New Bill Exempts Debt-Collecting Attorneys from FDCPA Rules, Shields Lawyers from Federal Lawsuits Over Court Actions

The “Restoring Court Authority Over Litigation Act of 2025” is a piece of legislation that sounds like it’s just about court procedure, but it could seriously change how consumers interact with the legal system, especially around debt collection. The core of this bill is simple: it wants to make sure that federal agencies and private citizens can’t sue or regulate lawyers for things they do while they’re actively litigating a case. It’s a major push to re-center the authority over attorney conduct back to state courts and their disciplinary boards, where it traditionally resided.

The Federal Agency Timeout

Right now, if a lawyer is doing something shady in court that violates a federal rule—say, a rule enforced by the Consumer Financial Protection Bureau (CFPB)—that federal agency might be able to step in. This bill slams the door on that. Section 3 explicitly states that no federal agency can supervise, enforce rules on, or regulate the “litigation activities” of attorneys or law firms. This means that when a lawyer is filing papers, sending discovery requests, or communicating in connection with a lawsuit, they are essentially shielded from federal oversight. The argument is that these activities are already covered by state bar rules and court sanctions, but for consumers, this removes a layer of federal protection and monitoring.

No More Suing the Opposing Lawyer

Perhaps the biggest change for everyday people is the elimination of a private right of action against opposing counsel. If you are in a lawsuit and you feel the lawyer on the other side engaged in misconduct or violated a technical rule during the litigation—even if you think it harmed your case—you generally won't be able to sue that lawyer in federal court for damages related to those actions. The bill aims to stop lawyers from being sued by opposing parties just for doing their jobs in court. While this might reduce frivolous lawsuits between legal teams, it also removes an avenue for individuals to seek recourse if they feel genuinely wronged by an attorney’s in-court behavior that might violate a federal statute, forcing them to rely solely on the state bar disciplinary process, which rarely results in compensation for the injured party.

The Debt Collection Loophole

This bill makes very specific changes to the Fair Debt Collection Practices Act (FDCPA), and this is where it hits home for anyone dealing with medical bills, credit card debt, or student loans. Currently, the FDCPA is the main federal law protecting consumers from abusive debt collection practices. Thanks to a 1995 Supreme Court ruling, lawyers involved in debt collection were considered “debt collectors” and had to follow the FDCPA rules. This bill reverses that. Section 4 amends the FDCPA to explicitly exclude licensed attorneys and law firms from the definition of a “debt collector” when they are engaged in litigation to collect a debt for a client.

What does this mean for you? If a debt collector calls you, they are still bound by the FDCPA—they can’t call you at weird hours or harass you. But if that debt collector hires a law firm to sue you, that law firm, acting as a litigator, would no longer be bound by the same FDCPA rules. This creates a potential loophole where the strongest federal consumer protections against unfair practices might disappear as soon as a collection effort moves from a collection agency to a law firm filing suit, shifting the burden entirely to state-level consumer protection laws and court rules.