Debt Collection Regulations Apply To New York Attorneys

The New York Court of Appeals has held that debt collection laws apply to attorneys

Plaintiffs, law firms involved in debt collection, commenced this action in federal district court to challenge certain amendments to the New York City Administrative Code (Local Law 15) pertaining to debt collection activities. The Second Circuit certified for our review the issue of whether the Local Law is preempted by the State’s statutory authority to regulate the conduct of attorneys. We conclude that the Local Law is not preempted.

The local law governs the conduct of debt collection agencies.

the courts’ authority to regulate attorney conduct does not evince an intent to preempt the field of regulating nonlegal services rendered by attorneys. “Intent to preempt the field may ‘be implied from the nature of the subject matter being regulated and the purpose and scope of the State legislative scheme, including the need for State-wide uniformity in a given area'” (People v Diack, 24 NY3d 674, 679 [2014] [citations omitted]). Although the courts may have preempted the field of regulating attorney misconduct, that authority does not extend to all nonlegal aspects of attorney behavior, which can be governed by both civil and criminal law, including regulatory proscriptions. To the extent that the courts have exercised some authority over nonlegal services provided by attorneys (see Rules of Professional Conduct 5.7), the regulation in that area is not “so detailed and comprehensive so as to imply that” the field has been preempted…

The court answered one of two questions certified by the United States Court of Appeals for the Second Circuit, (Mike Frisch)