Crystal Davis v. Credit Bureau of the South, 908 F.3d 972

Crystal Davis sued Credit Bureau of the South (CBOTS) under the FDCPA and Texas Debt Collection Act, alleging CBOTS misrepresented itself as a credit bureau when attempting to collect a $107.29 water bill.
District court granted summary judgment for Davis on an FDCPA §1692e(16) claim and awarded $1,000 statutory damages; other claims were rejected and there were no actual damages shown.
Davis moved for $130,410 in attorney’s fees under 15 U.S.C. §1692k(a)(3); the magistrate judge denied fees, finding special circumstances and bad-faith conduct by plaintiff and counsel.
The magistrate and district courts found evidence suggesting collusion: Davis had the bill mailed to a Texas address while employed by her counsel’s firm, counsel participated in recorded calls, and pleadings misrepresented Davis’s Texas citizenship.
The courts criticized excessive, duplicative billing (nearly 300 hours, $450/hr), poor pleadings quality, and counsel’s apparent aim to generate large fee awards; district court adopted magistrate’s denial and Davis appealed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether attorney’s fees are mandatory under FDCPA §1692k(a)(3) for a successful plaintiff	Davis: statutory text makes fee award mandatory for any successful FDCPA action	CBOTS: special circumstances and counsel misconduct justify denying fees	Fees are ordinarily mandatory, but special/unusual circumstances can justify denial; here denial affirmed
Whether district court abused discretion in denying fees	Davis: denial was erroneous because she prevailed and statute mandates fees	CBOTS: district court properly found bad faith, collusion, excessive fee request, and limited success	No abuse of discretion; factual findings and reasonableness analysis upheld
Whether the requested fees were reasonable in amount/hours/rate	Davis: fee request of $130,410 ($450/hr, ~290 hours) was reasonable	CBOTS: billing was excessive, duplicative, and the rate was unjustified	Court found hours and rate excessive; even lodestar adjustments could justify $0 award given misconduct
Whether plaintiff’s/counsel’s conduct constituted “special circumstances”	Davis: procedural objections but contesting special-circumstances finding	CBOTS: counsel created claim, misrepresented jurisdictional facts, participation in facts, and attempted to weaponize fees	Court held counsel’s conduct and collusion were special/unusual circumstances justifying denial of fees

McKenzie v. E.A. Uffman & Assocs., Inc., 119 F.3d 358 (5th Cir.) (false implication of being a consumer reporting agency under FDCPA)
Evon v. Law Offices of Sidney Mickell, 688 F.3d 1015 (9th Cir.) (attorney’s fees under FDCPA are mandatory for prevailing plaintiffs)
Zagorski v. Midwest Billing Servs., Inc., 128 F.3d 1164 (7th Cir.) (mandatory FDCPA fee award; denial was abuse of discretion)
Graziano v. Harrison, 950 F.2d 107 (3d Cir.) (fees may be denied only in unusual circumstances; require particularized findings)
Romain v. Walters, 856 F.3d 402 (5th Cir.) (special-circumstances exception to mandatory fee awards is narrowly construed)
Johnson v. Eaton, 80 F.3d 148 (5th Cir.) (plaintiff’s technical victory without damages may warrant $0 fee award)
Hensley v. Eckerhart, 461 U.S. 424 (U.S.) (lodestar method and factors for reasonable attorney’s fees)
Baylor v. Mitchell Rubenstein & Assocs., P.C., 857 F.3d 939 (D.C. Cir.) (courts may penalize exorbitant fee demands and deter abusive fee tactics)