Henson v. Santander Consumer USA Inc. , 198 L. Ed. 2d 177 ( 2017 )

(Slip Opinion) OCTOBER TERM, 2016 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U.S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
HENSON ET AL. v. SANTANDER CONSUMER USA INC.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE FOURTH CIRCUIT
No. 16–349. Argued April 18, 2017—Decided June 12, 2017
The Fair Debt Collection Practices Act authorizes private lawsuits and
weighty fines designed to deter the wayward practices of “debt collec-
tor[s],” a term embracing anyone who “regularly collects or attempts
to collect . . . debts owed or due . . . another.” 15 U.S. C. §1692a(6).
The complaint filed in this case alleges that CitiFinancial Auto
loaned money to petitioners seeking to buy cars; that petitioners de-
faulted on those loans; and that respondent Santander then pur-
chased the defaulted loans from CitiFinancial and sought to collect in
ways petitioners believe violated the Act. The district court and
Fourth Circuit held that Santander didn’t qualify as a debt collector
because it did not regularly seek to collect debts “owed . . . another”
but sought instead only to collect debts that it purchased and owned.
Held: A company may collect debts that it purchased for its own ac-
count, like Santander did here, without triggering the statutory defi-
nition in dispute. By defining debt collectors to include those who
regularly seek to collect debts “owed . . . another,” the statute’s plain
language seems to focus on third party collection agents regularly col-
lecting for a debt owner—not on a debt owner seeking to collect debts
for itself.
Petitioners’ arguments to the contrary do not dislodge the statute’s
plain meaning. Petitioners point out that the word “owed” is the past
participle of the verb “to owe,” and so suggest that the debt collector
definition must exclude loan originators (who never seek to collect
debts previously owed someone else) but embrace debt purchasers
like Santander (who necessarily do). But past participles like “owed”
are routinely used as adjectives to describe the present state of a
thing. Congress also used the word “owed” to refer to present debt re-
lationships in neighboring provisions of the Act, and petitioners have
2 HENSON v. SANTANDER CONSUMER USA INC.
Syllabus
not rebutted the presumption that identical words in the same stat-
ute carry the same meaning. Neither would reading the word “owed”
to refer to present debt relationships render any of the Act’s provi-
sions surplusage, contrary to what petitioners suggest.
Petitioners also contend that their interpretation best furthers the
Act’s perceived purposes because, they primarily argue, if Congress
had been aware of defaulted debt purchasers like Santander it would
have treated them like traditional debt collectors because they pose
similar risks of abusive collection practices. But it is not this Court’s
job to rewrite a constitutionally valid text under the banner of specu-
lation about what Congress might have done had it faced a question
that, on everyone’s account, it never faced. And neither are petition-
ers’ policy arguments unassailable, as reasonable legislators might
contend both ways on the question of how defaulted debt purchasers
should be treated. This fact suggests for certain but one thing: that
these are matters for Congress, not this Court, to resolve. Pp. 3–11.
817 F.3d 131, affirmed.
GORSUCH, J., delivered the opinion for a unanimous Court.
Cite as: 582 U. S. ____ (2017) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash-
ington, D. C. 20543, of any typographical or other formal errors, in order
that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 16–349
_________________
RICKY HENSON, ET AL., PETITIONERS v.
SANTANDER CONSUMER USA INC.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FOURTH CIRCUIT
[June 12, 2017]
JUSTICE GORSUCH delivered the opinion of the Court.
Disruptive dinnertime calls, downright deceit, and more
besides drew Congress’s eye to the debt collection indus-
try. From that scrutiny emerged the Fair Debt Collection
Practices Act, a statute that authorizes private lawsuits
and weighty fines designed to deter wayward collection
practices. So perhaps it comes as little surprise that we
now face a question about who exactly qualifies as a “debt
collector” subject to the Act’s rigors. Everyone agrees that
the term embraces the repo man—someone hired by a
creditor to collect an outstanding debt. But what if you
purchase a debt and then try to collect it for yourself—
does that make you a “debt collector” too? That’s the nub
of the dispute now before us.
The parties approach the question from common ground.
The complaint alleges that CitiFinancial Auto loaned
money to petitioners seeking to buy cars; that petitioners
defaulted on those loans; that respondent Santander then
purchased the defaulted loans from CitiFinancial; and
that Santander sought to collect in ways petitioners be-
lieve troublesome under the Act. The parties agree, too,
2 HENSON v. SANTANDER CONSUMER USA INC.
Opinion of the Court
that in deciding whether Santander’s conduct falls within
the Act’s ambit we should look to statutory language
defining the term “debt collector” to embrace anyone who
“regularly collects or attempts to collect . . . debts owed or
due . . . another.” 15 U.S. C. §1692a(6).
Even when it comes to that question, the parties agree
on at least part of an answer. Both sides accept that third
party debt collection agents generally qualify as “debt
collectors” under the relevant statutory language, while
those who seek only to collect for themselves loans they
originated generally do not. These results follow, the
parties tell us, because debt collection agents seek to
collect debts “owed . . . another,” while loan originators
acting on their own account aim only to collect debts owed
to themselves. All that remains in dispute is how to clas-
sify individuals and entities who regularly purchase debts
originated by someone else and then seek to collect those
debts for their own account. Does the Act treat the debt
purchaser in that scenario more like the repo man or the
loan originator?
For their part, the district court and Fourth Circuit
sided with Santander. They held that the company didn’t
qualify as a debt collector because it didn’t regularly seek
to collect debts “owed . . . another” but sought instead only
to collect debts that it purchased and owned. At the same
time, the Fourth Circuit acknowledged that some circuits
faced with the same question have ruled otherwise—and it
is to resolve this conflict that we took the case. Compare
817 F.3d 131, 133–134, 137–138 (2016) (case below);
Davidson v. Capital One Bank (USA), N. A., 797 F.3d
1309, 1315–1316 (CA11 2015), with McKinney v. Cal-
deway Properties, Inc., 548 F.3d 496, 501 (CA7 2008);
FTC v. Check Investors, Inc., 502 F.3d 159, 173–174 (CA3
2007).
Before attending to that job, though, we pause to note
two related questions we do not attempt to answer today.
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Opinion of the Court
First, petitioners suggest that Santander can qualify as a
debt collector not only because it regularly seeks to collect
for its own account debts that it has purchased, but also
because it regularly acts as a third party collection agent
for debts owed to others. Petitioners did not, however,
raise the latter theory in their petition for certiorari and
neither did we agree to review it. Second, the parties
briefly allude to another statutory definition of the term
“debt collector”—one that encompasses those engaged “in
any business the principal purpose of which is the collec-
tion of any debts.” §1692a(6). But the parties haven’t
much litigated that alternative definition and in granting
certiorari we didn’t agree to address it either.
With these preliminaries by the board, we can turn to
the much narrowed question properly before us. In doing
so, we begin, as we must, with a careful examination of
the statutory text. And there we find it hard to disagree
with the Fourth Circuit’s interpretive handiwork. After
all, the Act defines debt collectors to include those who
regularly seek to collect debts “owed . . . another.” And 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.
Neither does this language appear to suggest that we
should care how a debt owner came to be a debt owner—
whether the owner originated the debt or came by it only
through a later purchase. All that matters is whether the
target of the lawsuit regularly seeks to collect debts for its
own account or does so for “another.” And given that, it
would seem a debt purchaser like Santander may indeed
collect debts for its own account without triggering the
statutory definition in dispute, just as the Fourth Circuit
explained.
Petitioners reply that this seemingly straightforward
reading overlooks an important question of tense. They
observe that the word “owed” is the past participle of the
4 HENSON v. SANTANDER CONSUMER USA INC.
Opinion of the Court
verb “to owe.” And this, they suggest, means the statute’s
definition of debt collector captures anyone who regularly
seeks to collect debts previously “owed . . . another.” So it
is that, on petitioners’ account, the statute excludes from
its compass loan originators (for they never seek to collect
debts previously owed someone else) but embraces many
debt purchasers like Santander (for in collecting pur-
chased debts they necessarily seek to collect debts previ-
ously owed another). If Congress wanted to exempt all
present debt owners from its debt collector definition,
petitioners submit, it would have used the present partici-
ple “owing.” That would have better sufficed to do the
job—to make clear that you must collect debts currently
“owing . . . another” before implicating the Act.
But this much doesn’t follow even as a matter of good
grammar, let alone ordinary meaning. Past participles
like “owed” are routinely used as adjectives to describe the
present state of a thing—so, for example, burnt toast is
inedible, a fallen branch blocks the path, and (equally) a
debt owed to a current owner may be collected by him or
her. See P. Peters, The Cambridge Guide to English
Usage 409 (2004) (explaining that the term “past partici-
ple” is a “misnomer[ ], since” it “can occur in what is tech-
nically a present . . . tense”). Just imagine if you told a
friend that you were seeking to “collect a debt owed to
Steve.” Doesn’t it seem likely your friend would under-
stand you as speaking about a debt currently owed to
Steve, not a debt Steve used to own and that’s now actually
yours? In the end, even petitioners find themselves forced
to admit that past participles can and regularly do work
just this way, as adjectives to describe the present state of
the nouns they modify. See Brief for Petitioners 28; see
also B. Garner, Modern English Usage 666 (4th ed. 2016)
(while “owing . . . is an old and established usage . . . the
more logical course is simply to write owed”).
Widening our view to take in the statutory phrase in
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Opinion of the Court
which the word “owed” appears—“owed or due . . . another”—
serves to underscore the point. Petitioners acknowledge
that the word “due” describes a debt currently due at the
time of collection and not a debt that was due only in some
previous period. Brief for Petitioners 26–28. So to rule for
them we would have to suppose Congress set two words
cheek by jowl in the same phrase but meant them to speak
to entirely different periods of time. All without leaving
any clue. We would have to read the phrase not as refer-
ring to “debts that are owed or due another” but as de-
scribing “debts that were owed or are due another.” And
supposing such a surreptitious subphrasal shift in time
seems to us a bit much. Neither are we alone in that
assessment, for even petitioners acknowledge that theirs
“may not be the most natural interpretation of the phrase
standing in isolation.” Id., at 26–27.
Given that, you might wonder whether extending our
gaze from the narrow statutory provision at issue to take
in the larger statutory landscape might offer petitioners a
better perspective. But it does not. Looking to other
neighboring provisions in the Act, it quickly comes clear
that Congress routinely used the word “owed” to refer to
present (not past) debt relationships. For example, in one
nearby subsection, Congress defined a creditor as someone
“to whom a debt is owed.” 15 U.S. C. §1692a(4). In an-
other subsection, too, Congress required a debt collector to
identify “the creditor to whom the debt is owed.”
§1692g(a)(2). Yet petitioners offer us no persuasive reason
why the word “owed” should bear a different meaning
here, in the subsection before us, or why we should aban-
don our usual presumption that “identical words used in
different parts of the same statute” carry “the same mean-
ing.” IBP, Inc. v. Alvarez, 546 U.S. 21, 34 (2005).
Still other contextual clues add to petitioners’ problems.
While they suggest that the statutory definition before us
implicitly distinguishes between loan originators and debt
6 HENSON v. SANTANDER CONSUMER USA INC.
Opinion of the Court
purchasers, a pass through the statute shows that when
Congress wished to distinguish between originators and
purchasers it left little doubt in the matter. In the very
definitional section where we now find ourselves working,
Congress expressly differentiated between a person “who
offers” credit (the originator) and a person “to whom a debt
is owed” (the present debt owner). §1692a(4). Elsewhere,
Congress recognized the distinction between a debt “origi-
nated by” the collector and a debt “owed or due” another.
§1692a(6)(F)(ii). And elsewhere still, Congress drew a
line between the “original” and “current” creditor.
§1692g(a)(5). Yet no similar distinction can be found in
the language now before us. To the contrary, the statutory
text at issue speaks not at all about originators and cur-
rent debt owners but only about whether the defendant
seeks to collect on behalf of itself or “another.” And, usually
at least, when we’re engaged in the business of interpret-
ing statutes we presume differences in language like this
convey differences in meaning. See, e.g., Loughrin v.
United States, 573 U. S. ___, ___ (2014).
Even what may be petitioners’ best piece of contextual
evidence ultimately proves unhelpful to their cause.
Petitioners point out that the Act exempts from the defini-
tion of “debt collector” certain individuals who have “ob-
tained” particular kinds of debt—for example, debts not
yet in default or debts connected to secured commercial
credit transactions. §§1692a(6)(F)(iii) and (F)(iv). And
because these exemptions contemplate the possibility that
someone might “obtain” a debt “owed or due . . . another,”
petitioners submit, the word “owed” must refer only to a
previous owner. Ibid. This conclusion, they say, neces-
sarily follows because, once you have “obtained” a debt,
that same debt just cannot be currently “owed or due”
another.
This last and quite essential premise of the argument,
however, misses its mark. As a matter of ordinary Eng-
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Opinion of the Court
lish, the word “obtained” can (and often does) refer to
taking possession of a piece of property without also tak-
ing ownership—so, for example, you might obtain a rental
car or a hotel room or an apartment. See, e.g., 10 Oxford
English Dictionary 669 (2d ed. 1989) (defining “obtain” to
mean, among other things, “[t]o come into the possession
or enjoyment of (something) by one’s own effort or by
request”); Kirtsaeng v. John Wiley & Sons, Inc., 568 U.S.
519, 532–533 (2013) (distinguishing between ownership
and obtaining possession). And it’s easy enough to see
how you might also come to possess (obtain) a debt with-
out taking ownership of it. You might, for example, take
possession of a debt for servicing and collection even while
the debt formally remains owed another. Or as a secured
party you might take possession of a debt as collateral,
again without taking full ownership of it. See, e.g.,
U. C. C. §9–207, 3 U. L. A. 197 (2010). So it simply isn’t
the case that the statute’s exclusions imply that the
phrase “owed . . . another” must refer to debts previously
owed to another.
By this point petitioners find themselves in retreat.
Unable to show that debt purchasers regularly collecting
for their own account always qualify as debt collectors,
they now suggest that purchasers sometimes qualify as
debt collectors. On their view, debt purchasers surely
qualify as collectors at least when they regularly purchase
and seek to collect defaulted debts—just as Santander
allegedly did here. In support of this narrower and more
particular understanding of the Act, petitioners point
again to the fact that the statute excludes from the defini-
tion of “debt collector” certain persons who obtain debts
before default. 15 U.S. C. §1692a(6)(F)(iii). This exclu-
sion, petitioners now suggest, implies that the term “debt
collector” must embrace those who regularly seek to collect
debts obtained after default. Others aligned with peti-
tioners also suggest that the Act treats everyone who
8 HENSON v. SANTANDER CONSUMER USA INC.
Opinion of the Court
attempts to collect a debt as either a “debt collector” or a
“creditor,” but not both. And because the statutory defini-
tion of the term “creditor” excludes those who seek to
collect a debt obtained “in default,” §1692a(4), they con-
tend it again follows as a matter of necessary inference
that these persons must qualify as debt collectors.
But these alternative lines of inferential argument bear
their own problems. For while the statute surely excludes
from the debt collector definition certain persons who
acquire a debt before default, it doesn’t necessarily follow
that the definition must include anyone who regularly
collects debts acquired after default. After all and again,
under the definition at issue before us you have to attempt
to collect debts owed another before you can ever qualify
as a debt collector. And petitioners’ argument simply does
not fully confront this plain and implacable textual pre-
requisite. Likewise, even spotting (without granting) the
premise that a person cannot be both a creditor and a debt
collector with respect to a particular debt, we don’t see
why a defaulted debt purchaser like Santander couldn’t
qualify as a creditor. For while the creditor definition
excludes persons who “receive an assignment or transfer
of a debt in default,” it does so only (and yet again) when
the debt is assigned or transferred “solely for the purpose
of facilitating collection of such debt for another.” Ibid.
(emphasis added). So a company collecting purchased
defaulted debt for its own account—like Santander—
would hardly seem to be barred from qualifying as a credi-
tor under the statute’s plain terms.
Faced with so many obstacles in the text and structure
of the Act, petitioners ask us to move quickly on to policy.
Indeed, from the beginning that is the field on which they
seem most eager to pitch battle. Petitioners assert that
Congress passed the Act in large measure to add new
incentives for independent debt collectors to treat consum-
ers well. In their view, Congress excluded loan originators
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Opinion of the Court
from the Act’s demands because it thought they already
faced sufficient economic and legal incentives to good
behavior. But, on petitioners’ account, Congress never
had the chance to consider what should be done about
those in the business of purchasing defaulted debt. That’s
because, petitioners tell us, the “advent” of the market for
defaulted debt represents “ ‘one of the most significant
changes’ ” to the debt market generally since the Act’s
passage in 1977. Brief for Petitioners 8 (quoting Consumer
Financial Protection Bureau, Fair Debt Collection Practices
Act: CFPB Annual Report 2014, p. 7 (2014)). Had Con-
gress known this new industry would blossom, they say, it
surely would have judged defaulted debt purchasers more
like (and in need of the same special rules as) independent
debt collectors. Indeed, petitioners contend that no other
result would be consistent with the overarching congres-
sional goal of deterring untoward debt collection practices.
All this seems to us quite a lot of speculation. And while
it is of course our job to apply faithfully the law Congress
has written, it is never our job to rewrite a constitutionally
valid statutory text under the banner of speculation about
what Congress might have done had it faced a question
that, on everyone’s account, it never faced. See Magwood
v. Patterson, 561 U.S. 320, 334 (2010) (“We cannot replace
the actual text with speculation as to Congress’ intent”).
Indeed, it is quite mistaken to assume, as petitioners
would have us, that “whatever” might appear to “further[ ]
the statute’s primary objective must be the law.” Rodri-
guez v. United States, 480 U.S. 522, 526 (1987) (per curiam)
(emphasis deleted). Legislation is, after all, the art of
compromise, the limitations expressed in statutory terms
often the price of passage, and no statute yet known “pur-
sues its [stated] purpose[ ] at all costs.” Id., at 525–526.
For these reasons and more besides we will not presume
with petitioners that any result consistent with their
account of the statute’s overarching goal must be the law
10 HENSON v. SANTANDER CONSUMER USA INC.
Opinion of the Court
but will presume more modestly instead “that [the] legis-
lature says . . . what it means and means . . . what it says.”
Dodd v. United States, 545 U.S. 353, 357 (2005) (internal
quotation marks omitted; brackets in original).
Even taken on its own terms, too, the speculation peti-
tioners urge upon us is far from unassailable. After all, is
it really impossible to imagine that reasonable legislators
might contend both ways on the question whether defaulted
debt purchasers should be treated more like loan origina-
tors than independent debt collection agencies? About
whether other existing incentives (in the form of common
law duties, other statutory and regulatory obligations,
economic incentives, or otherwise) suffice to deter debt
purchasers from engaging in certain undesirable collection
activities? Couldn’t a reasonable legislator endorsing the
Act as written wonder whether a large financial institu-
tion like Santander is any more or less likely to engage in
abusive conduct than another large financial institution
like CitiFinancial Auto? Especially where (as here) the
institution says that its primary business is loan origina-
tion and not the purchase of defaulted debt? We do not
profess sure answers to any of these questions, but ob-
serve only that the parties and their amici manage to
present many and colorable arguments both ways on them
all, a fact that suggests to us for certain but one thing:
that these are matters for Congress, not this Court, to
resolve.
In the end, reasonable people can disagree with how
Congress balanced the various social costs and benefits in
this area. We have no difficulty imagining, for example, a
statute that applies the Act’s demands to anyone collecting
any debts, anyone collecting debts originated by another,
or to some other class of persons still. Neither do we doubt
that the evolution of the debt collection business might
invite reasonable disagreements on whether Congress
should reenter the field and alter the judgments it made
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Opinion of the Court
in the past. After all, it’s hardly unknown for new busi-
ness models to emerge in response to regulation, and for
regulation in turn to address new business models. Con-
stant competition between constable and quarry, regulator
and regulated, can come as no surprise in our changing
world. But neither should the proper role of the judiciary
in that process—to apply, not amend, the work of the
People’s representatives.
The judgment of the Court of Appeals is
Affirmed.