Bartl v. Enhanced Recovery Company, LLC, 0:16-cv-00252

Background

Plaintiff Christopher Bartl received a collection notice from Enhanced Recovery Company, LLC (ERC) for a $1,024.88 Sprint account. A third party (hired by Bartl) sent a written dispute/validation request to ERC on Bartl’s behalf, which ERC logged as a dispute.
ERC did not investigate or verify the debt after receiving the dispute, but reported the debt to Experian, TransUnion, and Equifax; the debt later was reported deleted. The reporting occurred before verification was provided to Bartl.
Bartl alleges violations of the Fair Debt Collection Practices Act (FDCPA): primarily 15 U.S.C. § 1692g(b) (continuing collection after a dispute without verification), and alternatively §§ 1692e/1692e(8) and 1692f.
ERC moved to dismiss for lack of standing under Rule 12(b)(1); Bartl moved for summary judgment on all claims. The court considered extrinsic evidence in resolving the jurisdictional challenge and the summary-judgment motion.
The court found Bartl suffered concrete emotional harm (anxiety, delay in mortgage efforts, a severe emotional episode) traceable to ERC’s reporting and redressable under the FDCPA, rejecting ERC’s standing challenge.
On the merits, the court held (1) the third-party-authored letter qualified as a § 1692g(b) dispute, (2) reporting a disputed debt to credit reporting agencies is a ‘‘collection effort’’ under § 1692g(b), and (3) ERC therefore violated § 1692g(b). Summary judgment was granted to Bartl on liability under § 1692g(b); damages were reserved. Summary judgment was denied on §§ 1692e/e(8) and 1692f claims.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Standing – injury in fact	Bartl suffered concrete emotional distress, credit-score impact, and mortgage delay from ERC’s reporting.	ERC argued no concrete injury; emotional harm insufficient for Article III standing.	Court: Emotional distress and economic effects suffice; Bartl has standing.
Whether a third-party letter triggers § 1692g(b)	Letter sent by an agent with Bartl’s authorization constituted a written dispute invoking § 1692g(b).	ERC contended only a consumer’s own letter qualifies; agent’s letter insufficient.	Court: Authorized third-party letter validly triggered § 1692g(b).
Whether the letter effectively disputed the debt	The letter referenced the collection notice, used the word “dispute,” requested validation and cessation of collection (including credit reporting).	ERC argued the letter only denied owing ERC (not Sprint) and so did not clearly dispute the underlying debt.	Court: Under the unsophisticated-consumer standard, the letter put ERC on notice and was sufficient.
Whether credit reporting after dispute is a prohibited "collection effort" under § 1692g(b)	Reporting the disputed debt to credit agencies is a tool to induce payment and thus a collection effort; ERC reported without verification.	ERC argued credit reporting is not a collection effort and therefore not covered by § 1692g(b).	Court: Credit reporting is a collection effort; ERC violated § 1692g(b) by reporting without verification.

Key Cases Cited

Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (Article III standing requires a concrete and particularized injury)
Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (standing requires injury in fact, causation, and redressability)
Dunham v. Portfolio Recovery Assocs., LLC, 663 F.3d 997 (8th Cir. 2011) (elements to establish a § 1692g(b) claim)
Krottner v. Starbucks Corp., 628 F.3d 1139 (9th Cir. 2010) (emotional distress can confer standing)
Branson Label, Inc. v. City of Branson, 793 F.3d 910 (8th Cir. 2015) (distinguishing facial and factual jurisdictional challenges)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary-judgment standard)
Edeh v. Midland Credit Mgmt., Inc., 748 F. Supp. 2d 1030 (D. Minn. 2010) (credit reporting treated as a collection effort under § 1692g(b))
McIvor v. Credit Control Servs., Inc., 773 F.3d 909 (8th Cir. 2014) (treating Edeh’s related reasoning as persuasive)