Alejandro Morales v. Healthcare Revenue Recovery Gr
859 F. App’x 625
| 3rd Cir. | 2021Background
- HRRG mailed a debt-collection letter to Alejandro Morales in an envelope bearing a scannable barcode (an Internal Reference Number, “IRN,” and the first ten characters of Morales’s street address).
- The visible IRN was not the account number printed on the letter; account details inside the envelope were hidden.
- Morales sued under the FDCPA § 1692f(8), which bars symbols or language (other than the debt collector’s address) on envelopes that can expose a debtor’s financial status.
- The district court dismissed for lack of Article III standing, finding the IRN did not disclose protected information because multiple debtors could share an IRN; it later denied reconsideration after the Third Circuit decided DiNaples.
- After discovery Morales sought class-wide account records; the district court denied that discovery as unreasonably cumulative and untimely.
- The Third Circuit reversed the dismissal (and denial of reconsideration) but affirmed the district court’s discovery ruling and remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a barcode/IRN on an envelope gives Morales Article III standing under FDCPA §1692f(8) | The IRN uniquely identifies Morales as a debtor and, like DiNaples, makes protected account information publicly accessible — this is a concrete injury | The IRN is not an account number; it may be shared by multiple debtors and is "meaningless on its face," so it did not disclose protected information or create concrete harm | Reversed: the IRN disclosed protected information and constituted a concrete informational injury under FDCPA §1692f(8) (standing satisfied) |
| Whether denial of Morales’s reconsideration motion (post-DiNaples) was proper | DiNaples controls and requires finding a concrete injury from a scannable code revealing an IRN tied to an account | The disclosure here differs from DiNaples because the IRN was not unique or directly the account number | Reversed: district court erred in denying reconsideration; DiNaples principles apply and support standing |
| Whether Morales’s class-wide discovery request for all putative class members’ account documents was properly denied | Broad discovery could show IRNs were not shared and bolster class claims | The request was cumulative, untimely, and beyond reasonable discovery | Affirmed: district court did not abuse discretion in denying the cumulative/untimely discovery request |
Key Cases Cited
- DiNaples v. MRS BPO, LLC, 934 F.3d 275 (3d Cir. 2019) (QR-code on envelope that exposed an internal account reference caused a concrete informational injury under the FDCPA)
- Douglass v. Convergent Outsourcing, 765 F.3d 299 (3d Cir. 2014) (disclosure of an account number on an envelope can expose a debtor’s financial predicament and give standing)
- St. Pierre v. Retrieval-Masters Creditors Bureau, Inc., 898 F.3d 351 (3d Cir. 2018) (reiterating that envelope disclosures of account identifiers create standing)
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (to have Article III standing a statutory violation must cause a concrete injury; intangible harms may be concrete)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (Article III standing requires an injury in fact that is concrete and particularized)
- In re Horizon Healthcare Servs. Data Breach Litig., 846 F.3d 625 (3d Cir. 2017) (disclosure of personal information in a data breach can constitute a concrete injury)