Franklin v. Parking Revenue Recovery Servs., Inc., No. 14-3774 (7th Cir. 2016)
Annotate this CaseFranklin and Chism parked their cars in a Chicago-area lot owned by Metra, the public commuter railroad, and operated by CPS. The lot offers parking spaces to the public for $1.50 per day. CPS says the two failed to pay and sent them violation notices demanding payment of the $1.50 fee and a $45 nonpayment penalty. When they still did not pay, CPS referred the matter for collection to Parking Revenue, which sent them collection letters for the $46.50 . Franklin and Chism filed a class action against Parking Revenue alleging violations of the Fair Debt Collection Practices Act, 15 U.S.C. 1692. The district court entered summary judgment for Parking Revenue, holding that the FDCPA does not apply because the unpaid parking obligations are not “debts” as that term is defined in section 1692a(5). The Seventh Circuit reversed. The obligations at issue are “debts” within the meaning of the FDCPA. That statutory term comprises obligations “arising out of” consumer “transactions.” Parking in a lot that is open to all customers subject to stated charges is a “transaction.” The obligation that arises from that transaction is a “debt,” and an attempt to collect it must comply with the FDCPA.
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