Bailey & Glasser, LLP Secures Key Federal Appellate Victory in Pay-to-Pay Litigation

Bailey & Glasser, LLP’s Pay-to-Pay team—comprised of partner James Kauffman and attorneys Denali Hedrick and Allison Bruff—secured a significant appellate victory for mortgage holders. Last week, the U.S. Court of Appeals for the Eleventh Circuit upheld a ruling against mortgage servicer Ocwen Loan Servicing/PHH Mortgage Corporation, finding that the company violated the Fair Debt Collection Practices Act (FDCPA) by charging consumers optional fees of $7.50 to $12 for making expedited mortgage payments online or by phone.

This case resulted from a strategic, long-term approach by the litigation team to address split authority in district courts in the Eleventh Circuit and nationwide regarding whether the FDCPA prohibits loan servicers from collecting “pay-to-pay” or “convenience” fees for certain payment methods. The U.S. District Court for the Southern District of Florida ruled that the FDCPA does prohibit such fees and awarded judgment to plaintiffs Sheryl Glover and Cathy Booze.

When Ocwen/PHH appealed to the Eleventh Circuit, the Bailey Glasser team, alongside co-counsel from Tycko & Zavareei, leveraged prior success on this issue in the Fourth Circuit and received support from the Consumer Financial Protection Bureau as amicus curiae. During oral arguments in November, Ocwen faced tough questioning from the appellate panel. In its ruling issued on February 4, 2025, the court held: “Ocwen violated the FDCPA because it is a ‘debt collector’ who charged an ‘amount’ that was not ‘expressly authorized by the agreement creating the debt or permitted by law.’”

This decision strengthens Bailey Glasser’s ongoing efforts to hold financial institutions accountable for unlawful payment processing fees and further bolsters the team’s momentum in Pay-to-Pay litigation, providing key supplemental authority in multiple ongoing cases.

Read the full Eleventh Circuit opinion below.