A company collecting its own charges is usually not a 'debt collector' under the FDCPA, and to sue one you need specific facts showing collection is its main business or that it collects for others.
The originator exclusion in 15 U.S.C. § 1692a(6)(F)(ii) applies only to a person who (1) collects debts for another and (2) originated the debts; but the plaintiffs did not plausibly allege that the parking operator was a debt collector under either the principal-purpose or regularly-collects-for-another definition, so dismissal with prejudice was affirmed.
- Case
- Frankfort v. Metropolis Technologies, Inc.
- Citation
- No. 25-11168 (5th Cir. Oct. 2, 2026)
- Court or agency
- U.S. Court of Appeals for the Fifth Circuit
- Date
- October 2, 2026
- Precedential
- Yes (published)
- Law
- FDCPA
Summary
Drivers who received 'Notice of Parking Violation' fines from gateless Metropolis garages in Dallas and Houston sued under the FDCPA. The Fifth Circuit held the district court misread the originator exclusion, but affirmed dismissal because the complaint did not plausibly allege Metropolis was a debt collector.
Background
Metropolis Technologies runs gateless, attendant-free parking garages. Cameras record license plates on entry and exit, and drivers are supposed to pay by scanning posted QR codes. If they do not, Metropolis mails a “Notice of Parking Violation” demanding the parking charge plus a much larger fine.
Curtis Goodban parked for 16 minutes at a Metropolis garage on Akard Street in Dallas, owed $5, and was fined $75.25. Todd Frankfort parked at a Metropolis-operated hospital garage on Fannin Street in Houston, owed $9, and was fined $30.25. They filed a putative class action in the Northern District of Texas under the FDCPA, the Texas Debt Collection Act, and the Texas Deceptive Trade Practices Act, alleging a “Violation Fine Scheme” in which payment signs are deliberately inconspicuous.
The district court dismissed the FDCPA claim with prejudice, holding that Metropolis fell within the exclusion for debts it originated, and declined jurisdiction over the Texas claims.
What the court held
The panel (Judges King, Smith, and Ramirez; opinion by Judge King) affirmed, but on different grounds. (The parties did not dispute whether the fines were “debts,” so the court assumed they were.)
The originator exclusion is narrower than the district court thought. The FDCPA excludes from “debt collector” a person collecting a debt “owed or due . . . another” to the extent the debt “was originated by such person.” Relying on Henson v. Santander (2017), the court held that “for a debt collector to successfully invoke the originator exclusion, it must (1) collect debts for another and (2) have originated the debts.” Because the exclusion is like an affirmative defense, a defendant cannot win a motion to dismiss on it unless the complaint itself shows both conditions. The same reasoning applies to the not-in-default exclusion.
But the complaint did not show Metropolis was a debt collector. Under the principal-purpose definition, the plaintiffs’ own allegations described Metropolis as a parking-technology company that owns or operates garages, which “establishes only that debt collection is some part of” its business. Under the regularly-collects-for-another definition, allegations that Metropolis partners with property owners and maximizes their revenue did not plausibly show it collects fines on their behalf.
No second chance to amend. The plaintiffs made only a one-line request to amend at the end of their briefs without saying what new facts they would plead. Under circuit precedent, that “bare bones request” was not enough, so dismissal with prejudice stood.
Our take
The clarification about the originator exclusion is helpful to consumers: a company cannot escape the FDCPA at the pleading stage just by showing it originated a debt. But the result shows how hard it is to bring FDCPA claims against businesses that collect their own charges, such as parking operators, landlords, or medical providers billing directly. The FDCPA was written mainly for third-party collectors and debt buyers.
The decision is recent, and further proceedings (such as a rehearing petition) are possible.
What it means if you’re sued in Texas
If a business is demanding fines or fees you think are unfair, the FDCPA may not be the right tool unless the business is a collection agency, debt buyer, or collects for someone else. The Texas Debt Collection Act defines “debt collector” more broadly, as any person who directly or indirectly engages in collecting consumer debts, so it can reach creditors collecting their own consumer debts. Contract and consumer-protection defenses may also apply. If you are sued over such charges, make the business prove the charge is authorized and the amount is correct. A free case review is available if you want help sorting out which laws apply to you.
Takeaway
Before filing an FDCPA claim against a business, confirm it fits the statute's definition of 'debt collector'; the Texas Debt Collection Act may still reach creditors who collect their own consumer debts.
Sources
Primary authority
This summary and analysis are general information, not legal advice. Later decisions, amendments or agency actions may change the law; check the current status before relying on it.