Banking and Finance Law Daily Wrap Up, DEBT COLLECTION—7th Cir.: FDCPA claim based on 29-day reporting delay rejected for lack of harm, (Mar 24, 2025)

By Shashi Kant, BALLB, LLM

Plaintiff who failed to demonstrate tangible harm from a 29-day reporting delay lacked standing under the FDCPA.

A plaintiff must substantiate their allegations with evidence that a delay or misreporting has had a meaningful impact on their creditworthiness or financial standing to establish standing under the Fair Debt Collection Practices Act (FDCPA), determined the United States Court of Appeals for the Seventh Circuit (Thomas v. LVNV Funding, LLC, No. 24-1993 (7th Cir. Mar. 21, 2025)).

Background. The plaintiff, Valerie Thomas, had received a notice stating she owed $187. In response, she disputed the accuracy of the claim. Resurgent Capital Services, and LVNV Funding, LLC, notified TransUnion, the credit reporting agency, about Thomas’ dispute on the day preceding her receipt of the notice. However, TransUnion did not update its records with the dispute until 29 days later, on its next regular reporting date. Under the FDCPA, Section 1692k(a)(2) provides that such delays may entitle a consumer to additional statutory damages, up to $1,000, over and above any actual damages sustained. A jury awarded Thomas $250, reflecting these potential additional damages.

Procedural delay. After the jury gave its verdict, a docket entry was made, but the official judgment was not formally entered until June 11, 2024. Resurgent Capital Services filed a notice of appeal just four days before the formal judgment, on the same day it was finally entered. According to the Federal Rule of Appellate Procedure 4(a)(7)(A), if a Rule 58 judgment is needed but not entered, it is considered entered 150 days after the record entry. This means the appeal period would have started on May 11, 2024, so if Resurgent had waited until the formal entry on June 11, they would have missed their chance to appeal. However, Resurgent filed in time, ensuring their right to appeal was protected, despite the delay by the district court.

Injury and standing. At the heart of the appeal was the question of whether Thomas had suffered a legally cognizable injury as a result of the delay in reporting her dispute. Under the FDCPA and relevant case law, a plaintiff must demonstrate a concrete financial or reputational injury to have standing to sue for statutory damages. Resurgent’s sole argument on appeal was that the delay did not result in any actual harm to Thomas, thus negating her standing. The district court ruled that Thomas was injured as a matter of law by relying on Ewing v. Med-1 Solutions, LLC, which treated the absence of a dispute notice as having potential reputational harm (see Banking and Finance Law Daily, Feb. 3, 2022).

However, in this matter, the court pointed to several precedents (TransUnion LLC v. Ramirez, 594 U.S. 413 (2021) and Spokeo, Inc. v. Robbins¸ 578 U.S. 330 (2016)) emphasizing that the mere availability of statutory damages does not automatically confer standing. To satisfy the injury requirement, the plaintiff must provide evidence that the delayed reporting had a tangible adverse effect, such as a drop in credit score or increased borrowing costs. In this case, Thomas failed to introduce any admissible evidence of such harm. No testimony or documentation was offered to demonstrate that any creditor or insurer reviewed her credit file during the 29-day delay. There was no evidence that the delay affected her credit score or resulted in higher insurance premiums.

Even though Thomas’ lawyer mentioned that five entities made “soft inquiries” during the delay period, the record did not further explain how these inquiries translated into measurable harm. The court noted that robotic or routine access to credit information, without a clear understanding of its significance by a third party, does not establish a legal injury. As a result, the court held that without concrete proof of injury, whether financial, reputational, or both—Thomas lacked the necessary standing to recover statutory damages under the FDCPA.

The case is No. 24-1993.

Judge: Easterbrook, J.

Attorneys: Seth McCormick (Harrer Law, P.C.) for Valerie Thomas. Nabil G. Foster (Barron & Newburger P.C.) for LVNV Funding, LLC.

Companies: LVNV Funding, LLC; Resurgent Capital Services; TransUnion

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