Judge Grants MSJ for Defendant in FDCPA Case Over Differing Amounts in Letter; Dispute Response
Virginia Bell Flynn, a partner in Troutman Pepper's Consumer Financial Services Practice Group, was quoted in the February 19, 2024 AccountsRecovery.net Compliance Digest article, " Judge Grants MSJ for Defendant in FDCPA Case Over Differing Amounts in Letter; Dispute Response."
In Linnabary v. Sequium Asset Sols., Plaintiff accused defendant of violating the FDCPA by sending debt collection and validation letters containing conflicting balances. On summary judgment the court found that defendant did not misrepresent the amount of the debt by listing two different balances because the defendant was not required to show detailed files of the debt, bills, or other evidence to satisfy its debt validation obligations. Further, the least sophisticated debtor would understand that the smaller amount listed in defendant's validation response represented the total amount owed and the larger amount represented the amount owed three months prior.
Businesses should still be wary of sending supporting statements that do not align with balances contained in debt validation responses. Although on summary judgment, the court rejected plaintiff's argument that defendant misrepresented the debt owed, such conflicting evidence will still constitute sufficient "informational injury" under Article III standing requirements, in which a plaintiff is denied information to which he or she was legally entitled and the denial caused adverse consequences. Here, the court found that Plaintiff's testimony of certain intangible harms she suffered from the miscommunication — including failing to pay the debt or take appropriate action, suffering from emotional distress, feeling upset, fighting with her spouse, losing time, and purchasing Tylenol — all qualified as sufficient injuries that satisfy Article III standing requirements.