Case: 16-10742    Date Filed: 09/13/2016   Page: 1 of 8


                                                          [DO NOT PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                      ________________________

                            No. 16-10742
                        Non-Argument Calendar
                      ________________________

                     D.C. No. 1:14-cv-00543-WS-C

ROBERT L. ARNOLD,
                                                             Plaintiff-Appellant,

                                   versus

BAYVIEW LOAN SERVICING, LLC.,

                                                           Defendant-Appellee.

                      ________________________

               Appeal from the United States District Court
                  for the Southern District of Alabama
                      ________________________

                            (September 13, 2016)

Before WILSON, ROSENBAUM, and ANDERSON, Circuit Judges.




PER CURIAM:
              Case: 16-10742     Date Filed: 09/13/2016   Page: 2 of 8


      Plaintiff-appellant Robert L. Arnold appeals from the District Court for the

Southern District of Alabama’s grant of summary judgment to defendant-appellee

Bayview Loan Servicing, LLC (“Bayview”). Arnold’s complaint alleged in

relevant part that Bayview, the servicer of Arnold’s mortgage loan, sent Arnold

two mortgage statements in December 2013, a year after Arnold had received a

Chapter 7 bankruptcy discharge and several weeks after the property had been

foreclosed. Arnold alleged that Bayview’s issuance of these statements violated

the Fair Debt collection Practices Act (“FDCPA” or the “Act”), 15 U.S.C. §1692 et

seq.. Specifically, Arnold alleged three causes of action based on the two

December statements: (1) harassment in connection with the collection of a debt in

violation of 15 U.S.C. §1692d; (2) false or misleading representation in connection

with the collection of a debt in violation of 15 U.S.C. §1692e; and (3) use of unfair

or unconscionable means to attempt to collect a debt in violation of 15 U.S.C.

§1692f(1). The district court granted summary judgment to Bayview on the

ground that there was no genuine question of fact that ”the violation was not

intentional and resulted from a bona fide error notwithstanding the maintenance of

procedures reasonably adapted to avoid any such error.” 15 U.S.C. §1692k(c). On

appeal, Arnold argues that the district court erred in granting summary judgment

based on the bona fide error defense. Upon review of the briefs and the record, we

affirm.


                                          2
                 Case: 16-10742     Date Filed: 09/13/2016   Page: 3 of 8


          This court reviews a district court’s ruling on a motion for summary

judgment de novo. Mais v. Gulf Coast Collection Bureau, Inc., 

,

1119 (11th Cir. 2014). A motion for summary judgment is properly granted when

the pleadings, depositions, answers to interrogatories, and admissions on file,

together with the affidavits, if any, show that there is no genuine issue as to any

material fact. Fed.R.Civ.P. 56.

          The FDCPA is a consumer protection statute that “imposes open-ended

prohibitions on, inter alia, false, deceptive or unfair” debt-collection practices.

Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 

, 587

(2010) (quotation marks and citations omitted). To enforce the FDCPA’s

prohibitions, Congress equipped consumer debtors with a private right of action,

rendering “debt collectors who violate the Act liable for actual damages, statutory

damages up to $1,000, and reasonable attorney’s fees and costs.” Owen v. I.C.

Sys., Inc., 

, 1270 (11th Cir. 2011). “[T]he FDCPA affords a narrow

carve-out to the general rule of strict liability, known as the ‘bona fide error’

defense.” 

The defense is provided in 15 US.C. §1692k(c), which

states:

          (c) Intent

          A debt collector may not be held liable in any action brought under
          this subchapter if the debt collector shows by a preponderance of
          evidence that the violation was not intentional and resulted from a


                                            3
              Case: 16-10742     Date Filed: 09/13/2016    Page: 4 of 8


      bona fide error notwithstanding the maintenance of procedures
      reasonably adapted to avoid any such error.

As we have explained, this defense “insulates [debt collectors] from liability even

when they have failed to comply with the Act’s requirements.” Edwards v.

Niagara Credit Solutions, Inc., 

, 1352 (11th Cir. 2009).

      “A debt collector asserting the bona fide error defense must show by a

preponderance of the evidence that its violation of the Act: (1) was not intentional;

(2) was a bona fide error; and (3) occurred despite the maintenance of procedures

reasonably adapted to avoid any such error.” 

at 1352-53 (citing

Johnson v. Riddle, 

, 727-28 (10th Cir. 2006)). The failure to meet any

one of those three requirements is fatal to the defense. 

Arnold argues that the district court erred in granting summary

judgment to Bayview because there are genuine questions of fact as to each of the

three prongs of the bona fide error defense. We address them in turn.

      The first prong of the bona fide error defense is that Bayview must show that

its violation of the act “was not intentional.” 

This element requires a

showing “that the violation was unintentional, not that the underlying act was

unintentional,” such that Bayview must “establish the lack of specific intent to

violate the Act. 

. As discussed in detail by the district

court, Bayview put forward ample evidence to show that the December statements

were sent to Arnold due to what can only be described as a mistake. See Docket
                                          4
              Case: 16-10742     Date Filed: 09/13/2016   Page: 5 of 8


81 at 14-15. The dispatch of the December statements was triggered by an

employee performing a routine pre-foreclosure review of the computerized record

of Arnold’s loan and accidentally changing one letter in one field such that the

computerized system began sending out statements automatically. This changed

the coding for the loan from “F” (“Foreclosure”) – which automatically prevented

any outgoing statements – to “A” (“Asset Management”) – an active loan status

which caused statements to be issued. This occurred despite the fact that Arnold’s

loan had previously been specifically coded not to receive statements as a result of

the foreclosure.

      Arnold argues on appeal that the evidence proffered by Bayview is

insufficient to show that the violation was unintentional because “[t]he act of

sending of a statement is not and has never been what Arnold’s case is about.

Instead, the case is about the format and content of the statements used.” Br. For

Appellant at 27. More specifically Arnold argues that “[i]t is irrelevant that

Bayview claims that [the]statements were sent in error because it intentionally uses

the form statements at issue to bill mortgage borrowers with discharged debts.”

Br. for Appellant at 35. In other words, Arnold argues that Bayview’s defense is

belied by the fact that Bayview allegedly had no system in place to prevent the

sending of form statements to mortgage borrowers with discharged debts. It is

difficult to understand this argument. The violations complained of – harassment


                                          5
               Case: 16-10742     Date Filed: 09/13/2016    Page: 6 of 8


in connection with the collection of a debt, false or misleading representation in

connection with the collection of a debt, and the use of unfair or unconscionable

means to attempt to collect a debt – all stem from the two statements sent by

Bayview in December 2013. If Bayview did not intend to send these statements –

a point which Arnold does not contest – then there can be doubt that its violation of

the act “was not intentional.” 

. Accordingly, we agree

with the district court that Bayview has readily satisfied the first prong of the test.

      The second prong of the bona fide error defense is that Bayview must show

that its violation of the act “was a bona fide error.” 

“As used in the

Act, ‘bona fide’ means that the error resulting in a violation was ‘made in good

faith; a genuine mistake, as opposed to a contrived mistake.” 

(citing

Kort v. Diversified Collection Servs., Inc., 

, 538 (7th Cir. 2005)). “To

be considered a bona fide error, the debt collector’s mistake must be objectively

reasonable.” 

by the district court, Bayview argued that it was

objectively reasonable to rely on its coding system to prevent the dispatch of

statements in violation of the Act. Bayview had no reason to believe that the code

would be changed during the pre-foreclosure review process. That routine process

was performed by employees trained in the requirements of the FDCPA and

guided by a detailed checklist.




                                           6
              Case: 16-10742     Date Filed: 09/13/2016    Page: 7 of 8


      Arnold argues on appeal that the evidence proffered by Bayview to

demonstrate that its violation of the Act was a bona fide error is insufficient

because Bayview intentionally uses the form statements at issue to bill mortgage

borrowers with discharged debts. Br. For Appellant at 26-27. This is simply a

reprise of Arnold’s argument on the first prong, which we rejected above. We

agree with the district court that Bayview’s mistake in issuing the December 2013

billing statements to Arnold was a bona fide error.

      The third prong of the bona fide error defense is that Bayview must show

that its violation of the act “occurred despite the maintenance of procedures

reasonably adapted to avoid such error.” 

. As discussed

by the district court, Bayview argued that its general training procedures, as well as

its specific procedures or pre-closure review, were designed to avoid sending

statements like the December 2013 statements. In addition to the coded

computerized record system and detailed pre-foreclosure checklist discussed

above, Bayview also points to its written policies and ongoing training procedures

instructing employees about FDCPA prohibitions on false, deceptive, or

misleading representations. Bayview argues that these procedures are adapted to

avoid error, and that no statement would have been sent but for an employee

mistakenly changing a field in the computer system.




                                           7
              Case: 16-10742     Date Filed: 09/13/2016    Page: 8 of 8


      Arnold argues on appeal that Bayview’s procedures are not reasonably

adapted to avoid the error in the instant case because Bayview allegedly had no

system in place to prevent the sending of form statements to mortgage borrowers

with discharged debts. Specifically, Arnold points out that the Bayview computer

system had no code for discharged debts. But such a code, even if it did exist,

would not have prevented the error here: an employee mistakenly changing a field

in the computer system. Just as an employee here mistakenly changed the code

from “F” to “A” an employee could have mistakenly changed the field from

Discharged to Active. Arnold also argues that Bayview could have drafted a

different wording for the statement that would have made clear that it was not

seeking payment from Arnold. However, whether or not the alternative wording

suggested by Arnold would have cured the alleged violation, the existence of such

an alternative does not challenge the substantial evidence put forward by Bayview

that it maintains procedures reasonably adapted to avoid error. We agree with the

district court that Bayview maintained adequate procedures.

      We conclude that there is no genuine question of fact that Bayview has

established all three elements of the bona fide error defense. Therefore, the district

court’s grant of summary judgment is

      AFFIRMED.




                                          8