Filed 11/2/26 UHG I, LLC v. Tran CA6
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SIXTH APPELLATE DISTRICT
UHG I, LLC, H053223
(Santa Clara County
Plaintiff, Cross-defendant and Super. Ct. No. 23CV401041)
Appellant,
v.
ANTHONY KIEM TRAN
Defendant, Cross-complainant
and Respondent.
In this appeal, we consider the limits of liability, permissible damages,
and availability of declaratory and injunctive relief under California’s
Identity Theft Act (CITA) (Civ. Code,1 §§ 1798.92–1798.97), where a creditor
ceases collection of a consumer debt and dismisses its collection lawsuit upon
learning that the debt arose from identity theft. We also examine whether a
creditor’s compliance with section 1788.17 of the Rosenthal Fair Debt
Collection Practices Act (Rosenthal Act) and parallel provisions of the federal
Fair Debt Collection Practices Act (FDCPA), bars liability under CITA.
1 All further unspecified statutory references are to the Civil Code.
UHG I, LLC (UHG), a debt buyer, purchased a debt from the original
creditor and filed an action to collect debt (collection action) against Anthony
Tran, the debtor identified on the account. Tran in turn filed a cross-
complaint against UHG, alleging that UHG’s collection action violated
provisions of CITA, the Rosenthal Act, and the FDCPA and seeking, inter
alia, injunctive relief, declaratory relief, damages, and attorney fees. In his
cross-complaint, Tran asserted that he was the victim of identity theft and
had been erroneously sued. After receiving notification—via the cross-
complaint—of Tran’s identity theft claim, UHG promptly opened an
investigation and, within 30 days, dismissed its collection action against
Tran.
The matter proceeded to a bench trial on the cross-complaint, and Tran
prevailed. The trial court awarded Tran declaratory and injunctive relief
under CITA, actual damages of $251 for parking and mileage incurred in
meeting with his lawyer, and attorney fees and costs. The court rejected
UHG’s bona fide error defense and found UHG liable for actual damages
under the FDCPA and Rosenthal Act. The court rejected Tran’s claims for a
civil penalty under CITA and for statutory damages under the FDCPA and
Rosenthal Act.
On appeal, UHG challenges, inter alia, the trial court’s findings of
liability, award of damages under CITA, the FDCPA, and the Rosenthal Act,
and Tran’s entitlement to declaratory and injunctive relief under CITA.
We decide the trial court did not err in its determination of liability
under any of the three statutes but did err in awarding actual damages for
costs incurred by Tran in meeting with his attorney regarding the lawsuit.
We modify the judgment to strike the damage award and affirm the
judgment as modified.
2
I. FACTS AND PROCEDURAL BACKGROUND
We first set out the relevant factual context and then turn to the
procedural history of the suits underlying this appeal.
A. Facts2
In 2019, Citibank, N.A. (Citibank) issued a consumer credit account,
with an account number ending in 5736 (account 5736), to “Anthony K.
Tran.” Charges accrued to account 5736 between January and March 2020,
and the account holder made partial payments on the account until April 6,
2020. Tran called Citibank sometime in April or May 2020, and reported the
account was fraudulently opened as the result of identity theft. After
investigation, Citibank concluded that the account arose from balance
transfers from another bank account associated with the same name and
social security number and was not the result of identity theft.
Citibank later “charged off” account 5736 (which had an outstanding
balance of $8,552.26) and sold the debt to UHG.3 Citibank warranted in the
purchase and sale agreement with UHG that account 5736 was, “to the best
of its knowledge . . . a legal, valid, and binding obligation” and that there was
“no dispute, claim, action, suit or proceeding pending or threatened” with
respect to the account.
2 The factual background is drawn from the trial court’s written
statement of decision, the trial testimony and evidence, and the record on
appeal. We recite the essential relevant facts, which are largely undisputed
for purposes of this appeal, “ ‘in the manner most favorable to the judgment,
resolving all conflicts and drawing all inferences in favor of respondent.’ ”
(Nwosu v. Uba (2004) 122 Cal.App.4th 1229, 1233, fn. 2.)
3 “ ‘Charged-off consumer debt’ means a consumer debt that has been
removed from a creditor’s books as an asset and treated as a loss or expense.”
(§ 1788.50, subd. (a)(2).)
3
On June 8, 2022,4 UHG’s counsel, Mandarich Law Group, LLP, sent
Tran a debt collection letter notifying him that UHG had authorized a
lawsuit to collect the balance owed on account 5736 if the matter remained
unresolved. Tran received the letter but did not call the number provided or
attempt to respond. Instead, Tran “worried” and “looked for an attorney to
protect [himself].”
B. Procedural History
1. Complaint and Cross-Complaint
On July 11, UHG filed the collection action against Tran. The
complaint alleged that Tran was the debtor on account 5736, had a debt
balance of $8,552.26 at charge-off, and had not paid the amount owed.
On August 29, Tran answered the complaint and filed a cross-
complaint, alleging violations of multiple consumer protection statutes. The
cross-complaint alleged that Tran was a victim of identity theft and never
used or possessed the credit card on account 5736 (referred to by Tran as the
“fraudulent account”). Tran asserted that he is entitled to actual damages,
statutory damages, injunctive relief, and attorney fees and costs under CITA.
Tran additionally sought relief under the FDCPA and the Rosenthal Act.
Tran alleged that UHG violated the FDCPA by, inter alia, making false
representations in an attempt to collect the alleged debt and misrepresenting
the character or legal status of the alleged debt, including that “the alleged
debt is lawfully owed by [Tran].” Tran asserted violations of sections 1692e,
1692e(5), 1692e(10), and 1692f(1) of title 15 of the United States Code. Tran
asserted similar claims under the Rosenthal Act, alleging violations of
sections 1788.13, subdivision (e), 1788.14, subdivision (b), and 1788.17. Tran
4 Unless otherwise indicated, all dates were in 2022.
4
sought actual and statutory damages and reasonable attorney fees and costs
under both the FDCPA and Rosenthal Act, and a statutory penalty under the
Rosenthal Act.
Tran attached and incorporated by reference two exhibits to the cross-
complaint. These were a copy of an incident report made to the Gilroy Police
Department on August 12 (police report)5 and an identity theft complaint and
affidavit, signed and dated on August 29 (the same date that the cross-
complaint was filed and served).
After conducting an investigation, UHG elected to close account 5736
and dismiss the collection action. On September 28, UHG filed a request for
dismissal, and the trial court later ordered the complaint dismissed with
prejudice.6 UHG thereafter filed an answer to the cross-complaint, amended
answer, and second amended answer to the cross-complaint.
2. Bench Trial and Decision
The trial court held a bench trial on Tran’s cross-complaint. The trial
commenced on October 1, 2024, with motions in limine, and continued over
four court days. Both sides presented evidence and, at the court’s request,
filed supplemental trial briefs on the applicable law and issues for decision.
5 Tran’s cross-complaint misstates the date of the police report as filed
“[o]n or about August 12, 2020. ” However, the police report is dated August
12, 2022, and includes the following narrative by Tran: “In 2020, [he] did not
make a police report because he was unaware of the process.”
6 The request for dismissal filed by UHG sought dismissal “[w]ithout
prejudice” and of the “[e]ntire action.” The record on appeal does not reflect
an order on the request for dismissal. In a later order, filed on May 21, 2024,
which does appear in the appellate record, the trial court granted Tran’s ex
parte application to vacate the request for dismissal, stating “The complaint
remains dismissed with prejudice. Defendant/[c]ross-complainant did not
consent to dismissal of the cross-complaint and it was not dismissed.”
5
On January 14, 2025, the trial court issued a tentative decision and
proposed statement of decision. Sixteen days later, on January 30, 2025, the
court issued a final statement of decision and entered judgment.7 Several
days later—after the court issued its final statement of decision and entered
judgment—UHG filed objections to the tentative decision. The record on
appeal does not reflect any response by the court or Tran to the objections to
the tentative decision. In their briefing, the parties address the final
statement of decision and do not raise any arguments related to UHG’s
objections. We likewise do not consider them.
In its statement of decision, the trial court addressed Tran’s three
causes of action under CITA, the FDCPA, and the Rosenthal Act.
Starting with CITA, the trial court found that Tran established by a
preponderance of the evidence that he was a victim of identity theft as
defined in Penal Code section 530.5 and did not open account 5376 or make
charges to it. Based on this finding, the court reasoned that Tran was
entitled to (1) judgment under CITA, (2) a declaration that he is not obligated
to UHG on the claim, and any security interest UHG had purportedly
obtained in Tran’s property is void and unenforceable, and (3) an injunction
7 The judgment filed on January 30, 2025, was styled a “[p]roposed
[j]udgment” and noted that, absent further action by the trial court, the
proposed judgment would “become the [j]udgment of the [c]ourt after the
timeline set forth in Cal[ifornia] [Rules of Court, rule] 3.1590(j) has passed.”
In supplemental briefing filed at the request of this court, UHG confirmed
that the proposed judgment on the cross-complaint is the one final judgment
resolving all causes of action between the parties to this appeal. Pursuant to
the California Rules of Court, rule 3.1590(j), the judgment became final 10
days after the January 31, 2025 mail service and was extended by five
additional court days because of mail service. Therefore, the proposed
judgment became final on February 17, 2025. UHG’s appeal from the
judgment was timely.
6
restraining UHG from collecting or attempting to collect on the claim. The
court rejected UHG’s argument that these remedies were inapplicable
because UHG had already dismissed its lawsuit and closed the account. The
court reasoned that, although the collection action had been dismissed with
prejudice, dismissal does not preclude future collection activity. Thus, “Tran
is appropriately entitled to declaratory and injunctive relief as stated in
section 1798.93.”
The trial court further ruled that, by providing notice of the identity
theft to UHG via the cross-complaint, Tran was entitled to actual damages
under section 1798.92, subdivision (c)(5) of CITA. The court found Tran’s
travel mileage and parking fees incurred in visiting his lawyer were
“appropriate and recoverable” as damages, for a total of $251. The court
rejected Tran’s request for emotional distress damages. It also rejected
Tran’s request for a civil penalty under section 1798.92, subdivision (c)(6),
finding that he had not shown by clear and convincing evidence that UHG
had failed to diligently investigate the notification of identity theft and
continued to pursue its claim against him. The court found that UHG
“diligently investigated the notice of identity theft provided in Tran’s cross-
complaint and abandoned its claim against Tran by ceasing its collection
efforts and dismissing its action to recover on the claim.”
Turning to the FDCPA, the trial court found that Tran satisfied the
elements of liability under sections 1692e and 1692f of title 15 of the United
States Code for UHG’s attempts to collect a debt that Tran had not incurred
and did not owe. The court found that UHG did not establish the “ ‘bona fide
error defense’ ” to liability under title 15 United States Code section 1692k(c)
because, while UHG had shown by a preponderance of the evidence that the
statutory violation was not intentional and any error was in good faith, “it
7
fail[ed] to meet the third element of the defense” requiring a showing that it
“maintained procedures reasonably adapted to avoid the violations Tran has
established.” The court found that UHG lacked processes to avoid violations
and “simply assume[d] that any debt bought from Citibank [wa]s valid.”
Citing case authority from the Ninth Circuit Court of Appeals, including
Reichert v. National Credit Systems, Inc. (9th Cir. 2008) 531 F.3d 1002
(Reichert), the court explained that such “assumption and blind reliance”
defeats application of the bona fide error defense.
Having decided that UHG was liable for violations under the FDCPA,
the trial court found that Tran could recover his damages, but the damages
(totaling $251) had been awarded pursuant to Tran’s CITA claim and could
only be recovered once. Therefore, the court did not award them under the
FDCPA.
The trial court rejected Tran’s claim for statutory damages. Citing the
factors stated in Riveria v. MAB Collections, Inc. (W.D.N.Y. 1988) 682
F.Supp. 174, 179, the court found that, although UHG should have had
policies and procedures in place to discover the identity theft claim before
pursuing collection, the “facts surrounding the frequency, persistence, nature
of noncompliance, and the lack of intentional noncompliance do not warrant a
statutory penalty.”
The trial court drew similar conclusions on Tran’s Rosenthal Act
claims. Citing California case authority holding that any violation of the
federal statute “is per se a separate violation” of the Rosenthal Act, the court
found UHG liable under section 1788.17. The court also concluded that UHG
could not establish the bona fide error defense under the state statute
(because of the failure to maintain procedures, as described ante), and that
Tran could not recover duplicate damages and had not shown entitlement to
8
statutory damages. The court found that Tran, as the prevailing party, was
entitled to attorney fees and costs under all three statutes.
The judgment granted Tran declaratory and injunctive relief against
UHG and damages of $251, and ruled he was entitled to attorney fees and
costs.
II. DISCUSSION
UHG challenges the trial court’s decision and judgment on seven
grounds. UHG contends that (1) UHG’s compliance with statutory
procedures to address a debtor’s claim of identity theft under the Rosenthal
Act barred liability for noncompliance under CITA; (2) declaratory relief was
improper absent evidence of an actual controversy; (3) injunctive relief was
unauthorized because there was no evidence establishing a probability the
conduct would recur; (4) mileage and parking were not recoverable as
compensatory damages; (5) the record supported application of the bona fide
error defense in this case and showed that UHG’s procedures constituted
more than “blind reliance”; (6) the court erred in finding liability under the
Rosenthal Act, because UHG complied with the provisions of section 1788.18
regarding debt collection efforts after receiving written notice of identity
theft; and (7) absent liability under any of the three statutes, Tran is not
entitled to attorney fees.
Tran counters that the judgment, award of damages, and rulings under
CITA and on UHG’s bona fide error defense under the FDCPA and Rosenthal
Act were proper based on the evidence presented at trial.
A. Statutory Background
In 1977, Congress enacted the FDCPA to address the “abundant
evidence of the use of abusive, deceptive, and unfair debt collection practices
by many debt collectors.” (15 U.S.C. § 1692(a); see Wade v. Regional Credit
9
Ass’n (9th Cir. 1996) 87 F.3d 1098, 1099; Rotkiske v. Klemm (2019) 589 U.S.
8, 10 (Rotkiske).) The FDCPA regulates the conduct of debt collectors by,
among other things, forbidding “any false, deceptive, or misleading
representation or means in connection with the collection of any debt.” (15
U.S.C. § 1692e.) Courts apply what is commonly termed the “ ‘least
sophisticated debtor’ standard” to claims arising under the FDPCA. (Wade,
at p. 1100.)
The FDCPA “authorizes private civil actions against debt collectors
who engage in certain prohibited practices.” (Rotkiske, supra, 589 U.S. at
p. 9; see 15 U.S.C. § 1692k.) However, a debt collector will not be held civilly
liable for an FDCPA violation “if the debt collector shows 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).) As a “broadly
remedial” statute, courts “liberally construe the FDCPA in favor of
consumers.” (McAdory v. M.N.S. & Associates, LLC (9th Cir. 2020) 952 F.3d
1089, 1092.)
California’s Rosenthal Act is modeled on and applies more broadly than
the federal FDCPA. (Best v. Ocwen Loan Servicing, LLC (2021) 64
Cal.App.5th 568, 576 (Best).) Also enacted in 1977, its purpose is “to prohibit
debt collectors from engaging in unfair or deceptive acts or practices in the
collection of consumer debts and to require debtors to act fairly in entering
into and honoring such debts.” (§ 1788.1, subd. (b); see Stats. 1977, ch. 907,
§ 1.) Like the FDCPA, courts interpret the Rosenthal Act broadly to
effectuate its protective purpose. (Davidson v. Seterus, Inc. (2018) 21
Cal.App.5th 283, 295.) The Rosenthal Act “incorporates the FDCPA, so that
a violation of the FDCPA is per se a violation of the Rosenthal Act.” (Best, at
10
p. 576; § 1788.17.) Amendments to the Rosenthal Act in 2003, added section
1788.18, establishing procedures to protect identity theft victims from
collection activities upon notification to the debt collector. (Stats. 2003,
ch. 287, § 1.)
In 2001—prior to the amendments to the Rosenthal Act that added
section 1788.18’s identity theft protections—the California Legislature added
identity theft provisions, commonly known as CITA, to the Civil Code.
(§§ 1798.92–1798.97; Stats. 2001, ch. 354, § 21.) Section 1798.93 of CITA
authorizes the filing of a civil action, or a cross-complaint, permitting a
person to establish they are a victim of identity theft if subjected to a debt
collector’s attempt to collect on a debt resulting from identity theft.
B. Appellate Standards of Review
On appeal, we presume the judgment is correct. “ ‘All intendments and
presumptions are indulged to support it on matters as to which the record is
silent, and error must be affirmatively shown. This is not only a general
principle of appellate practice but an ingredient of the constitutional doctrine
of reversible error.’ ” (Denham v. Superior Court (1970) 2 Cal.3d 557, 564.)
In reviewing a judgment based upon a statement of decision after a
bench trial, we review the trial court’s factfinding for substantial evidence.
(Schmidt v. Superior Court (2020) 44 Cal.App.5th 570, 581 (Schmidt).)
Under substantial evidence review, we liberally construe the court’s factual
findings to support the judgment and consider the evidence in the light most
favorable to the prevailing party, drawing all reasonable inferences in
support of the findings. (Thompson v. Asimos (2016) 6 Cal.App.5th 970, 981
(Thompson).) “Under this standard of review, parties challenging a trial
court’s factfinding bear an ‘enormous burden.’ ” (Schmidt, at p. 582.)
11
On the other hand, “[w]hen the decisive facts are undisputed, we are
confronted with a question of law and are not bound by the findings of the
trial court.” (Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 799.) We review de
novo questions of law arising from the judgment and statement of
decision. (Thompson, supra, 6 Cal.App.5th at p. 981.) Where the issue on
appeal raises a mixed question of law and fact, the proper degree of deference
varies based on the nature of the inquiry. (Ghirardo, at pp. 800–801;
Connerly v. State Personnel Bd. (2006) 37 Cal.4th 1169, 1175 (Connerly).)
C. Liability Under the Identity Theft Act
UHG contends that, in evaluating the claims of an identity theft victim
against a debt collector, CITA must be reconciled with the more recently
enacted Rosenthal Act. UHG asserts that CITA’s provisions governing notice
of identity theft and recovery against a debt collector are ambiguous and less
specific than the Rosenthal Act provisions, and therefore section 1788.18
“prevails over” section 1798.93.
1. Legal Principles and Standard of Review
a. CITA
Under CITA, a “victim of identity theft” can bring an action—or a cross-
complaint—for damages, civil penalties, and injunctive relief “against a
claimant to establish that the person is a victim of identity theft in
connection with the claimant’s claim against that person.” (§ 1798.93, subd.
(a).) A “ ‘[c]laimant’ ” is defined as “a person who has or purports to have a
claim for money or an interest in property in connection with a transaction
procured through identity theft.” (§ 1798.92, subd. (a).) A “ ‘[v]ictim of
identity theft’ ” is defined as a “person who had his or her personal
identifying information used without authorization by another to obtain
credit, goods, services, money, or property, and did not use or possess the
12
credit, goods, services, money, or property obtained by the identity theft, and
filed a police report in this regard.” (Id., subd. (d).) “A person shall establish
that he or she is a victim of identity theft by a preponderance of the
evidence.” (§ 1798.93, subd. (b).)
Section 1798.93, subdivision (c) provides remedies to which a person
who proves that they are a victim of identity theft “shall be entitled . . ., as
appropriate.” These remedies include (1) a declaratory judgment that the
victim of identity theft “is not obligated to the claimant on that claim” and
that any security interest purportedly acquired by the claimant against the
victim’s property “is void and unenforceable”; (2) an injunction preventing the
claimant from collecting on the claim or from enforcing a judgment against
the plaintiff on the claim; and (3) actual damages, attorney fees, and costs.
(Id., subd. (c)(1)–(3), (5).)
To recover actual damages or attorney’s fees, the victim of identity theft
must “show that they provided written notice to the claimant” as detailed in
the statute “at least 30 days before filing the action, or within their cross-
complaint pursuant to this section” or, alternatively, “may provide a valid
copy of a police report or of a Department of Motor Vehicles . . . investigative
report, filed pursuant to [s]ection 530.5 of the Penal Code, at least 30 days
before filing the action or within their cross-complaint pursuant to this
section.” (§ 1798.93, subd. (c)(5).)
b. The Rosenthal Act
The Rosenthal Act also establishes procedures to protect identity theft
victims from collection activities. Section 1788.18, subdivision (a) provides
that a debt collector who receives one of the enumerated forms of notice of
13
identity theft8 “shall cease collection activities” until it has completed the
review specified in subdivision (d) of the statute. Section 1788.18,
subdivision (d) states that, within 10 business days of receiving the required
notice, “the debt collector shall, . . . initiate a review considering all of the
information provided by the debtor and other information available to the
debt collector in its file or from the creditor. The debt collector shall send
notice of its determination to the debtor no later than 10 business days after
concluding the review.” The Rosenthal Act allows the debt collector to
“recommence debt collection activities only upon making a good faith
determination that the information does not establish that the debtor is not
responsible for the specific debt in question.” (Ibid.) That determination
must be made in a manner consistent with specified provisions of the
FDCPA, as incorporated by section 1788.17. (Ibid.)
Whether these statutory provisions “must be reconciled,” as UHG
contends, presents an issue of statutory interpretation that we review de
novo. (Jackson v. LegalMatch.com (2019) 42 Cal.App.5th 760, 767.)
2. Analysis
UHG premises its argument on a purported conflict between the
Rosenthal Act and CITA that it maintains presents “ ‘irreconcilable’ ”
directives. UHG argues that section 1788.18 of the Rosenthal Act “provides a
more detailed description of the information required for an identity theft
8 The required notice consists of “a copy of a Federal Trade Commission
. . . identity theft report, completed and signed by the debtor,” or,
alternatively, a copy of a police report alleging that the debtor is the victim of
identity theft for the debt being collected (§ 1788.18, subd. (a)(1)) and a
“written statement that the debtor claims to be the victim of identity theft
with respect to the specific debt being collected by the debt collector” (id.,
subd. (a)(2)) that comports with additional specifications in the statute for the
written statement (id., subd. (b)(1)–(2)).
14
notice, when debt collection should cease, what notices are necessary before
and after a reasonable investigation, and when debt collection can
recommence,” whereas section 1798.93 of CITA “provides for notice
requirements (without the same level of detail), and fails to address when
debt collection ceases and can recommen[ce].”
Our fundamental task in interpreting a statute “ ‘ “is to determine the
Legislature’s intent so as to effectuate the law’s purpose. We first examine
the statutory language, giving it a plain and commonsense meaning. We do
not examine that language in isolation, but in the context of the statutory
framework as a whole in order to determine its scope and purpose and to
harmonize the various parts of the enactment. If the language is clear, courts
must generally follow its plain meaning unless a literal interpretation would
result in absurd consequences the Legislature did not intend. If the statutory
language permits more than one reasonable interpretation, courts may
consider other aids, such as the statute’s purpose, legislative history, and
public policy.” [Citation.] “Furthermore, we consider portions of a statute in
the context of the entire statute and the statutory scheme of which it is a
part, giving significance to every word, phrase, sentence, and part of an act in
pursuance of the legislative purpose.” ’ ” (City of San Jose v. Superior Court
(2017) 2 Cal.5th 608, 616–617 (City of San Jose).)
Having independently reviewed the language of both statutes, we
perceive no conflict between them.9
Section 1798.93, subdivision (c)(5) pertains exclusively to the recovery
of actual damages, attorney fees and costs, and equitable relief under CITA.
9 Tran argues that UHG has forfeited this argument, having failed to
assert it at any time during the litigation in the trial court. However, Tran
fails to support his forfeiture argument with relevant citations to the trial
court record, and we decline to resolve the issue on this basis.
15
Giving the provision its “ ‘ “plain and commonsense meaning” ’ ” (City of San
Jose, supra, 2 Cal.5th at p. 616), a victim of identity theft seeking to recover
any of these forms of relief upon filing an action or cross-complaint under
CITA must prove they have given notice to the claimant in one of two ways:
by providing, (1) upon written request, a valid, signed Federal Trade
Commission (FTC) identity theft report “completed at least 30 days before
filing the action, or within their cross-complaint pursuant to this section,” or
(2) a valid copy of a police report or of a Department of Motor Vehicles
investigative report, filed pursuant to Penal Code section 530.5, “at least 30
days before filing the action or within their cross-complaint.” (§ 1798.93,
subd. (c)(5).) UHG contends that the phrase “ ‘within their cross-complaint’ ”
is ambiguous and “does not appear to fit” into CITA’s procedure to allow
notice to the debt collector to conduct a reasonable investigation, whereas
section 1788.18 provides more detail about the information required to notify
of identity theft. We disagree that the notice timeline under CITA is unclear.
The phrase “completed at least 30 days before filing the action, or
within their cross-complaint” is repeated twice in describing the notice
requirement for recovery of actual damages, attorney fees and costs, and
equitable relief (§ 1798.93, subd. (c)(5)), and again (albeit not verbatim) in the
next subpart on obtaining a civil penalty. (Id., subd. (c)(6)(A).) That
provision authorizes the recovery of a civil penalty “if the victim establishes
by clear and convincing evidence” three elements, the first being “[t]hat at
least 30 days prior to filing an action or within the cross-complaint pursuant
to this section, they provided written notice to the claimant at the address
designated.” (Ibid.) In the latter usage, the reference to “within the cross-
complaint” is plainly juxtaposed against the “30 days prior to filing an action”
and allows notice to be given in two contexts—the first, when filing an action,
16
requires written notice to the claimant “at least 30 days prior to filing” the
action, and the second, when bringing a cross-complaint, requires written
notice “within the cross-complaint.” (Ibid.)
Viewing together the various parts of the enactment, the phrase
“within the cross-complaint” (§ 1798.93, subd. (c)(6)(A)) carries the same
meaning when used in the prior subpart. When a victim of identity theft
seeks actual damages, attorney fees and costs, or equitable relief against the
claimant by way of a cross-complaint, notice of the identity theft must be
given “within their cross-complaint.” (Id., subd. (c)(5).)
Although UHG maintains this language “fails to address when debt
collection ceases and can recommen[ce]” and “lacks provisions for notice to
credit reporting agencies and notice to the victim/debtor regarding the results
of the investigation,” those perceived shortcomings do not render the
statutory language ambiguous, nor does applying the plain meaning result in
absurd consequences. (City of San Jose, supra, 2 Cal.5th at p. 616.) We
perceive no absurdity in the Legislature’s decision to require that a victim of
identity theft who brings an affirmative, direct action for damages or other
relief, supply evidence of an FTC or police report made at least 30 days prior
to filing that action. By contrast, the Legislature has afforded a victim who
has already been sued in a collection action the opportunity to provide notice
of reporting the identity theft at the time of (or “within”) filing a cross-
complaint. These different timelines reflect the possibility that the identity
theft victim might not be aware of the alleged debt (or, as in this case, might
be under the false impression that they previously resolved the issue with
their former creditor) until they are sued.
We are not persuaded by UHG’s unsupported assertion that “[s]ection
1798.93 appears to reflect a legislative intent to allow a creditor to conduct an
17
investigation before finding liability.” On the contrary, to secure a
judgment—including declaratory and injunctive relief—section 1798.93
requires only that a person prove by a preponderance of the evidence that
they are a “victim of identity theft” as that term is defined in the statute.
(§ 1798.93, subds. (b), (c).) Although the statute adds a notice requirement
when the victim pursues actual damages or attorney fees, this requirement
merely premises liability for possible monetary damages or attorney fees on
notice. (Id., subd. (c)(5).) Only in the context of a civil penalty pursuant to
section 1798.93, subdivision (c)(6), does the statute reflect a clear legislative
intent to consider a creditor’s investigation. Under that subpart, the creditor
claimant may avoid civil penalties by conducting a diligent investigation and
discontinuing its claim. (Ibid.)
None of these provisions conflict with the Rosenthal Act. UHG points
to a more “specific process” for notifying debt collectors of identity theft
claims pursuant to section 1788.18 of the Rosenthal Act. Section 1788.18
provides a timeframe for debt collectors who receive proper notice of an
identity theft claim to undertake several actions, including to (1) “cease
collection activities” until completion of a specified review (id., subd. (a)),
(2) notify the consumer credit reporting agency (if the debt was reported) that
the account is disputed and initiate a review of all the information available
on the claim, and (3) inform the debtor of its determination, allowing the debt
collection to resume only if the debt collector has made a “good faith
determination” that the debtor is responsible for the debt in question (id.,
subd. (d)).
These processes protect consumers by requiring notice to the consumer
credit reporting agencies when an account is disputed and restricting the
resumption of collection activities subject to the outcome of the investigation.
18
However, they do not mitigate or preclude potential liability for collection
activities against a victim of identity theft, whether liability arises under the
Rosenthal Act or CITA. Section 1788.18, subdivision (e) expressly disclaims
such an effect: “The exercise or nonexercise of rights under this section is not
a waiver of any other right or defense of the debtor or debt collector.” In
addition, section 1788.18 specifically provides that the notice requirements
therein “may also satisfy” the notice requirements of section 1798.93,
subdivision (c)(5). (§ 1788.18, subd. (f).) The statute’s express recognition
that notice under the Rosenthal Act may satisfy notice requirements for the
recovery of actual damages or attorney fees under CITA suggests that the
Legislature intended both statutory schemes to function together and
undermines UHG’s argument that the Legislature intended for one scheme to
take precedence over the other.
In sum, we conclude that the relevant provisions of the Rosenthal Act
and CITA are not conflicting but complementary. Therefore, section 1788.18
does not “prevail” over section 1798.93, and UHG’s purported compliance
with section 1788.18 does not foreclose its liability under section 1798.93.
D. Declaratory and Injunctive Relief
UHG contends that the trial court awarded Tran declaratory and
injunctive relief without addressing the underlying legal standards for them.
UHG asserts that the court awarded declaratory relief “without addressing
the uncontroverted evidence that the controversy was mooted” and there was
“no actual or justiciable controversy.” UHG similarly asserts that the court
awarded injunctive relief without addressing that the controversy was moot
and that there was “no evidence that UHG will attempt to collect the debt”
from Tran in the future. Tran counters that the court properly awarded
declaratory and injunctive relief, as expressly provided in section 1798.93.
19
Because UHG does not dispute the trial court’s factual findings and
challenges only the legal grounds for declaratory and injunctive relief, we
treat the material facts as undisputed and decide UHG’s challenges as a
question of law. (Connerly, supra, 37 Cal.4th at pp. 1175–1176.)
Under CITA, a person who proves they are a victim of identity theft as
to a particular claim, “shall be entitled to a judgment providing all of the
following, as appropriate: [¶] (1) A declaration that they are not obligated to
the claimant on that claim. [¶] (2) A declaration that any security interest or
other interest the claimant had purportedly obtained in the victim’s property
in connection with that claim is void and unenforceable. [¶] (3) An
injunction restraining the claimant from collecting or attempting to collect
from the victim on that claim, from enforcing or attempting to enforce any
security interest or other interest in the victim’s property in connection with
that claim, or from enforcing or executing on any judgment against the victim
on that claim.” (§ 1798.93, subd. (c)(1)–(3).)
The trial court found that Tran established by a preponderance of the
evidence that he was a victim of identity theft as defined by the statute. It
found, inter alia, that “Tran’s testimony and the weight of the evidence
established that a theft of his identity occurred,” “Tran did not open or use
the subject Citibank credit account,” and “Tran notified Citibank in 2020 that
his identity had been stolen and that he did not make the charges on the
subject Citibank account.” The court noted that UHG did not rebut these
facts, which the court found more likely than not to be true, and concluded
that Tran was accordingly entitled to judgment as appropriate under the
statute.
The court rejected UHG’s assertion that none of the enumerated
remedies was appropriate “since UHG dismissed its lawsuit, ‘closed the
20
account,’ and there is no evidence that the conduct will be repeated.” It
reasoned that, while the collection action had been dismissed with prejudice,
that action did not preclude future collection activity or an attempt to collect.
We decide that UHG has not established reversible error in the trial
court’s decision to grant declaratory and injunctive relief. The statutory
language is unambiguous. Section 1798.93 confers on Tran a right to any of
the forms of relief set forth in subparts (1) through (5) of subdivision (c),
limited only by the trial court’s discernment of whether such relief is
“appropriate.” (See Abbett Electric Corp. v. Storek (1994) 22 Cal.App.4th
1460, 1469.) That UHG dismissed the collection action with prejudice, and
UHG witnesses testified UHG would not attempt to collect on the debt in the
future, did not eliminate grounds for relief under the statute because the trial
court found that those facts did not eliminate the possibility of future
collection activity. UHG has not challenged the court’s findings, nor its
characterization of potential debt collection activity as distinct from the legal
action previously dismissed.
The statutory language entitling Tran to relief based on the trial court’s
conclusion that he was a victim of identity theft and declaratory and
injunctive relief were appropriate (given the otherwise lack of enforceable
assurance against future attempts to collect the debt) undercuts UHG’s
contention that the underlying controversy is moot because no actual or
justiciable controversy exists. “[W]here an actual controversy exists the
complainant in a declaratory action is entitled to a judgment determining his
rights, even though the only determination to which he is entitled may be an
adjudication that he has no rights.” (Pittenger v. Home Savings & Loan Ass’n
(1958) 166 Cal.App.2d 32, 36; see Code Civ. Proc., § 1060 [describing right of
21
action “in cases of actual controversy relating to the legal rights and duties of
the respective parties”].)
This is not a circumstance in which “some event has occurred which
‘deprive[s] the controversy of its life’ ” (Giraldo v. Department of Corrections
& Rehabilitation (2008) 168 Cal.App.4th 231, 257). The dismissal of the
collection action and assurances at trial that no further collection efforts
would be pursued did not resolve the justiciable questions under section
1798.93, nor under the FDCPA and Rosenthal Act. Tran responded to UHG’s
action against him to recover on its claim in connection with account 5736 by
filing a cross-complaint, entitling Tran to relief on the question of being “a
victim of identity theft in connection with [UHG]’s claim.” (§ 1798.93, subd.
(a).) Furthermore, the trial court implicitly found UHG’s assurances that it
would not pursue further collection activity on the account insufficient to
avoid imposition of injunctive relief to which he was entitled under the
statute. (Cf. Satey v. JPMorgan Chase & Co. (9th Cir. 2008) 521 F.3d 1087,
1093 [construing the term “ ‘claimant’ ” under CITA not to include someone
who had an interest in a disputed debt in the past, but “who no longer retains
the interest at the time suit is filed”].) Equitable principles governing
injunctive relief cited by UHG, under which “[t]he injunctive remedy should
not be exercised ‘in the absence of any evidence that the acts are likely to be
repeated in the future’ ” (Cisneros v. U.D. Registry, Inc. (1995) 39 Cal.App.4th
548, 574) do not foreclose Tran’s injunctive remedy in this case.
We decide the trial court did not err in granting declaratory relief
pursuant to section 1798.93, subdivision (c)(1) and (2) and injunctive relief
pursuant to section 1798.93, subdivision (c)(3).
22
E. Damages
UHG contends that the travel and parking costs incurred by Tran in
connection with the collection action and filing the cross-complaint were not
recoverable damages. UHG argues that mileage and parking to meet with a
litigant’s attorney are personal litigation expenses, not compensatory
damages. UHG contends that, because California follows the “generally
applicable ‘ “American rule” ’ that each party bears its own costs and attorney
fees” (Olson v. Automobile Club of Southern California (2008) 42 Cal.4th
1142, 1147), the costs associated with meeting with counsel are treated the
same as other costs of managing the lawsuit and may not be “ ‘snuck in’ ” as
direct economic damages, nor as any of category of recoverable costs of
litigation set forth in Code of Civil Procedure section 1033.5.
Tran responds that the trial court’s assignment of travel and parking
fees as actual damages was correct because he incurred those costs as a direct
result of UHG’s lawsuit. Tran asserts that, but for UHG’s pursuit of its
collection action, Tran would not have had to visit a lawyer five times,
traveling 60 miles round trip each time and paying $10 in parking fees on
each trip, for a total, at the applicable federal mileage reimbursement rate, of
$251.
While appellate courts typically review a damages award under the
deferential abuse of discretion standard, “the proper measure of damages in a
particular case is . . . an issue of law subject to de novo review, and such issue
may be considered on appeal even though the appellant did not move for a
new trial.” (Switzer v. Wood (2019) 35 Cal.App.5th 116, 125.)
CITA provides for “[a]ctual damages, attorney’s fees, and costs, and any
equitable relief that the court deems appropriate” and imposes additional
qualifying factors (based on notice to the claimant) for actual damages and
23
attorney fees. (§ 1798.93, subd. (c)(5).) The statute does not otherwise
specify what constitutes or qualifies as “actual damages.”
Neither party cites to any case law or other legal authority that directly
addresses whether travel and parking costs incurred in connection with
meeting with an attorney can constitute “actual damages” as that term is
used in section 1798.93, and we have not located any. Nevertheless, courts
considering the meaning of the term “actual damages” in the context of other
statutes have generally agreed that “ ‘ “ ‘[a]ctual damages’ is a term
synonymous with compensatory damages.” ’ ” (Saunders v. Taylor (1996) 42
Cal.App.4th 1538, 1544; see DeLisi v. Lam (2019) 39 Cal.App.5th 663, 682
[noting “ ‘actual damages’ are simply compensatory damages, as opposed to
nominal, exemplary or speculative”].) “ ‘[A]ctual damages’ are those which
compensate someone for the harm from which he or she has been proven to
currently suffer or from which the evidence shows he or she is certain to
suffer in the future.” (Saunders, at p. 1543.) California statutes use the term
“to denote compensatory damages for actual injuries, as opposed to other
types of relief” (id. at p. 1544), such as civil penalties, exemplary damages,
and attorney fees and costs.
Moreover, while the law ascribes a broad definition to the term
“damages” (§ 3281), courts for centuries have “consistently held that expenses
of litigation could not be recovered as damages, and no costs were recoverable
beyond those taxable under the statute.” (Woodward v. Bruner (1951) 104
Cal.App.2d 83, 85.) “This rule of the common law that counsel fees were to be
classed as costs and not damages is a part and parcel of our law, except to the
extent that a statute or a contract between the parties provides otherwise.”
(Ibid.)
24
Given these well-established principles, we agree with UHG that travel
mileage and parking fees to meet with a litigant’s attorney in the context of
the underlying lawsuit are personal litigation expenses (more akin to costs),
not compensatory damages. We are unpersuaded by Tran’s “but for”
argument. While travel and parking expenses incurred to meet with counsel
to defend against a putative creditor’s claim for payment are arguably a
result of the creditor’s claim, the same can be said for all expenses of
litigation “caused by” the other party’s legal action. Such a broad
interpretation of damages is incongruous with the well-established principles
governing litigation expenses and inconsistent with the statutory definition
of damages as monetary compensation when a person “suffers detriment from
the unlawful act or omission of another.” (§ 3281, italics added.) We
therefore conclude that the trial court erred in awarding Tran $251 in actual
damages under CITA.
Although the trial court did not award duplicate damages, its finding
that Tran was similarly entitled to actual damages under the FDCPA and
Rosenthal Act was erroneous for the same reasons. The FDCPA authorizes
damages against “any debt collector who fails to comply with any provision of
this subchapter . . . in an amount equal to the sum of . . . [¶] . . . any actual
damage sustained by such person as a result of such failure.” (15 U.S.C.
§ 1692k(a)(1).) Thus, “actual damage” (ibid.) under the FDCPA is that which
is sustained as a direct result of the statutory violation. (See Sanders v.
Jackson (7th Cir. 2000) 209 F.3d 998, 1004 [“[A]ny egregious debt collection
practices which cause actual losses to debtors are fully compensable
according to the actual damages provision of the FDCPA.”].)
Although actual damages may include “ ‘recovery . . . for emotional
distress, including humiliation, embarrassment, mental anguish, and
25
emotional distress’ ” (Rankin by and through Antrobus v. Resurgent Capital
Services, L.P. (S.D. Ohio 2025) 791 F.Supp.3d 803, 811–812, fn. 2), Tran has
cited no published authority (and we are aware of none) extending actual
damages to expenses incurred in meeting with counsel in response to the
unlawful collection activities. Because the Rosenthal Act remedies mirror
those available under the FDCPA (§ 1788.17), the same analysis applies.
We conclude that the trial court erred in awarding actual damages for
Tran’s mileage and parking fees incurred in connection with meeting with an
attorney for the purposes of this litigation. Where “a trial court erroneously
award[ed] [one type of damages,] a reviewing court may, instead of reversing
the entire judgment, make an order of modification striking that portion
relating to [the erroneously awarded] damages and affirm the judgment as so
modified.” (Crogan v. Metz (1956) 47 Cal.2d 398, 405; accord, Maughan v.
Correia (2012) 210 Cal.App.4th 507, 523; Mega RV Corp. v. HWH Corp.
(2014) 225 Cal.App.4th 1318, 1344.) Therefore, we will order the award of
$251 in actual damages to be stricken from the judgment.
F. Bona Fide Error Defense
UHG contends that the trial court erred in finding liability under the
FDCPA and Rosenthal Act because the evidence at trial supported
application of the bona fide error defense with respect to both statutes. Tran
counters that the evidence at trial satisfied all the elements to establish
liability under each statute, and UHG failed to prove bona fide error because
it did not show that it maintained procedures reasonably adapted to avoid
the violations alleged in the cross-complaint.
“It is a violation of the FDCPA to falsely represent ‘the character,
amount, or legal status of any debt’ ([15 U.S.C.] § 1692e(2)(A)) or to ‘use . . .
any false representation or deceptive means to collect or attempt to collect
26
any debt.’ (Id., § 1692e(10).)” (Aguilar v. Mandarich Law Group, LLP (2023)
87 Cal.App.5th 607, 622.) It is also an FDCPA violation for a debt collector to
“collect ‘any amount (including any interest, fee, charge, or expense
incidental to the principal obligation) unless such amount is expressly
authorized by the agreement creating the debt or permitted by law.’ 15
U.S.C. § 1692f(1).” (Reichert, supra, 531 F.3d at p. 1005.) “The FDCPA
makes debt collectors liable for violations that are not knowing or intentional.
[Citation.] It provides a ‘narrow exception to strict liability,’ however, for
bona fide errors.” (Ibid., citing Clark v. Capital Credit & Collection Servs.
(9th Cir. 2006) 460 F.3d 1162, 1176–1177 (Clark).) Because the Rosenthal
Act incorporates by reference the requirements of the FDCPA and makes
available its remedies for violations, “[a] violation of any of these FDCPA
provisions is per se a violation of the Rosenthal Act.” (Aguilar, at p. 621.)
UHG does not challenge the trial court’s finding that UHG sued Tran
“to collect a debt that he did not incur and does not owe,” giving rise to
liability under both statutes. UHG challenges only the court’s rejection of
UHG’s bona fide error defense on the ground that UHG “fail[ed] to meet the
third element” showing “that it maintained procedures reasonably adapted to
avoid the violations Tran has established.”
The FDCPA’s exception for bona fide error states, “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 bona fide error notwithstanding the
maintenance of procedures reasonably adapted to avoid any such error.” (15
U.S.C. § 1692k(c).) The bona fide error exception under the Rosenthal Act
uses similar language, stating that there shall be no civil liability “if the debt
collector shows by a preponderance of evidence that the violation was not
27
intentional and resulted notwithstanding the maintenance of procedures
reasonably adapted to avoid any such violation.” (§ 1788.30, subd. (e).)
“This narrow exception to strict liability under the FDCPA is an
affirmative defense.” (Clark, supra, 460 F.3d at p. 1177.) It “requires the
debt collector to show they ‘(1) violated the FDCPA unintentionally; (2) the
violation resulted from a bona fide error; and (3) the debt collector
maintained procedures reasonably adapted to avoid the violation.’ ”
(Rodriguez v. LVNV Funding, Inc. (2024) 106 Cal.App.5th 717, 726, quoting
Urbina v. National Business Factors Inc. (9th Cir. 2020) 979 F.3d 758, 763.)
Thus, “if a debt collector reasonably relies on the debt reported by the
creditor, the debt collector will not be liable for any errors. On the other
hand, the bona fide error defense will not shield a debt collector whose
reliance on the creditor’s representation is unreasonable or who represents to
the consumer a debt amount that is different from the creditor’s report.”
(Clark, at p. 1177.)
We review the trial court’s predominantly factual findings under the
FDCPA and Rosenthal Act for substantial evidence, liberally construing the
court’s factual findings to support the judgment, considering the evidence in
the light most favorable to the prevailing party, and drawing all reasonable
inferences in support of the findings. (Schmidt, supra, 44 Cal.App.5th at
pp. 581–582; Thompson, supra, 6 Cal.App.5th at p. 981.) Insofar as the court
found that UHG failed to carry its burden of proof on the third element of the
affirmative defense, the question for this court “ ‘becomes whether the
evidence compels a finding in favor of the appellant as a matter of law.’ ”
(Sonic Manufacturing Technologies, Inc. v. AAE Systems, Inc. (2011) 196
Cal.App.4th 456, 466 (Sonic Manufacturing) [explaining that where the issue
on appeal turns on a failure of proof at trial, it is misleading to characterize
28
the review as based on whether substantial evidence supports the
judgment].) Where the trial court has determined that a party has failed to
carry its burden of proof, “we ask ‘whether the appellant’s evidence was
(1) “uncontradicted and unimpeached” and (2) “of such a character and
weight as to leave no room for a judicial determination that it was
insufficient to support a finding.” ’ ” (Ajaxo, Inc. v. E*Trade Financial Corp.
(2020) 48 Cal.App.5th 129, 163–164 (Ajaxo); see Roesch v. De Mota (1944) 24
Cal.2d 563, 571.)
UHG has not demonstrated on appeal that the evidence presented at
trial overcomes this “onerous standard” (Ajaxo, supra, 48 Cal.App.5th at
p. 164). UHG argues that it presented evidence establishing (1) that its
experience with Citibank provided a reasonable basis for it to rely on
Citibank’s representations, (2) it negotiated terms with Citibank that
included warranties that Citibank would only sell debts to it that were not
subject to a claim or dispute (such as identity theft), and (3) Tran presented
no evidence that UHG’s allegations in the collection action included any
information that was not provided by Citibank. Relying on the principle that
the FDCPA “ ‘does not require an independent investigation of the debt
referred for collection’ ” (Smith v. Transworld Systems, Inc. (6th Cir. 1992)
953 F.2d 1025, 1032), UHG points to the Ninth Circuit Court of Appeal’s
statement in Clark that “if a debt collector reasonably relies on the debt
reported by the creditor, the debt collector will not be liable for any errors.”
(Clark, supra, 460 F.3d at p. 1177.)
UHG argues that, unlike in Clark, where the Court of Appeals
determined the debt collector lacked a reasonable basis to rely on the
creditor’s representations of a valid debt because the debt collector was aware
of the creditor’s bookkeeping difficulties and billing problems (Clark, supra,
29
460 F.3d at pp. 1176–1177), the evidence here established that UHG set
terms with Citibank to ensure the validity of the debts being sold. UHG
asserts that by negotiating an agreement with the creditor that the creditor
will supply only valid debts, a debt collector satisfies the affirmative defense’s
third element for maintaining procedures reasonably adapted to avoid error.
That UHG presented evidence of Citibank’s broad contractual warranty
and of Citibank’s prior track record selling UHG valid debts is not in dispute.
Nevertheless, UHG has not shown the trial court erred in finding that these
measures failed to satisfy the third element of the bona fide error defense,
requiring “the defendant to show that it maintains procedures to avoid
errors.” (Reichert, supra, 531 F.3d at p. 1006.)
The Reichert decision examined the types of activities that have been
held satisfactory to prove a debt collector utilized “ ‘reasonable preventive
procedures’ aimed at avoiding” a violation. (Reichert, supra, 531 F.3d at
p. 1006.) It referred to an illustrative case from the Seventh Circuit, in which
the debt collector’s procedures “included a requirement that the creditor
verify under oath that each charge was accurate, as well as ‘the publication of
an in-house fair debt compliance manual, updated regularly and supplied to
each firm employee; training seminars for firm employees collecting
consumer debts; and an eight-step, highly detailed pre-litigation review
process to ensure accuracy and to review the work of firm employees to avoid
violating the Act.’ ” (Ibid., quoting Jenkins v. Heintz (7th Cir. 1997) 124 F.3d
824, 834.)
Reichert emphasized that reliance on a creditor’s good track record is
not, without more, sufficient: “The fact that the creditor provided accurate
information in the past cannot, in and of itself, establish that reliance in the
present case was reasonable and act as a substitute for the maintenance of
30
adequate procedures to avoid future mistakes.” (Reichert, supra, 531 F.3d at
p. 1007.) The court explained, “When we spoke in Clark of the nonliability of
a debt collector who ‘reasonably relies’ on the reported debt, we were
referring to a reliance on the basis of procedures maintained to avoid
mistakes. A debt collector is not entitled under the FDCPA to sit back and
wait until a creditor makes a mistake and then institute procedures to
prevent a recurrence. To qualify for the bona fide error defense under the
FDCPA, the debt collector has an affirmative obligation to maintain
procedures designed to avoid discoverable errors.” (Ibid.)
Under the standard articulated in Reichert, UHG has not shown its
procedures—consisting of an agreement with Citibank warranting the
validity of the debts purchased, and its reliance on Citibank’s prior track
record in transferring debts to UHG—provided evidence “ ‘ “of such a
character and weight as to leave no room for a judicial determination that it
was insufficient to support a finding.” ’ ” (Ajaxo, supra, 48 Cal.App.5th at
pp. 163–164.) To the contrary, the trial court observed that the procedures
UHG had instituted did not appear to be “adapted to avoid the error”
(Reichert, supra, 531 F.3d at p. 1007) that occurred. The court found that
“Citibank had multiple conversations about fraud on the Tran account, but
UHG did not so much as flag the account for further inquiry prior to
collection efforts and filing suit.” Instead, UHG relied exclusively on the
agreement with Citibank and absence of prior incidents involving debts
acquired from Citibank to file the underlying collection action, despite
“UHG’s witnesses[’ testimony] that UHG did not know what Citibank’s
procedure was for ensuring that it did not attempt to collect debts that were
not, in fact, incurred by the consumer.”
31
Under these circumstances, the trial court’s finding that UHG’s
reliance on Citibank’s representations regarding the debt was not reasonably
adapted to avoid the error (Reichert, supra, 531 F.3d at p. 1007) is supported
by substantial evidence. Further, we decide that UHG has not shown the
evidence compelled a finding in its favor on the bona fide error defense.
(Sonic Manufacturing, supra, 196 Cal.App.4th at p. 466.)
G. Rosenthal Act Compliance
UHG contends that the trial court erred in finding liability under the
Rosenthal Act, because UHG complied with section 1788.18, subdivision (d),
which as discussed ante permits the debt collector to continue collection
efforts until it receives one of the specified forms of written notice of the
identity theft. UHG maintains that since the evidence establishes that it
made no further collection efforts after it received notice via Tran’s cross-
complaint, there can be no violation of section 1788.18. UHG further asserts
that as section 1788.18 “is a later enacted” and “more specific statute” than
section 1788.17, it “should govern” the obligations of UHG in cases, like this
one, involving identity theft. UHG makes an identical argument in relation
to section 1798.93 under CITA.
“To demonstrate error, appellant must present meaningful legal
analysis supported by citations to authority and citations to facts in the
record that support the claim of error.” (In re S.C. (2006) 138 Cal.App.4th
396, 408.) When an appellant asserts a point on appeal “ ‘but fails to support
it with reasoned argument and citations to authority’ ” (Nelson v. Avondale
Homeowners Assn. (2009) 172 Cal.App.4th 857, 862), this court may treat the
point as forfeited.
UHG has failed to provide any reasoned argument or citations to legal
authority in support of its contention that compliance with the provisions of
32
section 1788.18 forecloses liability under the other statutory provisions,
including section 1788.17 (incorporating, by reference, the requirements of
the FDCPA) and under CITA. It is this provision (§ 1788.17) upon which the
trial court’s finding of liability under the Rosenthal Act was premised. We
are not required to examine undeveloped claims or develop UHG’s arguments
for it (Paterno v. State of California (1999) 74 Cal.App.4th 68, 106) and
decline to consider this conclusory assertion of error.
H. Attorney Fees
Citing its arguments against recovery for Tran under any of the three
statutory schemes, UHG relatedly challenges the award of attorney fees.
UHG also suggests, without any citation to the record or presentation of legal
argument or authorities, that even if this court “does believe that some
award” of attorney fees and costs is authorized, it should remand that issue
to the trial court “to make a determination of the correct amount of fees and
costs.”
UHG’s conclusory argument seeking reversal of the attorney fee award
is unpersuasive. Having carefully considered UHG’s contentions of error on
appeal, we have determined that the trial court erred in awarding actual
damages based on travel and parking costs incurred by Tran in meeting with
an attorney after being sued in the collection action. While this eliminates
the award of $251 in actual damages, requiring modification of the judgment,
it does not otherwise affect the trial court’s findings on the principal issues of
liability under CITA, giving rise to declaratory and injunctive relief, and on
liability under the FDCPA and Rosenthal Act.
Each of these statutes provides for an award of attorney fees to a
prevailing consumer. (See § 1798.93, subd. (c)(5) [entitling, as appropriate, a
person who proves they are victim of identity theft to “attorney’s fees and
33
costs”]; §§ 1788.17 [making debt collector under the statute subject to the
remedies under FDCPA], 1788.30, subd. (c) [entitling the prevailing party in
an action to enforce “any liability” under the statute to reasonable attorney
fees]; 15 U.S.C. § 1692k(a)(3) [providing that any debt collector found liable
for a violation under the FDCPA “is liable” for “the costs of the action,
together with a reasonable attorney’s fee as determined by the court”].)
Because UHG has not established reversible error as to the grounds for
liability ruled on by the trial court, we do not disturb the judgment entitling
Tran to attorney fees under the applicable statutes.
III. DISPOSITION
The judgment is modified to strike paragraph No. 4, awarding $251 in
actual damages on the cross-complaint. As modified, the judgment is
affirmed. Costs on appeal are awarded to respondent Tran. (Cal. Rules of
Court, rule 8.278(a)(3), (5).)
34
______________________________________
Danner, J.
WE CONCUR:
____________________________________
Greenwood, P. J.
____________________________________
Adams, J.
H053223
UHG I, LLC v. Tran