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Monday, January 10, 2005

Indiana Decisions - 7th Circuit posts one today

Kort, Elizabeth v. Diversified Collection (ND Ill.)

Before POSNER, MANION, and EVANS, Circuit Judges.
MANION, Circuit Judge. Elizabeth Kort, representing a
class of individuals, sued Diversified Collection Services
(“DCS”), claiming that DCS violated the Fair Debt Collec-
tion Practices Act (“FDCPA”), 15 U.S.C. §§ 1692, et seq., by
mailing her and others misleading garnishment notices. The
debts at issue were student loans governed by the Higher
Education Act (“HEA”), 20 U.S.C. §§ 1070, et seq. The text of
the garnishment notice was taken entirely from a form
issued by the Department of Education (“DOE”), which is
the federal agency charged with regulating under the HEA.
Given DCS’s reliance on the DOE form, the district court
ruled that DCS was entitled to an affirmative defense under
the FDCPA known as the “bona fide error” defense and
thus granted DCS summary judgment on this issue. Kort is
no longer prosecuting the case, but Hattie Harris-Alleyne
and Lindsay Miller have intervened to appeal the grant of
summary judgment to DCS on behalf of themselves and the
corresponding class. We affirm. * * *

DCS’s adherence to the DOE form in its garnishment
notice entitles it to the bona fide error defense, and DCS is
thus insulated from FDCPA liability with respect to its
handling of the HEA unemployment exemption.

Posted by Marcia Oddi on January 10, 2005 09:56 AM
Posted to Ind. (7th Cir.) Decisions