Legal Case Summary

All right, the first case we're going to hear is Paul versus policy's acquisition and Mr. Brauer. We'll hear from you. Good morning, Your Honours and May it please the court. A question to be answered today is whether a debt collector's filing of an assignment of judgment is subject to the FDCPA and MCDCA. When the debt collector is not the assay and the document states inflated amounts owed. Now in answering this question, it's important first for the court to consider the text of the Fair Debt Collection Practices Act and ground its opinion in well rooted precedent in the FDCPA. And what that precedent tells us is that the FDCPA is a remedial statute that should be construed liberally in favor of the consumer. The court should not draw narrow lines to protect debt collectors but rather broad lines to protect consumers. And in this particular case, the district court aired for two reasons. The first being that an assignment of judgment filed in a district court debt collection post judgment enforcement procedure is a communication or is rather is not a communication but rather only needs to be an attempt to collect a debt or in connection with an attempt to collect a debt. And second, this assignment of judgment when false is materiously misleading to the least sophisticated consumer. Now with respect to the first point, the district court ignored precedent and plain meaning of the text and required that an assignment of judgment be a communication. But if we look to the text of the FDCPA first, we see that only one section of the FDCPA that's 15 USC 1692C addresses communications and 1692C claim was not pled in this case. Rather, the claims were under 1692E and 1692F. E covers false deceptive or misleading representations or means phrase broadly or means. In connection with the collection of the debt and 1692F again broadly, just covers means to collect or attempt to collect a debt. Now the action or the act taken by the debt collector does not need to be a communication specifically. And generally, starting with the Supreme Court's opinion in Heinz versus Jenkins

. Debt collection litigation proceedings have been held to be actionable under the FDCPA as being actions in connection with the attempt to collect a debt cited numerous cases in that brief starting from the filing of the complaint affidavits filed with complaint and motions in a derogatory motions for summary judgment. All of these litigation steps have been held to be actionable under the FDCPA. Now when it comes to an assignment of judgment, the only difference here is an assignment of judgment is a post judgment enforcement pleading so to speak. And under the Maryland rules under Maryland rule three dash six twenty four. But when an assignment is filed, the judgment may thereafter be enforced in the name of the assignee to the extent of the assigned interest. Now what this means is that if a new ass if a judgment is assigned the new assignee before they are allowed to use post judgment enforcement mechanisms sanctioned by the court to collect must first file this document assignment of judgment to alert both the consumer and the court that this new debt collector is the new assignee. Consequently an assignment of judgment is a necessary step. It is a necessary procedure for a new debt collector to attempt to collect the debt through post judgment enforcement mechanisms such as for example. Let me agree with you and you make some good points. There was an affirmative defense asserted in this case under 1692 K for unintentional error. And the district court characterized it as that although there really didn't address it. Is there still the should there still be the possibility of developing that aspect of the case if we agree with you. In other words, K doesn't the case say if the error is unintentional. It's a mistake that that's a defense. I disagree with your honor's interpretation of K K's a bonafide error defense and courts have generally stated that. Well, I'm not saying it applies, but I'm saying it was raised. It was presented as an affirmative defense and the court discussed it briefly. I may be even put no, but

. The case as a debt collector may not be held liable and any action brought in the subject. If the debt collector shows by for pundits evidence that the violation was not intentional. And resulted from a bonafide error. Notwithstanding the main procedure, et cetera. And as I understood the record in this case. There was a paralegal error in transferring the data to a template that the attorney relied on and he acknowledged the error and said it was mistake and the district court seemed to refer to it as unintentional error. My question is should the district court. Now have to address that defense. If we agree with you on the fact that the assignment is a debt collection activity covered by the act. To a certain extent again, the posture of the case below is just on summary judgment. And there's at least a dispute of material fact as to whether there was a bonafide error. And your point is I gather you would like to be able to address whether it's bonafide and develop that further. Yes, you're on it. Correct. And in this case, it's at least a dispute of material fact as to whether it was bonafide or not, although the paralegal acknowledged there was an error generally. And I'm going to say that the debt collector must maintain some type of quality control check some type of procedures to double check and verify whether the data and the processes used by the debt collector to collect the debt are accurate or not. In this case, the deposition testimony of Mr. Whiteman

. Basically establishes that data is uploaded by this debt collector. Parallegals may do this that or the other thing, but the data is never double checked for accuracy and when in fact this assignment of judgment was filed, it was never double checked by the attorney before signing the assignment of whether or not the information contained and it was actionable or not. With respect to the assignment itself, just a few more points I would like to make. Well, it looks pretty clearly that the debt was 8,200 plus priest judgment interest of a thousand 11 and when you combine those two, that's 10,497. And then that's what the paralegal put in 10,497 and then added in attorneys fees which got too much and the actual debt should have been lower. No, all three numbers added to four. She added all three numbers together. It's exact number 10,497 and then added on the attorneys fees in addition to that. Correct. What ended up appearing on the assignment of the document was a slightly inflated amount of effectively double dipped on the attorneys fees. All the amounts were combined to about $10,000 and then another thousand attorneys fees added on for a total of 11,000. When in fact the assignment should have only stated $10,000. And this in fact is a material misrepresentation under the FD CPA. First under the FD CPA, the lease sophisticated consumer test is purely objective. It does not inject subjective elements with respect to the materiality. The assignment must only mislead the lease sophisticated consumer into believing something is true or perhaps to influence the consumer to take immediate action to correct the misstatement. Under this circuit's decision in the national financial services case, a lease sophisticated consumer and the FD CPA protects the gullible consumer as well as the shrewd and a gullible consumer is one who when you tell them something they would say yes, that's true. And if you are to or in this case perhaps when we're dealing with an old assignment, people may forget what they have paid and what they haven't

. And on this assignment of judgment, the false statements are that the amount is actually essentially 11,000 when it's really 10, which a gullible person may take that at pay value. It also failed to record the payments $2700 correct correct your honor at stated payments totaling $0 and over the passage of time gullible consumers, unsophisticated consumers, which the seven circuit is set as literally the most unsophisticated person on the ring may not have the means or may not remember what they have paid or perhaps they thought they paid another debt. Council when the misrepresentation lies in numbers like this, what's the bright line? I mean, what if it was $100 off? Do we have a case then? Absolutely, Your Honor, the bright line and in fact, it has the exact perfect number. Yes, Your Honor, generally precedent has stated that if the debt collector asks for a dollar more or penny more than they are owed, that is a misrepresentation under 1692. This question is is 33 cents overstatement material? Yes, Your Honor, it would lead the least sophisticated consumer to pay 33 cents more than is owed. You don't need to make the drawing something when I think it gets pretty you're pushing the line pretty hard. How about one send over or a three cents eight of the four turned into a seven on the document and it's three cents too much. Is that material? Yes, Your Honor, we have to draw the lines somewhere and but materiality is something we always assess. It's a little bit like objective reasonfulness. I mean, of course, assess those things, but I must say when you argue for such a hard rule of recent over is material on a $10,000, $11,000 judgment. Well, in this case, Your Honor, it's a $1,000 over and well, I understand that's your argument and it's actually may even be more because it didn't show the 2700 correct around. So we're dealing with the thousands of dollars and with respect to the bright line, I think the bright line does have to be drawn at any amount over because various amounts of money matter to different people, $100 matters. To people who, quite frankly, don't have a lot of money and we're dealing with standard that should be tailored towards unsophisticated consumers, many of whom are likely to not be of great means. If there has to be a line drawn here, it should be a bright line drawn at any amount more than that that is due in this case. One other point on materiality, the district court's opinion also aired because it ejected subjective belief or really was essentially inject injecting reliance into the leased sophisticated consumer standard. The district court found that the standard was a leased sophisticated consumer who did not believe they owed the debt that was injecting miss Powell's subjective belief from the deposition into that standard. And it was effectively putting in the common law fraud reliance element into the past. Now, Congress, when they passed the FDCPA in its FDCPA statement of purpose and Section 1692 says that existing laws are inadequate

. And that was the whole reason this statute was passed. Now, Congress was not intending to duplicate the elements of common law fraud here. So it doesn't matter whether or not the consumer was relying on the misrepresentation, but rather whether the hypothetical leased sophisticated consumer who is gullible may find that several thousand dollars overstatement is true and effectively overpay by several thousand dollars more. In more to the point, the issue of whether the assignment of judgment is false or not is already been finally and fully determined by the state courts in Maryland. In case began in the state district court of Maryland, it was appealed to the circuit court, which affirmed the district court's opinion that palisades did not have an assignment and that the amount in on these final calls. The sufficient evidence to the assignment that's there's no doubt there was an assignment. This record makes it almost conclusive. The problem in the state court was the evidence presented didn't adequately state that policy had the assignment. I mean assignments right in the records. Your Honor, I don't think they can relitigate that issue and come forward with better evidence in federal court once they are sued to say, oh, look, no, we really had the evidence. They had their opportunity when that issue was presented in state court. That wasn't being tried then and she won that case and she got her debt wiped out. And as a as a course on it, but what the court concluded was the evidence was insufficient to show the assignment and therefore palisades lost, but to come back in federal court and argue there was no assignment when the record has a copy of the assignment. And no one's alleged that it's fraudulent. In the on its face, the execution assignment. I don't think it goes very well. Your Honor, the judgment itself and the record has an extract through it and it's vacated. She doesn't owe money to anyone and with respect to the

. I ask you about that. How did the remedy for any defect in the assignment become. Distract the judgment. The district court considered that your honor and the district court explained very briefly how you get from a bad assignment of a judgment to the whole judgements. No good. Well, the district court found that palisades didn't have evidence considered well, then who would be able to enforce the judgment. That wasn't before the district court, wasn't should have been. Well, I understand you went on you went in on a motion. For fraud irregularity, etc. But, but you weren't really attacking the judgment. You were attacking the assignment of the judge. It's just a curiosity. That's all my time is up here. Answer briefly or why don't you hold it and told me. Thank you. Thank you. I miss Bella. Good morning, your honors may have to support my name is Megan

. I have to pick it up a little bit or pull the microphone to you, but we'd like to be able to hear what you're saying. May have to be the court. My name is Megan Galacey and I'm pairing on. I'm sorry, I still can't hear you. I'm sorry, your honor. My name is Megan Galacey and I'm appearing on behalf of the appellys, palisades, acquisition 16 LLC and Fulton agreement and Galacey LLC. I'd like to begin by addressing the materiality arguments. Police sophisticated tumor standard consumer standard may be different in degree from a reasonable person standard or reasonably prudent person standard, but it is not a different type of standard. It doesn't require that a court examine police sophisticated consumer on the conduct and question and a vacuum. I'm having a lot of difficulty hearing you. I don't know how we can improve this, but. If you can speak as if there is no microphone and you're trying to reach me here, that would help a lot. I don't want to cause you difficulty, but I do want to hear what you have to say. I'm sorry, I will try to speak louder. The least sophisticated consumer standard may be different in degree from a reasonable person standard or reasonably prudent person standard, but it is not a different type of standard. It doesn't require that a court examine the least sophisticated consumer on the conduct and question and a vacuum to decide whether the statute has been violated. The district court properly concluded that a reasonable, the sophisticated consumer who did not believe she owed a debt would not have chosen any different course of action, no matter what numbers had been stated in the assignment. Most, most consumers who failed to pay debts just sit on the couch

. And there may be a very material misrepresentation and they wouldn't have acted differently, whether it was correct or fraudulent. Does that mean because they wouldn't have acted differently because they just sit there like bumps on the log mean it's not material. Well, here we have a here we have a representation that overstates the debt by over $3,000, maybe a close to $4,000, which is fairly significant with respect to about. $11, $12,000 debt. I disagree with your honor. The assignment of judgment does not state the current balance of the debt. The assignment of judgment that was filed in the state court action was a court form and from the information that was contained in the court form is not possible to determine what the current balance of the debt is because it makes no mention of post judgment interest and it does not contain any field where you can input the amount of post judgment interest that have been approved. And it does it doesn't have a zero next payments made. It did your honor, but isn't that in and of itself material she made $2700. A consumer cannot preemptively or proactively file a lawsuit under the FDC PA upon receiving the assignment of judgment, at least sophisticated consumer could have pursued any number of courses of action, including contacting the new owner of the debt to inquire. But that's a different issue than your argument. You started off by saying the failure to include $2700 on this debt was not material. And I'm suggesting to you that the fact that the consumer just sat on there or wouldn't have acted differently if there were stated different numbers is not the test cannot be the test material. But you're on the failure to credit the payments was limited to the assignment of judgment in the own in the records of the appellees they had credited the $2700. Except the document said zero. It had a number in the in the blank spot right. It did. Okay, now if they said nothing about payments had no line at all you have a better argument, but there was an actual line representing how much she paid and they put zero there instead of $2700

. Now that's a misstatement isn't it? It's an accurate, but it doesn't result in this instance. It doesn't result in any detriment to the consumer because the appellees did have a record of her payments and had credit as a payment to her. What in the statute or the precedent requires quote detriment to the consumer under the least sophisticated debt or consumer pass. Well, my point is that she missed how will jump the gun and filing lawsuits. There was no. Sounds like what you're saying is this would evolve and worked out in the end. Is that essentially what you're saying? She filed a lawsuit but and by the way she didn't follow lawsuit. She filed a motion to vacate correct? Yeah. And so what your argument is, if she just talked to us and we had taken a closer look at our records, it all would have been worked out. No, my point is that even if she had done nothing, even if a leesa sophisticated consumer had done nothing upon receiving the assignment, a judgment and the judgment had ultimately been enforced. The appellees would have enforced it in the amount contained in their own records and then satisfied the judgment after receiving much less than Miss Powell actually owed. And that's not a violation of the fair deck. I don't know why you're so sure about that. But these type of debtically, debtors have all kinds of garnishments. And so, you know, but it seems to me it's not fanciful to think that a debtor in Miss Powell's position could easily have an amount in excess of what was actually owed. So those aren't the facts of the case here on our, the appellees didn't attempt to collect any amount of this. This is called an oath. Well, that's a separate issue

. Question is whether the filing and serving of the assignment was in connection with an attempt to collect the debt. But you didn't want to talk about that. I will. Or at least initially you wanted to go directly to material. I will get to the collection activity argument. The assignment of judgment doesn't amend the judgment and it doesn't give the assigned either right to enforce the judgment incorrectly. And even if the least sophisticated consumer. Wasn't the assignment that collection activity wasn't it one of the steps that had to be taken to collect the debt. But I disagree with it being collection activity and I can turn to that argument. Why do you think they filed the assignment? Well, the. The. Fulton Freeman Anglici is the attorney for palisades acquisition and the attorney has an obligation to protect its clients interest. And the attorney has been a judge. Mr. Whiteman testified that a purpose in filing the assignment of judgment was to avoid leaving the judgment vulnerable to vacator, which would have been a concern. As the original judgment creditor no longer existed and the attorney's office that represented it no longer existed. And those were the only entities associated with the judgment in the court's record. What about the affirmative defense? You didn't seem to press that in your motion to the district court. You raised it as an affirmative defense in your complaint. And it was sort of alluded to in passing the court talked about it as an error. But it seems to me this whole case. If you were to center this whole case and ask about whether your client has responsibility. The real answer is we made a mistake in our assignment. We mistreated the amount, but it was a administrative error created by a paralegal and transferring data. And we are sorry about that, but that doesn't create liability. Isn't that really where you are in this case? And I didn't see you make that kind of error. It is true that it was a clerical error and that it was intentional and the appellees are entitled to the bona fide error defense. I disagree that the. Did you raise that as a principal point in the motions before the district court? The appellees did raise the issue of the bona fide error defense. And you think the district court ruled on that? I don't believe the district court ruled on it. No, you're on it. And just I would point out that even if it was least sophisticated consumer viewed the assignment of judgment as a statement of what was due to misspelled out every dollar that was stated in that assignment. And then some. I will now turn to the collection activity argument. Filing the assignment of judgment was not collection activity because it did not contain a demand for payment. And nor does the filing of an assignment of judgment act as an inducement to pay the debt complaint and motions for judgment

. You raised it as an affirmative defense in your complaint. And it was sort of alluded to in passing the court talked about it as an error. But it seems to me this whole case. If you were to center this whole case and ask about whether your client has responsibility. The real answer is we made a mistake in our assignment. We mistreated the amount, but it was a administrative error created by a paralegal and transferring data. And we are sorry about that, but that doesn't create liability. Isn't that really where you are in this case? And I didn't see you make that kind of error. It is true that it was a clerical error and that it was intentional and the appellees are entitled to the bona fide error defense. I disagree that the. Did you raise that as a principal point in the motions before the district court? The appellees did raise the issue of the bona fide error defense. And you think the district court ruled on that? I don't believe the district court ruled on it. No, you're on it. And just I would point out that even if it was least sophisticated consumer viewed the assignment of judgment as a statement of what was due to misspelled out every dollar that was stated in that assignment. And then some. I will now turn to the collection activity argument. Filing the assignment of judgment was not collection activity because it did not contain a demand for payment. And nor does the filing of an assignment of judgment act as an inducement to pay the debt complaint and motions for judgment. And that speaks the entry of judgment. That's just pretty broad. It's not related to just the communication. It's any misleading representation or means in connection with. That's pretty broad. And if we were. You seem to think that the assignment. And that's not a. From one company to another, which is necessary to collect the debt and actually. Wood did result, I guess, in this case, some garnishments and so forth that the. That's not a. Representation or means in connection with collection of that. Well, in order for the filing of an assignment of judgment to lead to payment of the debt, there have to be a taxable assets and there have to be additional filings with the court. Sure, but it's because of rules and procedures, you have to do it in steps. Your argument would be that if it could all be done in one document that you file the assignment, you file a garnishment, you file an attachment, all in a single document. Then there would be a violation. Is that is at the point? Well, the six circuit in the garden case stated that when there is no direct demand for payment, something has the requisite connection to collection to itself be considered collection activity. If it aims to make any attempt to collection more likely to succeed the filing of an assignment was not only more likely it was necessary to file this in order to collect

. And that speaks the entry of judgment. That's just pretty broad. It's not related to just the communication. It's any misleading representation or means in connection with. That's pretty broad. And if we were. You seem to think that the assignment. And that's not a. From one company to another, which is necessary to collect the debt and actually. Wood did result, I guess, in this case, some garnishments and so forth that the. That's not a. Representation or means in connection with collection of that. Well, in order for the filing of an assignment of judgment to lead to payment of the debt, there have to be a taxable assets and there have to be additional filings with the court. Sure, but it's because of rules and procedures, you have to do it in steps. Your argument would be that if it could all be done in one document that you file the assignment, you file a garnishment, you file an attachment, all in a single document. Then there would be a violation. Is that is at the point? Well, the six circuit in the garden case stated that when there is no direct demand for payment, something has the requisite connection to collection to itself be considered collection activity. If it aims to make any attempt to collection more likely to succeed the filing of an assignment was not only more likely it was necessary to file this in order to collect. What is it? It's not the purpose of the filing of an assignment of judgment is a ministerial step which records the new holder of the judgment and permits him to file enforcement papers in his own name without having to amend the caption. It doesn't cause assets to be discovered. It doesn't inherently put pressure on a judgment that are to pay the debt and it might never lead to collection of the. The assignment has the right to enforce the judgment by virtue of having acquired all right title and interest to the judgment by the assignment not by virtue of the filing of the assignment of judgment with support. Council, do you agree that when you file an assignment, it's spread on the record of the court. If you have a job and you hit a four you haven't paid the debt but you know that NAS and assign you don't want to be gone. I don't know if it's done that in due shoe perhaps to pay the debt now. But so the judgment the the assign or of the judgment could have enforced the judgment also. I mean nothing has changed by by filing the assignment of judgment. It doesn't become more due or more enforceable. I mean once a judgment is. Yes, it does it means that somebody now is paying attention to it. I mean it would have to come in sense of it is now this thing is active someone is filing something in the court. The knowledge and assignment is dead and the next step would be garnishment most people know about garnishment. That's the one that you lose your job and that's the biggest weapon of debt collectors be able to say I'm going to garnish your pay. Why would that least be inducement? Part of inducement even if you say maybe it's it might be somewhat superfluous but it is inducement. There's nothing in the you know nothing in the language of the assignment of judgment. Self which suggests that the a fine can now enforce the judgment

. What is it? It's not the purpose of the filing of an assignment of judgment is a ministerial step which records the new holder of the judgment and permits him to file enforcement papers in his own name without having to amend the caption. It doesn't cause assets to be discovered. It doesn't inherently put pressure on a judgment that are to pay the debt and it might never lead to collection of the. The assignment has the right to enforce the judgment by virtue of having acquired all right title and interest to the judgment by the assignment not by virtue of the filing of the assignment of judgment with support. Council, do you agree that when you file an assignment, it's spread on the record of the court. If you have a job and you hit a four you haven't paid the debt but you know that NAS and assign you don't want to be gone. I don't know if it's done that in due shoe perhaps to pay the debt now. But so the judgment the the assign or of the judgment could have enforced the judgment also. I mean nothing has changed by by filing the assignment of judgment. It doesn't become more due or more enforceable. I mean once a judgment is. Yes, it does it means that somebody now is paying attention to it. I mean it would have to come in sense of it is now this thing is active someone is filing something in the court. The knowledge and assignment is dead and the next step would be garnishment most people know about garnishment. That's the one that you lose your job and that's the biggest weapon of debt collectors be able to say I'm going to garnish your pay. Why would that least be inducement? Part of inducement even if you say maybe it's it might be somewhat superfluous but it is inducement. There's nothing in the you know nothing in the language of the assignment of judgment. Self which suggests that the a fine can now enforce the judgment. And as I said the judgment the original judgment creditor could enforce the judgment as well. I mean nothing has been is a motion for summary judgment on the debt. That's not the collection of a debt. It's a preliminary step in order to get a judgment to enforce. But a summary didn't we hold in Syed that the motion for summary judgment was a collection activity. A summary judgment seeks. Seeks entry of judgment. That's an imminent negative consequence that some of the. Seeks entry of a judgment and also in a in a sense that it puts it in a different person's name. But there's the the the seat entry of judgment which is an imminent negative consequence which someone might be induced to avoid to avoid by payment of the debt. Once the judgment is entered the negative consequences of that factor ever present. There's always going to be someone who can. What if you took a Baltimore city judgment and recorded it in the circuit court for anorundal county. What that is that. With that satisfy the statute. Just recording. A judgment from a neighboring jurisdiction. No, I don't it wouldn't

. And as I said the judgment the original judgment creditor could enforce the judgment as well. I mean nothing has been is a motion for summary judgment on the debt. That's not the collection of a debt. It's a preliminary step in order to get a judgment to enforce. But a summary didn't we hold in Syed that the motion for summary judgment was a collection activity. A summary judgment seeks. Seeks entry of judgment. That's an imminent negative consequence that some of the. Seeks entry of a judgment and also in a in a sense that it puts it in a different person's name. But there's the the the seat entry of judgment which is an imminent negative consequence which someone might be induced to avoid to avoid by payment of the debt. Once the judgment is entered the negative consequences of that factor ever present. There's always going to be someone who can. What if you took a Baltimore city judgment and recorded it in the circuit court for anorundal county. What that is that. With that satisfy the statute. Just recording. A judgment from a neighboring jurisdiction. No, I don't it wouldn't. That the recording of a judgment. I'm sorry. I guess I don't understand your question. Well, in order to get a judgment and forced against real property in Maryland. You have to record it in each county where there's real property. So. Judge Davis's question is if the judgment is entered in Baltimore city and the land the person's land has some land down in the beach and anorundal county. And they go and file the judgment in the circuit court for anorundal county. It now becomes a lien against that property. And his question is is that of that collection activity to record the judgment in anorund county. I don't know your honor. I'm not here to answer. Well, under the principle you're advocating a boy to be. It sounds to me like if you're being consistent, you would have to argue it's not. And you would also have to argue that even a motion for summary judgment to reduce the debt the judgment is not because it's not the collection of the debt. It's the preliminary step of getting the judgment of or enforcement. Well, as I said, as the six circuit said in order for something to be in connection with the collection of debt of a debt, it has to make an attempt to collect the debt more likely to succeed. Well, don't you think getting the assignment and the right person filing their assignment in the name of the right person who owns the thing is necessary to collect the debt

. That the recording of a judgment. I'm sorry. I guess I don't understand your question. Well, in order to get a judgment and forced against real property in Maryland. You have to record it in each county where there's real property. So. Judge Davis's question is if the judgment is entered in Baltimore city and the land the person's land has some land down in the beach and anorundal county. And they go and file the judgment in the circuit court for anorundal county. It now becomes a lien against that property. And his question is is that of that collection activity to record the judgment in anorund county. I don't know your honor. I'm not here to answer. Well, under the principle you're advocating a boy to be. It sounds to me like if you're being consistent, you would have to argue it's not. And you would also have to argue that even a motion for summary judgment to reduce the debt the judgment is not because it's not the collection of the debt. It's the preliminary step of getting the judgment of or enforcement. Well, as I said, as the six circuit said in order for something to be in connection with the collection of debt of a debt, it has to make an attempt to collect the debt more likely to succeed. Well, don't you think getting the assignment and the right person filing their assignment in the name of the right person who owns the thing is necessary to collect the debt. It may be a step toward collection, but it doesn't make collection more likely to succeed. It makes it it's necessary not only more likely. It's essential, but it doesn't increase. I mean, you can file in a fine of judgment and never get paid. I mean, you and. Well, summary judgment, you can get a judgment and never get paid. Or recording the judgment of Baltimore city judgment in anorund county, you'll never get paid. But that establishes that the judgment is due to the there's nothing that inherent about an assignment of judgments that puts pressure on a judgment that are to pay the debt. If you was sent a copy, wasn't she? She was. Yeah. The district court likened the assignment of judgment to a proof of claim filed in a bankruptcy proceeding. The purpose of a proof of claim is to establish the amount owed to the claimant. Maryland rule 366 for does not date that upon filing an assignment of judgment, the assignment, the establishes the amount owed. And as I've already stated, you can't possibly state the current balance and the court form that was filed in the state court collection action. And once you file a proof of claim, you get paid. And as I've been trying to point out filing the assignment of judgment does not result in payment of the debt. And if filing a proof of claim is not selection activities, I'm certainly filing an assignment of judgment. Which court held that file in a proof of claim is not a that collection activity

. It may be a step toward collection, but it doesn't make collection more likely to succeed. It makes it it's necessary not only more likely. It's essential, but it doesn't increase. I mean, you can file in a fine of judgment and never get paid. I mean, you and. Well, summary judgment, you can get a judgment and never get paid. Or recording the judgment of Baltimore city judgment in anorund county, you'll never get paid. But that establishes that the judgment is due to the there's nothing that inherent about an assignment of judgments that puts pressure on a judgment that are to pay the debt. If you was sent a copy, wasn't she? She was. Yeah. The district court likened the assignment of judgment to a proof of claim filed in a bankruptcy proceeding. The purpose of a proof of claim is to establish the amount owed to the claimant. Maryland rule 366 for does not date that upon filing an assignment of judgment, the assignment, the establishes the amount owed. And as I've already stated, you can't possibly state the current balance and the court form that was filed in the state court collection action. And once you file a proof of claim, you get paid. And as I've been trying to point out filing the assignment of judgment does not result in payment of the debt. And if filing a proof of claim is not selection activities, I'm certainly filing an assignment of judgment. Which court held that file in a proof of claim is not a that collection activity. Lower court in the district of Maryland. As that ever do we have any forth circuit precedent and circuit precedent that reaches that conclusion? No. That concludes my remarks. Pardon me. That concludes my remarks. Oh, okay. Well, thank you. Thank you very much. We'll have some rebuttal for Mr. Brauer. Thank you, Your Honor. I actually wanted to begin clearing up the bonafide error issue on the court's opinion at J.A. 606 footnote 12. The court did note that although the defendants argue that they are entitled to a bonafide error defense. That affirmative defense does not apply to errors of law because the defendants made an error. I'm very peculiar to me. I can't see how it was an error of law when the paralegal mis-transposed the wrong number into the template

. Lower court in the district of Maryland. As that ever do we have any forth circuit precedent and circuit precedent that reaches that conclusion? No. That concludes my remarks. Pardon me. That concludes my remarks. Oh, okay. Well, thank you. Thank you very much. We'll have some rebuttal for Mr. Brauer. Thank you, Your Honor. I actually wanted to begin clearing up the bonafide error issue on the court's opinion at J.A. 606 footnote 12. The court did note that although the defendants argue that they are entitled to a bonafide error defense. That affirmative defense does not apply to errors of law because the defendants made an error. I'm very peculiar to me. I can't see how it was an error of law when the paralegal mis-transposed the wrong number into the template. They is an error of what amounts are included in a judgment. Attorney's fees are not included in a judgment. So by essentially putting the attorney's fees in with the judgment and then asking for an additional thousand plus in attorney's fees. That was the error of law. Well, there's also the misstatement failure to pay $2,700. Correct, Your Honor. And at the end of the day, what we're dealing with here as far as I can see how those are errors of law when somebody transposes the error was created by a paralegals. Billion out of template that was used by the attorney in the collection effort. And under the bonafide error standard, the error, it's not just a mistake, but it must be bonafide. They must have procedures in place to double check what paralegals are doing and make sure that they're doing it accurately or anyone. You know, we're the rule of law that called an aero-medic error in the error of law. Perhaps, Your Honor. But the bigger point is that the error must be bonafide. And when there are no quality control procedure checks on what paralegals are doing. Or there's no checking of the integrity of the data in a debt collector's system when the attorney is just simply signing a standard form pleading that's put in front of them that data are put into when the Maryland rules require that an attorney sign up leading having reviewed it and knowing that there's good cause to file it. There's no bonafide error. We disagree with the district courts. A parent believe that that the bonafide defense error defense is not available here because it was an error of law

. They is an error of what amounts are included in a judgment. Attorney's fees are not included in a judgment. So by essentially putting the attorney's fees in with the judgment and then asking for an additional thousand plus in attorney's fees. That was the error of law. Well, there's also the misstatement failure to pay $2,700. Correct, Your Honor. And at the end of the day, what we're dealing with here as far as I can see how those are errors of law when somebody transposes the error was created by a paralegals. Billion out of template that was used by the attorney in the collection effort. And under the bonafide error standard, the error, it's not just a mistake, but it must be bonafide. They must have procedures in place to double check what paralegals are doing and make sure that they're doing it accurately or anyone. You know, we're the rule of law that called an aero-medic error in the error of law. Perhaps, Your Honor. But the bigger point is that the error must be bonafide. And when there are no quality control procedure checks on what paralegals are doing. Or there's no checking of the integrity of the data in a debt collector's system when the attorney is just simply signing a standard form pleading that's put in front of them that data are put into when the Maryland rules require that an attorney sign up leading having reviewed it and knowing that there's good cause to file it. There's no bonafide error. We disagree with the district courts. A parent believe that that the bonafide defense error defense is not available here because it was an error of law. Then we should probably say that if we send the case back because otherwise, if it if you agree, I think you I think you agree with your judge. If there's a law that does not have a record of a case that's nowhere that if. If it's not an error of law, then it's available to the defendant when this case goes forward before jury. But, but I understand your argument now you're saying the district court is taking that issue out of the case. The district court did take the issue out of the case, but my only. argument is that there's still a dispute of material fact that this court should not Should not overturn the district court and then find that a bona fide or exist I understand that I understand that but you understand my point is yes, you're on it If the if as you say the district court is taking it out of the case Maybe if we send it back we should put it back in the case if we have convinced it's not an error of law If your honors are convinced it's not an error of law then You are correct Judgment did reflect and the payments did it Could you repeat the question on the judgment did not reflect any reductions for payments no you're on it the judgment reflected no Reductions for payment. All right, there are at least twenty so in that case that if there was If there was no And double doubling the attorneys fees You wouldn't have a case merely because they as zero for payments would you? We would have a case why would you have a case? Would it be correct they purchased paper They purchased a judgment for amount of money And if they accurately reflect what that judgment said which did not reflect payments because you have to live and die about the first act of an attempt You're saying that the first act is filing the assignment In collection unless assume that's correct Well, what is the error if they said no, I'm giving you exactly what the judgment we purchased said This was the amount it didn't reflect payments at all. Where would they it be a false statement just in that as counsel said I think correctly and that is if they try to collect more Didn't reflect that but right now we're just talking about did you accurately The court what that judgment said and give it for the purpose of an assignment would you have a case If all they did was did not reflect Payments that's the question uh can I clarify one thing or to make sure I understand when you say if I'm not question They said payment zero dollars. So is your hypothetical if they all they did was write down the amount of the judgment and said nothing about payments or In whether in the facts of this case What if they had written down the amount and this case if that's a form that had payments on there Which would be available? I suppose if the judgment reflected it since it did it is zero So yes, I'll even if it said payment zero But in this case payments for twenty seven hundred dollars. Yeah, but that's not the question the question is they have an assignment Did they accurately say what that judgment said because you got to live and die about it That's all they did in the act they didn't try to collect any amount that's counsel correctly stated What they do what they're saying is that we They said this is the paper we purchased which is a judgment These are the numbers that came from that judgment. There was no reflection of payment zero is accurate But what in the facts of this case your honor they stated more than the amount of the judgment They double dipped on the attorney's fees and then when payments were actually made I thought at my hypothetical I said if there were no Little mistake as to doubling the attorneys fees Sejudgment amount was accurately stated and they put payments and said zero because the judgment didn't reflect any It just purchasing paper For example You gotta think of that world at industry Someone is telling them what the judgment is listen. I have a judgment How much would you really give me how much would you give me for this judgment? Thanks. Okay. I'll give you this Well, you know the people may not always accurately state What the amounts of the payments were so they purchased paper So at this point why are they going to cut themselves short and put down payments if the judgment didn't say that Now the burden would be on them if they try to collect more and it's fine and it's like that But at this point, this is a amount of transferring numbers To an assignment and the numbers were not would not be incorrect It doesn't reflect payments is zero because this is the form it's good because some judgment is really may say credit for payments This one didn't so you can't have your cake and even too Mr. Broward isn't wasn't this an assignment a judgment under Maryland rule Which requires the assignment to be filed everywhere where a lien is filed and it requires that payments be shown On the face of it and in this case the assignment did Indicate affirmatively that no payments were made in other words when it's a lien against real estate in Maryland And you just record the whole judgment with not reflecting payments It'll misrepresent the scope of the lien and the the rule under which is this filed three dash six twenty four requires that it'll also be given to the To follow the lien Root that was originally filed show the reductions of the judgment It's absolutely correct your honor and in this case the lien would have stated and inflated amount and I see my time is expired if there no more questions Thank you your honors We'll come down a greet council and proceed on to the second case

All right, the first case we're going to hear is Paul versus policy's acquisition and Mr. Brauer. We'll hear from you. Good morning, Your Honours and May it please the court. A question to be answered today is whether a debt collector's filing of an assignment of judgment is subject to the FDCPA and MCDCA. When the debt collector is not the assay and the document states inflated amounts owed. Now in answering this question, it's important first for the court to consider the text of the Fair Debt Collection Practices Act and ground its opinion in well rooted precedent in the FDCPA. And what that precedent tells us is that the FDCPA is a remedial statute that should be construed liberally in favor of the consumer. The court should not draw narrow lines to protect debt collectors but rather broad lines to protect consumers. And in this particular case, the district court aired for two reasons. The first being that an assignment of judgment filed in a district court debt collection post judgment enforcement procedure is a communication or is rather is not a communication but rather only needs to be an attempt to collect a debt or in connection with an attempt to collect a debt. And second, this assignment of judgment when false is materiously misleading to the least sophisticated consumer. Now with respect to the first point, the district court ignored precedent and plain meaning of the text and required that an assignment of judgment be a communication. But if we look to the text of the FDCPA first, we see that only one section of the FDCPA that's 15 USC 1692C addresses communications and 1692C claim was not pled in this case. Rather, the claims were under 1692E and 1692F. E covers false deceptive or misleading representations or means phrase broadly or means. In connection with the collection of the debt and 1692F again broadly, just covers means to collect or attempt to collect a debt. Now the action or the act taken by the debt collector does not need to be a communication specifically. And generally, starting with the Supreme Court's opinion in Heinz versus Jenkins. Debt collection litigation proceedings have been held to be actionable under the FDCPA as being actions in connection with the attempt to collect a debt cited numerous cases in that brief starting from the filing of the complaint affidavits filed with complaint and motions in a derogatory motions for summary judgment. All of these litigation steps have been held to be actionable under the FDCPA. Now when it comes to an assignment of judgment, the only difference here is an assignment of judgment is a post judgment enforcement pleading so to speak. And under the Maryland rules under Maryland rule three dash six twenty four. But when an assignment is filed, the judgment may thereafter be enforced in the name of the assignee to the extent of the assigned interest. Now what this means is that if a new ass if a judgment is assigned the new assignee before they are allowed to use post judgment enforcement mechanisms sanctioned by the court to collect must first file this document assignment of judgment to alert both the consumer and the court that this new debt collector is the new assignee. Consequently an assignment of judgment is a necessary step. It is a necessary procedure for a new debt collector to attempt to collect the debt through post judgment enforcement mechanisms such as for example. Let me agree with you and you make some good points. There was an affirmative defense asserted in this case under 1692 K for unintentional error. And the district court characterized it as that although there really didn't address it. Is there still the should there still be the possibility of developing that aspect of the case if we agree with you. In other words, K doesn't the case say if the error is unintentional. It's a mistake that that's a defense. I disagree with your honor's interpretation of K K's a bonafide error defense and courts have generally stated that. Well, I'm not saying it applies, but I'm saying it was raised. It was presented as an affirmative defense and the court discussed it briefly. I may be even put no, but. The case as a debt collector may not be held liable and any action brought in the subject. If the debt collector shows by for pundits evidence that the violation was not intentional. And resulted from a bonafide error. Notwithstanding the main procedure, et cetera. And as I understood the record in this case. There was a paralegal error in transferring the data to a template that the attorney relied on and he acknowledged the error and said it was mistake and the district court seemed to refer to it as unintentional error. My question is should the district court. Now have to address that defense. If we agree with you on the fact that the assignment is a debt collection activity covered by the act. To a certain extent again, the posture of the case below is just on summary judgment. And there's at least a dispute of material fact as to whether there was a bonafide error. And your point is I gather you would like to be able to address whether it's bonafide and develop that further. Yes, you're on it. Correct. And in this case, it's at least a dispute of material fact as to whether it was bonafide or not, although the paralegal acknowledged there was an error generally. And I'm going to say that the debt collector must maintain some type of quality control check some type of procedures to double check and verify whether the data and the processes used by the debt collector to collect the debt are accurate or not. In this case, the deposition testimony of Mr. Whiteman. Basically establishes that data is uploaded by this debt collector. Parallegals may do this that or the other thing, but the data is never double checked for accuracy and when in fact this assignment of judgment was filed, it was never double checked by the attorney before signing the assignment of whether or not the information contained and it was actionable or not. With respect to the assignment itself, just a few more points I would like to make. Well, it looks pretty clearly that the debt was 8,200 plus priest judgment interest of a thousand 11 and when you combine those two, that's 10,497. And then that's what the paralegal put in 10,497 and then added in attorneys fees which got too much and the actual debt should have been lower. No, all three numbers added to four. She added all three numbers together. It's exact number 10,497 and then added on the attorneys fees in addition to that. Correct. What ended up appearing on the assignment of the document was a slightly inflated amount of effectively double dipped on the attorneys fees. All the amounts were combined to about $10,000 and then another thousand attorneys fees added on for a total of 11,000. When in fact the assignment should have only stated $10,000. And this in fact is a material misrepresentation under the FD CPA. First under the FD CPA, the lease sophisticated consumer test is purely objective. It does not inject subjective elements with respect to the materiality. The assignment must only mislead the lease sophisticated consumer into believing something is true or perhaps to influence the consumer to take immediate action to correct the misstatement. Under this circuit's decision in the national financial services case, a lease sophisticated consumer and the FD CPA protects the gullible consumer as well as the shrewd and a gullible consumer is one who when you tell them something they would say yes, that's true. And if you are to or in this case perhaps when we're dealing with an old assignment, people may forget what they have paid and what they haven't. And on this assignment of judgment, the false statements are that the amount is actually essentially 11,000 when it's really 10, which a gullible person may take that at pay value. It also failed to record the payments $2700 correct correct your honor at stated payments totaling $0 and over the passage of time gullible consumers, unsophisticated consumers, which the seven circuit is set as literally the most unsophisticated person on the ring may not have the means or may not remember what they have paid or perhaps they thought they paid another debt. Council when the misrepresentation lies in numbers like this, what's the bright line? I mean, what if it was $100 off? Do we have a case then? Absolutely, Your Honor, the bright line and in fact, it has the exact perfect number. Yes, Your Honor, generally precedent has stated that if the debt collector asks for a dollar more or penny more than they are owed, that is a misrepresentation under 1692. This question is is 33 cents overstatement material? Yes, Your Honor, it would lead the least sophisticated consumer to pay 33 cents more than is owed. You don't need to make the drawing something when I think it gets pretty you're pushing the line pretty hard. How about one send over or a three cents eight of the four turned into a seven on the document and it's three cents too much. Is that material? Yes, Your Honor, we have to draw the lines somewhere and but materiality is something we always assess. It's a little bit like objective reasonfulness. I mean, of course, assess those things, but I must say when you argue for such a hard rule of recent over is material on a $10,000, $11,000 judgment. Well, in this case, Your Honor, it's a $1,000 over and well, I understand that's your argument and it's actually may even be more because it didn't show the 2700 correct around. So we're dealing with the thousands of dollars and with respect to the bright line, I think the bright line does have to be drawn at any amount over because various amounts of money matter to different people, $100 matters. To people who, quite frankly, don't have a lot of money and we're dealing with standard that should be tailored towards unsophisticated consumers, many of whom are likely to not be of great means. If there has to be a line drawn here, it should be a bright line drawn at any amount more than that that is due in this case. One other point on materiality, the district court's opinion also aired because it ejected subjective belief or really was essentially inject injecting reliance into the leased sophisticated consumer standard. The district court found that the standard was a leased sophisticated consumer who did not believe they owed the debt that was injecting miss Powell's subjective belief from the deposition into that standard. And it was effectively putting in the common law fraud reliance element into the past. Now, Congress, when they passed the FDCPA in its FDCPA statement of purpose and Section 1692 says that existing laws are inadequate. And that was the whole reason this statute was passed. Now, Congress was not intending to duplicate the elements of common law fraud here. So it doesn't matter whether or not the consumer was relying on the misrepresentation, but rather whether the hypothetical leased sophisticated consumer who is gullible may find that several thousand dollars overstatement is true and effectively overpay by several thousand dollars more. In more to the point, the issue of whether the assignment of judgment is false or not is already been finally and fully determined by the state courts in Maryland. In case began in the state district court of Maryland, it was appealed to the circuit court, which affirmed the district court's opinion that palisades did not have an assignment and that the amount in on these final calls. The sufficient evidence to the assignment that's there's no doubt there was an assignment. This record makes it almost conclusive. The problem in the state court was the evidence presented didn't adequately state that policy had the assignment. I mean assignments right in the records. Your Honor, I don't think they can relitigate that issue and come forward with better evidence in federal court once they are sued to say, oh, look, no, we really had the evidence. They had their opportunity when that issue was presented in state court. That wasn't being tried then and she won that case and she got her debt wiped out. And as a as a course on it, but what the court concluded was the evidence was insufficient to show the assignment and therefore palisades lost, but to come back in federal court and argue there was no assignment when the record has a copy of the assignment. And no one's alleged that it's fraudulent. In the on its face, the execution assignment. I don't think it goes very well. Your Honor, the judgment itself and the record has an extract through it and it's vacated. She doesn't owe money to anyone and with respect to the. I ask you about that. How did the remedy for any defect in the assignment become. Distract the judgment. The district court considered that your honor and the district court explained very briefly how you get from a bad assignment of a judgment to the whole judgements. No good. Well, the district court found that palisades didn't have evidence considered well, then who would be able to enforce the judgment. That wasn't before the district court, wasn't should have been. Well, I understand you went on you went in on a motion. For fraud irregularity, etc. But, but you weren't really attacking the judgment. You were attacking the assignment of the judge. It's just a curiosity. That's all my time is up here. Answer briefly or why don't you hold it and told me. Thank you. Thank you. I miss Bella. Good morning, your honors may have to support my name is Megan. I have to pick it up a little bit or pull the microphone to you, but we'd like to be able to hear what you're saying. May have to be the court. My name is Megan Galacey and I'm pairing on. I'm sorry, I still can't hear you. I'm sorry, your honor. My name is Megan Galacey and I'm appearing on behalf of the appellys, palisades, acquisition 16 LLC and Fulton agreement and Galacey LLC. I'd like to begin by addressing the materiality arguments. Police sophisticated tumor standard consumer standard may be different in degree from a reasonable person standard or reasonably prudent person standard, but it is not a different type of standard. It doesn't require that a court examine police sophisticated consumer on the conduct and question and a vacuum. I'm having a lot of difficulty hearing you. I don't know how we can improve this, but. If you can speak as if there is no microphone and you're trying to reach me here, that would help a lot. I don't want to cause you difficulty, but I do want to hear what you have to say. I'm sorry, I will try to speak louder. The least sophisticated consumer standard may be different in degree from a reasonable person standard or reasonably prudent person standard, but it is not a different type of standard. It doesn't require that a court examine the least sophisticated consumer on the conduct and question and a vacuum to decide whether the statute has been violated. The district court properly concluded that a reasonable, the sophisticated consumer who did not believe she owed a debt would not have chosen any different course of action, no matter what numbers had been stated in the assignment. Most, most consumers who failed to pay debts just sit on the couch. And there may be a very material misrepresentation and they wouldn't have acted differently, whether it was correct or fraudulent. Does that mean because they wouldn't have acted differently because they just sit there like bumps on the log mean it's not material. Well, here we have a here we have a representation that overstates the debt by over $3,000, maybe a close to $4,000, which is fairly significant with respect to about. $11, $12,000 debt. I disagree with your honor. The assignment of judgment does not state the current balance of the debt. The assignment of judgment that was filed in the state court action was a court form and from the information that was contained in the court form is not possible to determine what the current balance of the debt is because it makes no mention of post judgment interest and it does not contain any field where you can input the amount of post judgment interest that have been approved. And it does it doesn't have a zero next payments made. It did your honor, but isn't that in and of itself material she made $2700. A consumer cannot preemptively or proactively file a lawsuit under the FDC PA upon receiving the assignment of judgment, at least sophisticated consumer could have pursued any number of courses of action, including contacting the new owner of the debt to inquire. But that's a different issue than your argument. You started off by saying the failure to include $2700 on this debt was not material. And I'm suggesting to you that the fact that the consumer just sat on there or wouldn't have acted differently if there were stated different numbers is not the test cannot be the test material. But you're on the failure to credit the payments was limited to the assignment of judgment in the own in the records of the appellees they had credited the $2700. Except the document said zero. It had a number in the in the blank spot right. It did. Okay, now if they said nothing about payments had no line at all you have a better argument, but there was an actual line representing how much she paid and they put zero there instead of $2700. Now that's a misstatement isn't it? It's an accurate, but it doesn't result in this instance. It doesn't result in any detriment to the consumer because the appellees did have a record of her payments and had credit as a payment to her. What in the statute or the precedent requires quote detriment to the consumer under the least sophisticated debt or consumer pass. Well, my point is that she missed how will jump the gun and filing lawsuits. There was no. Sounds like what you're saying is this would evolve and worked out in the end. Is that essentially what you're saying? She filed a lawsuit but and by the way she didn't follow lawsuit. She filed a motion to vacate correct? Yeah. And so what your argument is, if she just talked to us and we had taken a closer look at our records, it all would have been worked out. No, my point is that even if she had done nothing, even if a leesa sophisticated consumer had done nothing upon receiving the assignment, a judgment and the judgment had ultimately been enforced. The appellees would have enforced it in the amount contained in their own records and then satisfied the judgment after receiving much less than Miss Powell actually owed. And that's not a violation of the fair deck. I don't know why you're so sure about that. But these type of debtically, debtors have all kinds of garnishments. And so, you know, but it seems to me it's not fanciful to think that a debtor in Miss Powell's position could easily have an amount in excess of what was actually owed. So those aren't the facts of the case here on our, the appellees didn't attempt to collect any amount of this. This is called an oath. Well, that's a separate issue. Question is whether the filing and serving of the assignment was in connection with an attempt to collect the debt. But you didn't want to talk about that. I will. Or at least initially you wanted to go directly to material. I will get to the collection activity argument. The assignment of judgment doesn't amend the judgment and it doesn't give the assigned either right to enforce the judgment incorrectly. And even if the least sophisticated consumer. Wasn't the assignment that collection activity wasn't it one of the steps that had to be taken to collect the debt. But I disagree with it being collection activity and I can turn to that argument. Why do you think they filed the assignment? Well, the. The. Fulton Freeman Anglici is the attorney for palisades acquisition and the attorney has an obligation to protect its clients interest. And the attorney has been a judge. Mr. Whiteman testified that a purpose in filing the assignment of judgment was to avoid leaving the judgment vulnerable to vacator, which would have been a concern. As the original judgment creditor no longer existed and the attorney's office that represented it no longer existed. And those were the only entities associated with the judgment in the court's record. What about the affirmative defense? You didn't seem to press that in your motion to the district court. You raised it as an affirmative defense in your complaint. And it was sort of alluded to in passing the court talked about it as an error. But it seems to me this whole case. If you were to center this whole case and ask about whether your client has responsibility. The real answer is we made a mistake in our assignment. We mistreated the amount, but it was a administrative error created by a paralegal and transferring data. And we are sorry about that, but that doesn't create liability. Isn't that really where you are in this case? And I didn't see you make that kind of error. It is true that it was a clerical error and that it was intentional and the appellees are entitled to the bona fide error defense. I disagree that the. Did you raise that as a principal point in the motions before the district court? The appellees did raise the issue of the bona fide error defense. And you think the district court ruled on that? I don't believe the district court ruled on it. No, you're on it. And just I would point out that even if it was least sophisticated consumer viewed the assignment of judgment as a statement of what was due to misspelled out every dollar that was stated in that assignment. And then some. I will now turn to the collection activity argument. Filing the assignment of judgment was not collection activity because it did not contain a demand for payment. And nor does the filing of an assignment of judgment act as an inducement to pay the debt complaint and motions for judgment. And that speaks the entry of judgment. That's just pretty broad. It's not related to just the communication. It's any misleading representation or means in connection with. That's pretty broad. And if we were. You seem to think that the assignment. And that's not a. From one company to another, which is necessary to collect the debt and actually. Wood did result, I guess, in this case, some garnishments and so forth that the. That's not a. Representation or means in connection with collection of that. Well, in order for the filing of an assignment of judgment to lead to payment of the debt, there have to be a taxable assets and there have to be additional filings with the court. Sure, but it's because of rules and procedures, you have to do it in steps. Your argument would be that if it could all be done in one document that you file the assignment, you file a garnishment, you file an attachment, all in a single document. Then there would be a violation. Is that is at the point? Well, the six circuit in the garden case stated that when there is no direct demand for payment, something has the requisite connection to collection to itself be considered collection activity. If it aims to make any attempt to collection more likely to succeed the filing of an assignment was not only more likely it was necessary to file this in order to collect. What is it? It's not the purpose of the filing of an assignment of judgment is a ministerial step which records the new holder of the judgment and permits him to file enforcement papers in his own name without having to amend the caption. It doesn't cause assets to be discovered. It doesn't inherently put pressure on a judgment that are to pay the debt and it might never lead to collection of the. The assignment has the right to enforce the judgment by virtue of having acquired all right title and interest to the judgment by the assignment not by virtue of the filing of the assignment of judgment with support. Council, do you agree that when you file an assignment, it's spread on the record of the court. If you have a job and you hit a four you haven't paid the debt but you know that NAS and assign you don't want to be gone. I don't know if it's done that in due shoe perhaps to pay the debt now. But so the judgment the the assign or of the judgment could have enforced the judgment also. I mean nothing has changed by by filing the assignment of judgment. It doesn't become more due or more enforceable. I mean once a judgment is. Yes, it does it means that somebody now is paying attention to it. I mean it would have to come in sense of it is now this thing is active someone is filing something in the court. The knowledge and assignment is dead and the next step would be garnishment most people know about garnishment. That's the one that you lose your job and that's the biggest weapon of debt collectors be able to say I'm going to garnish your pay. Why would that least be inducement? Part of inducement even if you say maybe it's it might be somewhat superfluous but it is inducement. There's nothing in the you know nothing in the language of the assignment of judgment. Self which suggests that the a fine can now enforce the judgment. And as I said the judgment the original judgment creditor could enforce the judgment as well. I mean nothing has been is a motion for summary judgment on the debt. That's not the collection of a debt. It's a preliminary step in order to get a judgment to enforce. But a summary didn't we hold in Syed that the motion for summary judgment was a collection activity. A summary judgment seeks. Seeks entry of judgment. That's an imminent negative consequence that some of the. Seeks entry of a judgment and also in a in a sense that it puts it in a different person's name. But there's the the the seat entry of judgment which is an imminent negative consequence which someone might be induced to avoid to avoid by payment of the debt. Once the judgment is entered the negative consequences of that factor ever present. There's always going to be someone who can. What if you took a Baltimore city judgment and recorded it in the circuit court for anorundal county. What that is that. With that satisfy the statute. Just recording. A judgment from a neighboring jurisdiction. No, I don't it wouldn't. That the recording of a judgment. I'm sorry. I guess I don't understand your question. Well, in order to get a judgment and forced against real property in Maryland. You have to record it in each county where there's real property. So. Judge Davis's question is if the judgment is entered in Baltimore city and the land the person's land has some land down in the beach and anorundal county. And they go and file the judgment in the circuit court for anorundal county. It now becomes a lien against that property. And his question is is that of that collection activity to record the judgment in anorund county. I don't know your honor. I'm not here to answer. Well, under the principle you're advocating a boy to be. It sounds to me like if you're being consistent, you would have to argue it's not. And you would also have to argue that even a motion for summary judgment to reduce the debt the judgment is not because it's not the collection of the debt. It's the preliminary step of getting the judgment of or enforcement. Well, as I said, as the six circuit said in order for something to be in connection with the collection of debt of a debt, it has to make an attempt to collect the debt more likely to succeed. Well, don't you think getting the assignment and the right person filing their assignment in the name of the right person who owns the thing is necessary to collect the debt. It may be a step toward collection, but it doesn't make collection more likely to succeed. It makes it it's necessary not only more likely. It's essential, but it doesn't increase. I mean, you can file in a fine of judgment and never get paid. I mean, you and. Well, summary judgment, you can get a judgment and never get paid. Or recording the judgment of Baltimore city judgment in anorund county, you'll never get paid. But that establishes that the judgment is due to the there's nothing that inherent about an assignment of judgments that puts pressure on a judgment that are to pay the debt. If you was sent a copy, wasn't she? She was. Yeah. The district court likened the assignment of judgment to a proof of claim filed in a bankruptcy proceeding. The purpose of a proof of claim is to establish the amount owed to the claimant. Maryland rule 366 for does not date that upon filing an assignment of judgment, the assignment, the establishes the amount owed. And as I've already stated, you can't possibly state the current balance and the court form that was filed in the state court collection action. And once you file a proof of claim, you get paid. And as I've been trying to point out filing the assignment of judgment does not result in payment of the debt. And if filing a proof of claim is not selection activities, I'm certainly filing an assignment of judgment. Which court held that file in a proof of claim is not a that collection activity. Lower court in the district of Maryland. As that ever do we have any forth circuit precedent and circuit precedent that reaches that conclusion? No. That concludes my remarks. Pardon me. That concludes my remarks. Oh, okay. Well, thank you. Thank you very much. We'll have some rebuttal for Mr. Brauer. Thank you, Your Honor. I actually wanted to begin clearing up the bonafide error issue on the court's opinion at J.A. 606 footnote 12. The court did note that although the defendants argue that they are entitled to a bonafide error defense. That affirmative defense does not apply to errors of law because the defendants made an error. I'm very peculiar to me. I can't see how it was an error of law when the paralegal mis-transposed the wrong number into the template. They is an error of what amounts are included in a judgment. Attorney's fees are not included in a judgment. So by essentially putting the attorney's fees in with the judgment and then asking for an additional thousand plus in attorney's fees. That was the error of law. Well, there's also the misstatement failure to pay $2,700. Correct, Your Honor. And at the end of the day, what we're dealing with here as far as I can see how those are errors of law when somebody transposes the error was created by a paralegals. Billion out of template that was used by the attorney in the collection effort. And under the bonafide error standard, the error, it's not just a mistake, but it must be bonafide. They must have procedures in place to double check what paralegals are doing and make sure that they're doing it accurately or anyone. You know, we're the rule of law that called an aero-medic error in the error of law. Perhaps, Your Honor. But the bigger point is that the error must be bonafide. And when there are no quality control procedure checks on what paralegals are doing. Or there's no checking of the integrity of the data in a debt collector's system when the attorney is just simply signing a standard form pleading that's put in front of them that data are put into when the Maryland rules require that an attorney sign up leading having reviewed it and knowing that there's good cause to file it. There's no bonafide error. We disagree with the district courts. A parent believe that that the bonafide defense error defense is not available here because it was an error of law. Then we should probably say that if we send the case back because otherwise, if it if you agree, I think you I think you agree with your judge. If there's a law that does not have a record of a case that's nowhere that if. If it's not an error of law, then it's available to the defendant when this case goes forward before jury. But, but I understand your argument now you're saying the district court is taking that issue out of the case. The district court did take the issue out of the case, but my only. argument is that there's still a dispute of material fact that this court should not Should not overturn the district court and then find that a bona fide or exist I understand that I understand that but you understand my point is yes, you're on it If the if as you say the district court is taking it out of the case Maybe if we send it back we should put it back in the case if we have convinced it's not an error of law If your honors are convinced it's not an error of law then You are correct Judgment did reflect and the payments did it Could you repeat the question on the judgment did not reflect any reductions for payments no you're on it the judgment reflected no Reductions for payment. All right, there are at least twenty so in that case that if there was If there was no And double doubling the attorneys fees You wouldn't have a case merely because they as zero for payments would you? We would have a case why would you have a case? Would it be correct they purchased paper They purchased a judgment for amount of money And if they accurately reflect what that judgment said which did not reflect payments because you have to live and die about the first act of an attempt You're saying that the first act is filing the assignment In collection unless assume that's correct Well, what is the error if they said no, I'm giving you exactly what the judgment we purchased said This was the amount it didn't reflect payments at all. Where would they it be a false statement just in that as counsel said I think correctly and that is if they try to collect more Didn't reflect that but right now we're just talking about did you accurately The court what that judgment said and give it for the purpose of an assignment would you have a case If all they did was did not reflect Payments that's the question uh can I clarify one thing or to make sure I understand when you say if I'm not question They said payment zero dollars. So is your hypothetical if they all they did was write down the amount of the judgment and said nothing about payments or In whether in the facts of this case What if they had written down the amount and this case if that's a form that had payments on there Which would be available? I suppose if the judgment reflected it since it did it is zero So yes, I'll even if it said payment zero But in this case payments for twenty seven hundred dollars. Yeah, but that's not the question the question is they have an assignment Did they accurately say what that judgment said because you got to live and die about it That's all they did in the act they didn't try to collect any amount that's counsel correctly stated What they do what they're saying is that we They said this is the paper we purchased which is a judgment These are the numbers that came from that judgment. There was no reflection of payment zero is accurate But what in the facts of this case your honor they stated more than the amount of the judgment They double dipped on the attorney's fees and then when payments were actually made I thought at my hypothetical I said if there were no Little mistake as to doubling the attorneys fees Sejudgment amount was accurately stated and they put payments and said zero because the judgment didn't reflect any It just purchasing paper For example You gotta think of that world at industry Someone is telling them what the judgment is listen. I have a judgment How much would you really give me how much would you give me for this judgment? Thanks. Okay. I'll give you this Well, you know the people may not always accurately state What the amounts of the payments were so they purchased paper So at this point why are they going to cut themselves short and put down payments if the judgment didn't say that Now the burden would be on them if they try to collect more and it's fine and it's like that But at this point, this is a amount of transferring numbers To an assignment and the numbers were not would not be incorrect It doesn't reflect payments is zero because this is the form it's good because some judgment is really may say credit for payments This one didn't so you can't have your cake and even too Mr. Broward isn't wasn't this an assignment a judgment under Maryland rule Which requires the assignment to be filed everywhere where a lien is filed and it requires that payments be shown On the face of it and in this case the assignment did Indicate affirmatively that no payments were made in other words when it's a lien against real estate in Maryland And you just record the whole judgment with not reflecting payments It'll misrepresent the scope of the lien and the the rule under which is this filed three dash six twenty four requires that it'll also be given to the To follow the lien Root that was originally filed show the reductions of the judgment It's absolutely correct your honor and in this case the lien would have stated and inflated amount and I see my time is expired if there no more questions Thank you your honors We'll come down a greet council and proceed on to the second cas