## Facts

- A debt collector filed a Kentucky state-court action to collect a charged-off credit-card debt, seeking principal plus interest “until paid.”
- After the debtor’s counsel failed to appear at a hearing, the state court entered a default judgment against the debtor.
- The debtor promptly moved to vacate the default judgment and sought additional time to answer, asserting a statute-of-limitations defense.
- Under Kentucky law, the motion to vacate suspended the judgment’s finality while the motion was pending.
- While the judgment was nonfinal, the debt collector recorded a notice of judgment lien against the debtor’s home.
- Kentucky law allows a judgment lien only from a final judgment, and strict statutory compliance is required; the lien was therefore invalid when recorded.
- The state court later announced it would grant the motion to vacate the default judgment, but the collector did not release the lien until several days later.
- The debtor filed a federal action alleging the invalid lien and its continued maintenance violated the FDCPA; the district court dismissed under Rule 12(b)(6).
- The debtor appealed.

## Issues

1. Whether recording and temporarily maintaining a judgment lien that is invalid under Kentucky law can constitute an “unfair or unconscionable” collection practice under 15 U.S.C. § 1692f.
2. Whether using an invalid lien to secure a consumer debt plausibly involves collecting an amount not “permitted by law” under 15 U.S.C. § 1692f(1).
3. Whether taking an action that state law does not authorize constitutes an actionable violation of 15 U.S.C. § 1692e(5), even absent a separate “threat.”
4. Whether the complaint plausibly stated FDCPA claims sufficient to survive dismissal under Rule 12(b)(6).

## Decision

- The Sixth Circuit reversed the dismissal and remanded for further proceedings.
- The court held the complaint plausibly alleged FDCPA violations based on recording a lien that could not legally arise from a nonfinal judgment and failing to release it promptly once vacatur was forthcoming.
- The court rejected a categorical limitation that would place debt-collection litigation conduct, including lien practices, outside the FDCPA’s reach.

## Legal Principles

- The FDCPA is construed broadly to reach unfair, deceptive, and unauthorized debt-collection practices, including conduct carried out through litigation mechanisms.
- For § 1692e(5), whether an action “cannot legally be taken” depends on applicable state law; taking an unlawful action can violate the provision even without a separate forward-looking threat.
- Recording an encumbrance on a consumer’s home without legal authority can plausibly qualify as an “unfair or unconscionable” means of collection under § 1692f.
- Seeking to secure payment through an unauthorized lien can plausibly implicate § 1692f(1) because the collector is using a remedy not permitted by law to collect the debt.
- At the pleading stage, allegations that (i) the lien was invalid under state law, (ii) the collector recorded it while the judgment lacked finality, and (iii) the collector maintained it after vacatur was indicated, are sufficient to state plausible FDCPA claims.

## Conclusion

The Sixth Circuit held that a debt collector’s recording and short-term maintenance of a judgment lien that is invalid under Kentucky law can plausibly violate the FDCPA, and that such litigation-related collection conduct is not exempt from FDCPA scrutiny; the case was remanded for further proceedings.


Currier v. First Resolution Inv. Corp., 762 F.3d 529 (6th Cir. 2014)