Judge Denies Plaintiff’s MSJ, Partially Grants Defendant’s Motion in FDCPA Case Over Disputed Debt

It’s a situation that happens all-too-often in collection agencies across the country. A consumer, in this case through her attorney, submits a letter disputing the debt. But the information included in the letter doesn’t match anything the agency can find in its system. Turns out, the agency had the debt under a different last name for the consumer — she had since remarried after the debt was incurred — as well as a different address. When searching for the last four digits of the consumers’ Social Security number, the agency had more than 200 matches, and its software did not allow for more than one search criteria to be used at a time. So it put the dispute in a folder with other disputes it could not identify and waited to see if more information came in.

Looking at that information, a District Court judge in Indiana denied the plaintiff’s motion for summary judgment while partially granting a summary judgment motion from the defendant, and ruling that the defendant is not entitled to the bona fide error defense under the Fair Debt Collection Practices Act and that the plaintiff is only entitled to statutory damages.

A copy of the ruling in the case of Johnson v. Waypoint Resource Group can be accessed by clicking here.

The plaintiff claimed the defendant violated Sections 1692e(8) and 1692f of the FDCPA because it should have known the debt was being disputed. Judge Robert L. Miller, Jr. of the District Court for the Southern District of Indiana, identified that both parties claimed the other side should have done more to help fill in any blanks related to the dispute, but denied the defendant’s motion for summary judgment because it could have contacted the plaintiff’s attorney for more information.

“The essence of both parties’ arguments is that the other party should have done more,” Judge Miller wrote. “Waypoint doesn’t show that Ms. Johnson’s actions excuse its behavior or that a factfinder would be unreasonable to conclude that it should have known of the debt. Likewise, Ms. Johnson doesn’t show that Waypoint had a duty to contact her attorney or that a factfinder would be unreasonable to find that Waypoint should not have known about the debt. Neither party is entitled to summary judgment on these grounds.”

On the 1692f claim, Judge Miller did rule in favor of the defendant.

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