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Decided: August 15, 2014

The Fourth Circuit affirmed the district court’s judgment.

Appellant, a debt collection service, persistently made repeated collection demands to Appellee regarding on a debt that she incurred in 2008. Appellee paid the outstanding debt in full within one month of receiving the first collection letter from Appellant. However, in the following months, Appellant continued to send Appellee demand letters that falsely stated that the already paid debt remained due, and threating to report the debt to credit bureaus as past due. Appellee filed suit alleging that Appellant violated the Fair Debt Collection Practices Act (“FDCPA”). The district court granted Appellee’s motion for judgment as a matter of law (“JMOL”) regarding the FDCPA claims, and allowed the state claims to go to the jury, which found in favor of Appellee and awarded her $37,501.00. Appellant filed a timely appeal.

The Fourth Circuit stated that one of the FDCPA’s primary purposes is to make it unlawful for a debt collector to make any deceptive or false statements while conducting their collection activities. See 15 U.S.C. § 1692e. A debt collector that violates the FDCPA is liable for actual damages, costs, reasonable attorneys’ fees, and potential statutory damages. See 15 U.S.C. § 1692(k)(a)(1), (a)(2)(A), & (a)(3). The Fourth Circuit rejected the Appellant’s argument that it was not liable for any false or deceptive statements made because the Appellee failed to dispute the debt in writing within thirty days of receiving the initial collection letter. The Court stated that nothing in the FDCPA’s text suggested that the ability to state a claim under § 1692e depends on a debtor first disputing the validity of the debt in compliance with § 1692g. Further, the express language and remedial purpose of the FDCPA confirm that a debtor is not required to dispute the debt before bringing a § 1692e claim. The Fourth Circuit also affirmed the district court’s decision granting Appellee’s JMOL motion because the Appellant’s collection letter served as a threat to communicate credit information, which it knew or should have know was false, as well as using deceptive means to collect the debt. Further, the Fourth Circuit affirmed the district court’s determination that Appellant violated the disclosure requirements of Federal Rules of Civil Procedure (F.R.C.P.) 26(a) and (e). The Fourth Circuit also affirmed the decision to exclude evidence related to Appellant’s bona fide error defense because Appellant failed to provide any justification for its late disclosures after twenty months of initial litigation.

Full Opinion

Alysja S. Garansi