Roslyn Currier v. First Resolution Inv. Corp.
2014 U.S. App. LEXIS 15277
| 6th Cir. | 2014Background
- First Resolution sued Currier in Kentucky state court for a charged-off credit-card debt; a default judgment was entered after Currier’s local counsel failed to appear.
- Currier filed a motion to vacate the default judgment on October 5, 2012, which under Kentucky law rendered the judgment non-final while the motion was pending.
- On October 8, 2012, First Resolution filed a notice of judgment lien against Currier’s home; a Kentucky judgment lien can arise only from a final judgment, so the lien was invalid from October 8 onward.
- First Resolution learned of Currier’s motion to vacate (or had notice of it) but did not release the lien until November 5, 2012, after the state court indicated it would vacate the judgment.
- Currier sued in federal court under the Fair Debt Collection Practices Act (FDCPA), alleging unfair/deceptive collection practices, collecting unauthorized amounts, and threats to take illegal action; the district court dismissed, and Currier appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether filing and maintaining an invalid judgment lien can violate § 1692f (unfair practices) | Filing and keeping an invalid lien on Currier’s home is an unfair, coercive means to collect a debt | Not every state-law violation is an FDCPA violation; this was a mere technical/state-law error | Yes. Allegations plausibly state an unfair practice under § 1692f because the lien unlawfully encumbered the home and coerced the debtor |
| Whether the same conduct can violate § 1692e(5) (threat to take illegal action) | The lien functioned as a threat to take action (e.g., force sale) that could not lawfully be taken | Filing a document in court is not per se an illegal threat; court filings are protected | Yes. The filing/maintenance of an invalid lien can constitute a threat under § 1692e(5) as viewed by the least sophisticated consumer |
| Whether a state-law violation automatically equals an FDCPA violation | FDCPA protects against unfair/deceptive conduct even if state law also forbids the act; the invalid use of state procedure matters | FDCPA should not be a blanket enforcement vehicle for every state-law procedural violation | Court: State-law violations are not per se FDCPA violations, but here the state-law invalidity is relevant and supports an FDCPA claim |
| Whether defendant is entitled to the bona fide error defense under 15 U.S.C. § 1692k(c) | Defendant argues it lacked reason to know lien was invalid when mailed; thus qualifies for bona fide error defense | Plaintiff points to defendant’s knowledge and post-notice inaction; no procedures to avoid/correct error | Not resolved on merits: at pleading stage defendant does not establish the defense; factual issues remain and defense likely fails on these pleadings |
Key Cases Cited
- Barany-Snyder v. Weiner, 539 F.3d 327 (6th Cir. 2008) (FDCPA is extraordinarily broad and uses the least sophisticated consumer standard)
- Hartman v. Great Seneca Fin. Corp., 569 F.3d 606 (6th Cir. 2009) (documents that can mislead least sophisticated consumer may support § 1692e/§ 1692f claims)
- Gionis v. Javitch, Block, Rathbone, LLP, [citation="238 F. App'x 24"] (6th Cir. 2007) (court filings can constitute threats under the FDCPA)
- LeBlanc v. Unifund CCR Partners, 601 F.3d 1185 (11th Cir. 2010) (state-law licensing violations are not per se FDCPA violations but may be relevant)
- Beler v. Blatt, Hasenmiller, Leibsker & Morre, LLC, 480 F.3d 470 (7th Cir. 2007) (FDCPA is not an automatic enforcement mechanism for all state-law errors; factual context matters)
- Sayyed v. Wolpoff & Abramson, 485 F.3d 226 (4th Cir. 2007) (FDCPA can apply to court discovery and other litigation filings)
- Fox v. Citicorp Credit Servs., Inc., 15 F.3d 1507 (9th Cir. 1994) (taking garnishment against a debtor can give rise to FDCPA liability when improper)