Ferguson v. Skrupa

372 U.S. 726 (1963)

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Nature of the Case

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Facts

A Kansas state statute prohibits the practice of 'debt adjustment' which wherein a third party intervenes in a contractual arrangement to intercept installment payments from a debtor and present them to the creditor for a fee. Respondent Skrupa initiated an injunctive relief to enjoin the application of the statute, asserting that its business, 'Credit Advisors,' is a 'debt adjuster' under the definition of the statute but its business participated in honest transactions. The Respondent claimed its business was not 'inherently immoral or dangerous' and therefore, should not come under the purview of the statute. The Respondent maintained that the law infringed its Due Process rights under the Fourteenth Amendment. The district court held in favor of the Respondent. The U.S. Supreme Court reversed.