The United States Court of Appeals for the Sixth Circuit recently overturned a trial court order granting summary judgment in favor of the defendant over a consumer’s claim that the defendant had violated federal consumer law. fair debt collection practices.
In that decision, the Sixth Circuit held that while the defendant’s failure to properly identify himself in phone calls confused the plaintiff and led him to send a cease and desist request to the wrong entity, confusion in itself does not establish “prejudice for the purposes of Article III.
Therefore, the Court held that the consumer had not suffered “more than a mere procedural violation of the FDCPA” as required to establish the necessary standing to pursue his claims.
A copy of the notice in Ward v. Nat’l Patient Account Serv. is available on: Link to Opinion.
The consumer incurred medical expenses after treatment with a medical provider. The supplier hired a company to collect the debt. The collection company reportedly left several voicemail messages while attempting to collect the debt.
The consumer filed a complaint alleging claims against the collecting company (“defendant”) under the FDCPA resulting from the alleged voicemail messages where the defendant did not identify himself precisely. The consumer claimed that the defendant’s failure to accurately provide his correct legal name confused him. Due to this confusion, the consumer would have sent a cease and desist letter to the wrong entity.
Specifically, the consumer claimed that the defendant had violated Article 1692d (6) of the FDCPA, which provides that a “debt collector may not engage in any behavior the natural consequence of which is to harass, oppress or abuse any person in connection with the collection of a debt[,]”, Including“ making telephone calls without meaningful disclosure of caller ID ”.
The consumer also claimed that the defendant had violated section 1692e (14), which provides that a “debt collector may not use any false, deceptive or deceptive representation or means in connection with the collection of any debt.[,]”including” us[ing] any business, company or organization name other than the real name of the business, company or organization of the debt collector.
The defendant sought summary judgment arguing that he did not meet the definition of a debt collector under the FDCPA, and the trial court allowed the petition. This call followed.
On appeal, the respondent argued that the consumer lacked standing under Article III. Although the defendant did not raise this issue with the trial court, the Sixth Circuit observed that it had an independent obligation to determine its jurisdiction to hear an appeal.
As you may recall, standing requires that the “plaintiff must have (1) suffered prejudice in fact, (2) which is somewhat attributable to the contested conduct of the defendant, and (3) which is likely to be remedied by a Judicial Decision. “The onus is on the plaintiff to set out the facts which demonstrate standing.
The issue in this appeal was whether the plaintiff had suffered prejudice in fact. This requires that “the injury must be (1) specific and (2) concrete”. The dispute here revolved around the question of whether the consumer had suffered concrete damage.
The consumer claimed to have suffered concrete harm for two reasons. First, he argued that the violation of his procedural rights under the FDCPA established tangible harm. Second, he claims that the confusion caused by the telephone calls and the expenses of the lawyer he retained demonstrates that he suffered concrete prejudice.
The Sixth Circuit observed that in TransUnion LLC v. Ramirez, the United States Supreme Court recently clarified what is required to demonstrate that a violation of a procedural right has established concrete harm and, therefore, the plaintiff “must demonstrate either that the procedural harm itself is tangible harm of the kind traditionally recognized or that procedural violations have caused independent tangible harm. After conducting this investigation here, the Sixth Circuit concluded that the consumer did not have standing to pursue his alleged Article III claims.
As a result of the alleged violations of the FDCPA, the consumer argued that the FDCPA created an enforceable right to know who is calling about a debt because the defendant’s failure to correctly provide their full legal name caused them to concrete damage. The consumer further argued that this harm is closely related to the invasion of privacy that most states recognize.
The Sixth Circuit rejected the consumer’s argument because the defendant’s alleged failure to disclose his full legal name does not resemble traditional prejudice “considered to provide a basis for legal action”, as required to establish prejudice. concrete.
The Sixth Circuit recognized that most states recognize actions aimed at upholding the right to privacy, including “the offense of trespassing on the right to seclusion.” However, the Court noted that not receiving full and complete information about a defendant’s name does not closely resemble the trespassing offense, as this common law trespass usually requires proof. that the defendant “intentionally intruded[d], physically or otherwise, about another’s loneliness or isolation or their privacy affairs or concerns. “
The alleged harm to the consumer did not affect his privacy. Instead, it just confused him. The defendant did not share his private information with any third party or make his private information public. Thus, the Sixth Circuit concluded that the harm alleged by the consumer was “not closely related to traditional harm” and that the consumer could not establish a position based solely on the alleged violations of the law.
The consumer put forward several additional reasons for which he suffered concrete harm as a result of the alleged violation of the law. First, the consumer claimed that the defendant’s failure to properly identify himself in phone calls confused him and caused him to send a cease and desist request to the wrong entity. The Sixth Circuit rejected this argument because confusion in itself does not establish “concrete injury for the purposes of Article III”.
The consumer then argued that he had retained the services of a lawyer to stop the calls and that this action constituted tangible harm resulting from the violation of the law. The Sixth Circuit disagreed that the cost of hiring a lawyer establishes tangible harm, as applying this “logic to any claimant who hires a lawyer to positively pursue a claim would nullify the claims. limits created under Article III “.
Finally, the consumer argued that an additional call he received after sending his cease and desist letter to the wrong entity actually caused him harm. The Sixth Circuit declined to consider this argument because the consumer did not clearly allege in his complaint that he received another phone call after the cease and desist letter was sent or that this additional call to him. had caused harm.
Thus, the Sixth Circuit ruled that the consumer had not demonstrated that he had suffered “more than a simple procedural violation of the FDCPA” and that he had no standing to assert his claims under the Article III. Therefore, the Sixth Circuit overturned the trial court’s order granting summary judgment and remitted the case to be dismissed without prejudice for lack of jurisdiction in the matter.