Summary:
Following up on his earlier order in Brown v. First Advantage granting default judgment as to liability against Ashcott, LLC under the Fair Credit Reporting Act (FCRA), the Middle District of North Carolina revisited Plaintiff Charles Edward Brown’s claim for damages. The Court ultimately awarded Brown $11,343.79 — consisting of $8,843.79 in lost income and $2,500 for emotional distress, while allowing him to separately seek attorney’s fees.
Background:
Brown, a North Carolina truck driver, applied for a FedEx Ground subcontractor position through FXG in December 2022. FedEx’s offer was contingent upon a background check conducted by First Advantage, which in turn subcontracted to Ashcott. Ashcott erroneously matched felony convictions from Pennsylvania to Brown — despite mismatched Social Security numbers and the fact that he had never lived in that state.
The false report led FXG to withdraw its offer. Though Brown immediately disputed the report, it took six weeks to correct. Despite being invited to reapply, he never did so — a fact that sharply curtailed his damages recovery.
Lost Income:
Judge Schroeder limited Brown’s economic loss to a six-week period, rejecting his claim for a full year’s lost income on mitigation grounds. Brown’s prior employment at R&L Carriers earned him roughly $326 per week, while the FedEx position would have paid about $1,800 per week. The resulting “shortfall” was pegged at $8,843.79.
Emotional Distress:
Brown claimed $100,000 in emotional damages for depression, sleeplessness, and increased alcohol use, supported only by his own affidavit referencing rising A1C levels and later treatment. Citing Sloane v. Equifax and Robinson v. Equifax, the Court found such claims “fraught with vagueness and speculation” absent medical corroboration or timely treatment.
Despite acknowledging Brown’s frustration and “some demonstrable emotional distress,” the Court found the ten-month delay in seeking therapy undercut causation and limited recovery to $2,500.
Commentary:
This decision serves as a sobering coda to Judge Schroeder’s earlier opinion in Brown v. First Advantage (Sept. 8, 2025), where liability was easily found but damages were deferred. Then, the Court made clear that default judgments under the FCRA are not blank checks; plaintiffs still bear the burden of proving harm — both economic and emotional. Now, the Court’s modest award underscores the difficulty of quantifying emotional distress without objective, contemporaneous medical support.
Brown’s experience — losing a job offer over false criminal charges — is undoubtedly humiliating. Yet the Court’s tone reveals skepticism toward the expanding “soft tissue” of FCRA emotional distress claims, particularly where plaintiffs recover swiftly or fail to mitigate. To paraphrase Sloane, “the distress must be demonstrable, not speculative.”
Broader Implications: “The Sweatbox” of Psychological Harm
While this was a Fair Credit Reporting Act case, the Court’s demand for “external corroboration” of mental suffering parallels a recurring challenge in consumer bankruptcy and debt-collection litigation — the undervaluation of psychological injuries.
As I’ve said (perhaps too colorfully) before, consumer lawyers could take a page from personal injury practitioners. Just as PI attorneys are accused (often unfairly) of having “a chiropractor in every glovebox,” consumer advocates need to develop relationships with psychologists and mental-health professionals who can testify to the genuine, measurable trauma inflicted by financial abuse.
The scholarship bears this out.
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The seminal “Life in the Sweatbox” study by Katherine Porter, Deborah Thorne, Robert Lawless, and Pamela Foohey demonstrates that consumers often spend years trapped in a pre-bankruptcy purgatory — juggling debts, fielding collection calls, and enduring what the authors memorably describe as “slow financial asphyxiation” before finally seeking bankruptcy relief. During this “sweatbox” period, families exhaust retirement funds, borrow from relatives, and suffer cascading emotional and physical distress — all to avoid the perceived stigma of bankruptcy until they are, quite literally, out of options.
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The UK’s “Debts and Despair” report documents that nearly half of people in arrears felt harassed, and 50% reported suicidal thoughts linked to debt collection contact.
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Similarly, Debt Collection Pressure and Mental Health (2024) found a statistically significant correlation between repeated creditor contact and depressive symptoms among young adults.
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Even another credit reporting organization, Equifax, reports that "[t]here's a strong link between debt and poor mental health. People with debt are more likely to face common mental health issues, such as prolonged stress, depression, and anxiety."
Together, these data reveal that financial harm is inseparable from psychological harm. The FCRA’s remedial structure — permitting “actual damages” for emotional distress — recognizes this, but as Brown demonstrates, federal courts continue to require a clinical translation of distress into medical or diagnostic evidence. Absent such testimony, even a man falsely branded a felon may be told his sleepless nights are worth no more than $2,500.
Takeaway:
Judge Schroeder’s ruling may be defensible as a matter of evidentiary rigor, but it exposes a deeper disconnect between how courts conceptualize “harm” and how ordinary people actually experience it. Emotional and psychological injuries—especially those tied to financial humiliation, job loss, or harassment—are real, measurable, and often debilitating, yet they remain undervalued when judges require “medical” corroboration for what is, as David Graeber reminded us in Debt: The First 5,000 Years, a human experience intertwined with obligation, shame, and power since the dawn of civilization.
To bridge that gap, consumer attorneys should not only improve how they prove emotional distress—but also reconsider who should decide it. A jury of one's peers, drawn from the same economic and social fabric as the plaintiffs who face abusive credit reporting, debt collection, or financial exclusion, is far more likely to understand the toll of sleepless nights, collection calls, and the loss of dignity that accompany financial hardship. Federal judges, by contrast, tend to approach such claims with institutional skepticism and often little shared experience. As a result, the difference between $2,500 and $100,000 in emotional-distress damages may depend less on the facts than on the decision maker.
To shift that balance, consumer advocates should:
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Document distress contemporaneously — Encourage clients to seek counseling early and to preserve records of anxiety, sleeplessness, and family impact.
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Retain qualified mental-health professionals — Expert testimony can connect “financial harassment” to observable physical and psychological outcomes such as hypertension, depression, and alcohol misuse.
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Link causation clearly — Tie those symptoms directly to the statutory violation, whether under the FCRA, FDCPA, or related consumer-protection laws.
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Push for jury determinations — Where feasible, frame emotional-distress damages as questions for jurors, whose empathy and lived experience make them better arbiters of intangible human harm.
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Educate courts — Through briefing and expert testimony, remind judges that financial distress and emotional harm are not speculative—they are predictable, documented, and tragically common.
Until courts internalize this reality, plaintiffs may continue to win the liability battles yet lose the damages war—a familiar fate for those still living, as Porter, Thorne, Lawless, and Foohey put it, in the Sweatbox.
Conversely, creditors and debt collectors facing credible allegations of consumer-rights violations might take note: accepting a default judgment with minimal judicial damages may sometimes be the wiser course than risking a jury’s verdict from twelve citizens who know too well what it feels like to answer the phone with dread.
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To read a copy of the transcript, please see:
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