{"id":271753,"date":"2026-04-17T01:19:07","date_gmt":"2026-04-17T01:19:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ca\/271753\/"},"modified":"2026-04-17T01:19:07","modified_gmt":"2026-04-17T01:19:07","slug":"two-trade-associations-file-putative-class-action-in-california","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ca\/271753\/","title":{"rendered":"Two Trade Associations File Putative Class Action in California"},"content":{"rendered":"<p>On April 7, two trade associations and a licensed debt collector filed a putative <a href=\"https:\/\/edge.sitecorecloud.io\/sheppardmulb051-sheppard4091-prdcdbe-6fda\/media\/project\/sheppard\/sheppard\/attachments\/class-action.pdf\" data-uw-pdf-br=\"2\" data-uw-pdf-doc=\"\" rel=\"nofollow noopener\" target=\"_blank\">class action<\/a>\u00a0in the California Superior Court for the County of San Francisco alleging that the California DFPI\u2019s annual debt-collector licensing assessments violate the Debt Collection Licensing Act, Proposition 26, and the California Administrative Procedure Act. The complaint also alleges that the assessment scheme fails to provide a clear, adequately disclosed formula for calculating annual fees.<\/p>\n<p>The class action challenges DFPI\u2019s 2025 annual assessments for licensed debt collectors and seeks relief on behalf of a proposed class of about 1,243 licensees statewide. Specifically, the suit alleges that DFPI\u2019s fee regime is unlawful because:<\/p>\n<p>The annual assessments exceed reasonable regulatory costs. The complaint alleges the fees constitute unlawful taxes in violation of Proposition 26, which requires that state-imposed charges not exceed the reasonable cost of regulation and bear a fair relationship to each payor\u2019s burden on, or benefit from, the regulatory scheme. The suit alleges those charges are disproportionate and materially higher than comparable charges in other states.<br \/>\nThe assessment formula was not adequately disclosed. The suit alleges DFPI did not clearly explain the calculation methodology in its regulations or rulemaking materials.<br \/>\nThe advisory process was deficient. The complaint alleges DFPI did not meaningfully consult the Debt Collection Advisory Committee regarding the proposed fee schedule or the mechanics of implementation.<\/p>\n<p>Putting It Into Practice:\u00a0Recent California enforcement developments have continued to focus on whether companies are properly licensed to operate in the state\u2019s consumer financial services market (previously discussed <a href=\"https:\/\/natlawreview.com\/article\/dfpi-orders-mortgage-lender-pay-160000-alleged-unlicensed-mortgage-loan-originator\" data-uw-rm-vglnk=\"\" data-uw-rm-brl=\"PR\" data-uw-original-href=\"https:\/\/www.sheppard.com\/insights\/blogs\/dfpi-orders-mortgage-lender-to-pay-160000-for-alleged-unlicensed-mortgage-loan-originator-activity\" rel=\"nofollow noopener\" target=\"_blank\">here<\/a>, <a href=\"https:\/\/natlawreview.com\/article\/dfpi-imposes-1-million-penalty-crypto-kiosk-operator-alleged-digital-financial\" data-uw-rm-vglnk=\"\" data-uw-rm-brl=\"PR\" data-uw-original-href=\"https:\/\/www.sheppard.com\/insights\/blogs\/dfpi-imposes-up-to-1-million-penalty-on-crypto-kiosk-operator-for-alleged-digital-financial-assets-law-violation\" rel=\"nofollow noopener\" target=\"_blank\">here<\/a>, and <a href=\"https:\/\/natlawreview.com\/article\/dfpi-orders-crypto-lending-platform-pay-500000-alleged-unlicensed-lending-and\" data-uw-rm-vglnk=\"\" data-uw-rm-brl=\"PR\" data-uw-original-href=\"https:\/\/www.sheppard.com\/insights\/blogs\/dfpi-orders-crypto-lending-platform-to-pay-500000-for-alleged-unlicensed-lending-and-underwriting-failures\" rel=\"nofollow noopener\" target=\"_blank\">here<\/a>). The outcome of this case could affect how California structures licensing fees and assessments for debt collectors and other licensees going forward. Companies operating in the state should monitor the litigation and consider whether changes to licensing costs or related requirements could affect compliance planning.<\/p>\n","protected":false},"excerpt":{"rendered":"On April 7, two trade associations and a licensed debt collector filed a putative class action\u00a0in the California&hellip;\n","protected":false},"author":2,"featured_media":271754,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[7,9,8],"class_list":{"0":"post-271753","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-california","8":"tag-california","9":"tag-california-headlines","10":"tag-california-news"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/271753","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=271753"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/271753\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/271754"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=271753"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=271753"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=271753"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}