McCollough v. Johnson, Rodenburg & Lauinger, LLC
2011 U.S. App. LEXIS 4072
| 9th Cir. | 2011Background
- McCollough owed a Chase Manhattan credit card balance that Chase wrote off in 2000; Collect America via CACV purchased the debt in 2001 and pursued collection.
- JRL, a debt-collection law firm, handled Montana cases for CACV; between 2007–2008 it filed thousands of Montana lawsuits, with about 90% default judgments.
- JRL identified a potential statute of limitations problem for McCollough but filed a collection suit anyway in April 2007, seeking substantial fees and costs.
- JRL relied on CACV information alleging a June 30, 2004 payment; CACV later clarified no such partial payment occurred; the electronic file showed time-barred status.
- McCollough answered pro se, asserted SOL defense, and later accused JRL of pursuing a time-barred action; CACV advised dismissal due to SOL problem, which occurred in December 2007.
- District court granted partial summary judgment to McCollough on FDCPA claims; trial followed resulting in damages and punitive awards against JRL, which they appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether JRL's defense under the bona fide error defense applies | McCollough | JRL | Bona fide error defense fails as a matter of law |
| Whether JRL violated the FDCPA by seeking attorney's fees without proof of entitlement | McCollough | JRL | FDCPA violation established; summary judgment affirmed |
| Whether JRL's requests for admission violated the FDCPA | McCollough | JRL | Requests for admission violated FDCPA; summary judgment affirmed |
| Whether state-law claims of malicious prosecution and abuse of process survive given FDCPA outcome | McCollough | JRL | Not reached; district court judgment sustained on federal claims; state claims dismissed to the extent dependent on federal ruling |
| Whether evidentiary rulings and jury instructions were proper | McCollough | JRL | District court did not abuse discretion; rulings upheld |
Key Cases Cited
- Heintz v. Jenkins, 514 U.S. 291 (U.S. 1995) (FDCPA applies to lawyers' litigation activities)
- Reichert v. Nat'l Credit Sys., Inc., 531 F.3d 1002 (9th Cir. 2008) (bona fide error defense requires reasonable procedures to avoid errors)
- Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, U.S. , 130 S. Ct. 1605 (2010) (FDCPA scope and application to lawyers in litigation)
- Donohue v. Quick Collect, Inc., 592 F.3d 1027 (9th Cir. 2010) (FDCPA covers service of complaints; extends to discovery activity)
- Clark v. Capital Credit & Collection Serv., Inc., 460 F.3d 1162 (9th Cir. 2006) (analysis of 1692e(2) misstatements in debt collection)
- Sayyed v. Wolpoff & Abramson, 485 F.3d 226 (4th Cir. 2007) (FDCPA coverage of written discovery documents)
- Fox v. Citicorp Credit Servs., Inc., 15 F.3d 1507 (6th Cir. 1994) (FDCPA applies to abuses in debt collection; no special attorney exemption)