Court Finds FDCPA SOL Accrues on Date Debt is Reported to CRA; FCRA Does Not Require Adherence to Metro 2 Guidelines

In these chaotic days for the accounts receivable industry, it’s important to take note of good news coming from court decisions. So, here’s today’s bit of good news: on April 28, 2021, in the case of Davenport v. Capio Partners, Case No. 20-cv-01700 (M.D. Pa. 2021), a district court granted the debt collectors motion to dismiss finding that (1) failing to follow Metro 2 guidelines is not actionable under the Fair Credit Reporting Act (FCRA); and (2) a Fair Debt Collection Practices Act (FDCPA) violation related to credit reporting accrues at the time the debt is reported.

What happened?

It’s important to note that the court must treat the complaint’s allegations as true on a motion to dismiss (the motion this court decided in this case). According to the consumer’s complaint, accounts for unpaid medical services were placed with Capio Partners, LLC (Capio) for collections. Capio began reporting the accounts to the Credit Reporting Agencies (CRAs) as medical collections in September 2017. Upon receiving notice from its client in early 2018 that the accounts had been paid by insurance, Capio closed the accounts. However, instead of using the Metro 2 special comment code of “BP,” Capio closed the accounts as a “paid collection” (i.e., that the accounts were delinquent, placed in collection, then satisfied). In November 2019, upon receipt of a dispute from the consumer, Capio deleted the tradelines for the accounts. According to the consumer, these facts amounted to a violation of the  FDCPA and the FCRA.