The Court of Appeals for the Third Circuit has ruled the plaintiff in a Hunstein Fair Debt Collection Practices Act case does not have standing to sue and has vacated a lower court’s dismissal of the case for a different reason and remanded the case back to state court in New Jersey where it was originally filed.
The Background: The plaintiff filed a class-action suit against the defendant in December 2021, alleging it violated the Fair Debt Collection Practices Act by using a third-party vendor to print and mail a collection letter to her.
- The plaintiff filed for bankruptcy protection three months later and did not disclose this suit.
- The defendant was able to use that to get a District Court judge to dismiss the case, which the plaintiff appealed.
The Ruling: While this appeal was pending, the Third Circuit issued its ruling in Barclift v. Keystone Credit Services, which held that a plaintiff alleging a Hunstein case against a defendant did not have standing to sue because she did suffer a concrete injury.
- In this case, the plaintiff’s claim “is deficient for substantially the same reason,” the Appeals Court wrote. Because the plaintiff only alleged that the defendant communicated information about her debt to an intermediary tasked with contacting her about the debt, and failed to mention any harm, including embarrassment, stress or invasion of her privacy, her case lacks an “identifiable trifle” of injury, the Appeals Court determined.
- Because there is no concrete injury, there is no basis to keep the case in federal court, the Appeals Court noted, and instructed the lower court to remand the case back to New Jersey state court, where it was originally filed.
