The collector pays your lawyer
The FDCPA, the FCRA, Florida's FCCPA and New York's GBL 349 each require a company found liable to pay the consumer's reasonable attorney's fees and costs. Those rules matter because the statutory damages in an individual case are small. The rule has limits: it applies when you win, the court decides what is reasonable, and the TCPA has no such clause.
The most common reason people do not sue a collector that broke the law is arithmetic. The statutory damages in an individual FDCPA case are capped at $1,000. A lawyer's time costs more than that. So why would anyone bring the case?
Because the statute changes the arithmetic. This post explains how, where the rule comes from, and where it stops.
The rule, law by law
In most American lawsuits, each side pays its own lawyer. Consumer protection statutes are the main exception. Each of these says, in its own words, that a successful consumer recovers attorney's fees from the company.
| Law | Who it covers | The fee rule |
|---|---|---|
| FDCPA | Debt collectors, debt buyers, collection law firms | In any successful action, costs plus a reasonable attorney's fee as determined by the court (15 U.S.C. § 1692k(a)(3)) |
| FCRA | Credit bureaus, furnishers, report users | In any successful action, willful or negligent, costs plus reasonable attorney's fees (§§ 1681n(a)(3), 1681o(a)(2)) |
| FCCPA (Florida) | Any person collecting a consumer debt, including creditors | Court costs and reasonable attorney's fees (Fla. Stat. § 559.77(2)) |
| GBL 349 (New York) | Businesses that use deceptive practices | The court may award reasonable attorney's fees to a prevailing plaintiff (N.Y. Gen. Bus. Law § 349(h)) |
| TCPA | Robocalls, autodialed calls, Do-Not-Call violations | No fee-shifting clause (47 U.S.C. § 227(b)(3), (c)(5)) |
Put plainly: the FDCPA requires a collector found liable to pay the consumer's reasonable attorney's fees and costs. The FCRA, the FCCPA and GBL 349 do the same for the companies they cover. The fee is paid in addition to the damages, not out of them.
What "reasonable" means in practice
The court decides the fee, not the lawyer. The consumer's lawyer files a motion with time records and evidence of customary rates. The company can object to the hours, the rates or both. The judge decides.
The public record in Miller v. Equifax shows what that looks like. After the trial, the plaintiff's lawyers asked for their fees. Equifax opposed. In a 21-page order on May 23, 2014, the court went lawyer by lawyer, compared each requested hourly rate to survey data on Oregon lawyers with similar experience, and awarded $302,002.50 in attorney's fees and $380 in costs, payable by Equifax. The jury's compensatory award in that case was $180,000.
That is one case, with a trial and a willful violation. It is not a prediction of any other fee. But it shows the design: a fee measured by the work, so that a strong case is worth bringing even when the damages are modest.
Where the rule stops
- It applies to a successful case. The FDCPA and FCRA provisions speak of a "successful action." GBL 349 speaks of a prevailing plaintiff. If the case does not succeed, the statute does not make the company pay your fees.
- The court decides the amount. A court can cut hours it finds excessive or rates it finds too high.
- Bad-faith suits can shift fees the other way. Under the FDCPA, a court may award the collector its fees if it finds the consumer's action was brought in bad faith and for the purpose of harassment (§ 1692k(a)(3)). The FCRA allows fees against a party whose unsuccessful pleading, motion or other paper was filed in bad faith or for harassment (§§ 1681n(c), 1681o(b)). Florida's statute allows the court to award the defendant fees if the suit lacked a justiciable issue of law or fact (Fla. Stat. § 559.77(2)).
- The TCPA has no fee clause. The TCPA provides $500 per violation, up to three times that if willful or knowing, but it does not shift fees. When a case involves both robocalls and collection conduct, the FDCPA or FCCPA claim is often what carries the fee provision.
What this means before you call a lawyer
Do not let the size of the statutory damages decide for you whether a violation is worth raising. Ask instead whether the violation can be proven: a log of calls, a voicemail, a letter, a credit report pulled by a lender. The call log and the violation checker help you gather that.
Ask the lawyer how fees and costs are handled in your engagement letter, including what happens if the case does not succeed. Read it before you sign. The who pays your lawyer page covers the fee rules in more detail, and what you get covers the damages each law allows.
And mind the deadlines, which are short: one year under the FDCPA, two years under the FCCPA, and under the FCRA the earlier of two years after discovery or five after the violation. The deadlines page has the rest.
Sources: 15 U.S.C. § 1692k; 15 U.S.C. §§ 1681n, 1681o; 47 U.S.C. § 227; Fla. Stat. § 559.77; N.Y. Gen. Bus. Law § 349(h); Miller v. Equifax Info. Servs., LLC, No. 3:11-cv-01231-BR (D. Or. May 23, 2014), opinion and order on attorney's fees.
Common questions
Does fee shifting mean the case costs me nothing?
No one can promise that. Fee shifting means the court orders a company found liable to pay the consumer's reasonable attorney's fees and costs. It applies to a successful case. How fees and costs are handled between you and your own lawyer, including if the case does not succeed, is set out in the engagement letter, and you should read it before you sign.
Can I end up paying the collector's lawyer?
In narrow cases. Under the FDCPA, a court may award fees to the collector if it finds the consumer's suit was brought in bad faith and for the purpose of harassment. The FCRA allows fees against a party whose unsuccessful paper was filed in bad faith or for harassment. The FCCPA allows the court to award the defendant fees if the suit lacked a justiciable issue of law or fact.
Why would a lawyer take a case worth $1,000?
Because the law measures the fee by the work the case reasonably required, not by the size of the damages. In Miller v. Equifax, the court awarded $302,002.50 in fees after reviewing each lawyer's hours and hourly rate. That is one public case, not a prediction, but it shows how the rule is designed to work.
Tell us what they did.
One conversation with an attorney, in your language. We tell you which laws the collector or the credit bureau broke, which deadline runs first, and what to save this week. If it is not a case we can take, we say so and tell you where to go.
(718) 484-7510The FDCPA and the FCRA require a company found liable to pay the consumer’s reasonable attorney’s fees and costs. Our fee arrangement is confirmed in a written retainer before we begin. English, Russian and Spanish in-house; an interpreter for any other language.