndham engaged the defendant, a debt collection firm, to begin the debt collection process. The defendant sent the plaintiffs a collection notice advising them that the firm would consider the debt valid if plaintiffs did not provide written notice of their objection to all or any part of the debt within 30 days.

The plaintiffs brought an action in district court, claiming that the collection notice did not comply with Section 1692g of the FDCPA. Specifically, the plaintiffs challenged the validity of the provision that required them to object in writing to the validity of the debt. The district court granted the defendant's motion to dismiss for failure to state a claim, holding that the writing requirement did not violate the FDCPA.

The Second Circuit disagreed and vacated the district court's decision. The court examined the language in Section 1692g and the decisions of the two circuit courts that have considered this issue. Agreeing with the US Court of Appeals for the Ninth Circuit, the court noted that Section 1692g(a)(3) does not incorporate a writing requirement in contrast to other provisions of Section 1692g, which specifically include a writing requirement. The court also noted that it cannot substitute its own view for Congress's.

Practitioners should be aware that circuits are split on whether a collection notice violates Section 1692g of the FDCPA if it requires a consumer to dispute the validity of a debt in writing. With this decision, the Second Circuit joins the Ninth Circuit in holding that a consumer may not be required to object to the debt in writing. The US Court of Appeals for the Third Circuit has taken the opposite view.