Court Opinion

ID: 2762560
Source: CourtListenerOpinion
Date Created: 2014-12-18 20:01:10.716718+00
Date Added: 2024-06-11T10:43:48.936863
License: Public Domain

PUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                             No. 14-1171

ALETA POWELL,

                Plaintiff - Appellant,

           v.

PALISADES ACQUISITION XVI, LLC; FULTON FRIEDMAN & GULLACE,
LLP; JOHN DOES 1-10,

                Defendants - Appellees.

Appeal from the United States District Court for the District of
Maryland, at Baltimore.    Richard D. Bennett, District Judge.
(1:13-cv-00219-RDB)

Argued:   October 30, 2014            Decided:   December 18, 2014

Before NIEMEYER and GREGORY, Circuit Judges, and DAVIS, Senior
Circuit Judge.

Affirmed in part, vacated in part, and remanded by published
opinion.    Judge Niemeyer wrote the opinion, in which Judge
Gregory and Senior Judge Davis joined.

ARGUED: Max F. Brauer, THE LAW OFFICES OF E. DAVID HOSKINS, LLC,
Baltimore, Maryland, for Appellant.    Megan Elizabeth Gullace,
FULTON FRIEDMAN & GULLACE, LLP, Rochester, New York, for
Appellees.   ON BRIEF: E. David Hoskins, THE LAW OFFICES OF E.
DAVID HOSKINS, LLC, Baltimore, Maryland, for Appellant. Cynthia
L. Fulton, FULTON FRIEDMAN & GULLACE, LLP, Rochester, New York,
for Appellees.
NIEMEYER, Circuit Judge:

     Aleta Powell, a credit card debtor, commenced this action

against    Palisades         Acquisition    XVI,       LLC,        and    its    attorneys,

Fulton Friedman & Gullace, LLP, as debt collectors, alleging

violations    of       two    provisions        of    the        Fair    Debt    Collection

Practices    Act   (“FDCPA”),       15    U.S.C.       §    1692e       and   § 1692f,     and

related    state       statutes.      She       claimed          that    after    Palisades

purportedly purchased a judgment that had been entered against

her in state court, it filed an Assignment of Judgment in the

action that falsely represented its ownership of the judgment

and misrepresented the amount she owed.

     The district court granted summary judgment to Palisades

and Fulton Friedman & Gullace, concluding that the filing of the

Assignment    of       Judgment    did     not       qualify       as    debt    collection

activity that implicated the protections of the FDCPA and that,

in any event, the misrepresentations made in the document were

not material.          It also concluded that Powell failed to produce

sufficient evidence to support a claim under 15 U.S.C. § 1692f

and the related state statutes.

     On    Powell’s      appeal,     we    vacate          the    judgment       entered    on

Powell’s FDCPA claim under 15 U.S.C. § 1692e and remand that

claim.      We conclude (1) that the filing of an assignment of

judgment     in    a     debt     collection         action        qualifies       as    debt

collection activity that triggers the protections of the FDCPA;

                                            2
(2) that the Assignment of Judgment that Palisades filed against

Powell     did   not    falsely    claim    Palisades’      ownership       of   the

judgment; and (3) that the misrepresentations in the Assignment

of Judgment as to the amount of the judgment and the amount of

Powell’s payments on the judgment were material.                   We also vacate

the   court’s    conditional      ruling    that   the    errors     made   in   the

Assignment of Judgment did not provide a basis for the “bona

fide error defense” found in 15 U.S.C. § 1692k(c).                      We affirm

the judgment entered on Powell’s § 1692f claim and her state-law

claims.

                                        I

      Powell,    a     resident   of   Baltimore,        Maryland,    incurred     a

credit card debt of $8,205.24, payable to Direct Merchants Bank,

N.A., and defaulted on the debt after losing her job in 2000.

The Bank assigned the debt to Platinum Financial Services Corp.,

which filed an action in November 2001 in the District Court of

Maryland for Baltimore City (“Baltimore City District Court”) to

collect the debt.         In response to the suit, Powell agreed to a

payment schedule, subject to the entry of a consent judgment in

the event of default.        On June 24, 2003, after Powell defaulted

again, the Baltimore City District Court entered judgment in

favor of Platinum Financial in the amount of $10,497.21, which

included    $9,216.43      for    principal   and    pre-judgment       interest,

                                        3
$1,230.78     in       attorney’s         fees,       and    $50   in    costs,       and    which

provided for post-judgment interest at the statutory rate of

10%.    When Platinum Financial began garnishment proceedings to

collect on its judgment, Powell again agreed to make payments,

and she did so until May 2005, making monthly payments totaling

$2,700.      She        later      stated     that      she    stopped        making   payments

because she thought she had paid off the debt.

       In March 2007, Platinum Financial sold its judgment against

Powell to Palisades Acquisition XV, LLC, which, on the same day,

sold    it   to        Palisades          Acquisition         XVI,      LLC    (“Palisades”).

Palisades     later       retained         the    law       firm   of   Fulton       Friedman    &

Gullace,     LLP,       to     help    it    collect         the   debt.           Pursuing   its

collection        effort,          Fulton     Friedman         &     Gullace        entered     an

appearance        in     the       debt     collection         action        pending    in    the

Baltimore     City        District          Court,      prepared        an     Assignment       of

Judgment, served a copy of it on Powell, and, on June 29, 2012,

filed it in the pending action.                         The Assignment of Judgment,

which included the caption of the action, indicated that it was

prepared     pursuant          to     Md.    Rule       3-624,       which     authorizes       an

assignee     who       files    an    assignment        of     judgment       to    enforce   the

judgment     in    its       own    name.        The    Assignment       of     Judgment      that

Fulton Friedman & Gullace filed provided in relevant part:

       A Judgment in the above case was entered on June 24,
       2003 in the amount of $10497.21 plus attorney’s fees
       of $1230.78 and costs of $0.00.    Payments totaling

                                                  4
      $0.00.    PLATINUM FINANCIAL SERVICES CORP was the
      judgment creditor in this case.   PLATINUM FINANCIAL
      SERVICES CORP transferred and assigned all title,
      rights, and interest in said judgment on or about
      March 5, 2007 to:

           Palisades Acquisition XVI, LLC
           210 Sylvan Avenue
           Englewood Cliffs, NJ 07632

      The Bill of Sales for said assignment are attached
      hereto reflecting Judgment Creditor’s assignment.

The Assignment was signed by an attorney with Fulton Friedman &

Gullace and included a certificate of service indicating that a

copy was mailed to Powell on May 29, 2012.             The last line of the

paper stated, “This communication is from a debt collector.”

      As it turned out, the Assignment of Judgment was erroneous

in two respects.       First, it reported a judgment in the total

amount   of   $11,727.99,    instead        of   the    correct   amount    of

$10,497.21.     Apparently, the preparer of the document double

counted the $1,230.78 award for attorney’s fees.                  Second, it

reported that Powell had made no payments on the judgment when,

in fact, she had made $2,700 in payments.

      The Assignment of Judgment indicated that bills of sale

reflecting    the   assignment   of   the    judgment    to   Palisades    were

attached, but as the Baltimore City District Court later found,

the attached bills of sale simply referenced “accounts” and were

not   sufficiently    specific   to    demonstrate      the   assignment     of

Powell’s judgment.

                                      5
       In response to the Assignment of Judgment, Powell filed a

motion    in   the    Baltimore    City       District    Court   to    vacate   the

judgment on the ground of “fraud, mistake, or irregularity.”                      At

the hearing on the motion, an attorney from Fulton Friedman &

Gullace acknowledged that the Assignment of Judgment that had

been filed was erroneous, and he submitted an amended Assignment

of   Judgment    to    correct    the   errors.          Nonetheless,    the   court

vacated the judgment because the bills of sale attached to the

Assignment of Judgment were insufficient to indicate Palisades’

ownership      and    because    Palisades       lacked     records     documenting

Powell’s payments on the debt.                The Circuit Court for Baltimore

City affirmed the ruling on appeal, and the Maryland Court of

Appeals denied discretionary review.

       After her judgment had been vacated by the Maryland court,

Powell    commenced     this     action       against     Palisades     and    Fulton

Friedman & Gullace, asserting claims under the FDCPA, 15 U.S.C.

§§     1692-1692p;     the   Maryland         Consumer    Debt    Collection     Act

(“MCDCA”), Md. Code Ann., Com. Law §§ 14-201 to 14-204; and the

Maryland Consumer Protection Act (“MCPA”), id. §§ 13-101 to 13-

501.     Specifically, she alleged that the defendants violated two

provisions of the FDCPA, 15 U.S.C. § 1692e and § 1692f, “by

filing an assignment of judgment that overstated the amount due

on her debt” and “by filing an assignment of judgment without

proof of a valid assignment.”                 She alleged further that this

                                          6
conduct also violated the two Maryland statutes.                       She demanded

$1,000   in   statutory     damages    under   the    FDCPA      and    $60,000   in

compensatory damages, as well as attorney’s fees and costs.

     On cross-motions for summary judgment, the district court

entered judgment in favor of the defendants on January 29, 2014.

With respect to the FDCPA claims, the court concluded that the

representations      that     Palisades     made     in    the    Assignment      of

Judgment did not implicate the FDCPA because the filing of an

assignment    of   judgment    did    not   qualify   as    conduct      taken    “in

connection with the collection of any debt,” 15 U.S.C. § 1692e,

or conduct taken “to collect or attempt to collect any debt,”

id. § 1692f.       The court explained that “[f]iling an Assignment

of Judgment is not an action against a consumer, but rather a

request to the court that it recognize a right of the filing

party.” It also found that even if the FDCPA applied to the

Assignment of Judgment, the misrepresentations made in it were

not material.       The court explained that at the time Palisades

filed the Assignment of Judgment, Powell was under the mistaken

“impression that she had paid her debt in full,” and that “[a]ny

reasonable consumer in that circumstance would have contested

the Assignment regardless of whether the judgment amount was

technically correct and regardless of the identity of the debt

collector.”    The court separately concluded that “there [was] no

evidence that the Defendants acted unfairly or unconscionably in

                                        7
violation of [15 U.S.C. § 1692f].”                       Finally, as to her state-law

claims,    the       court    concluded         that       Powell       had    not    produced

evidence to show that the defendants had attempted to enforce a

right with knowledge that the right did not exist, as required

by the relevant state statutes.

       From the final judgment, Powell took this appeal.

                                               II

       Powell    contends      first      that      the     district      court       erred      in

concluding that the filing of an assignment of judgment in a

debt    collection       action      does      not       constitute       debt       collection

activity that implicates the FDCPA.                       In reaching its conclusion,

the district court considered three factors:                             “(1) whether the

communication         included       a    demand         for     payment       or     had       the

‘animating      purpose’       to    induce        payment;      (2)     the     relationship

between the parties; and (3) the purpose and context of the

communication.”              While       the       court       acknowledged          that       the

relationship between the parties was that of debtor and debt

collector,      it    found    that      the   Assignment         of    Judgment          did   not

contain    a    demand       for    payment        and     was    not    filed       to    induce

payment.        Moreover,      although        the       court    recognized          that      the

Assignment of Judgment “was a step to ultimately collecting the

debt,”    it    nonetheless         emphasized        that       “the    Defendants         would

[still] have had to take separate action to collect any money

                                               8
from Powell.”         It thus concluded that “filing the Assignment was

not an action to collect a debt” and that it therefore was “not

subject to the [FDCPA].”                 Challenging the court’s conclusion,

Powell argues that the standard applied by the court is not

supported by the statutory language and, in any event, has been

employed         by      other    courts          only     to     evaluate               informal

communications           from    debt     collectors,        such        as        letters      or

telephone calls, but not debt collectors’ litigation activities.

        The defendants, on the other hand, assert that the district

court        correctly     concluded      that     “the     Assignment             was    not    a

collection        activity,      because        [it]     contained       no        demand       for

payment and was not an action against the consumer capable of

inducing payment but rather served to establish a right of the

filing party with the court.”

        To     determine    whether       the     filing     of     an    assignment            of

judgment in a debt collection action triggers application of the

FDCPA, we look first to the text of the statute -- in this case,

15 U.S.C. § 1692e and § 1692f.                      Section 1692e prohibits debt

collectors       from     “us[ing]      any   false,      deceptive,          or    misleading

representation or means in connection with the collection of any

debt,” 15 U.S.C. § 1692e (emphasis added), and § 1692f prohibits

debt collectors from “us[ing] unfair or unconscionable means to

collect or attempt to collect any debt,” id. § 1692f (emphasis

added).        It is apparent that nothing in this language requires

                                              9
that a debt collector’s misrepresentation be made as part of an

express demand for payment or even as part of an action designed

to   induce    the      debtor    to        pay.       Cf.     Gburek    v.     Litton       Loan

Servicing LP, 614 F.3d 380, 385 (7th Cir. 2010) (noting “that a

communication need not make an explicit demand for payment in

order     to     fall     within           the     FDCPA’s      scope”      and       that    “a

communication made specifically to induce the debtor to settle

her debt will be sufficient to trigger the protections of the

FDCPA” (emphasis added)).                    But see Grden v. Leikin Ingber &

Winters    PC,      643 F.3d 169,       173   (6th    Cir.     2011)      (“[F]or     a

communication to be in connection with the collection of a debt,

an   animating      purpose      of    the       communication       must     be     to   induce

payment by the debtor”).                   Rather, to be actionable under these

provisions of the FDCPA, a debt collector needs only to have

used a prohibited practice “in connection with the collection of

any debt” or in an “attempt to collect any debt,” a standard

significantly broader than that employed by the district court.

      The defendants do not take issue with the fact that the

Assignment     of    Judgment         filed       in   the    Baltimore       City    District

Court misrepresented the amount of the judgment and the amount

of payments made toward its satisfaction; indeed, they pleaded

that the misrepresentation was an unintentional clerical error.

Rather, they argue that because of its purpose and function, an

assignment     of    judgment         is    not    filed      “in   connection        with   the

                                                 10
collection      of   any      debt,”   nor      as    an   “attempt       to    collect    any

debt.”      To address that argument, we turn to the nature and role

of    the   Assignment        of   Judgment       filed     in    the       Baltimore     City

District Court.

       After Powell defaulted on her credit card debt, Platinum

Financial filed an action in the Baltimore City District Court

to    collect    the    debt.       Following          Powell’s     agreement        to   make

payments      and    her   subsequent        default       on    that       agreement,     the

Baltimore City District Court entered a judgment in the action

against Powell, dated June 24, 2003.                        When Platinum Financial

sought to enforce the judgment through garnishment proceedings

under Md. Rule 3-645, Powell yet again agreed to make payments,

deferring further debt collection efforts.                        After she defaulted

yet   again,     however,       Platinum     Financial          sold     the    judgment    to

Palisades, which substituted itself as the party plaintiff in

the action by filing the Assignment of Judgment under Md. Rule

3-624.        That     Rule    provides      that      “[w]hen      an      assignment     [of

judgment] is filed, the judgment may thereafter be enforced in

the    name     of   the      assignee     to        the   extent      of      the   assigned

interest.”      Md. Rule 3-624.          Thus, in the debt collection action

filed against Powell in the Baltimore City District Court, a

consent judgment was entered, a writ of garnishment was entered,

and the Assignment of Judgment was filed.                        All were steps taken

to collect Powell’s debt.                 More particularly, once Palisades

                                             11
filed    the   Assignment      of   Judgment,     it   was    able   to   step      into

Platinum Financial’s shoes and enforce the judgment in its own

name by pursuing various mechanisms authorized by the Maryland

Rules, such as obtaining a writ of execution under Md. Rule

3-641    or    a   writ   of   garnishment    under     Md.   Rule   3-645.          See

Maryland Rules Commentary Rule 2-624 (4th ed. 2014) (describing

the purpose and effect of Md. Rule 2-624, the analogous rule for

state Circuit Courts).

        Thus, it can hardly be disputed that when a person files an

assignment of judgment in a debt collection action so as to be

able to execute on the judgment, the person has taken action in

connection with the collection of the judgment debt or as part

of an attempt to collect the judgment debt.

        This   inevitable      conclusion    is   further     reinforced       by    the

factual context of the actions taken by Palisades in this case.

First, Palisades was in the business of collecting debts, and it

purchased the judgment in this case pursuant to that business

purpose.       Thus, when Palisades filed the Assignment of Judgment

and served a copy on Powell, it included on the document, “This

communication is from a debt collector.”                 Moreover, counsel for

Palisades stated in his deposition that the company thought it

had   “found       some   recoverable   asset”    and   so    decided     to   pursue

“collection procedures [on the judgment] against Ms. Powell.”

To that end, Fulton Friedman & Gullace entered its appearance in

                                        12
the Baltimore City District Court action, filed the Assignment

of Judgment, and served a copy on Powell.

      In   reaching    its    contrary    conclusion,     the     district     court

emphasized that the filing of an assignment of judgment “simply

preserves the rights of the assignee by establishing [that it

is] the rightful owner of a judgment.”                  This characterization,

however, was too cramped and overlooked the crucial role that

the filing of an assignment of judgment plays in giving the

assignee    access     to    court-sanctioned       enforcement      procedures.

Indeed, while the district court recognized that “filing the

Assignment was a step to ultimately collecting the debt,” it

nonetheless concluded that such a filing was not itself done to

collect a debt because “the Defendants would have had to take

separate    action     to    collect    any     money   from    Powell.”       Such

reasoning, however, would exclude a large range of collection

activities from the FDCPA’s protections, including activity that

we have already recognized as falling within the purview of the

statute.    For example, in Sayyed v. Wolpoff & Abramson, 485 F.3d
226, 234 (4th Cir. 2007), we held that a motion for summary

judgment filed in a debt collection action was “subject to the

provisions of [the] FDCPA.”            It would be incongruous now to hold

that an assignment of judgment filed in a debt collection action

is   not   similarly    subject    to     the    FDCPA,   given    that    a   debt

collector who obtains a judgment through a successful summary

                                         13
judgment motion stands in exactly the same position as a debt

collector who files an assignment of judgment.                      Both have the

right    to   collect    on     their     judgments,      and     both    must   take

additional steps to do so.

     Accordingly, we conclude that the district court erred in

dismissing Powell’s FDCPA claims based on its holding that the

filing   of   an   assignment        of   judgment   is    not    debt    collection

activity.

                                          III

     Powell    contends       that    the   district      court    also    erred   in

concluding     that     the     defendants’     misrepresentations          in     the

Assignment of Judgment were not material.                  She argues that the

defendants falsely represented (1) that Palisades was the owner

of the judgment, and (2) both the amount of the judgment and her

payments on it.         She maintains that these misrepresentations

were material.

     As to the first alleged misrepresentation, we conclude that

the record clearly shows that the judgment against Powell had

indeed been assigned by Platinum Financial to Palisades and that

the defendants’ representation of this fact was therefore not

false.    To be sure, the Baltimore City District Court found that

Palisades failed adequately to document the assignment in the

proceeding    before     that    court,     since    Palisades      attached     only

                                          14
generic bills of sale that were not specific as to Powell’s

debt.         But    Palisades      has    rectified       that        problem      in    this

litigation,         providing    the      relevant       records        that     show     that

Powell’s judgment was one of the many “accounts” that Platinum

Financial assigned to Palisades in March 2007.

       Powell argues nonetheless that the doctrine of collateral

estoppel requires us to conclude that Palisades lacked a valid

assignment      and     was     not    the    true       owner     of     the       judgment.

Collateral estoppel, however, “only bars relitigation of issues

actually resolved in a previous suit.”                      Bethel World Outreach

Ministries v. Montgomery Cnty. Council, 706 F.3d 548, 554 n.2

(4th Cir. 2013) (citing Colandrea v. Wilde Lake Community Ass’n,

761 A.2d 899, 907 (Md. 2000)).                    In the collection action, the

Baltimore      City     District      Court   held       only    that     Palisades       had

failed to produce records documenting the assignment, not that

there had been no assignment to Palisades at all.                                Therefore,

the district court in this case correctly ruled against Powell

on her claim that the defendants falsely represented Palisades’

ownership of the judgment.

       On the second alleged misrepresentation, it is undisputed

that the original Assignment of Judgment inaccurately reported

both    the    amount    of   the     judgment     and    the     amount       of    Powell’s

payments       toward    satisfaction         of    it.          The     district        court

nonetheless held that the false representation did not violate

                                             15
15 U.S.C. § 1692e because it was not material, emphasizing both

that “it appears beyond doubt that on May 29, 2012, Powell owed

significantly more . . . than the amount of the judgment stated”

due to the accrual of post-judgment interest and that “the least

sophisticated consumer who [like Powell] thought no debt was

owed   at    all   would      not   reasonably     act   differently       based    on

whether the judgment amount was stated with exact precision.”

       “Whether a communication is false, misleading, or deceptive

in violation of § 1692e is determined from the vantage of the

‘least   sophisticated        consumer,’”       evaluating   how    that   consumer

“would interpret the allegedly offensive language.”                    Russell v.

Absolute Collection Servs., Inc., 763 F.3d 385, 394-95 (4th Cir.

2014).      A logical corollary of the least sophisticated consumer

test is that false, deceptive, and misleading statements must be

material to be actionable.            See Donohue v. Quick Collect, Inc.,

592 F.3d 1027, 1033 (9th Cir. 2010) (“[F]alse but non-material

representations         are     not       likely    to    mislead     the        least

sophisticated consumer and therefore are not actionable under §§

1692e or 1692f”); Miller v. Javitch, Block & Rathbone, 561 F.3d
588, 596 (6th Cir. 2009); Hahn v. Triumph P’ships, 557 F.3d 755,

758 (7th Cir. 2009) (“A statement cannot mislead unless it is

material,     so    a    false      but    non-material      statement      is     not

actionable”); see also Warren v. Sessoms & Rogers, P.A., 676
F.3d 365, 374 (4th Cir. 2012) (“[C]ourts have generally held

                                           16
that violations grounded in ‘false representations’ must rest on

material misrepresentations”); Lembach v. Bierman, 528 F. App’x

297, 303 (4th Cir. 2013) (per curiam) (“[T]o plead a claim of

false representation under the FDCPA, the party must show that

the representations are material”).

        The   materiality    requirement          limits    liability    under    the

FDCPA    to   genuinely     false    or    misleading       statements   that    “may

frustrate a consumer’s ability to intelligently choose his or

her response.”       Donohue, 592 F.3d at 1034; see also Hahn, 557
F.3d at 758 (“The statute is designed to provide information

that helps consumers to choose intelligently . . .”).                            Thus,

only misstatements that are important in the sense that they

could    objectively      affect     the    least     sophisticated      consumer’s

decisionmaking are actionable.              See Black’s Law Dictionary 1124

(10th ed. 2014) (defining “material”); cf. TSC Indus., Inc. v.

Northway, Inc., 426 U.S. 438, 449 (1976) (“An omitted fact is

material if there is a substantial likelihood that a reasonable

shareholder     would     consider    it        important   in   deciding   how    to

vote,” even if “disclosure of the omitted fact would [not] have

caused the reasonable investor to change his vote” (emphasis

added)).      In assessing materiality, “we are not concerned with

mere technical falsehoods that mislead no one.”                      Donohue, 592
F.3d at 1034.        For example, where a demand letter misstates

interest as principal but accurately states the total amount

                                           17
owed, such a technical error is not material.                        See Hahn, 557
F.3d at 757.        Similarly, a de minimis misstatement of the total

amount      owed   might    not     be    actionable,     although    we   need   not

determine the threshold here.

       In this case, the Assignment of Judgment falsely stated

that the judgment against Powell was “in the amount of $10497.21

plus attorney’s fees of $1230.78 and costs of $0.00,” for a

total of $11,727.99.          It also erroneously stated that Powell had

made   no    payments      toward    satisfaction    of    this   judgment.       The

amended Assignment of Judgment corrected these errors, stating

instead that the judgment was for “$9,216.43 plus attorney’s

fees of $1,230.78 and costs of $50.00.”                     It also stated that

Powell had made $2,700 in payments.                The difference between the

erroneous judgment total of $11,727.99 and the correct judgment

total of $10,497.21 and the erroneous statement of no payments

and $2,700 in payments was $3,930.78.                     This overstatement --

more than 50 percent -- was material under any standard.

       The fact that Powell mistakenly thought that she had paid

off the debt in full does not render the false representation

immaterial.        The district court presumed that an unsophisticated

consumer in Powell’s position would not “act differently based

on whether the judgment amount was stated with exact precision.”

(Emphasis     added).        But    the    least   sophisticated      consumer    who

previously believed that she had paid her debt in full could,

                                            18
upon receiving a copy of an assignment of judgment, be led to

realize that she did indeed have a debt outstanding.                             And when

that    assignment      contained       an     overstatement         in   excess    of    50

percent, the least sophisticated consumer could be led to decide

to pay far more than she otherwise would have paid.                             Moreover,

even were we to assume the contrary, the inquiry is not whether

the least sophisticated consumer would have acted differently

upon receiving Palisades’ Assignment of Judgment.                           Instead, it

is    whether   the     information      would      have    been     important     to    the

consumer in deciding how to respond to efforts to collect the

debt.       Given       the   importance           of     the    figures     that       were

inaccurately     reported        in    the     Assignment       of   Judgment    and     the

degree to which they were misstated, the misrepresentations here

easily satisfy that test.

       Accordingly, we conclude that the district court erred in

its    materiality      conclusion       with      respect      to   Powell’s      § 1692e

claim.

                                             IV

       While Powell’s claim under § 1692f was based on the same

facts advanced to support her § 1692e claim, the district court

granted summary judgment to the defendants on the § 1692f claim

after    concluding       that        “there      [was]    no    evidence       that     the

Defendants      acted    unfairly       or     unconscionably        in    violation      of

                                             19
[§ 1692f].”      Powell has not challenged this separate ruling on

appeal, and therefore it remains part of the judgment that we

affirm.    See United States ex rel. Ubl v. IIF Data Solutions,

650 F.3d 445, 456 (4th Cir. 2011) (“‘[T]he failure of a party in

its   opening    brief    to    challenge     an   alternate      ground    for   a

district court’s ruling given by the district court waives that

challenge’” (quoting Rodriguez v. Hayes, 591 F.3d 1105, 1118 n.6

(9th Cir. 2010))); Sapuppo v. Allstate Floridian Ins. Co., 739
F.3d 678, 680 (11th Cir. 2014) (“When an appellant fails to

challenge properly on appeal one of the grounds on which the

district   court    based       its   judgment,    he   is    deemed   to     have

abandoned any challenge of that ground, and it follows that the

judgment is due to be affirmed”).

                                         V

      Finally, with respect to Powell’s claims under the MCDCA

and the MCPA, we affirm the judgment of the district court.

Powell alleged that the defendants violated a provision of the

MCDCA   that    specifies      that   “[i]n   collecting     or   attempting      to

collect an alleged debt a collector may not . . . [c]laim,

attempt, or threaten to enforce a right with knowledge that the

right does not exist.”            Md. Code Ann., Com. Law § 14-202(8)

(emphasis added).        And her MCPA claim relies on the fact that a

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violation of the MCDCA is a per se violation of the MCPA.                                  See

id. § 13-301(14)(iii).

       Unlike the FDCPA, the MCDCA contains a “with knowledge”

element,     which    Powell     did     not       establish.           See     Spencer     v.

Hendersen-Webb, Inc., 81 F. Supp. 2d 582, 595 (D. Md. 1999)

(interpreting        § 14-202(8)         as        requiring        proof       “that      the

Defendants     either      had   actual        knowledge         that     their    asserted

claims were invalid or [that they] acted with reckless disregard

as to the validity of the claims”).                       Thus, the district court

correctly     concluded      that,      regardless         of     the     errors    in     the

amounts listed in the Assignment of Judgment, the undisputed

evidence shows that “when the Defendants filed the Assignment, .

. . they legitimately believed they had the legal right to do

so.”     Because      we   agree       with    the       district       court     that    “the

Defendants did not attempt to enforce a right with knowledge or

reckless disregard as to the non-existence of that right,” we

affirm its judgment on Powell’s state-law claims.

                                              VI

       In sum, while we affirm the summary judgment on the § 1692f

claim and the state-law claims, we vacate the summary judgment

granted to the defendants on the § 1692e claim, based on our

conclusions     (1)     that     the    Assignment          of    Judgment        was     debt

collection    activity      implicating            the    FDCPA     and    (2)     that    the

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misrepresentations in the Assignment of Judgment were material.

We remand the § 1692e claim for consideration of the defendants’

“bona    fide     error      defense”     and   any    other      remaining      factual

questions.       While the bona fide error defense was pleaded, it

was not a basis of the district court’s judgment and therefore

was not presented to us on appeal.

       The bona fide error defense allows a defendant to avoid

liability by “show[ing] by a preponderance of evidence 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).              While

the district court acknowledged that the defendants’ error in

this case was a “clerical error,” it nonetheless indicated that

the defense was inapplicable because the “affirmative defense

does not apply to errors of law” and “the Defendants made an

error of Maryland law as to what amounts are included in a

judgment.”       Yet, there is no evidence in the record to support

the     district       court’s     characterization          of    the       defendants’

overstatement of the judgment amount as an error of law.                         To the

contrary,        the      record    suggests          that     Palisades        made      a

transcription error.             Moreover, the lawyer for Palisades who

filed the Assignment of Judgment testified at his deposition

that the transcription error was not known to him and had been

made    by   a    paralegal.        The    commission        of   such       errors,    if

                                           22
factually established, is an issue of fact, not a question of

law.      On   remand,    the   court    should     give      the    defendants   an

opportunity     to    develop     the     defense       and    the     parties    an

opportunity to establish any other matter necessary to resolve

the FDCPA claim.

       Accordingly,      we   vacate    the   summary    judgment       entered   in

favor of the defendants on Powell’s § 1692e claim and remand

that claim, and we affirm the summary judgment entered in favor

of the defendants on Powell’s § 1692f claim and her state-law

claims.

                                                               AFFIRMED IN PART,
                                                                VACATED IN PART,
                                                                    AND REMANDED

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