7th Cir. Says Reporting Multiple Debts Rather than Aggregating into Single Account Did Not Violate FCRA/FDCPA

In Zablocki v. Merchs. Credit Guide Co., No. 19-2045, 2020 U.S. App. LEXIS 23737 (7th Cir. July 28, 2020), the Court of Appeals dismissed an FDCPA claim premised on a debt collectors failure to aggregate debts into a single account when reporting to the CRAs.

Viewing Merchants’s separate reporting of debts from the perspective of an unsophisticated but reasonable consumer, we see the alleged conduct as falling outside the scope of these terms. It is reasonable, and not at all deceptive or outrageous, for a collector to report individually debts that correspond to different charges, thereby communicating truthfully how much is owed on each debt. Some consumers may prefer to have their debts reported  in a way that conceals debt-specific information, like how much is owed on individual debts, when specific debts were incurred, and which debts are stale. Those consumers may be willing to forego the more detailed information on their credit reports if the aggregated reporting increases their credit scores. But a preference does not necessarily equal an injustice, partiality, or deception. And the debt-reporting rule that the plaintiffs propose would conceal debt-specific information that other consumers may prefer, or be entitled, to see on their credit reports. See Rhone, 915 F.3d at 439 (recognizing that aggregated reporting could be misleading). The case before us illustrates the point: had Merchants reported in the aggregate all the debts owed to each creditor, Zablocki’s and Johnson’s credit reports would not indicate the amounts of each separate debt; when each debt would be removed from the credit report; or other features specific to each obligation. A consumer may find this information valuable or necessary to manage his or her debts. Cf. Fields v. Wilber Law Firm, P.C., 383 F.3d 562, 566 (7th Cir. 2004) (concluding that collector’s failure, in a dunning letter, to separate attorney fees from other obligation was misleading and unfair to consumers, impairing  their ability to knowledgeably assess debt validity). If sorting through and weighing these competing interests ultimately shows the plaintiffs’ proposed “aggregation” rule to be a wise public policy, then the adoption of that rule should be done by Congress or through the administrative process. Section 1692f does not create that rule on its own. And the courts are not the proper body to issue that rule.