8th Circuit: FDCPA Plaintiff Has Standing, Not Barred by Statute of Limitations

The Eighth Circuit Court of Appeals recently addressed various aspects of claims under the Fair Debt Collection Practices Act (FDCPA), holding that having a debt collector attempt to collect a debt that is not owed is a sufficient injury in fact to establish standing, and that the statute of limitations runs from the date of the alleged violation, even if the violation is a repetition of an earlier allegedly false assertion.

In Demarais v. Gurstel Chargo, P.A., the complaint alleged that the defendant debt collector filed suit in state court, claiming to be the successor in interest to the creditor on a debt that had been charged off four years earlier, and sued for post-charge-off interest it had no right to collect.  After several continuances, the state court suit was dismissed with prejudice by the debt collector.  Eighteen days later, the debt collector served the consumer with interrogatories and document requests containing the caption and number of the dismissed case.  This letter said it was a communication “from a debt collector and is an attempt to collect a debt.”  The consumer sued, claiming violations of the FDCPA.

The district court dismissed the complaint, finding that any violation was barred by the statute of limitations; that the defendant’s tactic of allowing a case to be set for trial, then seeking judgments based on non-appearance at trial of the purported debtor was a permissible litigation tactic; and that the discovery requests sent after dismissal were not likely to deceive anyone.  The Eighth Circuit reversed.

Addressing the plaintiff’s standing (which was not decided by the district court), the Court of Appeals first held that the alleged attempt to collect a debt not owed, in violation of the FDCPA, and the improper threat to take an action the defendant could not and did not intend to take each constituted concrete injuries sufficient to confer standing.

The court next considered whether the case was barred by the FDCPA’s one-year statute of limitations, holding that the limitations period began when the debt collector appeared in state court and attempted to collect the debt through a default action, even though that action allegedly merely reiterated an earlier actionable assertion.

Finally, the Eighth Circuit held that the plaintiff had plausibly alleged that the defendant had threatened to take an action it never intended to take, namely threatening to go to trial to recover the debt, and that the letter attempting to collect the debt after the final dismissal in state court was actionable even if it was not likely to deceive anyone, because Section 1692(f) of the FDCPA does not require deception.  Rather, any letter attempting to collect money not permitted by law is a violation of the plain language of the FDCPA.

The entire opinion of the Eighth Circuit may be found here.