Lawsuits – Page 6

Beat Midland Funding (Again) – $2,000 collection lawsuit in Baldwin County – Alabama Consumer Credit Attorney Judson E Crump

June 6, 2014 by Attorney Judson E Crump 3 Comments

Another trial against Midland Funding. Another victory for the consumer.

On Friday, May 30th, I tried another collection lawsuit against Midland Funding – this time in Baldwin County, at the Fairhope Courthouse. For those who aren’t familiar with Alabama’s largest county, Baldwin County actually has three separate courthouses. The main one in Bay Minette is at the northern end of the County, and for people who live down at the beach, the county seat is over 60 miles away. That’s a 1.5 hour trip for people living in Fort Morgan. So a few years back, the county opened a satellite courthouse in Foley for the beach folks, and a satellite courthouse in Fairhope for those who live in the more heavily populated Eastern Shore of Mobile Bay.

This case was about an old computer purchase. They claimed that my client bought a Dell computer from a company called WebBank, who was at the time in charge of financing options for Dell computer sales. Dell Financial Services was the “servicer” of the loans. And WebBank at some point sold the account to Asset Acceptance, who sold it to Midland Funding, who then sued my client for $1900 plus court costs.

Midland actually took the case seriously: about a month before trial, they subpoena’d my client to appear in court. This is something they don’t do unless there’s an attorney involved. If you answer pro se, they’ll expect you to appear on your own. Some lawyers instruct their clients to answer pro se and then the lawyer appears on the day of court to ‘ambush’ the collector, and that’s fine, as long as no “ghostwriter” pleadings are involved, but I’ve found that isn’t even necessary. Now, sometimes a client really does call me the day before a trial and I’ll appear for them, but I prefer to let the collector know that I’m coming from a long way away. It usually doesn’t affect the end result.

When they send you a subpoena, it just means that you have to show up and testify. The idea is to try to get you to prove a) that you owe money and b) that their statements and assignment documents are true and admissible as evidence. So in this case, my client had to show up for trial and Midland’s lawyer called her up to testify. It didn’t matter though, because I convinced the judge to exclude their other evidence and without it, there wasn’t enough to prove their case. So we won.

Dealing with Requests for Admissions in a Credit Card Lawsuit – Alabama Consumer Credit Attorney Judson E Crump

May 26, 2014 by Attorney Judson E Crump Leave a Comment

Proving a credit card debt can actually be a tricky thing if you have serious opposition. But collection lawyers have a few tricks up their sleeves that you may encounter. One of the worst is a discovery device called “Requests for Admissions.”

What is a request for admissions?

A Request for Admissions is a written demand that you admit or deny specific factual assertions made by the adverse party. So how is it different from just denying the allegations in a complaint? Well, the rules say that you can get in trouble for denying things that the other side later proves to be true. Furthermore, screwing around with a request for admissions can give the court reason to sanction you for doing so. Sounds scary.

But what does it mean in reality? The specifics depend on your state, but usually it means that if you deny something that you’re later shown to have had no basis for denying, you can be made to pay the other side’s attorney fees – in addition to whatever judgment they’re entitled to. Sounds even scarier. But it isn’t. Like most discovery sanctions, it is usually pretty lame in reality. To illustrate why, I’ll use an example.

Bubba is sued by Capital One – the most aggressive credit card company I know of – for $20,000 (plus interest, plus court costs, plus attorneys fees) on a business card that he used for his plumbing business. Bubba denies the allegations in the Complaint, and so Capital One sends some Interrogatories and Requests for Admissions. Now let’s look at two possible scenarios: One where Bubba answers honestly that he owed at least part of the alleged debt, and another where he just flat out denies everything.

In scenario A, Bubba admits part of the debt, Capital One moves for summary judgment based on their affidavits and his admissions, and gets a judgment for $20,000 plus court costs, plus attorney’s fees, plus interest – something like $22,000.

In scenario B, Bubba sends a two page letter telling Capital One that he doesn’t know the answer to most of their questions and denies all of the Requests for Admissions. Capital One gets angry at him and comes to court prepared. Bubba shows up and loses at trial because he doesn’t know what he’s doing. Capital One gets a judgment, but this time they add the costs of the attorney’s fees that they incurred by his failure to admit what they later proved at trial. So now they get a judgment for $20,000 plus court costs, plus attorney’s fees, plus interest PLUS what? Plus the portion of the attorneys’ fees that can be traced back to his failure to admit everything. So instead of a $22,000 judgment, he now faces something like a $22,500 judgment.

The fact is, credit card contracts give the credit card company the right to collect attorneys’ fees and interest at their super high rate anyway. So the amount of heat that the Requests for Admissions penalty isn’t nearly what it would be at, say, a personal injury trial. I’m not telling anyone to make bad faith denials of any discovery request. I just want you to understand that, like many things you may face when dealing with the credit card industry, the truth isn’t quite as scary as some would have you believe.

$3100 Alarm System Collection Suit Dismissed at Trial – Alabama Consumer Credit Attorney Judson E Crump

May 20, 2014 by Attorney Judson E Crump 1 Comment

My Client was sued for $3,100 for an old alarm company bill. We successfully objected to the debt buyer's evidence and the Court granted our motion to dismiss the case at the close of the Plaintiff's testimony. — My Client was sued for $3,100 for an old alarm company bill. We successfully objected to the debt buyer’s evidence and the Court granted our motion to dismiss the case at the close of the Plaintiff’s testimony.

Last week, a client came to me who had been sued by a debt buyer for $3,100. Allegedly, the debt was based on an old alarm system account that had gone unpaid. The debt buyer, a smaller outfit called Harbin, LLC, actually brought a corporate officer to court to testify as to their documentation and information procedures. We made a number of objections to their proof, and the court sustained several of them. My client was in court and prepared to testify that she had in fact paid the debt, but it wasn’t necessary. At the close of the debt collector’s case, I moved for dismissal based on their inability to prove their case. The court sustained my objections and entered an order dismissing the case. Another collection lawsuit defeated in Mobile County.

Next week: I go to Fairhope to take on Midland Funding in Baldwin County. They subpoena’d my client as a witness, which is an unusual step. We’ll see how it goes.

Fixing Identity Theft, Part Three: When to Hire a Lawyer – Alabama Consumer Credit Attorney Judson E Crump

May 19, 2014 by Attorney Judson E Crump Leave a Comment

So you’ve written a dispute to the creditor or debt collector who is asking you to pay money on an account you never opened or for purchases you never made. And you’ve placed an initial fraud alert on your credit reports and reviewed them and written dispute letters to the credit bureaus. Now what can you do if the creditor or collection agency is still asking you for money?

That’s when it is time to hire a consumer credit attorney. You’ve already done everything that could reasonably be expected of you and put them on notice that they’re pestering you about someone else’s debt. If they won’t leave you alone even after you have told them that it isn’t your debt, then the only way you can get them to comply with the law is to hire a lawyer who knows how to deal with them.

If it is the original creditor, then their failure to respect your Fair Credit Billing Act dispute can render them liable to you for up to $5,000 plus attorney’s fees.

If it is a debt collector, then their failure to answer your Fair Debt Collection Practices Act validation request can render them liable to you for up to $1,000 plus actual damages, plus attorney’s fees.

If the credit reporting agency won’t remove items that were placed on your credit record because of identity theft, then they can be liable to you for any damages, plus $1,000, plus attorney’s fees.

You get the point. Once you’ve written them to explain the situation and given them the chance to do the right thing, you can take them to court without having to pay your lawyer up front. I handle credit reporting, identity theft, and FDCPA cases on a contingency fee basis – meaning I don’t charge you a dime unless I win you money.

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Why I defend People From Credit Card Lawsuits – Alabama Consumer Credit Attorney Judson E Crump

May 15, 2014 by Attorney Judson E Crump Leave a Comment

I regularly go to court to fight lawsuits against people who legitimately do owe some money to the people suing them. Is that morally acceptable? Is it ethical for me as an attorney? Yes, because being in financial trouble is not a crime. The people I represent have already tried to pay their bills, but their creditors have chosen to sue them instead of make affordable settlement arrangements. By fighting these suits, I send a message that you should consider working with your delinquent customers before taking them to court. Because if you go to court against a well-defended debtor, you may end up with nothing at all.

Moreover, the banks I fight are all based in big cities far away from my community. I consider it a duty to do what I can to keep as much of the hard-earned money of the people of South Alabama as possible right here. Our local businesses need customers whose wages aren’t being shipped out to Delaware or New York. Everyone wins if the justice system isn’t twisted into some giant collection machine.

Dealing with Identity Theft, Part Two: Fixing your Credit Reports – Alabama Consumer Credit Attorney Judson E Crump

May 14, 2014 by Attorney Judson E Crump 2 Comments

2. Contact a Credit Reporting Agency and Place an Initial Fraud Alert

If you’ve been the victim of Identity Theft, you are entitled to a free credit report from each of the major credit bureaus. First, though, you have to place an initial fraud alert with one of the them, either Transunion, Equifax, or Experian. This is the one communication with a credit bureau that can be over the telephone, though using the internet is better. Each of the big three has a link on their site specifically to help victims of identity theft.

3. Get a copy of your credit report.

After you’ve placed an initial fraud alert, you need to write each credit bureau a letter demanding a copy of your credit report. They cannot charge you for this, and all you must do to get one is say that you’ve been the victim of a suspected identity theft, state the specific debts which you know or reasonably suspect to be bogus, and ask them to only show the last 4 digits of your SSN on your reports.

4. Review the report.

Look for anything you don’t recognize. Make a list.

5. Write a dispute letter to each credit bureau. Send a copy to the creditors reporting the info.

This is a very important step and it is IMPERATIVE that you do it in writing and keep a copy of everything you send the credit bureaus and everything they send you. If an item doesn’t belong on your report, they’re not supposed to report it. Period. If you dispute an item that doesn’t belong there and they don’t remove it within 30 days, they are liable to you for any damages that causes you, plus attorney’s fees! You don’t have to be denied credit or have an interest rate hike to suffer damages. The time, trouble, and frustration of having bad credit, the stress, the embarrassment, all of these things are damages and they are recoverable if a credit reporting agency does not fix your credit report after you’ve disputed an item. That is the law and if you have a credit report problem that hasn’t been fixed despite your dispute, then you need to contact a lawyer.

Next we’ll go over what you need to do about a creditor or debt collector who won’t leave you alone after you’ve told them about the identity theft.

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What is the risk of suing a debt collector in Alabama? – Alabama Consumer Credit Attorney Judson E Crump

May 5, 2014 by Attorney Judson E Crump Leave a Comment

What is the risk of suing a collection agency?

So here’s a common scenario: you have a debt collector who’s bothering you and being so rude and deceitful that you’re virtually certain they must be breaking some law. But there’s one problem: you do actually owe the money. At least, you owed the money to the original creditor, and they seem pretty sure about their right to collect from you. If you sue them in Alabama under the Fair Debt Collection Practices Act, what will happen? Can they turn right around and sue you for the money you owe? It is possible, but unlikely. Particularly if your lawyer knows what he is doing.

As I’ve written before, debt collectors very often don’t have the witnesses and documents necessary to prove their case. So even if they do counterclaim, they may not win anything on the counterclaim. Sure, they could pony up and hire a real litigator to play hardball, but that rarely happens. Why? Because litigation is expensive, and debt collectors hate spending money. Their business is taking money in, not putting it out. And since the FDCPA requires them to pay your attorney’s fees if they are found to have broken the law, what seems like a simple collection suit can become an expensive, drawn out battle that can vastly outweigh whatever amount of debt they can prove that you owe. What usually happens is this: their lawyer calls your lawyer and they review the evidence. Once your lawyer convinces their lawyer that you actually have a case, they offer you a nuisance settlement amount. Then negotiations continue until they reach terms everyone agrees on. Ideally it involves a release of the debt, payment of your attorney’s fees, and cash in your pocket. So don’t be afraid. If the people dealing with you are breaking the law, they need to pay.

Debt Settlement on the Courthouse Steps: 75% Discount – Alabama Consumer Credit Attorney Judson E Crump

May 2, 2014 by Attorney Judson E Crump 2 Comments

At 8:30 on the morning of April 23rd, I got a phone call as I was getting ready to go to work.

“Mr. Jones” was sued in Small Claims Court by a debt buyer called Midland Funding for $2,000, and he had a trial date at 2:00 p.m. The suit was allegedly for a credit card balance that had been unpaid back when the client had gotten audited by the IRS and hit with a huge tax bill. He tried to settle it with the original credit card company, but he couldn’t keep up the payments. He couldn’t afford to pay the $2000 they were asking for, so he hired me to defend the case.

It was Small Claims, which means that depending on the judge, bad evidence can possibly be allowed into the record, unlike in higher courts. The collection lawyer was there with a lot of documents and some past statements. But I pointed out a few weaknesses in the way they’d brought the case, and I offered $500, which was what my client said he could afford to pay. After reviewing the evidence and considering the possibility that they’d get nothing at all, they agreed to accept the offer.

Another Victory: Beat a $13,000 lawsuit by Midland Funding today. – Alabama Consumer Credit Attorney Judson E Crump

April 16, 2014 by Attorney Judson E Crump Leave a Comment

Our continuing efforts to save the families of South Alabama from credit card debt have born another ripe fruit today. In Mobile County Circuit Court Case No. CV-13-901687, I appeared in court today to defend my client from a lawsuit demanding $12,967.43 + $260 Court Costs for an alleged Sears Mastercard account. The Plaintiff, Midland Funding, was represented by Holloway & Moxley of Montgomery, Alabama and they did an unexpectedly good job of proving their case. Midland sent in a witness from St. Cloud, Minnesota to testify as to the accuracy of Midland’s records.

After a 1 1/2 hour trial, we won a judgment for the defendant.

Here’s a copy of the order:

Beat Midland Funding at Trial

The South Alabama debt relief stimulus package continues…

Sued by New Horizons Credit Union? Here’s what to expect: – Alabama Consumer Credit Attorney Judson E Crump

April 16, 2014 by Attorney Judson E Crump Leave a Comment

New Horizons Credit Union is an small credit union that does business primarily in Mobile County and Baldwin County, Alabama. I do not bank there, so I cannot say anything about their customer service before you default on a loan, but I have represented clients who have been sued by New Horizons. As a general rule, New Horizons does not send its defaulted accounts to collection agencies. So if you get behind and the balance is more than a few hundred bucks, you can expect them to sue you. In Mobile County, they are usually represented by Barre Dumas of Dumas & McPhail, a collection law firm based in downtown Mobile. I’ve dealt with Barre on numerous occasions and I can tell you that he’s a nice and honest man. But he is still going to do his job, and unfortunately for you, so is New Horizons. Unlike a lot of the larger out-of-state banks and credit card companies, New Horizons does a decent job of recordkeeping. They try to include copies of the loan agreement and pay history with the complaint and they have a “VP of Collections” who signs an affidavit stating that the records are accurate. To make matters worse, that same VP of Collections will likely show up for a trial date if you deny the allegations.

So basically, New Horizons Credit Union is tough to beat in court unless they’ve just made a mistake or you have a substantive defense like failure to follow UCC rules on repossession, etc. They sue for their own debts, not those made by other companies, they provide the court with copies of their documents, and they may actually send a witness.

If you’ve been sued by New Horizons, it may worth your time to call them and try to work out a settlement you can afford. If they won’t work with you, then you may be forced to either take a 25%-of-your-paycheck garnishment or file bankruptcy.