The Seventh Circuit Court of Appeals recently affirmed a district court’s dismissal of a suit holding that the plaintiff had not suffered a concrete injury, and therefore, lacked standing to assert a claim under the Fair Debt Collections Practices Act (FDCPA).
In Choice v. Kohn Law Firm, S.C. et al, the lawsuit arose out of an unpaid consumer credit account with a bank. The bank sold the debt to the defendant creditor. The creditor then placed the account with the defendant law firm for collection. The law firm filed suit against the plaintiff in state court seeking judgment in the amount of the debt as well as “statutory attorney fees.” However, attached to the complaint was an affidavit of the creditor’s agent indicating that the creditor was not seeking additional amounts after the charge-off date, including attorney’s fees.
The plaintiff filed suit in federal court alleging violations of the FDCPA from the receipt of “false, misleading, and deceptive communications” from the defendants. Specifically, the plaintiff alleged that he “became concerned, and worried as the result of the reference to ‘statutory attorney fees’ being sought.” Further, the plaintiff alleged that after reading the complaint, he “was confused regarding the amount of money that was being sought from him.” The plaintiff contended that as a result, he was forced to hire an attorney to help him ascertain the amount of the alleged debt owed and whether attorney fees could be imposed.
The defendants moved to dismiss for lack of subject matter jurisdiction. In granting the defendants’ motion, the district court held that the plaintiff did not suffer any actual injuries and “neither confusion, lost sleep, nor hiring a lawyer are concrete harms.”
On appeal, the Seventh Circuit affirmed the dismissal. Citing relevant case law, the court held the plaintiff’s “decisions to hire an attorney and pay an appearance fee are insufficient to establish standing.” The court also dismissed the plaintiff’s contention that he would have paid the debt had the statement about statutory attorney fees not been made. “As we have consistently explained, confusion leading one to hire a lawyer is insufficient to establish standing.”
In his dissent from the majority opinion, Judge Hamilton argued that the facts of the plaintiff’s case distinguished it from the cited case law relied up on by the majority in affirming the dismissal. Specifically Judge Hamilton noted that here, the plaintiff claimed that the defendant law firm filed a suit against him that included a prayer for attorney fees that violated the FDCPA, to which the plaintiff responded by retaining a lawyer to defend himself. “Hiring a lawyer to defend yourself in state court in an action where the debt collector violated the FDCPA is readily distinguishable from consulting a lawyer to clear up your own confusion or to file your own lawsuit. The expense of hiring a lawyer to defend a baseless or illegal lawsuit is a concrete injury.”
