A District Court judge in Missouri has denied a defendant’s motion for summary judgment on claims it violated the Fair Debt Collection Practices Act by failing to correct inaccurate information it was furnishing to the credit reporting agencies, while granting the motion on claims it violated the Fair Credit Reporting Act, ruling the plaintiff did not establish that she suffered a concrete injury.
The background: The case was filed after the plaintiff discovered that a debt, which had been dismissed with prejudice as part of a legal settlement, continued to appear on her credit report. The plaintiff had originally entered into litigation with the defendant over two accounts. After reaching an agreement, a judgment of dismissal with prejudice was filed on December 30, 2022.
- Despite multiple disputes submitted to the credit reporting agencies, the inaccurate information persisted on her credit report. The CRAs repeatedly notified the defendant of the dispute, yet the accounts were verified as accurate and remained on the plaintiff’s report.
- The defendant’s employees failed to verify the status of the debts by consulting the outside law firm responsible for the litigation, which led to the continued reporting of the disputed accounts, according to the complaint. The plaintiff subsequently filed suit, alleging violations of both the FCRA and FDCPA, seeking actual, statutory, and punitive damages.
The ruling: Judge Henry Edward Autrey of the District Court for the Eastern District of Missouri ruled that the defendant was entitled to summary judgment on the FCRA claim, stating that the plaintiff failed to provide sufficient evidence of concrete injury. The plaintiff’s claim of emotional distress, including stress, anxiety, and depression, was unsupported by medical records or expert testimony. Judge Autrey found that self-reported claims of emotional distress were insufficient to demonstrate actual damages under the FCRA.
- However, the judge denied the defendant’s motion for summary judgment on the FDCPA claims. The court determined that genuine disputes of material fact remained regarding whether the defendant employed reasonable procedures to correct the disputed information.
- The plaintiff’s repeated efforts to dispute the debt and the defendant’s failure to adequately investigate raised questions suitable for trial. Judge Autrey noted that while the defendant argued that the errors stemmed from outside counsel’s failure to update internal records, the reasonableness of their investigation efforts remained in question, negating the defendant’s claim that it was entitled to the FDCPA’s bona fide error defense.
- “Whether it was reasonable for [the defendant] to fail to discover outside counsel’s error raises a genuine dispute of material fact,” Judge Autrey wrote.
