Have You Been Sued by a Debt Collector?

If you have been sued by a debt collector in Tennessee or Kentucky, you can fight back.  We have successfully defended and brought counterclaims against Midland Funding, Midland Credit Management, LVNV Funding, CACH, Portfolio Recovery, and many other debt collectors.

There are powerful federal statutes that we can use to your advantage.  These include the Fair Debt Collection Practices Act (FDCPA), the Fair Credit Reporting Act (FCRA), and the Telephone Consumer Protection Act (TCPA).

In addition, both Tennessee and Kentucky have very effective consumer protection acts, which can be used to fight off debt collectors.  And, in Tennessee, debt collectors have to be licensed before they can lawfully attempt to collect a debt.

Many debt collectors violate the law when they attempt to collect debts.  The most common violations include:

• Adding unlawful interest and fees to debt they have purchased
• Calling incessantly
• Calling before 8:00 a.m. or after 9:00 p.m. local time
• Calling at work after being notified that your employer does not allow such calls
• Directly contacting you after you have informed the debt collector you have a lawyer
• Threatening criminal charges
• Being overly rude and abusive on the telephone
• Suing on debt that is outside the statute of limitations
• Using recorded (robo) calls to your cell phone
• Falsely reporting the size of your debt to credit bureaus
• Failing to conduct a thorough investigation when you dispute a debt with a credit bureau

If you have been the victim any of these or anything else you think may be a violation of law give us a call at 866-279-9721 or visit our web site at www.debt-relief-law.com.  We never charge a fee for a consultation.  Learn what your rights and options are.  Don't just give up and give in.

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Filing Proof of Claim on Time Barred Debt in Bankruptcy Case Violates FDCPA

In Crawford v. LVNV Funding, LLC, 758 F.3d 1254 (11th Cir. 2014), the Eleventh Circuit Court of Appeals held that filing a proof of claim in a Chapter 13 bankruptcy case on debt that was outside the statute of limitations may violate the FDCPA.  This holding has not been adopted by all circuits, but it is, in my opinion, the correct application of the law.  Logic dictates that if a debt collector could not sue on a time barred debt, it should not be able to collect on the debt in a Chapter 13 case.

The Seventh Circuit in reviewing the issue found that the Bankruptcy Code and FDCPA could both be applied, and that neither the Bankruptcy Code nor the FDCPA trumps the other.  See Randoph v. IMBS, Inc., 368 F.3d 726 (7th Cir. 2004).  A recent ruling in the Southern District of Indiana held that the debt collector's motion to dismiss should be overruled and the debtor's FDCPA claim could go forward where the debt collector had filed a proof of claim on a time barred debt.  Patrict v. Quantum3 Funding, LLC, No. 1:14-cv-00545-TWP (Dist. Ct. S.D. Indiana 2015).  But the court in In re Poteet held just the opposite.  In re Poteet, No. 08-14936, Adv. No. 11-1081 (E.D. TN. 2011).

It will be interesting to see how the law develops on this issue.  You can bet there will be more FDCPA claims filed against debt collectors who file proofs of claim in bankruptcy cases.

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866-279-9721

Offer to "Settle" Time Barred Debt Violates FDCPA

In the case of Buchanan v. Northland Group, Inc., No. 13-2523 (6th Cir., Jan. 13, 2015) the Sixth Circuit Court of Appeals has reversed a lower court ruling that an offer to "settle" a debt outside the statute of limitations is not a threat to sue in violation of the FDCPA.  The Sixth Circuit held that such language in the absence of informing the debtor that she can't be sued on the debt violated the statutory ban on threatening to take legal action that cannot be taken.

The Court also examined the failure to inform a debtor that making a single payment could restart the statute of limitations and actually place the debtor in a worse position than if she had made no payment at all.  This practice coupled with the failure to inform the debtor that the debt could not be collected in court were potentially misleading in violation of the FDCPA.

There is a split among the circuits on this issue.  The Third and Eighth Circuits have held that dunning letters like the one at issue in Buchanan do not violate the FDCPA.  This issue may well make its way to the Supreme Court at some point, but for now, in the Sixth Circuit debt collectors that seek to settle time barred debt without informing the debtor that the debt cannot be collected in court because it is beyond the statute of limitations and that a partial payment may restart the statute of limitations violate the FDCPA.

The next question is whether the same logic applies to attempts to settle debts via telephone and the impact on the follow up validation letter if the initial attempt is via telephone.  Stay tuned.

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866-279-9721

Tennesseans Beware

I just took on a client from Tennessee who was sued on a time barred debt.  Debt collectors are suing on debt outside the six year statute of limitations in Tennessee in what seems like epidemic proportions.

 

Why?  In Tennessee the General Sessions Court has jurisdiction over civil cases with a value of less than $25,000.  Debt collectors merely issue summons with a less than skeleton allegation that the victim owes the debt, the amount of the debt, and requested interest.  The victim then receives the summons with a date to appear in court.  The debt collector sits back and waits, hoping the victim won't show up on the court date, and if the victim doesn't show, the court enters a default judgment for everything the debt collector has asked for.

 

In addition, in Tennessee a debt collector can "prove" it owns the debt with an affidavit.  However, under a new change in the evidentiary rules, many of these affidavits are short of adequate.

 

If you are sued in Tennessee on a debt on which you last made a payment over 6 years ago, call a lawyer who practices consumer law.  Suing on a time barred debt is a violation of the Fair Debt Collection Practices Act.  You can get $1000 in damages, and the debt collector will have to pay your legal fees.

 

 

www.debt-relief-law.com



866-279-9721

Struggling with Student Loan Debt?

If you are struggling with student loan debt, you're not alone.  In 2014 the Government Accountability Office said that about $94 billion — more than 11% of the federal student loan volume in repayment — was in default.  The government has turned much of this defaulted debt over to debt collectors.  Because they are working for the government, many of these debt collectors feel like they are beyond the reach of the FDCPA (Fair Debt Collection Practices Act) and the TCPA (Telephone Consumer Protection Act).  They are not.

These debt collectors often engage in one or more of the following unlawful practices:

1. Calling at unreasonable times and calling over and over.
2. Allocating payments in a way to maximize late fees.
3. Inflating minimum payments.
4. Charging late fees during the grace period.

If you have been victimized by a debt collector regarding a student loan debt, contact a consumer law attorney and fight back.

www.debt-relief-law.com

866-279-9721

Debt Collectors' Dirty Little Secret

Debt collectors love aged debt.  No, really, they do.  Why?  Because they can buy the debt for about 1% of its face value.  Think about the potential to make 99 times your investment!  Of course, they love aged debt.

Aged debt, or debt that is outside the statute of limitations, can still be collected.  However, the statute of limitations is a complete bar to suit, should a debtor be sued on aged debt.  But, debt collectors buy large tranches of old debt and call, cajole, and threaten debtors in an effort to collect. These debt collectors collect all they can in a tranche, then sell the remaining debt to another debt collector who repeats the cycle.  This explains why debtors often receive calls from more than one debt collector on an old debt.

Debt collectors are most likely to violate the Fair Debt Collection Practices Act (FDCPA) because of the age of the debt and the potential payoff.  As one debt collector put it when explaining why he had an ex-convict to run his collections: "Boy Scouts just don't get the job done."

Here are some do's and don'ts if you receive a collection call on an aged debt:

1. Don't pay the debt;
2. Don't sign any repayment agreement;
3. Get the collector's address;
4. Write to the collector and explicitly tell the collector to stop contacting you;
5. Document each and every call the collector makes to you, particularly to a cell phone, for the purpose of suing the collector for violating the Telephone Consumer Protection Act;
6. Keep all paper communications from the debt collector; and 
7. Make contemporaneous notes of all call contents.

Remember, these folks are looking to make a huge profit at your expense.

www.debt-relief-law.com

866-279-9721

Voicemail Heard by Third Party Violates FDCPA

The U.S. District Court for the Southern District of Texas in Thompson v. Diversified Adjustment Service, Inc., No. H–12–922, 2013 WL 3973976 (S.D. Tex. July 31, 2013) held that where a debt collector left a voicemail heard by a debtor's mother, it had violated the FDCPA.

The debt collector left a message at the consumer’s mother’s residence which disclosed the existence of a debt. The message stated:

This message is for [consumer’s name]. If I’ve reached the wrong number please call me back at 866–923–2995 [unintelligible] the number and then disconnect now. By continuing to listen to this message you acknowledge you are [consumer’s name]. This message contains private information. This is [collection agency’s name]. This is an attempt to collect a debt, any information obtained will be used for that purpose. Please return my call to 866–923–2995. It’s very important to hear back from you. Thank you.

The consumer's mother eventually heard the message. The consumer sued, claiming the message violated § 805(b) of the Fair Debt Collection Practices Act (FDCPA) because the message disclosed the existence of a debt to a third party. The collection agency countered that the voice mail message left at the consumer’s mother’s telephone number was not a prohibited third-party communication, noting that the consumer gave her mother’s telephone number and address to the collection agency as her contact information.  

The court, citing numerous cases, concluded the debt collector’s voice message was similar to other messages that were found to be communications under the FDCPA. Next, the court found that the consumer was not required to show that the debt collector intended to disclose her debt to a third party in order to assert a claim under § 805(b). The court stated that while some sections of the FDCPA do require a showing of intent (e.g., § 806(5)), there was no such requirement to show intent under § 805(b). The court also stated the FDCPA’ s legislative history further supports the notion that the collector may be liable for leaving a voice mail message at the consumer’s mother’s telephone number, regardless of intent. Specifically, the court noted that Congress adopted several provisions to limit specific methods of communication that were especially likely to reveal the existence of a debt (e.g., postcard, language on envelopes), and that these provisions applied without regard to a debt collector’s intent. The court also noted other courts had rejected the notion that debt collectors were entitled to leave messages for consumers. Citing other cases, the court stated “[the debt collector] could have reduced the risk that its voicemail would be heard by a third party by not leaving a message and instead calling again later.” Further, the court stated that other courts have consistently held that debt collectors may be liable for violations under § 805(b) by leaving voice mail messages that were inadvertently heard by a third party.

Based on this analysis, the court granted the consumer’s motion for summary judgment in part, finding the message was actionable under § 805(b) of the FDCPA. A factual dispute remained as to whether the debt at issue was a “consumer debt” covered by the FDCPA.

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