The Eastern District of New York recently found that a plaintiff lacked Article III standing to bring her FDCPA suit as she failed to demonstrate a concrete, particularized injury. In the case of Bush v. Optio Solutions LLC, opinion found here, the court held that, in the wake of TransUnion v. Ramirez, 141 S.Ct. 2190 (2021), a debt collector disclosing that a consumer owes a debt to a third party does not rise to the level of a concrete, particularized injury for Article III purposes.
The plaintiff first filed a complaint asserting two FDCPA violations for (1) the debt collector’s failure to provide unspecified information required by 15 U.S.C. §1692g, and (2) an alleged deception arising from the fact that the letter falsely implied that the plaintiff had waived a right to challenge the debt. However, the complaint did not allege any injuries. The plaintiff then filed an amended complaint, adding a third count arising from the defendant’s alleged use of a mailing vendor in sending her a single collection notice, and alleging that the defendant disclosed the plaintiff’s private and sensitive information to a third-party vendor. The plaintiff filed a bankruptcy petition shortly thereafter, and she listed the disputed debt in her bankruptcy schedules.
Following the Supreme Court’s TransUnion opinion, the court entered a show cause order against the plaintiff directing her to identify “any concrete, particularized injury in fact from the statutory violations alleged herein.” The plaintiff responded by stating that the defendant invaded the plaintiff’s right to privacy and seclusion when it disclosed the plaintiff’s private and sensitive information to the third party.
Taking up the show cause order, the court held that, as the only injury asserted by the plaintiff arises from a theory of a debt collector disclosing information to a mailing vendor and the disclosure only stated that the plaintiff owed a debt, the plaintiff failed to identify any injury in fact. Namely, as such a “mailing vendor” theory does not fit the definition of a concrete injury for Article III standing in the wake of TransUnion, and because the plaintiff made the debt information public by disclosing the debt in her bankruptcy petition, the court found that the plaintiff cannot state an injury for the communication of the fact that the plaintiff owed a debt to a third party.
Because the plaintiff disclosed the debt in her bankruptcy petition, and because the plaintiff could not claim a concrete injury from the defendant’s disclosing that the plaintiff owed a debt to a third party, the court dismissed the plaintiff’s amended complaint. While the TransUnion decision did a lot to clarify what constitutes an injury for Article III purposes, this decision illustrates that while such lawsuits may continue to be filed, they will have a much harder time progressing in federal court, which could result in more FDCPA and related lawsuits being filed in state court.
