A District Court judge in Washington has granted partial summary judgment to a plaintiff on his Fair Debt Collection Practices Act claims, ruling that a debt collector’s letters claiming to enclose “validation” of a debt were misleading and unfair when the collector knew the original creditor had never provided proof the debt existed.
The background: The dispute started when the plaintiff moved out of an apartment he believed he had left in good standing.
- Nearly two years later, the plaintiff discovered that the defendant, a debt collection agency, had placed an adverse entry on his credit report claiming he owed more than $800 to the apartment complex. He had never received any notice from the complex about an outstanding balance.
- The plaintiff disputed the debt through the credit bureaus but received only a letter stating the debt was “confirmed,” with no explanation of how. The collector’s own internal notes coded the account as one where the client “did not provide proof.”
- During a call, a representative told the plaintiff, “you’re the only person that this impacts. We would like to prevent further collection action, but the only way we can do that is by getting this paid.” The representative also said a notice had been mailed, but to an address where the plaintiff had lived before he ever moved into the complex.
- Over the next two years the collector sent letters it described as enclosing “validation of debt,” and the balance grew from $822.37 to $979.83 after interest was added. Only after the plaintiff complained to the state attorney general and a state licensing board did the collector write that its client “was unable to provide the documentation requested,” cancel the account, and ask to delete the tradeline.
- The plaintiff then hired counsel and sued under the FDCPA, Washington’s Collection Agency Act and Consumer Protection Act, plus a claim for outrage. Only in discovery did the collector produce a “ledger,” dated after the suit began and bearing a former roommate’s name rather than the plaintiff’s.
The ruling: Judge Tana Lin of the District Court for the Western District of Washington granted the plaintiff summary judgment on his two FDCPA claims and denied the collector’s competing motion outright.
- Judge Lin found the collector’s repeated assertions that it was sending proof of the debt were both misleading and unfair, because the collector knew the apartment complex had never given it that proof, yet told the plaintiff otherwise. Applying the “least sophisticated debtor” standard, she reasoned that such a consumer would believe the complex had confirmed the debt when it had not.
- The judge pointed out that the word “misleading” did not appear anywhere in the collector’s briefs.
- Judge Lin also struck the declaration and documents the collector leaned on, including the lease, the ledger, and a move-out statement, finding its witness had no personal knowledge of them and that they were hearsay. She noted the ledger was at best a business record “once removed,” since the underlying records belonged to the apartment complex, not the collector.
- The judge stopped short of declaring the debt fictitious. Whether the plaintiff actually owed the money remained a genuine dispute for trial, so she denied summary judgment on that narrower question and on the state-law collection and consumer-protection claims.
- She let the outrage claim move forward as well, finding reasonable minds could view the conduct as outrageous: misrepresenting that it had proof, repeating that representation for two years, and walking away only after a licensing board asked questions.
