Goodin v. Bank of America N.A.
114 F. Supp. 3d 1197
M.D. Fla.2015Background
- Ronald and Deborah Goodin obtained a mortgage with arrears, filed Chapter 13 in Feb 2009, and completed discharge in Dec 2009; TBW (original servicer) failed and Bank of America (BofA) began servicing in Aug 2009 but failed to file a transfer of claim to obtain $14,530.28 the trustee held.
- BofA repeatedly sent statements and demand letters from 2010–2013 misrepresenting amounts due, refused several Goodin payments, and filed a foreclosure complaint in Sept 2012 that sought a deficiency judgment if necessary.
- The Goodins, their trustee, and counsel contacted BofA many times (dozens of communications) alerting the bank to the registry funds and need to file a transfer of claim; BofA nonetheless continued collection communications and foreclosure proceedings until the Goodins filed suit.
- After litigation began, BofA filed the transfer of claim (Feb 2013), received the registry funds (Sept 2013), applied them and some rejected-payment credits, and dismissed the foreclosure (Mar 2013).
- The district court found BofA met the FDCPA definition of a debt collector, committed multiple FDCPA and parallel FCCPA violations by misrepresenting amounts and threatening collection/acceleration, rejected BofA’s bona fide error defense, and found emotional distress and punitive damages appropriate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether BofA is a "debt collector" under the FDCPA | Goodins: BofA acquired loan in default and thus is a debt collector | BofA: bankruptcy plan cured preexisting default, so not a debt collector | Held: BofA is a debt collector because cure occurs by repayment, not mere plan entry |
| Whether BofA’s communications violated the FDCPA/FCCPA | Goodins: repeated statements/letters misstated amounts and threatened foreclosure/acceleration; foreclosure complaint sought deficiency -> collection activity | BofA: many communications were informational or enforcement of security (not debt collection) | Held: Multiple communications (statements and demand letters Apr 2011–Mar 2012 and the foreclosure complaint requesting deficiency jurisdiction) violated FDCPA; same acts violated FCCPA because BofA knew amounts were incorrect |
| Applicability of the bona fide error defense | Goodins: BofA’s systemic failures and notice from trustee/attorney show not reasonable or bona fide | BofA: errors were unintentional and resulted from procedures (bankruptcy closing audit and emails to counsel) | Held: Defense rejected — errors were not objectively reasonable and procedures were inadequate to avoid the specific, repeated errors |
| Damages (statutory, actual, punitive) | Goodins: seek max statutory and large actual and punitive damages for prolonged emotional distress and deterrence | BofA: contest extent of emotional harm and punitive relief | Held: Awarded statutory damages: $1,000 each under FDCPA and $1,000 each under FCCPA; actual (emotional) damages: $50,000 each; punitive (FCCPA) damages: $100,000 total (court found gross negligence by employees and institutional failures) |
Key Cases Cited
- Grden v. Leikin Ingber & Winters PC, 643 F.3d 169 (6th Cir. 2011) (a communication is in connection with collection when its animating purpose is to induce payment)
- McIvor v. Credit Control Servs., Inc., 773 F.3d 909 (8th Cir. 2014) (same principle on collection-purpose communications)
- Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 559 U.S. 573 (2010) (bona fide error defense requires procedures reasonably adapted to avoid errors)
- Owen v. I.C. Sys., Inc., 629 F.3d 1263 (11th Cir. 2011) (third-element procedures inquiry is fact-bound; collector must show actual procedures reasonably adapted)
- Reese v. Ellis, Painter, Ratterree & Adams, LLP, 678 F.3d 1211 (11th Cir. 2012) (foreclosure/enforcement communications may constitute debt-collection activity)
- Helman v. Udren Law Offices, P.C., 85 F. Supp. 3d 1319 (S.D. Fla. 2014) (regular informational statements without payment inducement are not FDCPA collection communications)