Judge Grants MSJ in FDCPA Case Over Missed Dispute Notification

A District Court judge in Arizona has granted a defendant’s motion for summary judgment and agreed to entertain the defendant’s request for its attorney fees and costs to be covered by the plaintiff in a Fair Debt Collection Practices Act case in which the plaintiff was attempting to hold the defendant liable for the inaction of a credit bureau.

A copy of the ruling in the case of Navarro v. Portfolio Recovery Associates, LLC can be accessed by clicking here.

In reviewing his credit report, the plaintiff noted the defendant had reported a delinquent account. The plaintiff contacted the defendant and disputed the debt. The defendant subsequently reported an XB condition code to the credit bureaus. Upon concluding its investigation and determining the debt was valid, the defendant notified the plaintiff and began reporting an XC condition code to the credit bureaus. An XB code denotes an account is in dispute and an XC code denotes that the investigation has concluded and the consumer disagrees with the outcome.

Three weeks before filing his lawsuit, the plaintiff entered into a payment plan arrangement with the defendant. After entering into the payment plan, the plaintiff obtained his credit report and noticed that one of the credit bureaus was still reporting the debt as delinquent. The plaintiff made his first payment on the same day he filed his lawsuit against the defendant. The lawsuit claimed the defendant violated Section 1692e(8) of the FDCPA by failing to communicate that a debt had been disputed.

But the defendant had communicated the debt had been disputed. It was the credit bureau — Experian, in this case — which may have failed to mark the debt as disputed. The defendant, the judge ruled, could not be held accountable for “Experian’s possible deficiencies.”

To make its argument, the defendant submitted a declaration from its vice president of complaints and disputes indicating it did what it was supposed to when reporting the debt as disputed and then reporting the investigation had concluded but the consumer disagreed with the outcome.

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