A federal appeals panel has agreed a debt collector can’t be sued under federal law although it repeatedly called a woman was in no way responsible for her husband’s debt.
Kara Ross sued Financial Asset Management Systems over a call placed regarding her husband, Paul Camarena, alleging a violation of the Fair Debt Collection Practices Act.
U.S. District Judge Thomas Durkin granted summary judgment to FAMS, finding Ross didn’t meet the legal definition of “consumer” under the law and therefore couldn’t sue. He also said no reasonable jury would find the agency violated the law and, even if a jury did reach that conclusion, the company still could argue it made an honest mistake.
FAMS challenged Durkin’s ruling before the U.S. Seventh Circuit Court of Appeals, which issued an opinion affirming the decision on July 14. Judge Ilana Rovner wrote the opinion; Judges Amy St. Eve and Thomas Kirsch concurred.
According to court records, Ross and Camarena married after Camarena had defaulted on his debt, which meant she wasn’t financially or legally responsible.
“Like many married couples, Ross and Camarena share a phone plan,” Rovner wrote. “They also share an office. And Camarena represents Ross in this case.”
FAMS mailed Camarena a collections letter on Oct. 15, 2020, which included instructions on how to file a dispute within 30 days. But rather than use the mail or website form, per the letter’s instructions, “Camarena tracked down a document FAMS filed with a Massachusetts state agency, used that document to divine FAMS’ employee email address format, and then sent emails disputing his debt to FAMS’s CEO and Vice President of Operations on Oct. 27 and 28,” Rovner wrote.
When FAMS called Ross, she informed the agent they had dialed her personal cellphone number and agreed to inform Camarena of the call. The panel said the FAMS collector failed to properly code Ross’ number, which led it to call her six more times from Oct. 16 through 28. Ross didn’t answer the first five calls, picked up the sixth and again said it was not Camarena’s phone but declined to give his number. FAMS called five more times, including twice on the same day.
Ross argued FAMS couldn’t claim it made a legitimate error in failing to code Camarena’s debt as disputed after he emailed the executives, but the panel disagreed, noting a company can’t be expected to have procedures in place for when someone eschews expected conduct.
“Despite his legal training and knowing better, Camarena deliberately circumvented FAMS’ clear instructions for how to dispute his debt,” Rovner wrote. “The CEO and VP of operations have no recollection of receiving Camarena’s email, and client services never received notice of Camarena’s dispute.”
Ross also failed to show Judge Durkin erred in determining a reasonable jury wouldn’t infer FAMS meant to annoy her. Ross didn’t challenge whether FAMS’ alleged violation was unintentional and, when arguing in the district court, only FAMS contested the error resulted from a bona fide error. Only on appeal did she argue “the second occurrence of the same error precludes a finding that the error was bona fide,” Rovner wrote. And because FAMS already challenged that element before Durkin, when Ross didn’t, she can’t bring it up on appeal.
“Ross says that FAMS merely trained its agents on procedures but failed to maintain procedures reasonably adapted to avoid error. The record, however, shows that FAMS did both,” Rovner wrote. “A human error in effectuating that process does not mean that the process did not exist.”