Appeals Court Upholds $150k Ruling Against Defendant in FDCPA Case

The Court of Appeals for the Eleventh Circuit has upheld a ruling in favor of the plaintiffs in a Fair Debt Collection Practices Act case, saying the argument raised by the defense is “too little, too late,” and that the defendant remains responsible for nearly $150,000 in damages and attorney’s fees.

A copy of the ruling in the case of Cross v. can be accessed by clicking here.

The defendant filed a lien against the plaintiffs’ home and a collection lawsuit after an erroneous homeowner association fee was assessed and placed with the defendant for collection. The defendant allegedly “repeatedly called” the plaintiffs and attempted to settle the debt, making calls even after one of the plaintiffs said they were represented by an attorney. The defendant voluntarily dismissed its collection lawsuit.

The plaintiffs sued the defendant, alleging it violated the FDCPA and the Georgia Fair Business Practices Act. The defendant did not file a reply nor made any appearance until after a Magistrate Court judge issued a report and recommendation awarding the plaintiffs a default judgment and assessing more than $147,000 in fees and damages, partially thanks to a clause in the GFBPA that allows for damages to be trebled.

The defendant filed a motion to set aside the default, arguing that the service or process was insufficient, but that was deemed to lack merit and the court granted judgment in favor of the plaintiffs.

In its appeal, the defendant argued the District Court should have considered its argument that the plaintiffs’ claim was barred by the statute of limitations, but the defendant needed to raise that argument sooner, the Appeals Court ruled. “If the district court had allowed the belatedly asserted affirmative defense at that point in the proceedings, it would have unfairly prejudiced the plaintiffs,” it wrote.

The defendant also argued that the damages it was assess were excessive and should be lowered. That argument was also not persuasive.

“Equity Experts waged a long-term collection campaign against the Crosses based on a debt they did not owe, and the Crosses testified that the debt collector’s conduct caused them emotional distress, including embarrassment and frustration,” the Appeals Court wrote. “They faced multiple coercion tactics and resulting problems: a lien on their home; a state court collection lawsuit; direct collection calls while they were represented by counsel and the state court litigation was pending; loss of neighborhood amenities; and interference with a home equity loan that would have enabled them to pay off a high-interest credit card debt. In awarding the Crosses $30,000 in emotional distress damages, the court accounted for the injuries to
both plaintiffs with a single damage award, which is effectively $15,000 per individual plaintiff. Far greater damages awards based on a single plaintiff’s emotional distress have been upheld.”

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