US Dist Crt. Adopts "Haddad' for Validation

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For the first time in a credit card case, a district court in TX (the Fifth Circuit) has adopted  the more stringent debt validation requirement set out in Haddad v. Alexander (6th Circuit), a case involving condo fee payments.  In Mack v. Progressive Financial Services. the court said:




 More recently, the Sixth Circuit addressed the question of what verification means for purposes of section 1692g( B), and stated the following:

Haddad v. Alexander, Zelmanski, Danner & Fioritto, PLLC, 758 F.3d 777, 785 (6th Cir. 2014). The Sixth Circuit determined the following:These cases suggest that the "baseline" for verification is to enable the consumer to "sufficiently dispute the payment obligation." Although the answer to that question depends on the facts of a particular situation, the cases reflect that an itemized accounting detailing the transactions in an account that have led to the debt is often the best means of accomplishing that objective. Intuitively, such a practice makes good sense. In fact, it would likely lead to faster resolutions of disputes with those consumers who act in good faith, because it will either show a valid debt that a consumer acting in good faith will actually pay, uncover an error in the record of the debt leading to the cancellation of the debt, or reveal the underlying dispute between the parties that can then be resolved. Finally, such an approach is consonant with the congressional purpose of the verification provision.


The verification provision must be interpreted to provide the consumer with notice of how and when the debt was originally incurred or other sufficient notice from which the consumer could sufficiently dispute the payment obligation. This information does not have to be extensive. It should provide the date and nature of the transaction that led to the debt, such as a purchase on a particular date, a missed rental payment for a specific month, a fee for a particular service provided at a specified time, or a fine for a particular offense assessed on a certain date.


 More courts may adopt Haddad, making debt validation tougher for debt collectors

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