UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT

No. 20-2359

ASHLY ALEXANDER; CEDRIC BISHOP, On behalf of themselves individually and similarly situated persons,

Plaintiffs – Appellants, v. CARRINGTON MORTGAGE SERVICES, LLC,

Defendant – Appellee.

Appeal from the United States District Court for the District of Maryland, at Baltimore. Richard D. Bennett, Senior District Judge. (1:20-cv-02369-RDB)

Argued: December 8, 2021 Decided: January 19, 2022

Before WILKINSON, KING, and DIAZ, Circuit Judges.

Affirmed in part, reversed in part, vacated in part, and remanded by published opinion. Judge Wilkinson wrote the opinion, in which Judge King and Judge Diaz joined.

ARGUED: Hassan A. Zavareei, TYCKO & ZAVAREEI LLP, Washington, D.C., for Appellants. Fredrick S. Levin, BUCKLEY LLP, Santa Monica, California, for Appellee. ON BRIEF: Phillip R. Robinson, CONSUMER LAW CENTER, LLC, Silver Spring, Maryland; Dia Rasinariu, TYCKO & ZAVAREEI LLP, Washington, D.C.; Patricia M. Kipnis, BAILEY GLASSER LLP, Cherry Hill, New Jersey, for Appellants. Sarah B. Meehan, BUCKLEY LLP, Washington, D.C., for Appellee. WILKINSON, Circuit Judge:

Plaintiffs Ashly Alexander and Cedric Bishop brought this case as a class action against Carrington Mortgage Services, LLC. They alleged that Carrington violated the Maryland Consumer Debt Collection Act and the Maryland Consumer Protection Act by charging $5 convenience fees to borrowers who paid monthly mortgage bills online or by phone. Because Carrington, a collector, charged an amount that was not permitted by law, plaintiffs can proceed with some (but not all) of their claims. For the following reasons, we affirm in part, reverse in part, vacate in part, and remand for further proceedings consistent with this opinion.

I.

A.

The Maryland Consumer Debt Collection Act (MCDCA) and the Maryland Consumer Protection Act (MCPA) are remedial consumer protection statutes aimed at “protect[ing] the public from unfair or deceptive trade practices by creditors engaged in debt collection activities.” Andrews & Lawrence Pro. Servs. v. Mills, 223 A.3d 947, 950 (Md. 2020). The MCDCA prohibits debt collectors from engaging in an extensive list of practices, while the MCPA both functions as a “statutory enforcement umbrella” and contains its own prohibitions. Id.

Two provisions of the MCDCA are relevant in this case. First, “[i]n collecting or attempting to collect an alleged debt,” a “collector” may not “engage in any conduct that violates §§ 804 through 812 of the federal Fair Debt Collection Practices Act.” Md. Code Ann., Com. Law § 14-202(11). Maryland thus incorporates the substantive provisions of

2 the Fair Debt Collection Practices Act (FDCPA). One of those provisions, at issue here, is the FDCPA’s proscription on “[t]he collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.” FDCPA § 808, 15 U.S.C § 1692f(1). Section 14-202(11) contains no scienter requirement. Second, a “collector” may not “claim, attempt, or threaten to enforce a right with knowledge that the right does not exist.” Md. Code Ann., Com. Law § 14-202(8). The MCDCA defines “collector” to mean “a person collecting or attempting to collect an alleged debt arising out of a consumer transaction,” and a “consumer transaction” is “any transaction involving a person seeking or acquiring real or personal property, services, money, or credit for personal, family, or household purposes.” Id. § 14-201(b), (c).

The MCPA provides that “[a] person may not engage in any unfair, abusive, or deceptive tra