“You Hurt My Feelings!” An Examination of Emotional Distress Damages under the FDCPA

In December 2020, the United States Court of Appeals for the Seventh Circuit issued six opinions addressing Article III standing issues related to violations alleged under the Fair Debt Collection Practices Act (“FDCPA”). These opinions revisit the Supreme Court’s decision in Spokeo, Inc. v. Robins and clarify that a plaintiff in an FDCPA case is required to provide proof of a concrete injury in fact to establish Article III standing.

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Emotional distress damages as Article III standing

A violation of any provision of the FDCPA entitles the consumer to an award of actual damages, statutory damages up to $1,000, costs, and attorney's fees. 15 U.S.C. § 1692k(a). The statute does not define “actual damages.” However, courts determined that actual damages under the FDCPA may include compensation for emotional distress. Thus, a plaintiff’s allegation of emotional harm provides Article III standing. Accordingly, consumer attorneys typically allege emotional distress damages in FDCPA complaints, whether they can later be proven or not.

Sarah Doerr, shareholder at Moss & Barnett, shared the following insight:

Emotional distress damages are a throw-away claim that plaintiff’s attorneys often include but rarely prove up. It is not “emotional distress” to be annoyed or temporarily inconvenienced.

As clarified by the Seventh Circuit in the recent deluge of decisions, an FDCPA plaintiff must establish that the statutory violation presented an appreciable risk of harm.  Bare allegations of emotional distress without any proof are insufficient for establishing an injury.

Burden of proof for claims of emotional distress

The Supreme Court has not opined on a standard applicable to emotional distress damages under the FDCPA. As a result, there is a split among district courts as to the degree of specificity that is needed to sustain a claim of emotional distress damages. 

Some district courts have concluded that plaintiffs must meet the relevant state law standard for intentional infliction of emotional distress to prove emotional distress damages under the FDCPA.  Other courts have applied a lower, more lenient standard.  However, the recent Seventh Circuit decisions suggest that even under the less demanding standard, claims for emotional distress must be supported by “actual evidence.”

Jessica Klander, shareholder at Bassford Remele, shared the following insight:

The vast majority of emotional distress claims we defend against are “garden variety” claims involving vague and general allegations of “stress,” “anxiety” or “sleeplessness.”  Most jurisdictions do not require any extrinsic evidence to support these allegations other than a plaintiff’s testimony, which make them hard to dispose of by motion. 

But if the plaintiff alleges anything beyond these general allegations or claims medical treatment was sought, most courts no longer consider the claim “garden-variety.”  As a result, the plaintiff’s emotional distress claim requires the plaintiff to consent to review of their medical records and submit to an independent medical examination.  

Evidence needed to support a claim for emotional distress

Some district courts require that plaintiffs alleging damages for emotional distress under the FDCPA must provide some corroborative evidence of their emotional distress, apart from their own testimony.

John Boyle, shareholder at Moss & Barnett, shared the following insight:

Many jurisdictions consider an emotional distress claim as putting a plaintiff's medical history into controversy — especially if the plaintiff is claiming something more than “garden variety” annoyance and mental anguish.  A claim of severe emotional distress often opens the door to conducting discovery of the plaintiff’s prior mental health and treatment history. 

Thus, in such a situation, written discovery should include requests for names of providers and inquiries into treatment history, symptoms, alleged harm, and prior history of emotional trauma.  It is not uncommon that an early inquiry into a plaintiff's medical history will often cause a plaintiff who is asserting little more than a technical statutory violation to withdraw claims for emotional distress. 

For the plaintiff who insists on pursuing a serious claim of alleged severe emotional harm, thoughtful inquiry during the plaintiff's deposition is crucial.  It is important to explore what other factors have been a source of emotional distress or trauma in the plaintiff’s life (such as a recent divorce, loss of a job, death or serious illness of a loved one, drug or alcohol misuse, prior history of anxiety or depression, or pre-existing treatment for psychological issues).  It may very well be that the symptoms the plaintiff claims to be suffering from the alleged acts of the defendant are actually connected to and arise out of long pre-existing and underlying conditions.

Klander agreed, stating:

The plaintiff’s medical records often do not support their emotional distress claims or point to other circumstances having nothing to do with the collection efforts. 

In addition to the need for providing relevant medical records, Doerr identified additional challenges associated with proving emotional distress:

Where a plaintiff is being pursued by more than one creditor, she has the additional challenge of showing and quantifying the distress is somehow traceable and attributable to one particular creditor. 

The Seventh Circuit’s clarification relating to actual damages will be welcomed by defense counsel for collection agencies. 

More to come from the perspective of collection agencies.