blondie813

Being sued by Cavalry SPV I, LLC in Michigan

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1. Who is the named plaintiff in the suit? 

2. What is the name of the law firm handling the suit? (should be listed at the top of the complaint.) 

3. How much are you being sued for?

4. Who is the original creditor? (if not the Plaintiff) 

5. How do you know you are being sued? (You were served, right?) Served summons

6. How were you served? (Mail, In person, Notice on door) In person

7. Was the service legal as required by your state? Yes

8. What was your correspondence (if any) with the people suing you before you think you were being sued? I sent two letters requesting debt validation.

9. What state and county do you live in? Michigan

10. When is the last time you paid on this account? (looking to establish if you are outside of the statute of limitations) 2011, I think

11. What is the SOL on the debt? 6 years

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Wow ............ I think that this is the first time I've heard of Cavalry in MI.

Do you have questions?

Did they respond to your DV letters?

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I am putting together my Answer and will post shortly. I do have questions about how to respond about my address and jurisdiction. I'd appreciate any feedback.

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I am putting together my Answer and will post shortly. I do have questions about how to respond about my address and jurisdiction. I'd appreciate any feedback.

 

If it is your legal address/residence and they filed in the proper court then you have to admit those.  There is no harm in doing so.  They basically used fancy legalese in saying you live at 1313 Mockingbird Lane, Detroit, MI 44444 under the jurisdiction of District Court Wayne County to scare you about it.

 

Count II - Account Stated 9)For this count Plaintiff incorporates by reference all assertions of fact contained in paragraphs one through eight and further states:

10) Defendant received and accepted monthly billing statements from both the Plaintiff and the Plaintiff's assignor and did not object to their accuracy, nor has Defendant raised a legally recognized objection in this matter.

11)The account has become stated between the parties and consequently, Defendant is now justly indebted to the Plaintiff for the account balance.

 

10)  You are going to deny because you DID DV them and they failed to respond to that DV.  You did raise a legally recognized objection in the matter and I would state in my denial that the Plaintiff is attempting to commit a fraud upon the court by stating otherwise and ignoring the DV.

 

11)  Denied:  Defendant has never entered into any credit contract or agreement on an account with the Plaintiff and no proof of such contract has been provided upon which such conclusion can be drawn.

 

They did not respond to the DV letters. Their response is suing me. They are still reporting on all three credit reports. 

 

I would get on naca.net and start calling consumer attorneys first thing tomorrow because if you DV'd them timely with the first dunning letter that Cavalry ever sent you and they went right to lawsuit that is over shadowing and violates the FCDPA.   You could have a counter claim which would enable the attorney to take the case on contingency and make the whole thing go away with no effort on your part.  

 

They can continue to report and that is not a violation.  

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4. Who is the original creditor? (if not the Plaintiff) HSBC

10. When is the last time you paid on this account? (looking to establish if you are outside of the statute of limitations) 2011, I think

11. What is the SOL on the debt? 6 years

HSBC uses Virginal law to govern it's credit card agreements.  Virginia SOL is 3 years.

 

It seems Michigan borrows the shorter of the two SOLs, which would be VA in this case.  MSA  27A.5861

 

The one possible hitch here is that the VA AG has issued a "guidance" calling for credit card debts to be subject to a 5-year SOL.  I don't know if there is caselaw setting this precedent, but I don't think "guidance" is controlling on the courts (especially where there are statutes that contradict the "guidance") until an appellate court adopts it.

 

The other thing is that when Cavalry SPV I buys a portfolio, the bill of sale usually makes no warranty as to the accuracy of the information provided with the sale.  Basically, the seller is saying "sue if you want, but don't ask us to help you prove any of these debts."

 

The last thing I learned along the way is that the contract Cavalry uses with the lawyers they hire to sue on these cases limits their legal costs to somewhere around $1,500 (it probably varies based on jurisdiction/venue).  Assuming you are in a court that requires initial disclosures and permits discovery, the $1,500 limit is essentially reached once you file an answer.  What this means is that Cavalry has no monetary incentive to settle once you start fighting them in court.  In other words, they will pay the same $1,500 if you settle with them shortly after filing an answer or if you make them take it all the way to trial.  And if you lose, you will be paying that $1,500 anyway, so that makes them care that much less.  Personally, it wouldn't have changed my approach with them but if you are in a position to settle, you need to make some decisions on this sooner than later.  If it were me and I was considering settling, I would file my answer and include a letter (or maybe make a phone call right after mailing the answer) with an invitation to settle.  IMO, the answer should make reference to the VA SOL from the agreement and the MI borrowing statute.

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As far as the FDCPA violations, when did they occur? If it was less than a year ago him telling you the SOL had passed is quite likely another violation.

And did he say anything about him being a debt collector and that he was attempting to collect a debt and any information obtained will be used for that purpose? If not, another possible violation.

Did you mention to him that the agreement appears to demand VA laws to govern the contract and the SOL on Cavalry's claims have expired under VA law?

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@Harry Seaward

 

The one possible hitch here is that the VA AG has issued a "guidance" calling for credit card debts to be subject to a 5-year SOL.  I don't know if there is caselaw setting this precedent, but I don't think "guidance" is controlling on the courts (especially where there are statutes that contradict the "guidance") until an appellate court adopts it.

 

 

The AG said that for the 5-year SOL to apply, there has to be a signature on a contract, credit card receipt, or other document.

 

MSA  27A.5861 is now MCL 600.5861

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As far as the FDCPA violations, when did they occur? If it was less than a year ago him telling you the SOL had passed is quite likely another violation.

And did he say anything about him being a debt collector and that he was attempting to collect a debt and any information obtained will be used for that purpose? If not, another possible violation.

Did you mention to him that the agreement appears to demand VA laws to govern the contract and the SOL on Cavalry's claims have expired under VA law?

 

 

 

 

Thanks for the feedback.

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@Harry Seaward

 

 

The AG said that for the 5-year SOL to apply, there has to be a signature on a contract, credit card receipt, or other document.

 

MSA  27A.5861 is now MCL 600.5861

 

Be very careful with this.  They could pull a single charge off that one statement copy they gave you and send for the electronic copy of the charge receipt where you signed at the terminal. 

 

With the default in 2011 even with the shorter SOL it still could be a valid suit in 2014.

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I wouldn't bother with your own MSJ.  If/when they file one, I would request a hearing on the ruling of it.

 

When I had a pre-trial a few years ago with an OC, we first saw the judge and he asked if we had tried to settle yet.  He sent just the two of us into a room to talk.  Since they weren't dismissing, we had nothing to discuss re: the lawsuit so we just sat there and chatted for about 10 minutes before going back to the courtroom to tell the judge we would be going to trial.

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They sent a rent-a-lawyer (they guy was wearing a t-shirt and cargo pants - I would have never thought him to be a lawyer) ...

 

I've heard reports from people that work for the 'dark side' that they literally find these guys on Craigslist for $20/hr.

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The rent-a-lawyer is just trying to scare you. At pre-trial, the judge will be in the room. Prior to your case is being called, you have the option to talk to the attorney to try to settle. if not, the judge will set time for discovery, witness lists…etc.

 

The whole point of mediation is for the mediator to determine 1) if the parties might settle 2) how much the case is worth.

 

You still have a few steps prior to trial, if it even goes to trial.

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Just an update on this situation:

 

I want to thank everyone who took the time to respond to my questions and offer feedback.

 

I especially want to thank @bmc100 for his awesome guide. 

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Congrats!

You can ask for 'with prejudice' but take the WO if they won't give you 'with'. By dismissing, the SOL clock is running again as if it never stopped so if you're near that milestone, you can use that as a defense if you get sued again.

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Take the dismissal. Then you are going to turn around and sue them for FDCPA violations. As of now, they have not produced anything that shows you owe them any money. Once you send in the dismissal, I will send you the name of a consumer law attorney that can help you.

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Just an update on this situation:

 

I went to mediation a couple of weeks ago. Cavalry had a rent-a-lawyer representing them and it was seriously over in about 15 minutes because I would not entertain a settlement.

 

Cavalry was reporting the account on all 3 of my credit reports. I have requested validation multiple times prior to their filing suit but never received anything except more collection letters. I decided to file a complaint with the Consumer Financial Protection Bureau and I outlined all of the FDCPA and FCRA violations committed they committed thus far.  The tradelines were all removed within a few days after filing the complaint with the CFPB.  

 

I received a letter in this morning's mail from the attorney for Cavalry with a Stipulation and Order to Dismiss (without prejudice) for me to sign and return to them.

 

I am thinking I should request it to be dismissed with prejudice but that will not prevent them from selling the account to some other bottom feeder, right?

 

I want to thank everyone who took the time to respond to my questions and offer feedback.

 

I especially want to thank @bmc100 for his awesome guide.  I was sued by both Midland and Cavalry this spring and thanks to the wealth of information on this board (especially from @bmc100) I was able to properly answer the suits and defend myself and now both cases have been dismissed without my ever seeing a court room.

I decided to file a complaint with the Consumer Financial Protection Bureau and I outlined all of the FDCPA and FCRA violations committed they committed thus far.  The tradelines were all removed within a few days after filing the complaint with the CFPB.  

 

Maybe the CFPB is finally growing some teeth.  

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