District Court (NY) Allows Discovery to Prove that Error was not Bona Fide

In Strom v. National Enterprise Systems, Inc., 2010 WL 1533383 (W.D.N.Y.,2010), Judge Foschio held that a debt collector’s assertion of the bona fide error defense allowed discovery into other complaints so as to allow Plaintiff to attempt to prove that the debt collector’s conduct was not unintentional and the result of a bona fide error.  Judge Foschio framed the issue as follows: 

In this action alleging violations of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. (“the FDCPA”), and under New York law, intentional infliction of mental distress, Plaintiff seeks by an amended motion to compel, filed October 6, 2009 (Doc. No. 26), Defendant’s response to Plaintiff’s request, pursuant to Fed.R.Civ.P. 34(a), served July 30, 2009, Document Request 13, seeking documents relating to complaints filed with the Better Business Bureau (“BBB”) against Defendant including Defendant’s investigation of its responses to the BBB regarding such complaints. . .

Judge Foschio allowed the discovery, explaining: 

A commercial debt collector’s prior record of complaints, asserting violations of the FDCPA made to a government enforcement agency, leading to evidence of such violations, has been judicially accepted as a basis for enforcement against the violator. See United States v. ACB Sales & Service, Inc., 683 F.Supp. 734, 739 (D.Ariz.1987) (FTC enforcement action seeking penalties granted based on “hundreds of complaints” against defendant to the FTC and state agencies for “improper collection practices” leading to admissible evidence of such violations). See also Johnson v. Equifax Risk Management Services, 2004 WL 540459, at *9 (S.D.N.Y. Mar. 17, 2004) (denying defendant summary judgment on defendant’s bona fide error defense based on evidence of “numerous errors and violations of the FDCPA”). Thus, in this case regardless of whether, without more, the BBB and attorneys general complaints themselves may be admissible, it cannot be said that the information sought by Plaintiff is not reasonably calculated to lead to the discovery of admissible evidence in support of Plaintiff’s claims or to enable Plaintiff to rebut Defendant’s bona fide error defense. See Webster v. Nations Recovery Center, Inc., 2009 WL 2982649, at *2 (D.Colo.Sep’t.15, 2009) (denying defendant’s motion to strike plaintiff’s allegations of “a litany of suits” against defendant indicating frequency and similar intentional violations by defendant of FDCPA (citing Fed.R.Evid. 404(b) (permitting evidence of other “crimes, wrongs, or acts” to prove “motive, opportunity, intent, preparation, plan, knowledge, identity or absence of mistake or accident”))). Here, in addition to establishing Plaintiff’s FDCPA claims, proof of numerous violations of the FDCPA by Defendant, the existence of which Plaintiff seeks to establish through Document Request No. 13 and the 30(b)(6) deposition testimony at issue on Defendant’s motions, Plaintiff may also use such previous multiple violations to negate Defendant’s bona fide clerical error defense. See Johnson, 2004 WL 540459, at *9 (evidence of repetitive FDCPA violations by defendant collector admissible to require trial on merits of defendant’s bona fide error defense pursuant to 15 U.S.C. § 1692k(c)), as well as Defendant’s good faith defense. Id.  ¶  Additionally, in this case, Plaintiff has asserted a state claim for intentional infliction of mental distress. Under New York law, to establish this tort, a plaintiff must establish that a defendant’s “extreme or outrageous conduct” and “intent to cause, or disregard of a substantial probability of causing, severe emotional distress” caused plaintiff to suffer “severe emotional distress.” Howell v. New York Post Company, Inc., 612 N.E.2d 699, 702 (N.Y.1993) (underlining added). To be actionable, the alleged misconduct must be shown to be “outrageous in character,” and “beyond all possible bounds of decency, … regarded as atrocious, and utterly intolerable in a civilized community.” Id. (internal citations and quotation marks omitted). Here, Plaintiff has alleged that despite information she provided to Defendant’s collectors that she was disabled with a cancerous brain tumor and thus unable to work and pay the debt which Defendant sought to collect, Defendant’s employees harassed and verbally abused Plaintiff falsely threatening her with legal action and loss of her disability benefits which resulted in Plaintiff suffering seizures. Amended Complaint (Doc. No. 23) ¶¶ 16-20.  ¶  If, as a result of obtaining the discovery Plaintiff seeks regarding Defendant’s past complaints of FDCPA violations to the BBB and the state attorneys general, or other government agencies, Plaintiff is able to present evidence, pursuant to Fed.R.Evid. 404(b), of Defendant’s past numerous violations, involving abusive conduct substantially similar to that alleged by Plaintiff, a reasonable jury could conclude that Defendant acted intentionally or disregarded a serious risk of causing Plaintiff severe mental distress in the course of Defendant’s attempts to collect the underlying debt from Plaintiff.FN5 Moreover, such evidence could establish that because Defendant’s actions were not the result of a mistake or accidental, Fed.R.Evid. 404(b), they also constituted conduct that the jury could consider on whether Defendant’s conduct was, in the circumstances, “extreme or outrageous.” Howell, 612 N.E.2d at 702. As such, the information sought by Plaintiff in Document Request No. 13 and the noticed 30(b)(6) deposition questions is relevant to Plaintiff’s state law claim of an intentional infliction of mental distress.