Certification From the United States District Court for the Eastern District of Washington in Kelli Gray , and All Others Similarly Situated , Plaintiffs ,
Suttell & Associates et al., Defendants. Eva Lauber et al., and All Others Similarly Situated, Petitioners,
Encore Capital Group, Inc., et al., Respondents
Argued October 22, 2013
Michael D. Kinkley (of Michael D. Kinkley PS ); and Kirk D. Miller (of Kirk D. Miller PS ), for petitioners.
Carl E. Hueber (of Winston & Cashatt ); Bradley L. Fisher (of Davis Wright Tremaine LLP ); John D. Munding ; and Matthew J. Segal (of Pacifica Law Group LLP ) ( Richard L. Stone of Hogan Lovell U.S. LLP and Theodore W. Seitz of Dykema Gossett PLLC, of counsel), for respondents.
Frederick P. Corbit on behalf of Northwest Justice Project, amicus curiae.
AUTHOR: Justice Charles K. Wiggins. WE CONCUR: Chief Justice Barbara A. Madsen, Justice Charles W. Johnson, Justice Susan Owens, Justice Mary E. Fairhurst, Justice Debra L. Stephens, Justice Steven C. González, Justice Sheryl Gordon McCloud, James M. Johnson, Justice Pro Tem.
[181 Wn.2d 332] Charles K. Wiggins,
¶ 1 In response to questions certified to this court, we hold that debt buyers fall within the definition of " collection agency" under the Washington Collection Agency Act (WCAA), chapter 19.16 RCW, when they solicit claims for collection. Accordingly, if the court finds that Midland Funding LLC solicited claims, then Midland Funding is a collection agency and it cannot file collection lawsuits without a license.
¶ 2 The United States District Court for the Eastern District of Washington certified the following questions to us:
1. Does the definition of " collection agency" in RCW 19.16.100(2)  include a person who 1) purchases claims that are owed or due or asserted to be owed or due another, 2) undertakes no activity on said delinquent consumer account but rather contracts with an affiliated collection agency to collect the purchased claims, and 3) is the named plaintiff in a subsequent collection lawsuit for said purchased claims?
2. Can a company, such as Midland Funding, LLC, file lawsuits in the [state of] Washington on delinquent consumer accounts without being licensed as a collection agency as defined by RCW 19.16.100(2)?
Certification from United States District Court for the Eastern District of Washington, No. CV-09-251-EFS consolidated with No. CV-10-5132-EFS (E.D. Wash. 2013).
¶ 3 This lawsuit involves two consolidated suits: Gray v. Suttell & Associates, No. CV-09-251-EFS (E.D. Wash.), and [181 Wn.2d 333] Lauber v. Encore Capital Group., No. CV-10-5132-EFS (E.D. Wash.).  On April 8, 2011, plaintiffs filed an amended complaint, alleging claims under Washington's Consumer Protection Act (WCPA), chapter 19.86 RCW, and the federal Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § § 1692-1692p. These claims are based in part on plaintiffs' assertion that Midland Funding's business arrangements and debt collection processes violated the WCAA. See RCW 19.16.440; Evergreen Collectors v. Holt, 60 Wn.App. 151, 155, 803 P.2d 10 (1991) (violation of WCAA is a per se violation of the CPA). The following chart illustrates the relationships between Midland Funding and its parent companies.
Encore Capital Group Inc. (publicly held corporation)
Midland Credit Management Inc. (licensed collection agency)
Midland Portfolio Services Inc. (owns 100% of Midland Funding)
Midland Funding LLC (debt buying entity that owns the accounts) 
[181 Wn.2d 334] ¶ 4 Midland Funding purchases defaulted receivables, i.e., consumers' unpaid financial commitments to credit originators such as banks, credit unions, consumer finance companies, commercial retailers, auto finance companies, and telecommunication companies. Midland Funding has no ...