Long v. Pendrick Capital Partners II, LLC
8:17-cv-01955
| D. Maryland | Mar 18, 2019Background
- Pendrick, a debt buyer, purchased an EmCare medical account for a “Crystal Long” and assigned collection to Ability Recovery Services; Pendrick does not resell debts.
- Ability associated the account with identifying data (name, a skip-traced address, birthdate and SSN fragments); the actual plaintiff (Bowie resident Crystal Long) shares the name but not the birthdate, SSN, employer, or medical treatment history and did not incur the EmCare charge.
- Ability sent two collection letters to plaintiff in Nov. 2016; plaintiff phoned Ability within 30 days to dispute. Ability’s agent repeatedly told her to dispute with credit reporting agencies (CRAs) and said Ability would mark the account disputed, but Ability later furnished a derogatory tradeline to CRAs.
- Plaintiff disputed the tradeline with Equifax/Experian/TransUnion; CRAs sent ACDVs to Ability which contained plaintiff’s correct DOB/SSN that did not match Ability’s file, yet Ability verified the account as belonging to plaintiff multiple times.
- Plaintiff suffered alleged damages: deterred job applications, withdrawal from credit market, and emotional distress; Ability eventually requested CRA deletion only after suit was filed.
- Procedural posture: plaintiff moved for partial summary judgment (FCRA and FDCPA); defendants cross-moved. Court granted/denied in part on March 18, 2019.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FCRA §1681s‑2(b) — reasonable investigation/accuracy | Ability failed to reasonably investigate ACDVs and verified inaccurate tradelines despite mismatched DOB/SSN/address; liable at least negligently | Ability conducted reinvestigations by comparing internal file to CRA data and lacked more info from plaintiff; no unreasonable procedure | Court: Ability’s investigations were cursory and verification was materially misleading; summary judgment for plaintiff on Liability (negligence) against Ability; damages remain for trial issues |
| FCRA — willfulness | Ability acted recklessly/with disregard by repeatedly verifying despite red flags | Ability’s conduct may be negligent but not willful; gaps (no written dispute) create factual dispute | Court: Willfulness is a jury question; denied summary judgment to both sides on willfulness |
| FDCPA §1692e (false/misleading representations) re: agent’s statements | Agent misled plaintiff into thinking disputing with CRAs was plaintiff’s only recourse and that reporting had occurred, causing her to forego further direct steps; violates §1692e | Statements reflected agent’s view and were not objectively misleading; plaintiff’s failure to provide written dispute contributed | Court: Plaintiff entitled to summary judgment on Ability’s §1692e violation based on agent’s misleading statements |
| FDCPA §1692f (unfair/conscionable means) re: sending collection letters to wrong person | Sending letters without confirming identity is unfair/conscionable | Conduct overlaps §1692e; no separate §1692f violation; Ability was not on notice until plaintiff’s phone dispute | Court: §1692f claim fails as duplicative; Ability entitled to summary judgment on §1692f |
| Vicarious liability — Pendrick as a "debt collector" under FDCPA (principal purpose) | Pendrick’s business (buying delinquent medical debt and placing it for collection; not reselling) shows principal purpose is debt collection; vicarious liability possible | Pendrick had no direct contact with plaintiff and disputes over whether debt‑collection is its principal purpose preclude liability | Court: Fact issue remains whether Pendrick qualifies as a debt collector; motions denied on vicarious‑liability question |
| Defamation / MCDCA / MCPA claims | Ability published false derogatory tradeline with reckless disregard; MCDCA/MCPA claims survive where not preempted by FCRA | Pendrick cannot be vicariously liable for defamation; some MCDCA claims preempted by FCRA | Court: Ability not entitled to summary judgment on defamation, MCDCA (to extent not preempted), and MCPA; Pendrick entitled to summary judgment on defamation and MCDCA claims (as to vicarious liability) |
Key Cases Cited
- Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47 (U.S. 2007) (willfulness under FCRA includes reckless disregard standard)
- Johnson v. MBNA Am. Bank, N.A., 357 F.3d 426 (4th Cir. 2004) (elements of furnisher duties under §1681s‑2(b))
- Saunders v. Branch Banking & Trust Co., 526 F.3d 142 (4th Cir. 2008) (FCRA accuracy includes omissions that render information misleading)
- Sloane v. Equifax Info. Servs., LLC, 510 F.3d 495 (4th Cir. 2007) (actual damages under FCRA may include emotional distress)
- Wood v. Credit One Bank, 277 F. Supp. 3d 821 (E.D. Va. 2017) (furnisher’s superficial reinvestigation insufficient; persuasive on standard)
- Henson v. Santander Consumer USA, Inc., 137 S. Ct. 1718 (U.S. 2017) (discusses FDCPA "principal purpose" definition context)
- Janetos v. Fulton Friedman & Gullace, LLP, 825 F.3d 317 (7th Cir. 2016) (debt buyer cannot evade FDCPA by outsourcing collections)
- Chaudhry v. Gallerizzo, 174 F.3d 394 (4th Cir. 1999) (least‑sophisticated consumer standard for §1692e)