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Leeb v. Nationwide Credit Corp.

United States Court of Appeals, Seventh Circuit

November 20, 2015

GREGORY LEEB, Plaintiff-Appellee,
v.
NATIONWIDE CREDIT CORPORATION, Defendant-Appellant

Argued January 22, 2015

Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 1:12-cv-913 -- Elaine E. Bucklo, Judge.

For Gregory Leeb, Plaintiff - Appellee: Keith J. Keogh, Attorney, Timothy J. Sostrin, Attorney, Keogh Law, Ltd, Chicago, IL.

For Nationwide Credit Corporation, Defendant - Appellant: David M. Schultz, Attorney, Stephen R. Swofford, Attorney, Hinshaw & Culbertson LLP, Chicago, IL.

Before EASTERBROOK, MANION, and WILLIAMS, Circuit Judges.

OPINION

Page 896

Williams, Circuit Judge.

Nationwide Credit Corporation--a debt-collection agency--telephoned Gregory Leeb about an unpaid medical bill. Leeb disputed the debt, saying that his insurance company should have paid. Because Leeb disputed his debt, the Fair Debt Collection Practices Act required Nationwide to " cease collection" until it verified the debt. 15 U.S.C. § 1692g(b). But, without verifying the debt, Nationwide sent Leeb a letter that: (1) showed a " balance" of $327; (2) instructed Leeb to " detach the upper portion and return with payment" ; (3) asked Leeb to provide additional information; and (4) stated that the letter was " from a debt collector attempting to collect a debt and any information obtained will be used for that purpose." Leeb sued Nationwide under the FDCPA.

On summary judgment, the district court held that Nationwide violated the FDCPA because it did not " cease collection." We agree because Nationwide's January 5 letter, objectively viewed, was an attempt to collect the debt. The district

Page 897

court also held that Nationwide was not excused by the FDCPA's " bone fide error" provision. See 15 U.S.C. § 1692k(c). We agree because Nationwide failed to show each of the three required elements: that its violation was unintentional; that its violation resulted from a clerical or factual mistake; and that it maintained procedures reasonably adapted to avoid such mistakes. So we affirm the judgment against Nationwide.

I. BACKGROUND

In May 2011, Leeb received emergency medical care. The medical provider submitted a claim to Leeb's insurance company, Cigna. Cigna asked for additional information but the medical provider never responded, so Cigna closed its file without paying the claim. Later, Nationwide was hired to collect payment.

On December 28, 2011, Nationwide telephoned Leeb about his bill, and Leeb said that Cigna should have paid it. Leeb then mailed and faxed a letter to Nationwide, disputing the debt. Two days later, he received a letter from Nationwide, dated December 26. Nationwide wrote that it was " extremely important" that the debt be paid " in full," otherwise " collection activity [would] continue," and Nationwide would " report the account to Equifax, Experian, and Trans[U]nion credit reporting agencies." Leeb replied (by fax and mail), demanding that ...


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