A California Appeals Court has overturned a lower court’s ruling in favor of a debt buyer, ruling that any individual who pleads that a company violates the state’s Fair Debt Buying Practices Act has standing regardless of whether the individual suffered any harm. In the decision, the Sixth District Court of Appeal concluded that the statute itself grants consumers the right to sue for violations of its requirements, even when the violation results in no concrete injury.
The background: The case arose after the defendant purchased a charged-off consumer credit account from the original creditor and attempted to collect the debt through a collection agency. The defendant sent the plaintiff a written collection notice that included the disclosures required under California’s Fair Debt Buying Practices Act, including a notice informing the consumer of the right to request documentation related to the debt.
- The plaintiff’s issue was not whether the notice was provided. Instead, he alleged that the notice was printed in a font size smaller than the 12-point type size required by the statute. The plaintiff filed a class action asserting that this technical violation of the Act entitled him and other consumers to statutory damages.
- The defendant responded by filing a motion for judgment on the pleadings, arguing that the plaintiff lacked standing because he had not alleged any concrete injury or actual harm caused by the font size of the notice. The trial court agreed with that argument and dismissed the case, reasoning that a plaintiff must show some actual injury to pursue the claim.
The ruling: The appellate court disagreed with the trial court and reversed the dismissal. The court emphasized that the language of the Fair Debt Buying Practices Act allows consumers to enforce violations of the statute even if they did not suffer measurable harm.
- The court pointed directly to the statute’s damages provisions, which allow individuals to recover statutory damages between $100 and $1,000 for violations. According to the court, that structure indicates the Legislature intended to allow enforcement of the statute even when no actual damages occurred.
- As the court explained, the statute “expressly authorizes consumers who receive noncompliant collection letters to sue for the violation of their statutory rights, and nothing in the statute suggests that any injury beyond the noncompliance is required to impose civil liability.”
- The appellate panel also rejected the defendant’s attempt to distinguish the case from prior California decisions involving missing disclosures. The court noted that the statute imposes liability for “any” violation of the Act, and printing the notice in a smaller font still constitutes a violation of the statutory requirements.
