                                         PRECEDENTIAL

       UNITED STATES COURT OF APPEALS
            FOR THE THIRD CIRCUIT
               ________________

                      No. 17-2851
                   ________________


         JAMES TEPPER; ALLISON TEPPER

                            v.

               AMOS FINANCIAL, LLC,

                                        Appellant
                  ________________

       Appeal from the United States District Court
         for the Eastern District of Pennsylvania
         (D.C. Civil Action No. 2-15-cv-05834)
        District Judge: Honorable J. Curtis Joyner
                    ________________

                  Argued June 5, 2018

Before: AMBRO, JORDAN, and VANASKIE, Circuit Judges

             (Opinion filed: August 7, 2018)

Erik M. Helbing  (Argued)
Helbing Law, LLC
1328 Second Avenue
Berwick, PA 18603

      Counsel for Appellant

Michael J. Palumbo
Anthony J. Gingo
Gingo Palumbo Law Group
4700 Rockside Road, Suite 440
Independence, OH 44131

Matthew R. Rosenkoff
Taylor English Duma LLP
1600 Parkwood Circle, Suite 200
Atlanta, GA 30339

      Counsel for Amicus Appellant

Gleb Epelbaum
John J. Jacko, III   (Argued)
Fellheimer & Eichen
50 South 16th Street
Two Liberty Place, Suite 3401
Philadelphia, PA 19102

      Counsel for Appellee

Carlo Sabatini
Brett Freeman
Sabatini Law Firm
216 North Blakely Street
Dunmore, PA 18512




                              2
Daniel A. Edelman
Francis Greene
Edelman, Combs, Latturner & Goodwin LLC
20 S. Clark Street, Suite 1500
Chicago, IL 60603

       Counsel for Amicus Appellee

                     ________________

                OPINION OF THE COURT
                   ________________

AMBRO, Circuit Judge

       Many would gladly pay Tuesday for a hamburger
today. Of course, not all of those who fall into debt make
payments timely, and debt collection has become a
professional trade. The Fair Debt Collection Practices Act
(the “FDCPA” or “Act”), 15 U.S.C. § 1692, et seq., regulates
their efforts. Under it, debt collectors are prohibited from
engaging in deceptive, abusive, or otherwise unfair practices
to collect debts. When these practices occur, the Act gives
debtors a private right of action to seek recourse, with the
possibility of receiving statutory damages.

        The Act does not apply, however, to all entities who
collect debts; only those whose principal purpose is the
collection of any debts, and those who regularly collect debts
owed another are subject to its proscriptions. Those entities
whose principal business is to collect the defaulted debts they
purchase seek to avoid the Act’s reach. We believe such an
entity is what it is—a debt collector. If so, the Act applies.




                              3
I.     Background

      A.     “Debt Collectors” Under the Fair Debt
Collection Practices Act

        The FDCPA is a “remedial legislation” aimed, as
already noted, “to eliminate abusive debt collection practices
by debt collectors.” Kaymark v. Bank of Am., N.A., 783 F.3d
168, 174 (3d Cir. 2015) (quoting § 1692(e); Caprio v.
Healthcare Revenue Recovery Grp., LLC, 709 F.3d 142, 148
(3d Cir. 2013)). Importantly, it applies only to “debt
collectors,” Pollice v. Nat’l Tax Funding, L.P., 225 F.3d 379,
403 (3d Cir. 2000), defined as any person: (1) “who uses any
instrumentality of interstate commerce or the mails in any
business the principal purpose of which is the collection of
any debts” (the “principal purpose” definition); or (2) “who
regularly collects or attempts to collect, directly or indirectly,
debts owed or due or asserted to be owed or due another” (the
“regularly collects for another,” or “regularly collects,”
definition). 1 § 1692a(6). Specifically excluded from the
definition’s reach are, in relevant part, a creditor’s officers
and employees collecting debts for the creditor, a company
collecting debts only for its non-debt-collector sister
company, an entity collecting a debt it originated, and one
collecting a debt it obtained that was not in default at the time
of purchase. § 1692a(6)(A), (B), (F).

       “Creditors—as opposed to ‘debt collectors’—
generally are not subject to the [Act].” Pollice, 225 F.3d at
403. A “creditor” is any person: (1) “who offers or extends
1
  Though not relevant here, the definition of “debt collector”
also includes “any person who uses any instrumentality of
interstate commerce or the mails in any business the principal
purpose of which is the enforcement of security interests.”
§ 1692a(6).




                                4
credit creating a debt[;] or” (2) “to whom a debt is owed.”
§ 1692a(4). Excluded is “any person to the extent that he
receives an assignment or transfer of a debt in default solely
for the purpose of facilitating collection of such debt for
another.” Id. Notably, the Act, by its terms, contemplates that
an entity may be both a debt collector and a creditor, stating
that “debt collector” also includes “any creditor who, in the
process of collecting his own debts, uses any name other than
his own which would indicate that a third person is collecting
or attempting to collect such debts.” § 1692a(6).

        The landscape of debt collection has changed since the
FDCPA’s enactment in 1977, and not all those who collect
debt look like the classic “repo man.” The Federal Trade
Commission reported in 2009 that “[t]he most significant
change in the debt collection business in recent years has
been the advent and growth of debt buying.” Federal Trade
Commission, Collecting Consumer Debts: The Challenges of
Change – A Workshop Report 13 (2009). No longer do
creditors simply hire debt collectors to serve their named role;
rather, with increased frequency creditors sell debt to
purchasers, who may again resell the debt, hire outside debt
collectors to undertake collection efforts, or attempt to collect
on their own. See Federal Trade Commission, The Structure
and Practices of the Debt Buying Industry 1 (2013). Since this
shift, courts have had to find new ways to distinguish “debt
collectors” from “creditors” to determine whether the FDCPA
applies to a particular entity.

        In Pollice we followed the “default” test to make that
determination. Per that test, “an assignee of an obligation is
not a ‘debt collector’ if the obligation is not in default at the
time of the assignment; conversely, an assignee may be
deemed a ‘debt collector’ if the obligation is already in
default when it is assigned.” 225 F.3d at 403. Applying the
test to an entity alleged to be a “debt collector,” we held that




                               5
because “there [was] no dispute that the various claims
assigned to [it] were in default prior to their assignment[,] . . .
[and] there [was] no question that the ‘principal purpose’ of
[its] business [was] the ‘collection of any debts,’” the entity
was a debt collector. Id. at 404.

       In Federal Trade Commission v. Check Investors, Inc.,
502 F.3d 159 (3d Cir. 2007), we applied Pollice to similarly
situated entities whose principal business was the collection
of debts. Id. at 172. The alleged debt collectors argued they
were “creditors” because they collected debts owed to
themselves as opposed to “debt collectors” who collect debts
owed to another. Id. Because they owned the debt they
collected, they claimed they were not subject to the Act. Id.
We noted in a dictum that the entities “appear[ed] at first
blush to satisfy the statutory definition of a creditor,” yet, “as
to a specific debt, one cannot be both a ‘creditor’ and a ‘debt
collector,’ as defined in the [Act], because those terms are
mutually exclusive.” Id. at 173.

        We again followed the “default” test to determine
whether the entity was a creditor or instead a debt collector,
but pointed out that “focusing on the status of the debt when
it was acquired overlooks . . . that the person engaging in the
collection activity may actually be owed the debt and is,
therefore, at least nominally a creditor.” Id. We justified our
use of the “default” test by reasoning that “Congress . . .
unambiguously directed our focus to the time the debt was
acquired in determining whether one is acting as a creditor or
debt collector under the [Act].” Id. We noted that the Act’s
legislative history explained the term “debt collector” as
“intended to cover all third persons who regularly collect
debts,” id., because independent debt collectors, unlike
creditors, are not “restrained by the desire to protect their
good will when collecting past due accounts.” Id. (quoting S.
Rep. No. 95–382, at 2, 1977 U.S.C.C.A.N. 1695, 1696).




                                6
Instead, they likely will have “no future contact with the
consumer and often are unconcerned with the consumer’s
opinion of them.” Id.

       The Supreme Court, in Henson v. Santander Consumer
USA Inc., 137 S. Ct. 1718 (2017), has recently repealed the
“default” test we followed. Debtors claimed that Santander
Bank, which had purchased their loans already in default and
attempted to collect on them, met the second definition of
“debt collector,” i.e., one who “regularly collects or attempts
to collect . . . debts owed or due . . . another.” Id. at 1721
(quoting § 1692a(6)). They asserted as well that the Bank met
the “principal purpose” definition, but the Court did not
review that claim because it was not litigated in the District
Court. Id.

       The Supreme Court began “with a careful examination
of the statutory text,” in particular the definition’s limitation
to debts “owed . . . another.” Id. It reasoned that “by its plain
terms this language seems to focus our attention on third
party collection agents working for a debt owner—not on a
debt owner seeking to collect debts for itself.” Id. This
language does not suggest that “whether the owner originated
the debt or came by it only through later purchase”
determines if it is a debt collector. Id. “All that matters is
whether the target of the lawsuit regularly seeks to collect
debts for its own account or does so for ‘another.’” Id. Hence
the Bank, which collected debts for its own account, did not
meet the “regularly collects for another” definition. Id. at
1721–22.

       The debtors in Henson further argued that the
“default” test ought to apply because the statute excludes
from the definition of “debt collector” those who obtain debts
before default, and therefore those who obtain debts after
default must fit the definition. Id. at 1724 (citing




                               7
§ 1692a(6)(F)(iii)). The Court held that argument untenable
because “it doesn’t necessarily follow that the [‘regularly
collects’] definition [of ‘debt collector’] must include anyone
who regularly collects debts acquired after default;” to meet
that definition, those debts must be “owed another.” Id.
(emphasis in original).

        The Court also addressed the suggestion that everyone
who attempts to collect debt is either a “debt collector” or a
“creditor” with respect to a particular debt, but cannot be
both. Id. “[S]potting (without granting) th[at] premise,” it
stated that a company such as the Bank, which collects on
debt it purchased for its own account, “would hardly seem to
be barred from qualifying as a creditor under the statute’s
plain terms.” Id. But excluded from the definition of
“creditor” are those who acquire a debt after default when the
debt is assigned or transferred “solely for the purpose of
facilitating collection of such debt for another.” Id. (quoting
§ 1692a(4)) (emphases in original).

       Only one of our sister circuits has applied Henson thus
far in a precedential opinion. 2 In Bank of New York Mellon

2
  The Fifth Circuit, in a non-precedential opinion, ruled that
because Henson held “that debt purchasers who collect for
their own accounts are not ‘debt collectors’ under the
‘regularly collects’ alternative,” the plaintiff failed to state a
claim to that effect. Infante v. Law Office of Joseph
Onwuteaka, P.C., No. 17-41071, 2018 WL 2438153, at *2
(5th Cir. May 30, 2018). The Sixth Circuit ruled much the
same, also in a non-precedential opinion. Garner v. Select
Portfolio Servicing, Inc., No. 17-1303, 2017 WL 8294293, at
*3 (6th Cir. Oct. 27, 2017). In addition, the Eleventh Circuit
has since applied its pre-Henson standard that “a non-
originating debt holder [does not qualify as] a ‘debt collector’




                                8
Trust Co. N.A. v. Henderson, 862 F.3d 29 (D.C. Cir. 2017),
the D.C. Circuit ruled on whether the Bank of New York,
which regularly purchased and collected on defaulted loans,
was a “debt collector” or instead a “creditor” under the Act.
Id. at 33–34. As there was “no evidence to indicate the
Bank’s ‘principal’ business is debt collection[,] []or [that] the
debt the Bank is seeking to collect [is] ‘due another,’” the
Court (following Henson) held the Bank of New York was
not a debt collector. Id. No sister circuit has yet opined on
Henson’s applicability to the “principal purpose” definition of
“debt collector,” the task before us today.

       B.     Facts

       Appellees James and Allison Tepper, husband and
wife, entered into a home equity line of credit with NOVA
Bank secured by a mortgage on their Pennsylvania home.
Tepper v. Amos Financial, LLC, No. 15-cv-5834, 2017 WL
3446886, at *1 (E.D. Pa. Aug. 11, 2017). The Teppers
received periodic statements regarding their loan, and made
timely payments, until the Pennsylvania Department of
Banking and Securities closed the Bank and the Federal
Deposit Insurance Corporation was appointed as receiver. Id.
at *2.

        The Teppers were notified of the Bank’s closure, the
FDIC’s role as receiver, and its intention to market and sell
all of the Bank’s assets, including their loan. Id. Though the
Teppers stopped receiving periodic statements, they
attempted to remit a periodic payment to the FDIC, but it
neither cashed nor returned their check. Id. Rather than

. . . solely because the debt was in default at the time it was
acquired” (which, it noted, Henson confirmed). Kurtzman v.
Nationstar Mortgage LLC, 709 F. App’x 655, 659 (11th Cir.
2017) (citation omitted) (first alteration in original).




                               9
attempt to make further payments to the FDIC, the couple
decided to wait until they received a periodic statement from
the loan’s new servicer. Id.

        Some months later, the FDIC declared the loan to be in
default and sold it, also assigning the mortgage securing the
loan, to Appellant Amos Financial, LLC. Id. at *2–3. It is an
Illinois limited liability company that first registered to
conduct business in Pennsylvania in October 2015. Not a
financial institution or lender, its sole business is purchasing
debts entered into by third parties and attempting to collect
them. Id. at *1. The FDIC notified the Teppers of both the
loan’s default and its transfer to Amos, who made several
attempts to collect the amount due. Id. at *1, 3–4. Amos
mailed the Teppers three letters demanding lump-sum
payments and sent them a notice, containing a higher amount
due, stating that it intended to foreclose on their home. Id. at
*3–4. It then filed a foreclosure action in Pennsylvania court
in March 2015. Id. at *4. At that time, Amos was not
registered to do business in Pennsylvania. Id. at *1, 4.

       James Tepper reached out to Amos to request loan
statements and to resolve the loan’s default and avoid
foreclosure. Id. at *4–5. Nareg Korogluyan, an Amos officer,
returned his call. Id. at *5. He refused to give Mr. Tepper any
loan statements, said the Teppers’ home belonged to Amos,
and warned they could not stop its foreclosure. Id. at *5–6.
An attorney, acting on behalf of Amos, then sent Mr. Tepper
an email attempting to collect the debt, but at an even higher
amount. Id. at *6.

       C.     Procedural History

      The Teppers filed a complaint alleging Amos violated
the FDCPA and Amos timely replied. In their pretrial filings,
the Teppers argued that Amos was a “debt collector” as




                              10
defined in § 1692a(6) of the Act because their loan was in
default and Amos considered the loan to be in default when it
was purchased. They alleged Amos violated the Act through
its written and oral communications with the Teppers, in part
because it was not registered to do business in Pennsylvania
when it threatened and filed foreclosure.

       Amos, in its pretrial filings, did not contest its status as
a “debt collector” under the Act. Rather, it argued it was not
required to register in Pennsylvania as a foreign business
entity because its sole business was acquiring and collecting
debt. During the one-day bench trial that followed,
Korogluyan testified to the same and added that the higher
loan amount was calculated using an increased interest rate.

       The District Court requested post-trial memoranda
from the parties. In their memorandum, the Teppers argued
Amos violated the FDCPA because it increased their loan’s
interest rate without first terminating and accelerating the
loan, which their credit agreement required. Amos, in its
memorandum, again did not challenge its status as a debt
collector, and repeated that it was not required to register in
the Commonwealth because its sole business was collecting
the debt it acquired.

       After the trial and the post-trial supplemental briefing,
but before the District Court issued a decision, the Supreme
Court decided Henson. In response, the District Court ordered
additional briefing for the parties to address whether, in light
of Henson, Amos qualifies as a debt collector.

       Thereafter the Court decided: (1) Amos is a “debt
collector” as defined in § 1692a(6); (2) the Teppers’ loan is a
“debt” as defined in § 1692a(5) of the Act; and (3) Amos




                                11
violated the Act. 3 Tepper, 2017 WL 3446886, at *7–10.
Amos was not liable for failing to register as a foreign
business in Pennsylvania, however, because it is a debt
collector. Id. at *10. It appeals the District Court’s decision,
arguing that it is not a debt collector. Accordingly, we
summarize only the Court’s reasoning for that part of its
decision.

        Taking heed from Henson, the District Court looked
first to the statute’s text. Id. at *7. It explained there are two
ways for a plaintiff to prove a defendant is a debt collector:
either (1) its “principal purpose . . . is the collection of any
debts,” or (2) it “regularly collects or attempts to collect . . .
debts owed or due . . . another.” Id. at *8 (quoting § 1692a). It
explained that, following Henson, an entity that purchases
debts and then seeks to collect them for its own account is
ineligible for the second definition because it is limited to
those who regularly collect debts due a third party. Id. By
contrast, the first definition applies to “collection of any
debts” so long as that activity is the entity’s “principal

3
  Specifically, the Court held: (1) Amos’s foreclosure notice
and email that failed to disclose sufficient details about the
amount and character of the debt were incomplete and
misleading in violation of §§ 1692e(2) and (10); (2) its
calculation of the loan amount at an increased interest rate
without following the credit agreement’s required procedures
violated § 1692e; and (3) Korogluyan’s statements that Amos
owned the Teppers’ home and they could not stop the
foreclosure constituted false representations and deceptive
means to collect on the loan in violation of § 1692e(10).
Tepper, 2017 WL 3446886, at *10. The Court also ordered
$1,000 in statutory damages to the Teppers and deemed them
entitled to recoup costs and reasonable attorneys’ fees. Id. at
*11.




                               12
purpose.” Id. (citing § 1692a). The parties did not dispute that
Amos’s sole business activity is purchasing and then
attempting to collect debts. Id. Hence the Court held Amos
meets the first definition of debt collector. Id.

II. Jurisdiction and Standard of Review
       The District Court had jurisdiction under 28 U.S.C.
§ 1331 and we have jurisdiction to review its decision under
28 U.S.C. § 1291. We review de novo the Court’s conclusions
of law and review for clear error its factual findings. Battoni
v. IBEW Local No. 102 Employee Pension Plan, 594 F.3d
230, 233 (3d Cir. 2010).

III. Discussion

       Henson did not decide, but nonetheless affects, who
fits the “principal purpose” definition of “debt collector.”
Whereas, prior to the Supreme Court’s decision, our
precedent in Pollice and Check Investors instructed us to look
at whether the debt was in default at the time it was
purchased, after Henson the “default” test falls away for a
“principal purpose” framework.

        We take our cue from the Court to begin by carefully
examining the statute’s text. Henson, 137 S. Ct. at 1721. Both
Amos and the Teppers contend the plain text of the statute
supports their desired outcome—Amos arguing that it fits the
definition of “creditor” and therefore it is not a “debt
collector” because the terms are mutually exclusive, and the
Teppers arguing it fits the “principal purpose” definition of
“debt collector.”

      We do not overlook Amos’s omission of the “principal
purpose” definition from its argument. Its admitted sole
business is collecting debts it has purchased. It uses the mails




                              13
and wires for its business. It can be no plainer that Amos
“uses any instrumentality of interstate commerce or the mails
in any business the principal purpose of which is the
collection of any debts.” § 1692a(6). “Any debts” does not
distinguish to whom the debt is owed. And it stands in
contrast to “debts owed or due . . . another,” which limits only
the “regularly collects” definition. See Henson, 137 S. Ct. at
1723 (“[W]hen we’re engaged in the business of interpreting
statutes we presume differences in language . . . convey
differences in meaning.”). Asking if Amos is a debt collector
is thus akin to asking if Popeye is a sailor. He’s no cowboy.

       Amos claims that because it also meets the definition
of creditor—it is the entity “to whom [the] debt is owed,”
§ 1692a(4)—it is not a debt collector. In Check Investors we
noted an entity may satisfy the statutory definition of
“creditor” and yet be a “debt collector.” 502 F.3d at 173. Our
conclusion today does not require us to sort out what Check
Investors intended by its statement that those terms are
mutually exclusive. Suffice it to say that, following Henson,
an entity that satisfies both is within the Act’s reach.

        Amos argues as its fallback position that if we do not
find it is a creditor (to the exclusion of being a debt collector),
we should hold that it is not a debt collector under the
definition’s exclusion for “officer[s] [and] employee[s] of a
creditor [who], in the name of the creditor, [are] collecting
debts for [the] creditor.” § 1692a(6)(A). This exception
clearly does not fit; for even if Amos is a nominal creditor,
the Teppers sued Amos, a limited liability company, and not
any of its officers or employees.

                 *       *      *       *      *

      In sum, Amos may be one tough gazookus when it
attempts to collect the defaulted debts it has purchased, but




                                14
when its conduct crosses the lines prescribed by the FDCPA,
it opens itself up to the Act’s penalties. The District Court
held that Amos’s debt-collection attempts with the Teppers
crossed those lines, and it must face the statute’s penalties for
its bad behavior. We affirm the portion of the Court’s opinion
Amos has challenged on appeal—that it is a debt collector
under the “principal purpose” definition. The Court decided
correctly in light of Henson’s repeal of the “default” test.
Whether an entity acquired the debts it collects after they
became defaulted does not resolve whether that entity is a
debt collector. Instead, we follow the plain text of the statute:
an entity whose principal purpose of business is the collection
of any debts is a debt collector regardless whether the entity
owns the debts it collects.

       Thus we affirm.




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