Mahala A. Church v. Accretive Health, Inc.

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 15-15708
________________________
D.C. Docket No. 1:14-cv-00057-WS-B
MAHALA A. CHURCH,
Plaintiff - Appellant,
versus
ACCRETIVE HEALTH, INC.,
Defendant - Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Alabama
________________________
(July 6, 2016)
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Before ED CARNES, Chief Judge, DUBINA, Circuit Judge, and HUCK,∗ District
Judge.
PER CURIAM:
Appellant, Ms. Mahala Church (“Church”), filed a putative class action
against Appellee, Accretive Health, Inc. (“Accretive Health”) alleging violations of
the Fair Debt Collections Practices Act (“FDCPA” or “the Act”). Accretive Health,
working for Providence Hospital (“the Hospital”), sent Church a letter advising her
that she owed a debt to the Hospital. Church alleges Accretive Health violated the
FDCPA by not including in its letter certain disclosures required by the Act.
Church does not allege that she suffered actual damages from Accretive Health’s
failure to include the allegedly required disclosures. Rather, Church simply alleges
that upon receiving the letter in question, she “was very angry” and “cried a lot.”
This appeal stems from the district court’s grant of summary judgment in
favor of Accretive Health. The sole issue raised at summary judgment was
whether, at the time the debt at issue was obtained by Accretive Health, the debt
was in default, as contemplated by the FDCPA. The FDCPA applies only to “debt
collectors.” See 15 U.S.C. § 1692k; Lodge v. Kondaur Capital Corp., 750 F.3d
1263, 1273(11th Cir. 2014). The Act expressly excludes from the definition of
“debt collector” any third party collecting a debt that is not in default at the time it
∗
Honorable Paul C. Huck, United States District Judge for the Southern District of Florida,
sitting by designation.
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was obtained by the third party. Specifically, the Act exempts, “any person
collecting or attempting to collect any debt owed or due or asserted to be owed or
due another to the extent such activity . . . concerns a debt which was not in default
at the time it was obtained by such person.” 15 U.S.C. § 1692a(6)(F). Thus, if the
debt at issue was not in default at the time it was obtained by a third party agency,
the agency’s efforts to collect that debt are not governed by the FDCPA, and the
FDCPA-mandated disclosures would not be required. Unfortunately, the Act does
not define the term “default.”
Accretive Health argued below that Church’s debt was not in default at the
time it obtained the debt from the Hospital, and thus, the FDCPA does not govern
the letter sent to Church. The district court agreed and granted Accretive Health’s
motion for summary judgment. Church challenges the district court’s
determination that the debt was not in default and invites the Court to hold that a
debt can be in default before a debtor is ever asked to pay a balance. We decline
such invitation.
Before addressing the merits of the motion for summary judgment, the Court
addresses the standing issue, raised for the first time by Accretive Health in its
Notice of Pertinent Supplemental Authority (“Notice”), filed on May 27, 2016,
shortly before oral argument.
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I. STANDING
Accretive Health’s supplemental authority consisted of a recent Supreme
Court opinion, Spokeo, Inc. v. Robins, 578 U.S. ___, 136 S. Ct. 1540 (2016),
addressing standing’s injury-in-fact requirement. In its Notice, Accretive Health
argues that Church’s injury is not sufficiently concrete to support Article III
standing because Church incurred no actual damages from Accretive Health’s
violation of the FDCPA. Church responded that the Court should not consider the
standing issue because Accretive Health did not raise it earlier and that a violation
of a procedural right granted by statute can be sufficient in some circumstances to
constitute injury-in-fact.
Article III of the United States Constitution limits federal court jurisdiction
to actual cases and controversies. See U.S. Const. art. 3, § 2; Cone Corp. v. Fla.
Dep’t of Trasnsp., 921 F.2d 1190, 1204 (11th Cir. 1991). “The standing doctrine is
an aspect of this case or controversy requirement and has its origins in ‘both
constitutional limitations on federal-court jurisdiction and prudential limitations on
its exercise.’” Id. (quoting Warth v. Seldin, 422 U.S. 490, 498 (1975)).
Accordingly, “standing is a jurisdictional threshold question which must be
addressed prior to and independent of the merits of a party’s claims.” DiMaio v.
Democratic Nat’l Comm., 520 F.3d 1299, 1301 (11th Cir. 2008); see also Stalley
ex rel. United States v. Orlando Reg’l Healthcare Sys., Inc., 524 F.3d 1229, 1232
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(11th Cir. 2008). “‘Questions of subject matter jurisdiction may be raised . . . at
any time during the pendency of proceedings.”’ Ingram v. CSX Transp., Inc., 146
F.3d 858, 861 (11th Cir. 1998) (quoting United States v. Ayarza-Garcia, 819 F.2d
1043, 1048 (11th Cir. 1987). Indeed, “we are obliged to consider standing sua
sponte even if the parties have not raised the issue.” AT&T Mobility, LLC v. Nat’l
Ass’n for Stock Car Auto Racing, Inc., 494 F.3d 1356, 1360 (11th Cir. 2007). Thus,
although Accretive Health failed to raise its standing argument below, the Court
addresses it to ensure Church has standing.
In Spokeo, the Court vacated and remanded the Ninth Circuit’s opinion,
instructing the Ninth Circuit to consider whether the Plaintiff’s injury was
sufficiently concrete to satisfy Article III’s injury-in-fact requirement. 578 U.S. at
___, 136 S. Ct. at 1550. In Spokeo, the plaintiff alleged a violation of the Fair
Credit Reporting Act (“FCRA”). Id. at 1544. Reversing the district court’s
dismissal for lack of standing, the Ninth Circuit noted that “the violation of a
statutory right is usually a sufficient injury in fact to confer standing,” but
recognized that “the Constitution limits the power of Congress to confer standing.”
Robins v. Spokeo, 742 F.3d 409, 413 (9th Cir. 2014). The Ninth Circuit held that
the plaintiff adequately alleged injury-in-fact because the plaintiff alleged the
defendant “violated his statutory rights, not just the statutory rights of other
people” Id. at 413–14. The Supreme Court, however, observed that the Ninth
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Circuit’s analysis reached only whether the plaintiff’s injury was particularized,
not whether the injury was concrete. Spokeo, 578 U.S. at ___, 136 S. Ct. at 1550.
In its analysis, the Supreme Court explained that “[i]t is settled that Congress
cannot erase Article III’s standing requirements by statutorily granting the right to
sue to a plaintiff who would not otherwise have standing.” Id. at 1547–48. The
Court stated that to “establish injury in fact, a plaintiff must show that he or she
suffered ‘an invasion of a legally protected interest’ that is ‘concrete and
particularized’ and ‘actual or imminent, not conjectural or hypothetical.’” Id. at
1548 (quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)).
Regarding the concrete requirement, the Court stated that a “‘concrete’ injury must
be ‘de facto’; that is, it must actually exist.” Id. The Court explained that the term
“concrete” means “‘real,’ and not ‘abstract.’” Id. Yet, the Court also noted that an
injury need not be tangible to be concrete and reiterated that “Congress may
‘elevat[e] to the status of legally cognizable injuries concrete, de facto injuries that
were previously inadequate in law.’” Id. at 1549 (quoting Lujan, 504 U.S. at 578).
Thus, “the violation of a procedural right granted by statute can be sufficient in
some circumstances to constitute injury in fact.” Id. The Court added that the “risk
of real harm” could mean “the violation of a procedural right granted by statute can
be sufficient in some circumstances to constitute injury in fact” and in such
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circumstances, “a plaintiff . . . need not allege any additional harm beyond the one
Congress has identified.” Id. (emphasis in original).
An injury-in-fact, as required by Article III, “may exist solely by virtue of
statutes creating legal rights, the invasion of which creates standing . . . .” Havens
Realty Corp. v. Coleman, 455 U.S. 363, 373 (1982); see also Palm Beach Golf
Ctr.-Boca, Inc. v. Sarris, D.D.S., P.A., 781 F.3d 1245, 1251 (11th Cir. 2015)
(stating same). In Havens Realty, the Court addressed, inter alia, whether a tester-
plaintiff had sufficiently alleged injury-in-fact to assert a violation of the Fair
Housing Act. 455 U.S. at 372–73. The tester-plaintiff, an African American,
alleged the defendant falsely told her that it had no apartments available for rent on
four occasions, while the defendant, each time, told a white tester that it did have
apartments available for rent. Id. at 368. The tester-plaintiff did not intend to rent
an apartment, and was merely posing as a renter to collect evidence of unlawful
steering practices. Id. at 373. Thus, the only injury alleged by the tester-plaintiff
was that she was given false information, in violation of the Fair Housing Act. Id.at 373–74. The Court stated that the Fair Housing Act “establishes an enforceable
right to truthful information concerning the availability of housing” and that “[a]
tester who has been the object of a misrepresentation made unlawful under [the
Fair Housing Act] has suffered injury in precisely the form the statute was intended
to guard against, and therefore has standing to maintain a claim for damages under
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the Act’s provisions.” Id. The Court explained that the fact the tester never
intended to rent the apartment “does not negate the simple fact of injury within the
meaning of [the Fair Housing Act].” Id. at 374. Thus, the Court held that the tester-
plaintiff “alleged injury to her statutorily created right to truthful housing
information” and satisfied Article III’s injury-in-fact requirement. Id.Just as the tester-plaintiff had alleged injury to her statutorily-created right to
truthful housing information, so too has Church alleged injury to her statutorily-
created right to information pursuant to the FDCPA. The FDCPA creates a private
right of action, which Church seeks to enforce. The Act requires that debt
collectors include certain disclosures in an initial communication with a debtor, or
within five days of such communication. See 15 U.S.C. § 1692e(11); 1692g(a)(1)–
(5).1 The FDCPA authorizes an aggrieved debtor to file suit for a debt collector’s
1
Specifically, § 1692e(11) states:
The failure to disclose in the initial written communication with the consumer
and, in addition, if the initial communication with the consumer is oral, in that
initial oral communication, that the debt collector is attempting to collect a debt
and that any information obtained will be used for that purpose, and the failure to
disclose in subsequent communications that the communication is from a debt
collector, except that this paragraph shall not apply to a formal pleading made in
connection with a legal action.
And § 1692g(a) states:
Within five days after the initial communication with a consumer in connection
with the collection of any debt, a debt collector shall, unless the following
information is contained in the initial communication or the consumer has paid
the debt, send the consumer a written notice containing—
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failure to comply with the Act. See 15 U.S.C. § 1692k(a) (“[A]ny debt collector
who fails to comply with any provision of this subchapter with respect to any
person is liable to such person . . . .”) Thus, through the FDCPA, Congress has
created a new right—the right to receive the required disclosures in
communications governed by the FDCPA—and a new injury—not receiving such
disclosures.
It is undisputed that the letter Accretive Health sent to Church did not
contain all of the FDCPA’s required disclosures. Church has alleged that the
FDCPA governs the letter at issue, and thus, alleges she had a right to receive the
FDCPA-required disclosures. Thus, Church has sufficiently alleged that she has
sustained a concrete—i.e., “real”—injury because she did not receive the allegedly
required disclosures. The invasion of Church’s right to receive the disclosures is
not hypothetical or uncertain; Church did not receive information to which she
(1) the amount of the debt;
(2) the name of the creditor to whom the debt is owed;
(3) a statement that unless the consumer, within thirty days after receipt of the
notice, disputes the validity of the debt, or any portion thereof, the debt will be
assumed to be valid by the debt collector;
(4) a statement that if the consumer notifies the debt collector in writing within
the thirty-day period that the debt, or any portion thereof, is disputed, the debt
collector will obtain verification of the debt or a copy of a judgment against the
consumer and a copy of such verification or judgment will be mailed to the
consumer by the debt collector; and
(5) a statement that, upon the consumer's written request within the thirty-day
period, the debt collector will provide the consumer with the name and address of
the original creditor, if different from the current creditor.
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alleges she was entitled. While this injury may not have resulted in tangible
economic or physical harm that courts often expect, the Supreme Court has made
clear an injury need not be tangible to be concrete. See Spokeo, Inc., 578 U.S. at
___, 136 S. Ct. at 1549; Havens Realty Corp., 455 U.S. at 373. Rather, this injury
is one that Congress has elevated to the status of a legally cognizable injury
through the FDCPA.2 Accordingly, Church has sufficiently alleged that she
suffered a concrete injury, and thus, satisfies the injury-in-fact requirement.3
II. REVIEW OF THE DISTRICT COURT’S ORDER
Satisfied this case is properly before the Court, we now turn to the merits of
the appeal. After reviewing the record, the parties’ briefs, and applicable law, we
affirm and adopt the district court’s well-reasoned opinion granting summary
judgment in favor of Accretive Health, filed November 24, 2015. The debt at issue
was not in default at the time Accretive Health obtained the debt, and thus, the
FDCPA does not govern Accretive Health’s letter to Church.
AFFIRMED.
2
In Spokeo, the Court stated that a Plaintiff “cannot satisfy the demands of Article III by alleging
a bare procedural violation.” Spokeo, 136 S. Ct. at 1550. This statement is inapplicable to the
allegations at hand, because Church has not alleged a procedural violation. Rather, Congress
provided Church with a substantive right to receive certain disclosures and Church has alleged
that Accretive Health violated that substantive right.
3
The Court limits this discussion to injury-in-fact’s “concrete” requirement because this is the
only aspect of standing that Accretive Health has challenged. As the Court must, we have
independently analyzed all other elements of standing and have concluded this case is properly
before the Court.
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