A District Court judge in Indiana has adopted a Magistrate Judge’s Report and Recommendation that grants summary judgment in favor of a plaintiff who sued a collection agency for violating the Fair Debt Collection Practices Act for sending a letter to the plaintiff after she had communicated that she was refusing to repay the debt. The judge rejected the defendant’s argument that it was entitled to the FDCPA’s Bona Fide Error defense.
A copy of the ruling in the case of Hammock v. Landmark Accounts can be accessed by clicking here.
If nothing else is taken away from this case, let it be this: the plaintiff has one of the all-time greatest names in FDCPA case law history: Windy Hammock. She received a collection letter from the defendant attempting to collect on an unpaid medical debt. The plaintiff sent a letter back to the defendant, indicating she was refusing to repay the debt. About a year later, the defendant sent another letter to the plaintiff, trying to collect on the debt again. The plaintiff filed suit, alleging the second letter violated Section 1692c(c) of the FDCPA by communicating with a debtor after the debtor has provided written notice of refusal to pay a debt. The defendant acknowledged the plaintiff’s allegations, but attempted to invoke the Bona Fide Error defense to help its case.
The problem for the plaintiff, according to both the Magistrate Judge and Judge James Patrick Hanlon of the District Court for the Southern District of Indiana, Indianapolis Division, is that the defendant did not provide enough evidence that it was entitled to the BFE defense, specifically that it “did not show that it maintained procedures reasonably adapted to prevent the delivery of the post-refusal letter.”
The defendant pointed to testimony during a deposition and an affidavit from an employee that she receives newsletters, magazines, and a daily email with updates to FDCPA procedures, and that its collectors were trained to “discover any discrepancies” between new and old accounts belonging to the same debtor, but acknowledged that the systems it used were not set up properly. Such a “thinly specified ‘policy'” is not sufficient enough to allow the defendant to use the BFE defense, the judge ruled.
