If you’re the second collection agency attempting to collect on a debt, are you responsible for the sins of the first? If the sin is not responding to a dispute notice and validation request, a District Court judge in Connecticut has ruled you’re not, granting a defendant’s motion for judgment on the pleadings because the plaintiff lacked standing to pursue her claim.
A copy of the ruling in the case of Faherty v. Rubin & Rothman can be accessed by clicking here.
The plaintiff incurred a debt that was placed with a collection agency. The agency sent the plaintiff a collection letter, to which the plaintiff responded, seeking documentation relating to the agency’s authority to collect on the debt. When the agency did not respond, the plaintiff sent two more letters asking for information to validate the debt.
A few weeks later, the creditor placed the account with the defendant, which sent a collection letter of its own.
The plaintiff filed suit, alleging the letter from the defendant violated Section 1692g(b) of the Fair Debt Collection Practices Act, because the plaintiff had disputed the debt within the 30-day timeframe and the defendant was obligated to cease collection efforts until the validation information was provided to the plaintiff.
Because the plaintiff took no action to pay the debt, the defendant argued she lacked standing to sue. The plaintiff argued that the letter from the defendant was so defective that it misled her to the point of choosing not to make any payments on the underlying debt. Ultimately, ruled Judge Alvin W. Thompson of the District Court for the District of Connecticut, an informational type of injury, like the one suffered by the plaintiff does not create standing.
“…the plaintiff also alleges only informational harm, i.e. the defendants confused and deceived her,” Judge Thompson wrote. “Although the plaintiff is correct that, to establish a concrete injury for purposes of Article III standing, ‘an ‘identifiable trifle,’ suffices,’ the plaintiff provides no authority for the proposition that informational harm, such as confusion or deception, is a legally cognizable injury under Article III.”