The Eleventh Circuit Court of Appeals has upheld a lower court’s dismissal of the counts of a lawsuit that alleged a financial services organization violated the Fair Debt Collection Practices Act by reporting a debt to a credit bureau using a different name other than its own, but overturned the counts that alleged the company violated the Fair Credit Reporting Act by willfully failing to investigate repeated disputes by the plaintiff.
A copy of the ruling in the case of Pinson v. JPMorgan Chase can be accessed by clicking here.
The plaintiff obtained a copy of his credit report, which included a tradeline that he had a past-due amount with Chase Home Finance. The plaintiff, who was behind on his mortgage payments owed to JPMorgan Chase, repeatedly disputed the debt, both with the credit bureau and with Chase. Chase allegedly never responded and the credit bureau always responded that the debt would continue to appear on the plaintiff’s credit report.
The plaintiff filed suit, alleging the defendant violated the FDCPA by attempting to collect on a debt using a name different than its own and violated the FCRA by failing to investigate the accuracy of the information it was providing to the credit bureau and for obtaining his credit report without a permissible purpose.
A District Court judge dismissed the suit for failure to state a claim. The plaintiff appealed the ruling.
Applying the least sophisticated consumer standard, the Appeals Court determined that anyone would know that Chase Home Finance and JPMorgan Chase were “related entities” seeking the same objective — to collect on his mortgage.
“Because he took out a home mortgage with JPMorgan Chase, Mr. Pinson’s perception of Chase Home Finance as a third-party debt collector rises to the level of idiosyncratic,” the Appeals Court wrote.
Both the plaintiff and the defendant sought bright-line tests to avoid FDCPA liability — the plaintiff wanted creditors to use the exact name while the defendant argued that using any part of its name should suffice — but the Appeals Court demurred.
The issue with the FCRA claims, however, was not so cut-and-dried to the Eleventh Circuit. The Appeals Court ruled that it was plausible that the defendant “willfully failed to comply” with the FCRA’s investigation requirement and remanded the case back to the District Court for further proceedings.
