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Paz v. Portfolio Recovery Associates, LLC

United States District Court, N.D. Illinois, Eastern Division

November 21, 2016

LUSVINA PAZ, Plaintiff,
v.
PORTFOLIO RECOVERY ASSOCIATES, LLC, Defendant.

          MEMORANDUM OPINION AND ORDER

          James B. Zagel United States District Judge.

         In this case, Plaintiff Lusvina Paz alleges that the Defendant Portfolio Recovery Associates (PRA) provided credit information about her to three credit reporting agencies without informing those agencies that she had disputed her debt. Paz argues that this failure to provide information violates the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et. seq. (FDCPA).

         Both Paz and PRA now file for summary judgment. For the reasons stated below, the Court denies PRA's motion and grants Paz's motion.

         BACKGROUND

         The following facts are undisputed. Plaintiff Lusvina Paz incurred a debt on a Capital One Bank credit card and went delinquent on that debt on August 26, 2010. The amount of debt listed on the account was $949.02. Paz has testified that the card was used primarily for purchasing food. Defendant Portfolio Recovery Associates purchased the debt on August 19, 2013.

         PRA mailed Paz a demand letter on January 17, 2014, and Paz never made any payment to PRA following this demand letter. Paz testified that she never viewed her credit report following this demand letter nor did she reach out by phone to PRA.

         Lusvina Paz's daughter-in-law, Linda Paz, put Paz in touch with the Debtors Legal Clinic regarding legal representation. Lusvina does not speak English, so she brought Linda as a translator for her meeting with the Debtors Legal Clinic. In her deposition, Lusvina says she was not sure who she spoke with during this meeting, but her daughter-in-law testified that they met with an attorney named Michael Wood. Paz testified that at the time of this meeting she thought that she only owed $400 but could have been mistaken about that figure.

         After the meeting with Wood, another attorney at Debtors Legal Clinic, Andrew Finko, faxed a letter to PRA. This letter stated in part that “the amount reported is not accurate.” The letter was four paragraphs long and also informed PRA that Debtors Legal Clinic would be representing Paz and that Paz could not pay the debt because she was insolvent. This letter was faxed to PRA's general counsel on September 12, 2014. Paz testified that she did not remember discussing this letter with any attorney at the Debtors Legal Clinic or even talking to Andrew Finko.

         After PRA received this letter, PRA communicated information regarding Paz's account to three credit reporting agencies, Experian, Equifax, and TransUnion. When providing information about Paz, PRA did not say that Paz had disputed the amount of debt.

         LEGAL STANDARD

         Summary judgment should be granted when “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c). A genuine issue of triable fact exists only if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Pugh v. City of Attica, Ind., 259 F.3d 619, 625 (7th Cir. 2001) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)).

         When considering the Plaintiff's Motion for Summary Judgment, the Court considers the facts in the light most favorable to the Defendant, and when considering the Defendant's Motion for Summary Judgment, the facts are considered in the light most favorable to the Plaintiff. See First State Bank of Monticello v. Ohio Cas. Ins. Co., 555 F.3d 564, 567 (7th Cir. 2009) (“[B]ecause the district court had cross-motions for summary judgment before it, we construe all facts and inferences therefrom in favor of the party against whom the motion under consideration is made.”) (internal quotation marks omitted).

         DISCUSSION

         I. Standing

         PRA contends that Paz lacks Article III standing to sue in federal court because she cannot show that she suffered an injury. To establish Article III standing, a plaintiff must show “(1) an ‘injury in fact, ' that is, ‘an invasion of a legally protected interest which is...concrete and particularized, and...actual or imminent'; (2) a causal connection between the injury and the challenged conduct, meaning that the injury is ‘fairly traceable' to the challenged conduct; and (3) a likelihood ‘that the injury will be redressed by a favorable decision.'” Dunnet Bay Const. Co. v. Borggren, 799 F.3d 676, 688 (7th Cir. 2015) (quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992)). PRA argues that Paz has not suffered an “injury in fact, ” citing the recent Supreme Court decision in Spokeo, Inc. v. Robins, 136 S.Ct. 1540 (2016).

         In Spokeo, the Court considered whether a violation of a statutory right granted by the Fair Credit Reporting Act (FCRA) was a sufficient injury in fact to maintain an action in federal court. Id. at 1544. The defendant website operator generated a consumer report that inaccurately reported the plaintiff's marital status, age, employment status, salary, and educational history. Id. at 1546. The plaintiff alleged that the website operator violated the FCRA by generating this report, but the plaintiff did not allege that he suffered any monetary harm as a result of the FCRA violation. Id. The Supreme Court held that a violation of the FCRA alone was insufficient for Article III standing, as the plaintiff was also required to show a “concrete harm” that flowed from the statutory violation. Id. at 1549. The Court specifically limited its holding, noting that “the violation of a procedural right granted by statute can be sufficient in some circumstances to constitute injury in fact.” Id. Among those circumstances are cases where a statutory violation creates the “risk of ...


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