The U.S. Court of Appeals for the Sixth Circuit recently affirmed that a debt collector did not violate the Fair Debt Collection Practices Act (FDCPA) when it threatened legal action to collect debts that were still within the applicable statute of limitations.

In Williams v. Louisville Recovery Service, LLC, the plaintiff received services from a local emergency room seven times between 2011 and 2015. Each time, the plaintiff signed a “Conditions and Authorization for Treatment” form that authorized the hospital and its third-party providers to perform various services, clarified that most providers were independent contractors who would bill separately, and stated that by accepting treatment the plaintiff agreed to accept full responsibility for all associated charges.

When the plaintiff failed to pay the resultant medical bills, the debts were turned over to the defendant for collection. The defendant reported the debts to the credit bureaus. Upon learning of the negative credit history, the plaintiff disputed the debts. The defendant responded by providing an account itemization of the bills from the emergency room visits and subsequently sent a letter threatening legal action.

The plaintiff then filed a complaint under the FDCPA, asserting that the defendant had threatened to collect on time-barred debts. The district court granted summary judgment in favor of the defendant, finding that the statute of limitations had not expired.

There was no dispute that the plaintiff was a consumer who incurred debts for personal, family, or household purposes and that the defendant was a debt collector. The central issue was whether the defendant violated § 1692e(5) of the FDCPA by threatening to take legal action that cannot legally be taken — specifically, suing on a time-barred debt.

The Court of Appeals’ analysis centered on whether the “Conditions and Authorization for Treatment” form was enforceable as a written contract. Kentucky law recognizes a five-year statute of limitations for oral contracts and a fifteen-year statute of limitations for written contracts (recently amended to ten years). To qualify as written contract in Kentucky, the agreement must contain all essential terms: the parties involved, the price, and the performance to be rendered. The appellate court determined the contract did not have to specifically name the third-party beneficiaries because they were clearly indicated as the medical providers. The appellate court also held that a specific price did not have to be listed, provided there was a definite promise pay. The plaintiff had agreed to accept full responsibility for all charges, with the amount to be determined later. Finally, the appellate court held written contracts do not need to provide every detail of performance but must describe the required performance with reasonable certainty. The contract stated that the providers would perform various “diagnostic tests” and “procedures” to determine the plaintiff’s health issues, which the court found was sufficiently specific.

Because the plaintiff signed written contracts for each emergency room visit, the fifteen-year statute of limitations applied. Thus, the defendant’s threat to sue over the debts did not violate the FDCPA, and summary judgment in the defendant’s favor was affirmed.