In Bemero v. Lloyd & McDaniel, PC, the U.S. District Court for the Northern District of Illinois granted a motion to dismiss in a Federal Debt Collection Practices Act (FDCPA) case where the Model Validation Notice (MVN) was undated, finding the plaintiff lacked standing because she did not allege a concrete injury.

The defendant collections firm sent the plaintiff an MVN that was undated. The itemization portion of the letter stated that as of August 18, 2020, she owed $4,596.33 and “[b]etween August 18, 2020, and today,” she was not charged any interest or fees and no credits had been applied, resulting in a balance due of $4,569.33. The plaintiff claimed that because the letter was undated and the itemization said “today,” she was confused about what she owed and questioned whether the debt was legitimate. She claimed:

  • The missing date made her uncertain about the letter’s legitimacy;
  • She “would have pursued a different course of action” but for the confusing nature of the letter, but did not say what exactly she would have done;
  • “[T]he funds [she] could have used to pay all or part of the alleged debt were spent elsewhere;”
  • Her “reliance on the [l]etter, and the resulting inaction/non-payment” led the defendant to disseminate negative information about her to credit reporting agencies; and
  • She “spent time and money in an effort to mitigate the risk of future financial and reputational harm” resulting from the information disseminated about her nonpayment, though she did not provide any detail.

The plaintiff alleged violations of 15 U.S.C. §§ 1692d, 1692e, 1692f, and 1692g on behalf of a class of individuals in Illinois who received a similar undated letter. The defendant moved to dismiss for lack of standing and failure to state a claim. The court found the plaintiff failed to allege a concrete injury and dismissed for lack of standing.

The court noted that an injury in fact requires actual harm or “appreciable risk of harm.” The plaintiff’s allegation that she did not spend money because the letter was confusing was not an actual injury under Seventh Circuit precedent, which requires a consumer to “act[] to her detriment[] on that confusion.” While the plaintiff alleged her confusion resulted in negative credit reporting, she did not allege any false reporting or that her creditworthiness was harmed because of her reliance on the letter. The court noted a concrete injury might be shown by a plaintiff who plausibly alleges that absent confusion she would have paid the debt and increased her creditworthiness, but that was not this case.

This is one more case supporting the position that it is not enough to allege a mere violation of the FDCPA, the plaintiff must be able to show some type of concrete harm to establish standing.