Judge Grants MTD on Remanded Case Over Lack of Standing

A District Court judge in Ohio has granted a defendant’s motion to dismiss a Fair Debt Collection Practices Act case because claiming statutory damages is not enough of a concrete injury for the plaintiff to have standing to sue.

A copy of the ruling in the case of Portnoy v. National Credit Systems can be accessed by clicking here.

The plaintiffs filed suit, accusing the defendant of violating Sections 1692e and 1692f of the FDCPA by attempting to collect a debt that was not expressly authorized under the original agreement between the creditor and the plaintiff and misrepresenting the character, amount, or legal status of the debt. The plaintiffs moved out of their apartment before their lease expired and the defendant sent them a collection letter attempting to collect the remaining balance.

The defendant won a summary judgment motion initially, which the plaintiffs appealed to the Sixth Circuit Court of Appeals. The Sixth Circuit reversed the District Court’s decision based on the fact that the amount being sought was not expressly authorized by the lease, and remanded the case back to the District Court.

While this case was progressing through the legal system, the Supreme Court issued its ruling in TransUnion v. Ramirez, which the defendant used to argue that the plaintiff no longer had standing to sue and that the case should be dismissed.

Judge Michael R. Barrett of the District Court for the Southern District of Ohio, agreed with the defendant.

Claiming that they owed more than they actually did is nothing more than a “bare procedural violation” of the FDCPA and did not induce the plaintiffs to do anything other than file their lawsuit. In fact, the plaintiffs have testified that the letter did not cause any financial loss, property loss, or even mental or physical harm.

“As Plaintiffs fail to establish that the procedural violation that they assert bears a close relationship to a traditional harm recognized by American courts or that the procedural violation caused an independent injury, the Court finds that Plaintiffs cannot demonstrate a concrete harm and thus an injury in fact, and therefore cannot demonstrate standing based on the alleged FDCPA violation alone,” Judge Barrett wrote.

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