JDB Seeking Payment of Debt(+extra $10K!!)Previously Dismissed w/Prejudice

[Nikki01]

Dear Legal Brains,

 

I am trusting that with your vast legal knowledge, I will be able to get some solid and actionable advice on a case that I previously thought was dead. I'll do my best to keep it short and sweet.

 

First, let me state that I live in Tennessee, so that you know what state laws I am working under. Last November, I was taken to court for a credit card debt from Chase. I entered my sworn denial, requested the necessary items of discovery and refused to be one of the people who simply bent over and offered to pay the debt. I showed up for court (the third scheduled date we had due to them not having the paperwork I requested) and discovered that good old Comprehensive Legal Solutions had decided to hire a local lawyer to represent them in my case. This arrogant lawyer asked me if I "didn't just want to go ahead and agree to a payment plan" for the debt and, when I said NO, he told me that we would be going to trial that day. I told him that was fine by me. He then said that we had to wait an hour or so because he "had a reliable witness coming in from North Carolina who worked with Chase and knew the case intimately." Again, I told him I'd be happy to wait for this distinguished guest of his so that we could go see the judge.

 

Once the idiot witness showed up, we went before the judge and, as I suspected, they had nothing. There was no chain of purchase, they had no original signed contract (the witness said that I had mysteriously signed up for this card online and they don't need a signature or personal info if you obtain a card online...yeah, okay) and they certainly could not produce any documentation showing I ever made a payment on this account. They also had no accounting info showing how they came up with the amount that they swore I owed, which was $3982.37. After hearing a few moments of this nonsense, the judge dismissed with prejudice. Win for the little lady!!

 

So, yesterday I got a letter in the mail from a new JDB called CreditOne, LLC. Here's where this gets funky. It's for the same debt from Chase that was dismissed almost a year ago, BUT instead of the debt being right around $4,000...this one is for (hold on to your seats) $13,279.35!!! The only thing that I can figure is that Comp. Legal Sol. tacked about $10,000 on to the debt they alleged I owed, since that was approximately what they paid for the local lawyer they hired in the first place.  I am absolutely flabbergasted that this is happening and can't imagine that this is legal.

 

My questions for you are: What the heck do I do about this and do you think that this $13K debt is now being reported to the credit reporting agencies? Should I send the big 3 a letter, showing the debt was dismissed with prejudice and ask them to remove? And would that do any good, considering the debt is now up to $13K somehow? And, finally...who the he*l do I SUE OVER THIS TRAVESTY? 

 

Your input, advice and guidance would be most appreciated and acted upon. I will keep the topic updated as well, when new info is obtained so that others may be able to benefit from this terrible and shameful action by JDBs.

 

Best,

Nikki

[debtzapper]

http://www.barnettelawoffices.com/

 

 

I am not a legal brain, but Jason Barnette is.  He has posted here as TN Consumer Lawyer.  You can send him a PM, or since he hasn't posted here in a while, contact him at his office.  Tell him you heard about him here.

[ArtVandelay]

So, yesterday I got a letter in the mail from a new JDB called CreditOne, LLC. Here's where this gets funky. It's for the same debt from Chase that was dismissed almost a year ago, BUT instead of the debt being right around $4,000...this one is for (hold on to your seats) $13,279.35!!! The only thing that I can figure is that Comp. Legal Sol. tacked about $10,000 on to the debt they alleged I owed, since that was approximately what they paid for the local lawyer they hired in the first place.  I am absolutely flabbergasted that this is happening and can't imagine that this is legal.

 

I am positive of one thing and that 10K is not what they paid the last attorney. Most of these guys only get paid when they collect, which at that time would have been around 1,000 - 1,500. Since they lost he probably got nothing. Even a rent-a-lawyer showing up for one of these cases would only get a couple hundred at the most for an appearance. What it sounds like they did here is just make up the amount. If you push them on it they will claim the bona-fide error defense. 

 

If you are positive that the case was dismissed with prejudice then you might want to try the following:

 

-If you received the letter within the last 30 days send them a debt validation letter (CMRR). You can word it however you like although I just say "I dispute this and require validation".

If they continue to collect without validating then they have violated.

 

[15 USC 1692g] § 809(a A collector can't continue to collect on a debt after you've made a written request to verify the debt as long as the request was made within 30 days of the collector's written notice. 

 

 [15 USC 1692g] § 809(b After receiving your written dispute, the collector must stop collecting on the debt until you have receieved verification.

 

-If they send you a validation letter turn around and send them a letter stating "I refuse to pay".(CMRR) 

 

[15 USC 1692c] § 805© If you make a written request for the collector to cease communication, it can only contact you one more time, via mail to let you know one of the following: that further efforts to collect the debt are terminated, that certain actions may be taken by the collector, or that the collector is definitely going to take certain actions.

 

- You can also hit them with the amount since no law or agreement will allow it.

 

[15 USC 1692e] § 807(2)(a) The collector cannot misrepresent the amount you owe.

 

 [15 USC 1692f] § 808(1) The collector can't add on any extra fees that your original credit or loan agreement doesn't allow. 

 

-The final and strongest one would be if they sue you after the case was dismissed with prejudice. 

 

I posted on your other thread that you might want to consult with an experienced FDCPA attorney. Most attorneys that deal with FDCPA cases will give you a free consultation. You may or may not have a case at this point, but most of these attorneys will give you a free consultation. 

[shellieh98]

Nikki, I would send a debt validation letter out first, and see what they send back. May give you a little more info, and maybe another violation to tack on to the first one of misrepresenting the status if the debt. Then take it to a consumer lawyer.. They should not even be able to try to collect since it was dismissed with prejudice.

[racecar]

Barnette Law Offices

309 Hollow Tree Court

Nashville, TN 37221

Office: 615-585-2245

Fax: 615-250-8787

[1stStep]

You've got one H*LL of an FDCPA case for the new amount - but here's the kicker... they are well within their rights to collect as long as they do not sue you for the debt. You should have asked for a judgment on the merits at trial.

 

 

Send a DV letter and a copy of the dismissal paperwork... let them know that you are going to be following up with an invite to Federal court.

[WhoCares1000]

First off, are you sure this was a dismissal and not a judgement on merits? According to what the OP said, they went to trial and had nothing. If so, than this conclusion of the case might be the later.

I would not send a DV with the court paperwork because the DV would be sent to see what they really have. If they reply, then I would decide what is going on.

If I were to send the court paperwork to the JDB, it would be with a C&D letter stating that the OP refused to pay because they did not owe the debt according to the courts. A C&D letter can be sent after a DV (and in this case makes sense because the OP just tells the court that they want to verify it was the same debt).

Whether a DV or C&D is sent to the JDB, if this is on the OP's credit report, the OP should immediately challenge the tradeline and include the court decision (whether dismissal w/ prejudice or judgement on merits) with the challenge. The consumer protection bureau is starting to crack down on CRAs so they might take this seriously.

[WhoCares1000]

BTW, any JDB can call or send a demand letter to anyone to try to get money. Even someone who had a judgement on merits. The question is, will the collect and have they broken any laws in doing so.

[nascar]

You've got one H*LL of an FDCPA case for the new amount - but here's the kicker... they are well within their rights to collect as long as they do not sue you for the debt. You should have asked for a judgment on the merits at trial.

 

 

Send a DV letter and a copy of the dismissal paperwork... let them know that you are going to be following up with an invite to Federal court.

 

Dismissal with prejudice accomplishes the same thing. Nikki01 is the prevailing party. Here, even attempted collection is a 1692e(2) violation. Defendant in Diaz v. Resurgent Capital Services Ltd., 12-11281 (D. Mass. Jan. 2, 2013), lost on this very issue. Previous debt collector filed suit, case was dismissed with prejudice, new debt collector sent collection letters trying to collect same debt.  

[TNConsumerLawyer]

You've got one H*LL of an FDCPA case for the new amount - but here's the kicker... they are well within their rights to collect as long as they do not sue you for the debt. You should have asked for a judgment on the merits at trial.

 

 

Send a DV letter and a copy of the dismissal paperwork... let them know that you are going to be following up with an invite to Federal court.

Actually, there is authority that when a case is dismissed with prejudice further collection activity is prohibited.  Once a witness is called, a case cannot be dismissed without prejudice inasmuch as it has been heard on the merits - or the lack thereof.  The OP has a very good case and personally, I would not waste my time writing letters other than to the credit reporting agencies "if" the debt purchaser is reporting.  That is the only way to hook them under 15 U.S.C. 1681s-2b.

[TNConsumerLawyer]

Dismissal with prejudice accomplishes the same thing. Nikki01 is the prevailing party. Here, even attempted collection is a 1692e(2) violation. Defendant in Diaz v. Resurgent Capital Services Ltd., 12-11281 (D. Mass. Jan. 2, 2013), lost on this very issue. Previous debt collector filed suit, case was dismissed with prejudice, new debt collector sent collection letters trying to collect same debt.  

And there it is . . .

[TNConsumerLawyer]

BTW, any JDB can call or send a demand letter to anyone to try to get money. Even someone who had a judgement on merits. The question is, will the collect and have they broken any laws in doing so.

Not in Tennessee they can't "unless" they have a Tennessee Collection Services License and really even then they can't pursuant to some pretty "persuasive" authority that Nascar provided.

[TNConsumerLawyer]

My advice to the OP is to first see if the JDB is reporting.  If so, dispute it through the credit reporting agencies.  FCRA violations can only be made viable against a furnisher by doing so.  If they verify, sue under the FCRA and FDCPA with an attorney that knows the law and the procedure/judges in the U.S.D.C. for the M.D. of T.N. at Nashville.  She would be suing both the party that initially sued, lost, and then re-sold the debt, the current JDB, and the credit reporting agencies "if" they permitted verification.

 

Again - an attorney is advised.  Doesn't have to be me, but one that is experienced in these matters.

[1stStep]

We're not as lucky in AZ...  

[1stStep]

Learned something new...

 

Dismissal with prejudice accomplishes the same thing. Nikki01 is the prevailing party. Here, even attempted collection is a 1692e(2) violation. Defendant in Diaz v. Resurgent Capital Services Ltd., 12-11281 (D. Mass. Jan. 2, 2013), lost on this very issue. Previous debt collector filed suit, case was dismissed with prejudice, new debt collector sent collection letters trying to collect same debt.  

 

 

 

 

My advice to the OP is to first see if the JDB is reporting.  If so, dispute it through the credit reporting agencies.  FCRA violations can only be made viable against a furnisher by doing so.  If they verify, sue under the FCRA and FDCPA with an attorney that knows the law and the procedure/judges in the U.S.D.C. for the M.D. of T.N. at Nashville.  She would be suing both the party that initially sued, lost, and then re-sold the debt, the current JDB, and the credit reporting agencies "if" they permitted verification.

 

Again - an attorney is advised.  Doesn't have to be me, but one that is experienced in these matters.

[BV80]

@nascar

 

@TNConsumerLawyer

 

Here's a ruling that might be in contradiction to the Diaz ruling.   I'm not sure that it does, but you guys would know.

 

In Gros v. Midland Credit Management, Inc., Gros had leased a car from Ford Motors.  Later, he sued them for refusing to sell him the car at the contract price.  Ford Motor Credit counterclaimed for an amount allegedly owed.  Ford's counterclaim was dismissed with prejudice, and the circuit held held that Ford Credit had no right to additional funds from Gros.

Ford sold the nonexistant debt to Midland.  Midland sent him a letter notifying him that they owned the debt and asking him to contact them about the debt.  They sent a 2nd letter that included the sentence "This is a demand for payment."

Gros sued for a violation of 1692e(2)(A) which is the same violation claimed in Diaz v. Resurgent.  The court ruled that Gros didn't prove that the letter from Midland implied to the least sophisticated consumer that the debt was still payable.  I guess that means it all depends upon what's stated in the letter.

Then the court stated that "Although debt collectors are never free to falsely represent that a debt is payable, once the thirty-day validation period expires 'the debt collector may assume that the debt is valid.'"  I wonder if the court was implying that a debt collector has no way of knowing that the account was previously the subject of a legal action which was dismissed with prejudice, so the consumer should dispute the debt to let the debt collector know that fact.

[TomnTex]

I am happy to see two of our resident attorneys weighing in on this.

[nascar]

@nascar

 

@TNConsumerLawyer

 

Here's a ruling that might be in contradiction to the Diaz ruling.   I'm not sure that it does, but you guys would know.

 

I don't think it's contradictory. Gros simply did not adequately argue his position and lost as a result. See below. With all due respect to Plaintiff's counsel, let one slip away.

 

 

This court declines to read Durkin to signify that, as a matter of law, debt collectors are ever free to falsely represent that a debt is payable when it is not.

 

 

 

Furthermore, Gros does not direct the court to any specific language employed by MCM in its May 2006 communications that falsely implies the Debt is still payable.

 

[gwheelock915]

@debtzapper +1. We need more voices like his here.

[debtzapper]

I don't think it's contradictory. Gros simply did not adequately argue his position and lost as a result. See below. With all due respect to Plaintiff's counsel, let one slip away.

 

Yes, pro per's, but even lawyers, often let one slip away.  And not just in consumer law cases.  Some VERY well paid litigators from big DC firms arguing at SCOTUS have done that

 

@debtzapper +1. We need more voices like his here.

 

Damn right!

[debtzapper]

To continue from above, I like it when  experienced, knowledgeable lawyers discuss law on this board.  We are all just playing lawyers.  We need to hear more from the real litigators.  Wish more would post here.  It would be good for them, for OP's and for everyone who reads this board.

[WhoCares1000]

So it sounds like the OP should do DV. The question I have is, in the DV, should the alleged debtor let the collector know that this debt was decided in the courts or can the debtor take the position that they do not know the exact details of the debt yet and until they do, the do not know if this was the debt the the courts dealt with or another debt? In other words, must the debtor in the DV letter tell the collector about the court case or is that the responsibility of the party the collector bought the debt from?

[BV80]

@nascar

 

I don't think it's contradictory. Gros simply did not adequately argue his position and lost as a result. See below. With all due respect to Plaintiff's counsel, let one slip away.

 

Okay.  That's why I wanted you guys to look at it.    Could it depend upon what's in the letter?  For instance, would they be violating if they merely provided settlement options but didn't demand payment?

 

In regard to the fact that the court said that Gros didn't point out how the letter implied the debt was still payable, I don't get that one.  The letter included "This is a demand for payment."   How is that not implying that a debt is still payable?

[ArtVandelay]

Then the court stated that "Although debt collectors are never free to falsely represent that a debt is payable, once the thirty-day validation period expires 'the debt collector may assume that the debt is valid.'"  I wonder if the court was implying that a debt collector has no way of knowing that the account was previously the subject of a legal action which was dismissed with prejudice, so the consumer should dispute the debt to let the debt collector know that fact.

 

This is why I think the DV is a good option in this case. Sending the DV should not allow this question to come up in the future.

[debtzapper]

@nascar

 

 

Okay.  That's why I wanted you guys to look at it.    Could it depend upon what's in the letter?  For instance, would they be violating if they merely provided settlement options but didn't demand payment?

 

In regard to the fact that the court said that Gros didn't point out how the letter implied the debt was still payable, I don't get that one.  The letter included "This is a demand for payment."   How is that not implying that a debt is still payable?

 

http://scholar.google.com/scholar_case?case=15632447551015255795&q=unsophisticated+consumer+less+sophisticated+consumer&hl=en&as_sdt=4,112,127,268,269,270,271,272,314,315,331,332,333,334,335,377,378&as_ylo=2009

 

 

This may have something to do with the fact that "Gros" was decided in the Seventh Cir, which has adopted the "unsophisticated" standard, rather than the more common "least sophisticated" standard.   The "Diaz" case was decided in the First Cir, which has adopted the "least sophisticated" consumer standard.