Should You Have to Let Yourself Be Harassed by Creditors and Debt Collectors? U.S. Supreme Court to Decide

May 13, 2018

There is a very important decision on the horizon, scheduled to be issued by the U.S. Supreme Court in the spring. The case has, for the most part, been flying under the radar. It is the case of Spokeo, Inc. v. Robins. All of the relevant information about the case, including the briefs, may be found at SCOTUSBlog here. 

So before explaining why this case is so important for Florida consumers, let me first explain what the case is about. Spokeo, Inc. is one of those online companies that gathers up information about you (date of birth, marital status, income level, etc.) and - to the chagrin of many consumers - publishes it on the internet. Well, Spokeo published a slew of incorrect information about Mr. Robins, including his marital status and income level. Mr. Robins asked Spokeo to correct it and they refused. Mr. Robins then brought suit under a federal law called the Fair Credit Reporting Act ("FCRA") because Spokeo refused to take down the inaccurate information about him. This law provides for statutory damages and actual damages, if you have actual damages. The pertinent part of the law can be found here if you would like to read it for yourself.

Well, what's the difference between "actual" damages and "statutory" damages you may ask? Your actual damages are damages you can prove through the form of medical bills, receipts, etc. Statutory damages, on the other hand, are damages that you are entitled to if you prove a violation without actually having to show actual damages. The purpose of this is because with many of these types of violations (creditor harassment, etc.) the consumer does not have actual damages but has had to deal with the harassment by the creditor or debt collector. In the case of Robins, he had to deal with Spokeo's refusal to remove the inaccurate information about him on their website. 

When Robins filed suit, Spokeo asked the judge to dismiss the case, arguing that because he didn't suffer "actual" damages that he was not entitled to relief. After initially denying the request for dismissal, the judge then reversed himself and granted it, throwing out the case. The appeals court reversed the judge, saying that he was wrong. Because Congress has identified a harm with the inaccurate reporting and provided for these statutory damages, the appeals court found that the case should not have been dismissed. Spokeo was not too happy with this decision by the appeals court, so they appealed to the United States Supreme Court, which took the case. 

The Supreme Court recently held oral argument in the case, which you can listen to here. It seems like the justices are pretty evenly divided, with maybe Justice Anthony Kennedy being the swing vote. There are 9 justices on the Supreme Court and on many cases, the four "liberals" vote one way and the four "conservatives" vote another way, with Justice Kennedy being the swing vote as they need 5 votes for a majority opinion.

So why is this opinion so important? Because if the Supreme Court does what Spokeo is asking them to do, you will not have a claim against abusive creditor or debt collector unless you can show actual damages. Of course, in the vast majority of these cases you will not be able to show actual damages. So let's say you receive 50 phone calls a day from a creditor who will not stop calling. You come to my office and you want to sue them under the Florida Consumer Collection Practices Act or the Fair Debt Collection Practices Act. While generally we could seek $1,000 in the statutory damages, if Spokeo comes out the wrong way, we wouldn't be able to file a claim unless you literally suffered emotional distress, went to the doctor, and accrued medical bills. 

Of course, Spokeo is an inaccurate reporting case. If Spokeo goes the wrong way, a creditor could report inaccurate information on your credit report, and until you go out and get denied for a loan, you would have a hard time with a suit because you don't have the "actual" damages. You are just left to deal with the inaccurate reporting. 

It aggravates me that this case is flying under the radar because of the great impact it could have on consumers and their right to protect themselves from abusive tactics by well-heeled creditors. With that said, I am hopeful that Justice Kennedy may come through and form a 5-4 majority in favor of Mr. Robins. Stay tuned.


Ryan C. Torrens, Esq.

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