In In re FDCPA Mailing Vendor Cases, Civil Action No. 21-2312, 2021 U.S. Dist. LEXIS 139848, at *14-19 (E.D.N.Y. July 23, 2021), Judge Brown dismissed a series of Hunstein-based cases due to lack of standing under Ramirez.
Each case addressed herein invokes a recently-developed “mailing vendor” theory – alleging that the defendant debt collector employed an outside firm to print and mail so-called “dunning” letters to the plaintiffs. Plaintiffs argue that this violates the statute because the FDCPA limits the individuals and entities with which a debt collector may share information. See 15 U.S.C. § 1692c(b) (“[A] debt collector may not communicate, in connection with the collection of any debt, with any person other than the consumer, his attorney, a consumer reporting agency if otherwise permitted by law, the creditor, the attorney of the creditor, or the attorney of the debt collector.”). These cases emanate from an 11th Circuit decision decided earlier this year. See Hunstein v. Preferred Collection and Management Services Inc., 994 F.3d 1341, 1347-49 (11th Cir. 2021). Hunstein, though instructive, is not binding upon this Court, as the Second Circuit has not spoken on this theory. Moreover, the Supreme Court’s decision in TransUnion casts significant doubt on the continued viability of Hunstein. And, as demonstrated below, even if valid, Hunstein may not apply to the facts of the instant cases. First, in TransUnion, the Supreme Court held that the “mere presence of an inaccuracy in an internal credit file, if it is not disclosed to a third party, causes no concrete harm.” 141 S. Ct. at 2210. In reaching this determination, which certainly presents a hurdle to the mailing vendor theory advanced in Hunstein, the Court observed: “. . . the plaintiffs also argue that [*16] TransUnion “published” the class members’ information internally—for example, to employees within TransUnion and to the vendors that printed and sent the mailings that the class members received. That new argument is . . . unavailing. Many American courts did not traditionally recognize intra-company disclosures as actionable publications for purposes of the tort of defamation. Nor have they necessarily recognized disclosures to printing vendors as actionable publications.” Id. at 2210 n.6 (citations omitted). While dicta, this language appears dispositive of the mailing vendor theory. Second, TransUnion emphasizes that “in a suit for damages, the mere risk of future harm, standing alone, cannot qualify as a concrete harm—at least unless the exposure to the risk of future harm itself causes a separate concrete harm.” Id. at 2210-11; see also Fifth Ave. Peace Parade Comm. v. Gray, 480 F.2d 326, 332 (2d Cir. 1973) (rejecting “mere speculative apprehension of future misuse of information” as grounds for standing). Even to consider the risk of future harm, the Supreme Court found that the plaintiffs had to demonstrate that “their individual credit information would be requested by third-party businesses and provided by TransUnion during the relevant time period . . . [or] that there was a sufficient likelihood that TransUnion would otherwise intentionally or accidentally release their information to third parties.” TransUnion, 141 S. Ct. at 2212. Here, counsel repeatedly invokes the specter of potential future release of information by the mailing vendor. See, e.g., Complaint ¶ 25, Stergakos v. I.C. System, Inc., No. 21-CV-2312, ECF No. 1 (“[T]he debtor may well be harmed by the spread of this information.”); Letter at 2, Stergakos, No. 21-CV-2312, ECF No. 11 (“[A] letter vendor and its employees are often not subject to regulation by any statute or law imposing constraints on how long they can keep the information, what they can do with it, who they can disclose it to, or what security precautions they must maintain.”); Response Letter at 2, Ford v. Alpha Recovery Corp., No. 21-CV-2587, ECF No. 5 (“Plaintiff was distressed that Defendant would sue him for a debt he did not owe.”). Such speculative claims of potential future harm cannot support plaintiffs’ claim of Article III standing. See Fifth Ave. Peace Parade Comm. 480 F.2d at 332 (2d Cir. 1973) (“The shivering here was self-induced”). Third, the facts of these cases further distinguish them from cases in which plaintiffs can plausibly demonstrate injury-in-fact. In contrast to the spurious information at issue in TransUnion, to wit: erroneously branding class members as terrorists, the cases at issue involve debts ranging from $482.28 to as little as $25.00. Such information differs exponentially from the OFAC data at issue in TransUnion. It is one thing to falsely brand someone a drug trafficker; reporting that they failed to satisfy a modest obligation is quite another. Thus, attempts to analogize the harms alleged to a traditional common law tort simply fail. For example, using the defamation analysis applied in TransUnion, it seems untenable that the possible non-payment of a relatively small invoice could constitute “a defamatory statement that would subject [plaintiffs] to hatred, contempt, or ridicule,” particularly when such information is shared only with a mailing vendor. 141 S.Ct. at 2208. Similarly, it would be difficult to suggest, using the “invasion of privacy” analysis adopted in Hunstein, that communication of purported non-payment of a relatively de minimis debt to a mailing vendor constitutes a “matter publicized . . . of a kind that . . . would be highly offensive to a reasonable person.” 994 F.3d at 1347; compare Hunstein, 994 F.3d at 1347 (defining the identifiable family of common-law, invasion of privacy torts used as an [*19] analogous measure of damages) with Response Letter, Colas v. Sentry Credit, Inc., et al, No. 21-CV-3383, ECF No. 6 (invoking invasion of right to privacy as sole ground for standing). Finally, plaintiffs cannot invoke the common law tort of intentional infliction of emotional distress because simply mailing a collection letter, even if erroneous, is a far cry from “extreme and outrageous conduct.” See Conboy v. AT & T Corp., 241 F.3d 242, 258-59 (2d Cir. 2001) (numerous telephone calls from debt collectors is not extreme and outrageous conduct that “go[es] beyond all possible bounds of decency”).