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Drake v. Enhanced Recovery Co., LLC

United States District Court, D. Oregon, Eugene Division

March 19, 2018

RAYMOND DRAKE, Plaintiff,
v.
ENHANCED RECOVERY COMPANY, LLC, Defendant.

          OPINION AND ORDER

          Ann Aiken United States District Judge

         Plaintiff Raymond Drake brought suit against defendant Enhanced Recovery Company, LLC ("ERC") for, inter alia, violations of the Fair Debt Collection Practices Act ("FDCPA") and Fair Credit Reporting Act ("FCRA"). (doc. 1). Defendant now moves for summary judgment on all claims, (doc. 27). In the alternative, defendant also moves for summary judgment on (1) all portions of plaintiff s claims that are factually unsupported or otherwise fail as a matter of law; (2) defendant's bona fide error defense; and (3) plaintiffs claims for "credit denial" damages and punitive damages. For the reasons set forth herein, defendant's Motion for Summary Judgment is GRANTED.

         BACKGROUND

         This suit arises from a case of mistaken identity. In March 2015, a delinquent AT&T account ("the Account") belonging to a Raymond Drake, not the plaintiff, was placed with defendant for collection, [1] The information defendant received with the placement included the amount owed on the Account ($98), the debtor's name (Raymond Drake), and the debtor's address (Los Angeles, California). Defendant did not receive the debtor's social security number, date of birth, or any additional identifying information from AT&T, nor did defendant obtain this information from another source, or possess other such information.

         Pursuant to its standard procedures, defendant submitted to one of the consumer reporting agencies ("CRAs") the name and address information it received with the placement, as part of a "scrub" process. The purpose of the "scrub" process is to obtain from the CRAs the most current and accurate contact information on the debtor. When defendant submitted the name Raymond Drake and the past address it had received from AT&T, the CRA informed defendant that the most likely contact information for the debtor was the plaintiff who lived in Salem, Oregon.

         On March 12, 2015, defendant initiated contact with plaintiff in an effort to collect on the Account. On March 23, 2015, plaintiff informed defendant by telephone that he received the March 12 letter but that defendant had contacted the wrong Raymond Drake. Defendant noted the Account as "disputed" in its internal files. The next day, on March 24, 2015, defendant received a letter from plaintiff further formally disputing the validity of the Account. On Match 26, 2015, defendant responded to the letter, treating it as a verification request pursuant to 15 U.S.C. § 1692g(a)(4), by sending plaintiff a summary of charges on the Account and billing statement by AT&T. On April 6, 2015, plaintiff responded to the letter with a phone call to defendant, informing them that the Account was not his. Defendant informed plaintiff that it would not direct any further collection attempts on the Account to him.

         Defendant admits to reporting the Account as "disputed" on April 26, 2015, to the CRAs. On August 2, 2015, defendant requested that the CRAs delete this information regarding the Account.

         Plaintiff filed this lawsuit on October 7, 2015, asserting claims for (1) violation of the FDCPA; (2) willful violation of the FCRA; (3) negligent violation of the FCRA; (4) defamation; and (5) fraud.[2] Plaintiff alleges that he was damaged in the form of denial of credit and emotional distress, anger, anxiety, worry, frustration, and other "negative emotions." Plaintiff also seeks punitive damages. Defendant filed the present Motion for Summary Judgment on June 23, 2017. After an extended briefing schedule, I heard oral argument on January 16, 2018.[3]

         STANDARD OF REVIEW

         Summary judgment is appropriate if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). The moving party has the burden of establishing the absence of a genuine issue of material fact. Id.; Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986), If the moving party shows the absence of a genuine issue of material fact, the nonmoving party must go beyond the pleadings and identify facts which show a genuine issue for trial. Id. at 324. "Summary judgment is inappropriate if reasonable jurors, drawing all inferences in favor of the nonmoving party, could return a verdict in the nonmoving party's favor." Diaz v. Eagle Produce Ltd. Partnership, 521 F.3d 1201, 1207 (9th Cir. 2008).

         DISCUSSION

         Plaintiff asserts three categories of claims: (1) claims under the FDCPA, (2) claims under the FCRA, and (3) tort claims including defamation and fraud. Defendant also asserts a bona fide error defense and moves for summary judgment on plaintiffs claims for damages. I discuss each issue in turn.

         I. FDCPA Claims

         Defendant moves for summary judgment on plaintiffs claims that defendant violated various provisions of the FDCPA, including 15 U.S.C. § 1692e and § 1692f. Specifically, defendant claims that it did not violate § 1692e because it did not "use any false, deceptive, or misleading representation or means in connection with the collection of any debt." 15 U.S.C. § 1692e. Additionally, defendant claims it did not violate § 1692f because it did not use "unfair or unconscionable means to collect or attempt to collect any debt." 15 U.S.C. § 1692f.

         A. § 1692e

         Section 1692e of the FDCPA generally prohibits the "use [of] any false, deceptive, or misleading representation or means in connection with the collection of any debt." This includes (as alleged by plaintiff in his complaint): "[t]he false representation of... the character, amount, or legal status of any debt, " 15 U.S.C. § 1692e(2)(A); "[c]ommunicating ... to any person credit information which is known or which should be known to be false, including the failure to communicate that a disputed debt is disputed, " §1692e(8); and "[t]he use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer, " §1692e(10)

         Plaintiff alleges that defendant violated the above sections by reporting the Account to the CRAs after plaintiff disputed it. Defendant admits that it made a single report to the CRAs which it later requested be deleted. Namely, it reported that the Account was disputed. Defendant argues, however, that this did not constitute the use of any false, ...


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