Nina Kay MacDermid was bipolar and suffered from drug and alcohol problems. Discover Financial Services did not know this when she successfully obtained a card in her husband’s name and charged $15,000 worth of exotic cats and computer products and other shopping, despite her husband having forbidden her from having credit cards because of her previous manic spending sprees that sent her into personal bankruptcy. MacDermid also obtained cards from American Express and others, but it was checks from Discover that her husband intercepted and confronted her over on February 14, 2003. Ms. MacDermid overdosed on drugs, and was admitted to the hospital for five days that week, but later managed to commit suicide in June, which Mr. MacDermid claims in his lawsuit was a surprise. Mr. MacDermid complained to Discover in March that he had not authorized the card, but sued Discover, claiming that Discover’s resulting attempts to collect on Ms. MacDermid’s debts from the cancelled card was what actually drove her to suicide. (A psychiatrist conveniently submitted an affidavit that MacDermid would have been peachy keen if not for Discover’s actions, notwithstanding her substantial history of mental illness.) A magistrate judge dismissed the case under 12(b)(6), but the Sixth Circuit, in an opinion by Judge Boyce Martin, resuscitated it on a theory that Discover’s allegations of criminal violations may have been an intentional infliction of emotional distress. The opinion does not cite this month’s Twombly decision, which perhaps explains the wild save of the almost-surely doomed case, and Discover will now have to spend additional money defending it—which is why your credit-card interest rates are so high. (MacDermid v. Discover Financial Services (6th Cir. May 29, 2007) (via Bashman)). The opinion contains a variety of gratuitous slams at Discover for being a victim of MacDermid’s fraud.
9 Comments
I don’t share your outrage. Discover’s debt collectors told a woman they knew to be mentally ill that she could be thrown into prison for something that wasn’t a crime. If Discover’s agents had not lied, this case would not have survived summary judgment.
It was a crime (it is wire fraud to falsely represent someone else’s authorization, when that authorization is plainly material to the credit application, and why the court doesn’t recognize that based on the husband’s March 1 letter is beyond me), and if claiming mental illness is a get-out-of-jail-free card to avoid having to deal with debt collectors, then that gives debtors the incentive to falsely claim mental illness.
The Court acts as if credit card companies simply give credit cards to formerly bankrupt women based on Internet applications, and they don’t: they only do so if the MacDermids of the world lie about who has authorized the card. And Mr. MacDermid’s complaint explicitly alleged such a material misrepresentation.
And regardless, it doesn’t excuse the Sixth Circuit from applying the Conley “no set of facts” standard that the Supreme Court explicitly rejected and overturned last week.
The case is BS, but I really don’t think it’s why rates are so high. They’re high because they’re what the market will bear/what the service co can get away with. While it’s a good example of “overlawyered” I’m not feeling a lot of sympathy for credit card companies that like to permanently change rates to half a point below usury for being three days late on a payment. (my personal experience with discover)
I can see why a bipolar wouldseriously consider suicide in such a situation. Hell, I’ve been there…more than once.
However. Regardless of the laxness evident in Discover’s action of approving this card (and at such a limit!), it would seem to me the only case the husband would have would be to argue that he was not responsible for any of those charges. Regardless of one’s suicidality in response to debt collection, the precipitating factor(s) is not the companies approval of the card, but her own actions in applying for and using the card. Just because one may be deemed not “fully capable” of truly understanding their actions in such a situation, the fact of the matter is she did it. With proper treatment, she would not have had the urge to apply for the card, would not have used it, would not have been collected on, and almost certainly would not have committed suicide–not for this reason, anyway.
I wonder what was going on here, that she was displaying, and had obviously continued to display, these classic symptoms. When my actions got out of hand, and I was in roughly the same mental position as her…I sought help. I have been actively working to remain stable, and not repeat those behaviors that drove me to the brink.
While it’s a tragedy what happened, it was a preventable tragedy, and Discover could not prevent it–not directly at any rate. One must want to get better, and work at it.
In short–yeah, personal responsibility.
(side note–last year I got called by a guy trying to sign me up for a Mastercard. I told him twice that I had no job, but he was very insistent, so I pulled out of the air about what my parents were giving me to live on–a rather modest sum. I figured somewhere the truth would become obvious. A week later I received a card, it got activated, and after a few years without, this crazy guy has credit again. So I really can’t blame Discover…)
Believe it or not, I had a case like this. I defended the jeweler who had the misfortune of selling $22,000 of jewelry to a woman who was in a manic phase. She didn’t kill herself, but sued to get her money back. It settled on advantageous terms of all, but the underlying theory – you should be responsible for my mental illness” – was a bit loopy.
That said, I was shocked by Discover Card’s tactics and think they should be spanked. Yes, the woman committed a crime when she got the cards, but Discover Card set up its application process to make it easy. This begs the question on reasonable reliance. That said, none of this allows Discover to represent that the husband was liable – no matter what. It also doesn’t allow Discover to make its own misrepresentations about the collection process.
The emotional distress claim was the only theory available in this case.
And what did you think of yesterday’s summary reversal from the Supreme Court in the Eighth Amendment case? Was that wrong as well?
(Brian blogged about this case, albeit without mentioning us.)
I don’t have a problem with Erickson v. Perdus. Like this case, it’s a case where the appellate court applied the wrong legal standard under Rule 8.
The prisoner should face sanctions if his allegations are false, and I think an optimal Rule 8 (as opposed to the one we have) would permit this case to be thrown out (as it still might be), but those are different issues.
I’m also glad that the Supreme Court is taking up error-correction in its certiorari process. Perhaps it can correct MacDermid, too.
The CL&P Blog has some updated information & reference to case evidence and court documents that shows an entirely different scenario than presented on this blog. If you read the court opinions, you will not have a clue. Anyone know a reason?? Additional information is on mentalhealthnotes.com ** Read them & comment again – Still think it’s a gold digger case? Remember – a jury determines damages – hopefully no one else!
The suit is about A DEATH CAUSED BY felony acts of threatening criminal prosecution to collect a debt plus extortion using Nina’s known extreme medical and psychiatric risks to collect that illegal debt over a four month period! A second and simultaneous series of threats by those three Discover representatives to debit three small merchants to enrage them to attack Nina “If I didn’t pay”, turned into actions where money was taken from their bank accounts, checks bounced, and created a firestorm beginning in March through her death in June, to this day five + years later! Money changed hands by force. The proof rests with recorded telephone conversations with three different Discover representatives, various Discover and other written documents, and testimony. Nina was hospitalized and incapacitated when the attacks started! She was under psychiatric and other medical care in a home care environment during the entire period of attacks until death, trying to recover so she could function in life.
Discover could have filed civil suit to obtain judgment and a legitimate claim against Nina, but they didn’t! Why? They knew she was incapacitated and might never be able to pay! They also knew that I have step by step evidence of a fraudulent profile solicitation and baiting scam proving Discover’s intent! Fraud is unenforceable.
After numerous threats to criminally prosecute and jail Nina, conditioned with IF I WOULDN’T PAY, Discover did actively pursue criminal action to punish me and Nina! Discover lost that battle based on counter claims with the proper authorities – well before Nina’s death.
Identity theft and fraudulent acts by Nina would require her to agree under false pretenses and pretend to be someone else! She didn’t! The applications Discover used to prove binding agreement (Doc 131, 131-2 & exhibits A, B, & C) do not contain the required elements of contract and don’t even contain the word agree! There is no security protocol on any conveyance, including the so called internet applications or credit cards in her name that authorized her use with her physical being matching the document identity on the cards used to make purchases. Perjury and misinformation overwhelms the Doc. 144 opinion to dismiss on 5-28-8. Justice is denied once again, just a few days before the trial was to begin!
Why not put Doc 144. 131, 131-2, and Discover’s “binding agreement” exhibits on your blog? Will anyone find improprieties that deny justice?
I have PDF copies of the applications that Discover claims are agreements – will provide & don’t care who sees them! The SSN will be blocked out.
Ref case 1:03-0111 MacDermid v Discover, US District Court, Middle TN, Nashville District
Note on other credit cards – NONE harassed Nina after notification. None provided any proof of origination, application, or agreement. All refused to litigate in civil court. All had linkage to novusservices. All were profile & bait solicitations with no form of secure conveyance or communication.
Disc overlawyered 12-8-8 contract
Can you publish an excerpt copy of Discover’s Exhibit C (Ref. Doc 131-2)? I have it on a PDF file. Doc 131, 131-2, and the exhibits contain perjured testimony and evidence submitted by Discover. They are the pretext in case dismissal Doc 144 of 5-29-8. Exhibit C is the first dated application claimed to be an agreement by Discover. It’s what you don’t see. They have no substance of agreement! The credibility and materiality given to Discover’s exhibits defies reason!
You will not see the essential words “agree, agreement, promise, borrower, guarantor, lender, etc.” Key missing information includes, “identification of lender, lender & borrower expectations (terms, conditions, consideration, etc.). Discover required no identity beyond “a random name” to create an “authorized buyer”! There is no secure password, transmission device, personal contact, confirmation, electronic or other signatures, or known witnesses that can substantiate Discover’s wild claims of Nina, Internet protocol, and the law. Two of the three exhibits were not created by Nina! There is no unbroken chain of control between the solicitor (NOVUSSERVICES), the vast uncontrolled environment of Internet, a single non contractual inquiry that supposedly generated three contracts of no substance, and Discovers later actions! The court ignores a Discover telephone call at about time of first issue, where Donald ordered Discover to not issue any cards and to cancel any they had. There is no proof of conveyance other than three plastic credit cards in Nina’s name, authorizing her use with Discover confirming authorization at various points of purchase based on Nina’s physical presence! Contractual protocol is defined by the FTC Web site for ID Theft victims and affidavit instructions. Discover compliance is zero. (ref., Equal protection of the law, etc.)
There is no post office box entered on those documents! Thus, Discover’s material evidence and affidavit claims of Nina renting and using a post office box to deceive Discover are perjured and have obstructed justice! That also directly obstructed justice in the earlier TILA claim denial noted in the first appeal decision 06-5792, page 10, par. 3!
Discover’s claims of binding offer, agreement, promise, impersonation, etc. are fraudulent! Discover’s Exhibits prove there was no agreement or impersonation by Nina! Discover’s basis for dismissal in Doc 144 are false, perjured, and have obstructed justice! Look at their evidence! Look at Doc 144 and see if you can find Discover evidence for their claims. The web further unravels when you find no exhibit of “debt” (an amount and basis of claim), and no basis of “just debt” established in a court of law by due process as required by law and Constitution, where there is no agreement and there is evidence of fraud intent to commit extortion by Discover.