April 18, 2018
Appeals from the United States District Court for the
Northern District of Illinois, Eastern Division No.
15-cv-4498 - Matthew F. Kennelly, Judge, No. 15-cv-5073 -
Manish S. Shah, Judge, No. 15-cv-4037 - Jorge L. Alonso,
Judge, and No. 15-cv-4499 - Samuel Der-Yeghiayan, Judge.
Wood, Chief Judge, and Flaum and Easterbrook, Circuit Judges.
appeal concerns four consolidated cases involving similar
alleged violations of the Fair Debt Collection Practices Act
("FDCPA"), 15 U.S.C. § 1692e(8). Plaintiffs
defaulted on credit cards, and defendant Portfolio Recovery
Associates ("PRA"), an Illinois debt collection
agency, bought the accounts for collection. The Debtors Legal
Clinic (the "Clinic") sent separate letters on
behalf of each plaintiff to PRA, stating "the amount
reported is not accurate." PRA later reported each debt
to credit reporting agencies without noting that the debt was
"disputed." Plaintiffs each filed a suit against
PRA for violations of the FDCPA, alleging that PRA
communicated their debts to credit reporting agencies without
indicating they had disputed the debt. The district courts
granted summary judgment in favor of plaintiffs. We affirm.
plaintiff defaulted on their credit card account, and PRA
purchased the debts from the original creditors. As required
by 15 U.S.C. § 1692g, PRA sent plaintiffs validation
letters detailing the debt. Each plaintiff then sought the
advice of the Clinic, a non-profit legal aid organization.
More than thirty days after PRA sent the validation letters,
Andrew Finko, a volunteer attorney at the Clinic, faxed
separate letters to PRA on behalf of each plaintiff
(hereinafter, the "Letters"). The Letters stated:
This letter is concerning the above referenced debt.
Debtors Legal Clinic is a non-profit legal services
organization that advises senior citizens, veterans, and
low-income individuals whose income is protected by law of
their rights under various state and federal statutes. Our
clinic represents the above referenced client for the
purposes of enforcing their rights pursuant to all applicable
debt collection laws.
This client regrets not being able to pay, however, at this
time they are insolvent, as their monthly expenses exceed the
amount of income they receive, and the amount reported is not
accurate. If their circumstances should change, we will be in
Our office represents this client with respect to any and all
debts you seek to collect, now or in the future, until
notified otherwise by our office. As legal representative for
this client, all communication must be through our office,
please do not contact them directly.
If you wish to discuss this matter, please contact our office
directly at [phone number] to speak with the attorney
assigned to the matter, Andrew Finko.
to receiving the Letters, PRA reported the amount of the
debt, the account number, and the original creditor to credit
reporting agencies. However, PRA did not inform the credit
reporting agencies that the debt was disputed.
admits it received and reviewed the Letters. It says it
treated them as "attorney representation letters, "
but did not believe the Letters communicated disputes.
According to Nyetta Jackson, PRA's Vice President of
There was nothing [in the Letters] that indicated that this
was a clear dispute that needed to be processed. What was
clear is that the attorney was letting us know that they now
represent the customer. What was clear is that they said they
didn't have the money to pay and they regretted that.
support this view, Jackson states that Finko did not fax the
Letters to PRA's special disputes department; rather, he
sent the Letters to PRA's general counsel. Additionally,
Jackson notes that on prior occasions, Finko sent letters
that expressly stated his client "disputes the
plaintiffs alleged that PRA violated 15 U.S.C. §
1692e(8), which prohibits debt collectors from
"[c]ommunicating or threatening to communicate 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." Plaintiffs maintained that
they "disputed" the debt when the Clinic sent the
Letters to PRA, and PRA admits that it did not inform the
credit reporting agencies that the debt was disputed. The
parties filed cross-motions for summary judgment, and the
district courts each granted summary judgment for plaintiffs.
We consolidated PRA's appeals for argument and
review de novo a district court's decision on
cross-motions for summary judgment, construing all facts and
drawing all reasonable inferences in favor of the party
against whom the motion under consideration was filed."
Hess v. Bd. Of Trs. Of S. Ill. Univ., 839 F.3d 668,
673 (7th Cir. 2016). "Summary judgment is appropriate
where there are no genuine issues of material fact and the
movant is entitled to judgment as a matter of law."
Id. (citing Fed.R.Civ.P. 56(a)).
makes four arguments: (1) plaintiffs did not have Article III
standing; (2) the Letters did not "dispute" the
debt within the meaning of § 1692e(8); (3) even if PRA
violated the statute, the violation was not material; and (4)
PRA has a bona fide error defense under § 1692k(c). We
address each in turn.