FCRA Class Action Review – 2025

instructions to modify the class definition to include only individuals who suffered a financial detriment after receiving the second validation letter, and not just those who received it. On remand, after further discovery, the plaintiff proposed a modified class definition of individuals who, after receiving the second validation letter, re- disputed or re-asserted their validation rights either in writing, by telephone, or through an automated credit dispute system (ACDV), within 45 days. However, the court found that the new definition still did not meet the requirements for class certification. The court ruled that the class failed to meet the predominance requirement of Rule 23(b). The court opined that the individualized nature of determining whether each class member suffered financial harm, as required for Article III standing, would predominate over the common questions. The court concluded that while the class might include individuals who incurred minor costs (such as postage fees or phone charges) to dispute their debts, determining who suffered a concrete financial injury would require an individualized inquiry for each class member. For these reasons, the court denied the plaintiff’s motion for class certification. In Medina, et al. v. Two Jinn, Inc., 2024 U.S. Dist. LEXIS 188023 (N.D. Cal. Aug. 21, 2024), the plaintiffs filed a class action alleging that the defendants, a bail bond company, and AWA, a collection agency, inaccurately reported debts as overdue to credit agencies, in violation of the California Consumer Credit Reporting Agencies Act (CCRAA) and the FDCPA. The defendants moved for judgment on the pleadings, and the plaintiffs moved for class certification. The court ruled in favor of the defendants. Critically, the court found that although the debts were valid but unenforceable, the fact that the defendants reported them as past due was not misleading itself. The court stated that the plaintiffs’ allegations did not show that the defendants reported the information in a manner falsely suggesting enforceability. The court opined that nothing in the current allegations suggested that the accounts had been referred to a lawyer, were being handled by a settlement team, or had been marked as collections accounts. Id. at *7-8. The court ruled that describing the debt as “seriously past due” does not, by itself, suggest that it could be collected upon. Id. at *8. The court also stated that informing that a lender entered in a loan that they did not pay for a long time after the due date, even if the loan was unenforceable, is relevant information for creditors, and the law does not prohibit the provision of that truthful information. Id. The court therefore granted the motion for judgment on the pleadings. The court also denied the plaintiffs’ motion for class certification because it found that the plaintiffs lacked any cognizable claims under the FDCPA. The plaintiff in Stromberg, et al. v. Midland Funding, LLC , 2024 U.S. Dist. LEXIS 70792 (D.N.J. Apr. 18, 2024), filed a class action alleging that the defendant violated the FDCPA by attempting to collect a debt that was time- barred under Virginia’s statute of limitations. The plaintiff filed a motion for class certification, and the court denied the motion. The plaintiff had a credit card account with Capital One, which she defaulted on in March 2010. The defendant purchased the plaintiff’s defaulted debt and attempted to collect it by sending her a collection letter dated December 16, 2015, which offered different settlement options and discounts. The plaintiff alleged that the defendant attempted to collect the loan after the state law statute of limitations, and the letter was therefore misleading because if failed to disclose that the debt was time-barred or that making a payment could restart the statute of limitations. The defendant argued that the proposed class lacked standing and that individual issues, such as applicable statute of limitations and choice of law principles, predominated such that class certification was inappropriate. The putative class included individuals whose debt was time-barred under the applicable statute of limitations if they received collection letters from Midland Funding between December 16, 2015, and January 6, 2016, regarding Capital One credit card accounts. The court explained that it would analyze the standing issue under the predominance analysis. While it determined that the class was ascertainable based on the plaintiff’s class definition, which referenced specific dates and account criteria that could be objectively determined, the court agreed with the defendant that individual issues predominated over common questions of law or fact necessary for class certification. The court reasoned that determining the statute of limitations, default dates, and potential tolling for each class member required individualized inquiries, which rendered a class action less efficient than individual lawsuits. For these reasons, the court denied the motion for class certification.

X. Top FCRA, FACTA And FDPCA Class Action Settlements In 2024 In 2024, the top ten FCRA, FACTA and FDCPA settlements totaled $42.43 million. This was a significant decrease from the prior year when the top ten class action settlements totaled $100.15 million.

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