Judge Grants MTD in FDCPA Case Over Attorney’s Fees

Being confused about whether he owed attorney’s fees and hiring his own lawyer is not enough for a plaintiff to have standing to pursue a Fair Debt Collection Practices Act case, a District Court judge in Illinois has ruled, granting the defendant’s motion to dismiss on the grounds that the Court lacked subject matter jurisdiction because the plaintiff lacked standing to sue.

A copy of the ruling in the case of Choice v. Unifund CCR can be accessed by clicking here.

The plaintiff was sued by the defendant for an unpaid credit card debt, as well as costs and statutory attorney’s fees. But in an affidavit that was attached to the complaint, the defendants specifically said they would not be seeking attorney’s fees. In fact, they were barred from doing so under state law. An arbitration award in the case also did not include attorney’s fees. Nonetheless, the plaintiff claimed he was confused to the point where he hired a lawyer to figure out whether he owed attorney’s fees or not.

The plaintiff filed suit, alleging the defendant violated the FDCPA because he was deprived of truthful information that may have led him to decide to pay the debt rather than litigating it. Had he known for sure he was not being charged attorney’s fees, the plaintiff claims he would have paid the debt.

But, as the Seventh Circuit Court of Appeals has repeatedly pointed out in recent months, confusion alone is not enough to justify moving forward with a lawsuit in federal court. The plaintiff must allege that he took some detrimental step, like paying attorney’s fees. Precedent in the Seventh Circuit also dictates that hiring a lawyer is not enough to confer standing to sue.

Even the plaintiff’s claim that he lost sleep was not enough, ruled Judge Sharon Johnson Coleman of the District Court for the Northern District of Illinois.

“Plaintiff essentially argues that he has standing because defendants’ claims in state court for attorney’s fees could have led him to pay such fees,” Judge Johnson Coleman wrote. “This argument implies a complete distrust in the court system; plaintiff assumes the state court would have completely disregarded the law and forced him to pay fees that were not owed. The risk of a court forcing plaintiff to pay attorney’s fees was incredibly minimal, the arbitrator in the state court case correctly refused to award attorney’s fees, and plaintiff admitted in discovery that he did not actually pay any attorney’s fees.”

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