Government Affairs Report - January 2012
View this article at ACA International.
On Jan. 18, 2012, the U.S. Supreme Court reached a decision in Mims v. Arrow Financial Services, LLC, No. 10-1195. In Mims, the Supreme Court was asked to decide whether the Telephone Consumer Protection Act (TCPA) grants state courts exclusive jurisdiction over private TCPA claims, or whether consumers can file such claims in either state or federal courts.
In a unanimous opinion, the court held that consumers may sue in either federal or state court. In arriving at its decision, the court applied the default rule that federal courts have jurisdiction over claims that arise under federal law unless Congress divests them of that jurisdiction.
The court held that while § 227(b)(3) of the TCPA permits state courts to preside over claims brought under the Act, it does not also divest the jurisdiction of the federal courts. In making this determination, the court recognized the language in § 227(b)(3) may be state-court oriented, but stated “the grant of jurisdiction to one court does not, of itself, imply that the jurisdiction is to be exclusive.” The court noted the permissive language in § 227(b)(3) does not limit a consumer to filing a private TCPA action exclusively in state court.
With the support of ACA's Legal Fund, ACA submitted an amicus brief in this case in favor of Arrow Financial Services. While the decision is contrary to ACA's position, it resolves a split between the U.S. Courts of Appeals. ACA thanks MAP member David Schultz and Peter Pederson with Hinshaw and Culbertson, LLP, who drafted ACA's amicus brief, for their work on behalf of ACA and the credit and collection industry.