In a 5-3 decision, the Supreme Court held that the filing of a proof of claim that is obviously time barred in a chapter 13 case is not a false, deceptive, misleading, unfair or unconscionable debt collection practice within the meaning of the Fair Debt Collection Practices Act.
Midland Funding, LLC, a debt buyer, filed a proof of claim in a chapter 13 case. The claim indicated that the last time a charge was made on the account was more than 10 years before the debtor filed bankruptcy. The Debtor objected to the proof of claim, which was disallowed. The Debtor then sued Midland Funding for violating the FDCPA arguing that the filing of a stale proof of claim was false, deceptive, misleading, unfair or unconscionable within the meaning of the Act. The Court held that Midland Funding's stale claim is still a claim within the meaning of the Bankruptcy Code, albeit subject to dis-allowance based on staleness. See opinion here.