On December 10, 2019, the Supreme Court of the United States resolved a split among the Circuit Courts of Appeals over whether the one-year statute of limitations of the Fair Debt Collection Practices Act (“FDCPA”) begins to accrue from the time the alleged violation occurs, as opposed to when it is discovered.  The Supreme Court’s decision, delivered by Justice Thomas, in Rotkiske v. Klemm, et al., No. 18-328, held that claims brought under the FDCPA are strictly subject to the statutory language of the FDCPA and must be filed “within one year from the date on which the violation occurs.”

In Rotkiske, Mr. Rotkiske failed to pay his credit card debt, which led to a debt-collector filing a claim to collect the outstanding unpaid debt.  Mr. Rotkiske failed to respond to the debt-collector’s claim, which resulted in the latter obtaining final judgment in 2009.  Mr. Rotkiske alleged that he was unaware of the debt-collector’s claim until 2014, when his mortgage loan application was denied because of the default judgment.

In June 2015, more than six-years after default judgment was entered, Mr. Rotkiske filed a case against the debt-collector and asserted a claim under the FDCPA.  Relying upon Ninth Circuit precedent, Mr. Rotkiske claimed the court should apply the “discovery” rule, which would toll the one-year statute of limitations. The District Court rejected Mr. Rotkiske’s argument and held that under the plain language of the FDCPA, the limitations period accrues from the date of the violation, whether the claimant had discovered it or not.  The Third Circuit affirmed and held the FDCPA’s one-year limitations period runs from the “date on which the violation occurs,” and not the date when the violation was discovered.

To resolve the split amongst the Circuits, the Supreme Court granted certiorari.  The Supreme Court declined to enforce the “discovery” rule and held that the FDCPA’s unambiguous language plainly provides “an FDCPA action ‘may be brought … within one year from the date on which the violation occurs.”  The Supreme Court refused to render a different interpretation from the plain and unambiguous language provided by Congress.  The Supreme Court held “[i]t is not our role to second-guess Congress’ decision …” and reasoned “[w]e must presume that Congress ‘says in a statute what it means and means in a statute what it says there.’”

This narrow interpretation of the FDCPA by the Supreme Court in Rotkiske is a favorable ruling for businesses engaged in debt-collection practices.  In effect, it requires potential claimants to be more vigilant, while alleviating businesses that are subject to the FDCPA from stale claims.