'Four-Second Review' FDCPA Decision Cited in Separate Class Action Filing

Don Maurice

On the heels of a June 30 decision finding that a New Jersey law firm violated the Fair Debt Collection Practices Act because its attorneys spent four seconds reviewing a pleading, a complaint seeking class certification has been filed against the same firm, citing findings of fact from the adverse court opinion.

The complaint, filed in New Jersey state court last month, was removed to the federal District of New Jersey last week.

The new case focuses on a May 2014 settlement letter, which was allegedly not prepared by attorneys and was sent before an “attorney exercised professional judgment by independently evaluating the collection demands and determining that sending a collection letter was warranted.”

The complaint further alleges that the attorneys permitted non-lawyers to send letters that no attorney had personally reviewed, and that attorneys had not first reviewed the underlying account documents.

The plaintiff also alleges that the letter misrepresented that the creditor was required to report settlement of disputed debts to the Internal Revenue Service and did not “identify common exceptions to IRS reporting requirements that would apply to the settlement of disputed debts.”

Finally, the complaint alleges the letter violated the FDCPA by attempting to collect a debt subject to an expired statute of limitations and by “failing to include a notice in its letters…that the underlying debt was time-barred and unenforceable.”

This post originally appeared on the Consumer Financial Services Blog, run by ARM defense firm Maurice & Needleman.