Judge Denies Plaintiff’s MSJ Because Defendant Failed to Plead BFE Defense

If a defendant does not invoke the bona fide error defense when accused of violating the Fair Debt Collection Practices Act, does that mean it admits to have violating the statute? That is the argument that was made by one plaintiff who was seeking a partial motion for summary judgment, only to have to denied by a District Court judge in Washington.

A copy of the ruling in the case of Perno v. Enhanced Recovery Co. can be accessed by clicking here.

The defendant attempted to collect an unpaid cable debt from the plaintiff in the amount of $786.68 and reported the debt to the credit reporting agencies. Three years later, for an unspecified reason, the creditor recalled the account and the defendant asked the credit reporting agencies to delete the item from the plaintiff’s credit report. A couple months later, the plaintiff checked his credit report and saw the unpaid debt — in the amount of $787.00 — was on his credit report. The plaintiff was turned down for a job with a credit union because of the item on his credit report. He contacted the original creditor, which apparently told the plaintiff it could not find an account in his name that was referred for collection.

The plaintiff filed suit, alleging the defendant violated Section 1692e of the FDCPA because the amount of the debt that was on his credit report was 32 cents higher than the actual amount of the debt. He then filed for a partial motion for summary judgment, claiming that because the defendant did not plead the bona fide error defense, it meant the he was entitled to judgment as a matter of law as to the defendant’s liability.

But Judge Salvador Mendoza, Jr. of the District Court for the Eastern District of Washington had little trouble dismantling the plaintiff’s argument. “The Court has little trouble in concluding that inflating an account balance by 32 cents is not a materially false representation,” he wrote. “To the contrary, it is a ‘mere technical falsehood that mislead[s] no one.’ “

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