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QR & Barcodes On Debt Collection Letters Illegal - How A 3rd Circuit Approved A Class Action Lawsuit Against Debt Collector HRRG.

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QR & Barcodes On Debt Collection Letters Illegal – How A 3rd Circuit Approved A Class Action Lawsuit Against Debt Collector HRRG…

3rd Circuit Reinstate QR & Barcodes Class Action Lawsuit Over Medical Debt Collector

A new 3rd Circuit judgment should force debt collectors like Medical HRRG to reconsider whether they can include readable barcodes, Q.R. codes, or other technology in their debt collection letters.

Alejandro Morales v. Healthcare Revenue Recovery Group LLC

The 3rd Circuit recently decided that the existence of a barcode on the envelope addressed to the debtor — which when scanned exposed some protected debtor-related information — violated the Fair Debt Collection Practices Act (FDCPA) and caused serious damage sufficient to establish Article III standing.

The three-judge panel decided that Plaintiff Alejandro Morales’s class-action lawsuit against debt collector Healthcare Revenue Recovery Group LLC (HRRG) in 2015 could proceed, overturning a lower court’s ruling.

According to the lawsuit, Morales got a debt collection letter from Healthcare Revenue Recovery Group, which had a barcode on the envelope.

He later filed a class action lawsuit alleging that the envelope violated the FDCPA for it has a barcode that could be scanned by a smartphone, thus, revealing the debt collector’s internal reference number and his street address’ first 10 characters.

HRRG contended that because the reference numbers were not account numbers, they were not subject to the FDCPA. A district judge in New Jersey dismissed the lawsuit, stating that many debtors could share the same reference number.

The Verdict

Morales then filed an appeal after the 3rd Circuit ruled in another instance that a quick reference (Q.R.) code revealing an account number produced enough harm for Article III standing. 

U.S. Circuit Judge Thomas M. Hardiman, writing for the panel, stated that the District Court was wrong due to the distinction between an account number and an internal reference number. The panel added that disclosing the reference number may allow public access to the account and identify customers as debtors. 

Account numbers are only one type of protected data, Hardiman added.

Furthermore, the 3rd Circuit dismissed Healthcare Revenue’s allegations that Morales lacked knowledge of using an internal reference number to acquire access to protected information and failed to establish a risk of serious harm.

Lastly, Judge Hardiman stated that Morales was not required to understand how to access accounts using internal reference numbers. He does not need to demonstrate an increased risk of harm.

FDCPA

The FDCPA was established in 1977 to protect customers against unethical debt collection methods and aid in protecting their privacy. It forbids certain types of abusive practices, such as talking about your debt with third parties.

Numerous debt and bill collectors send customers letters for payment. However, they do not always print and mail the letters themselves. Instead, the company may send confidential information about customers’ debts to other businesses, which subsequently compile letters for mailing. This implies that private, personal information is disclosed to individuals who are not authorized to read it.

Editor’s Note on QR & Barcodes On Debt Collection Letters Illegal:

This article is published to update you on the reconsideration of a class action lawsuit against HRRG over privacy harm.

If you received a collection letter in the last year from a debt or bill collector, you might have a claim against the company for violating the FDCPA.

Case Name & No.: Alejandro Morales v. Healthcare Revenue Recovery Group LLC, Case No. 20-1827

Jurisdiction: U.S. Court of Appeals, Third Circuit

Products/Services: Users Private Data

Allegations: Debt collectors like HRRG include readable barcodes, Q.R. codes, or other technology in their letters that reveal personal information about the debtor, thus, violating the Fair Debt Collection Practices Act

Status: Pending

Do you believe debt collectors should be permitted to include Q.R. codes on their envelopes that include potentially identifying information? Share with us your ideas and thoughts by clicking the “Contact Us” button below!

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Suggested Article: What is FDCPA – How To Protect Yourself From Debt Letters

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