I will freely admit that there are a lot of people who have been following Fair Debt Collection Practices Act caselaw for a lot longer than I have, but, for my money, Judge Brian Cogan of the District Court for the Eastern District of New York might have the most honest and blunt assessment of the state of FDCPA lawsuits that I have seen. Granted, the ruling in question is arguably better for the plaintiffs than the defendants, but you have to tip your hat to the guy for being so direct.
A copy of the ruling in the cases of Friedman v. Cavalry Portfolio Services and Deutsch v. Allied Account Services can be accessed by clicking here.
The cases were consolidated because both plaintiffs were represented by the same law firm and both made the same allegations against the defendant involving an alleged FDCPA violation after receiving a collection letter from the defendant. Both cases were originally filed in state court and then removed to federal court by the defendants. Judge Cogan then stepped in and asked both sides to show cause why the plaintiffs had standing to sue in federal court. The plaintiffs declined to claim standing, but the defendants attempted to make their cases. Unfortunately, the “boilerplate, cookie-cutter assertions that any plaintiff could make should they receive a non-compliant collection letter” are “too vague to demonstrate standing,” Judge Cogan ruled.
The injuries alleged by the plaintiffs were:
Because of the Defendant’s actions, the funds the Plaintiff could have used to pay all or part of the alleged debt were spent elsewhere.
- Because of this, Plaintiff expended time and money in determining the proper course of action.
- In reliance on the Letter, Plaintiff expended time and money in an effort to mitigate the risk of future financial harm in the form of dominion and control over his funds.
- Plaintiff’s reliance on the Letter, and the resulting inaction/non-payment, was detrimental to the Plaintiff because of the lost opportunity to settle the alleged debt at a discount.
The plaintiffs also claimed to have suffered from “emotional and physical harm because of the Defendants’ improper acts, including, but not limited to, fear, anxiety, stress, increased heartrate, and difficulty with sleep,” the complaint alleges.
“The reason these allegations can be repeated across cases in cookie-cutter complaints is that they don’t really mean anything and can rarely be disproven,” Judge Cogan wrote. “Did their heart rate go up for more than a second? Did either plaintiff actually measure his heart rate? Did either plaintiff have to see a doctor? Did they have to get a prescription for a sleeping pill? The most likely answers to these questions are strongly suggestive that there was no injury in fact; at the very least, the vagueness of the allegations ‘without some further factual enhancement … stop short of the line between possibility and plausibility.”
The “remarkable uniformity” of “boilerplate” allegations that are so common in FDCPA complaints speaks to the “dozens if not hundreds of these cases on behalf of different plaintiffs who all seem to have the exact same injury” that are brought by plaintiffs’ attorneys for one reason alone, Judge Cogan notes.
“And no one should fool themselves into thinking that when it comes time to settle these cases (virtually all of them are either dismissed on motion or settle), there is any real discussion about compensating a plaintiff for an injury he has suffered,” he wrote. ” ‘Judicial experience and common sense,’ tell us that the settlements in these cases are about mitigating defense costs and the prospect of plaintiffs’ counsel receiving an attorneys’ fee. No doubt, plaintiffs who bring these cases receive some compensation for having lent their name to the endeavor, but there is no reason to conclude it is anything but nominal. That is why plaintiffs’ counsel, in this case and others, is not apprehensive about abstaining from the issue of whether there is an injury-in-fact, despite the potential overlap between that issue and a lack of damages. They are just as happy to be in state court and avoid the Article III motion practice. They know that when it comes down to resolving these cases, an inability to show damages is not what the settlement discussion is going to be about.”