Casey J. Lee

Has anyone been sued by Midland Funding and had the lawsuit dismissed with prejudice shortly after being served?

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Hello, 

I am doing some research about debt buyer lawsuits in Rhode Island, specifically what tends to happen to the lawsuits after they are filed. In looking at court records for cases filed by Midland Funding in one month this year, I have determined that at least 14% were dismissed with  prejudice. In these cases, the court docket shows that the defendants were served with the summons but never filed answers.  The dockets also show that Midland Funding dismissed those cases within a few weeks to a few months after they were filed.  During that same month, Midland obtained default judgments in at least 51% of the cases they filed, so I'm interested in why Midland would dismiss some cases but get defaults in others.

If I had to, I would speculate that after being served with the lawsuit, the defendants contacted Midland Funding's lawyers and provided proof that they were uncollectible; although I would be surprised if Midland would give up just for that reason.  

In any event, I am wondering if anyone has had a similar experience with Midland Funding: being served with a lawsuit, not filing an answer, and still having Midland dismiss with prejudice.

If so, I'd be very interested to know what led to the dismissal.

Thanks in advance. 

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9 minutes ago, Casey J. Lee said:

If I had to, I would speculate that after being served with the lawsuit, the defendants contacted Midland Funding's lawyers and provided proof that they were uncollectible; although I would be surprised if Midland would give up just for that reason.  

It would depend on WHY the Defendant was not collectible.  If they are on SSI, disability or have no assets and that isn't likely to change then it is ludicrous to throw good money after bad. However, if they are simply temporarily unemployed, young, or have assets they wouldn't drop it.

10 minutes ago, Casey J. Lee said:

During that same month, Midland obtained default judgments in at least 51% of the cases they filed, so I'm interested in why Midland would dismiss some cases but get defaults in others.

My educated guess is that it is either that the Defendant is uncollectable or they signed a stipulated judgment agreeing to pay but that means Midland would not have to sue them to collect if they default again they merely have to file the consent judgment with the court to use other methods like garnishment or bank levy.  A small percentage were likely settled between the parties due to counter claims the defendant had or invoking arbitration at great expense then agreeing to settle for no money and a dismissal with prejudice so Midland could not start the process over again.

12 minutes ago, Casey J. Lee said:

In any event, I am wondering if anyone has had a similar experience with Midland Funding: being served with a lawsuit, not filing an answer, and still having Midland dismiss with prejudice.

I am sure it has happened but isn't the norm and the chances of finding anyone in that small a group  in this small audience are slim to none.

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The problem is, we will never know because most likely, the deals were made between the debtor and Midland. Clydesmom has put up many reasons why that would be the case. I would like to add that in a couple of cases, it might be that the debtor actually settled in a lump sum with Midland in return for a dismissal with prejudice to end the issue. That means Midland got something in those cases. The courts encourage this.

What I wonder about is the 51% default rate. That seems particularly low and I would like to see the total % of case dispositions to see what really happens. How many cases get answered and of those, how many time did they get settled before trial vs how many times did either Midland or the debtor win at trial. The total % might give a clearer picture.

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This has happened to me personally, though it's been several years. 

Midland contacted me concerning a store credit card account that I had never heard of before.  They claimed that I opened this account back in 2000, in the state that I currently live in.  But I never set foot in this state until more than 3 years after they claimed that I opened this account, and they were claiming that this account was opened in this state.  They originally contacted me around 2007.  I sent a DV request.  They ignored it, and claimed that I sent it too late.  For those that do not know, it seems to be a favored trick at MCM that "federal law gives you 30 days to dispute, and we give you 15 more days on top of that, but you did not dispute until months later...."  So, I ran down the timetable with them.  For months, they insisted that they received my DV letter several months after they really did, and since I sent it certified mail, I was able to prove when  they really received it--less than 3 weeks after the original phone call came.  This dog and pony show went on for several months,  with MCM insisting that they did not have to validate, they did not have to stop calling even if I told them in writing(which I did)...they could basically do whatever they wanted, according to their people on the phone.  Then, they threatened to sue me.  They claimed that the original delinquent balance was a little over $500....they told me they would sue me and the total cost to me "when Midland wins in court" would be between $7K and $15K.  Guys, record your phone calls if it's legal...trust me on this.  In this state, it's a one-party state.  Those recorded calls made a huge difference.

That was the last call I got from them,  and the following month, I was served at home.  They filed a lawsuit for over $3K plus attorney's fees and court costs--this is the same debt that one month prior, the claimed balance owed was less than $1K even accounting for interest being tacked on.   So, I contacted their attorney, and informed them of what took place.  Once they heard about the recorded phone calls, they wanted copies.  So, I brought them copies.  Once they heard what was on those calls, and they saw the evidence of my DV request that was ignored, they dismissed with prejudice,  on the understanding that if they did, I would not pursue FDCPA and other claims against their client.

 

If the reason has anything to do with someone not being collectible, it would have to be a permanent reason, as clydesmom said.  I suspect, considering that I've dealt with Midland on at least 4 separate accounts(3 of which I had never heard of before they tried to collect), and every time, they broke several laws in the process of trying to collect, my guess is that another reason why they might dismiss with prejudice is because they got caught breaking FDCPA and so on, and they do it to prevent getting busted with a lawsuit of their own.

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But as you said, I bet none of that was put into Midlands motion to dismiss with Prejudice so anyone looking at the case would have no clue as to why it was dismissed. That is what the OP asked. The truth is, they may never know as each reason might be different and Midland does not have so to say. I would however bet that some of those dismissals were for the reason outlined above.

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17 hours ago, WhoCares1000 said:

I would however bet that some of those dismissals were for the reason outlined above.

Thanks for the feedback. I agree. As an attorney I have gotten some dismissals with prejudice for the reasons you outlined. In my jurisdiction (RI/MA), the general practice, at least for attorneys, is to enter an appearance for the defendant even if it looks like the case will be settled or dismissed. In the 14% of the cases that I mentioned, which is admittedly a very small random sampling (i.e. the case outcomes filed in one month, and only by Midland Funding), but the dismissals happened within weeks to a few months--always with prejudice and never with an attorney. I agree that at least some of the defendants were able to raise arbitration, FDCPA and other substantial defenses/counterclaims on their own and get dismissals without filing a single document. I'm very impressed.   

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23 hours ago, kraftykrab said:

So, I contacted their attorney, and informed them of what took place.  Once they heard about the recorded phone calls, they wanted copies.  So, I brought them copies.  Once they heard what was on those calls, and they saw the evidence of my DV request that was ignored, they dismissed with prejudice,  on the understanding that if they did, I would not pursue FDCPA and other claims against their client.

Very impressive. I come across so many people in a similar situation, but instead of being proactive, they ignore the lawsuit hoping that it will just go away. A default judgment enters, wage garnishments and bank attachments ensue, and it is usually becomes a bigger mess to clean up. Good for you for taking action. 

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21 hours ago, WhoCares1000 said:

But as you said, I bet none of that was put into Midlands motion to dismiss with Prejudice so anyone looking at the case would have no clue as to why it was dismissed. That is what the OP asked. The truth is, they may never know as each reason might be different and Midland does not have so to say. I would however bet that some of those dismissals were for the reason outlined above.

In my situation, the only reason I knew why they did it was because of the conversation that we had.  If you can back them into that much of a corner, they really have no other option, especially since this is all just about the numbers to them.  If I knew then what I know now, I would have countersued and let that done the talking for me.  I had so much information showing that their claims could not be true that I dont think they would have stood a chance.  Something like this comes across my path today, and they will pay me for their screwups and my time.

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4 hours ago, Casey J. Lee said:

Very impressive. I come across so many people in a similar situation, but instead of being proactive, they ignore the lawsuit hoping that it will just go away. A default judgment enters, wage garnishments and bank attachments ensue, and it is usually becomes a bigger mess to clean up. Good for you for taking action. 

Thanks, but I most likely stumbled into that success.  I knew just enough back then to know that something was wrong with the whole deal.  They did everything wrong and I should have dropped the hammer on them.  Since it's only a cost of doing business for them, I should have made their "business" cost more.

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I suspect the dismissals were settlements, made after the defendant was served.  They didn't bother to answer because they reached an agreement with Midland.

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39 minutes ago, nobk4me said:

I suspect the dismissals were settlements, made after the defendant was served.  They didn't bother to answer because they reached an agreement with Midland.

Certainly, some of them could be cash settlements too as I mentioned in my first post. Again, it is hard to know because Midland is not saying why they are dismissing, just that they are doing so.

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I was served a summons in South Carolina and entered a reply that there was not sufficient information  in the summons that they or I owned the debt . --the court date was set. I received a rather large package in the mail from Wylie Clarkson's (attorney for Midland) office one day before the court date  stating that they were willing to settle the dept for a "one time pay (about half of what they said I owed) or that I could make $50 a month payments which would be secured by a confession of judgement. the confession of judgement allows us to dismiss the pending case" They furthermore stated that they would leave the offer "open for 15 days of the date of the letter"  Attached to this letter were Bill's of Sales; Affidavit of bills of sale and copies of some old credit card statements. The affidavits did not show any account numbers and only verified that Midland had purchased a computer file--but appeared to not have listed the account number in the bill of sale, etc..

I did not respond to the offer and when  I showed up at the magistrates office for the hearing, the clerk in the magistrate's came out and told me that she had spoken to midland and that the case was dismissed.

Should I be looking for this to come back around again?

 

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It would be better to open a new thread than to piggy back on this one. As for the debt coming back around, it could depending on other circumstances such as SOL but it is doubtful because you are now listed in a database as someone who fights in court. Midland is usually looking for the easy defaults rather than actually fight

 

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