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Ronald S. Weiss April 5, 2021

Debt Collection Tactics Can Call for Class Actions to Help to Repair!

Sometimes we have to protect our own rights, but other times we have to look out for each other.  Ronald S. Weiss, working with the attorneys at Greenwald Davison Radbil, presented and settled an important case that protects people that received a collection letter that violated certain rights.  The positive effects of that victory will continue to protect Michigan residents going forward. 

The Fair Debt Collection Practices Act (FDCPA) protects consumers from certain actions by debt collectors.  Millions of American consumers have some amount of debt.  Debt collectors are certainly permitted to attempt to collect repayment of the debts.  The FDCPA makes sure that those debt collection attempts are fair and the Act prevents many abusive collection tactics. 

In Reeves v. Patenaude & Felix A.P.C., the United States District Court for the Eastern District of Michigan certified a class action and it approved the settlement where a debt collector sent an initial collection letter and the debt collector simultaneously demanded payment within a time less than 30 days after the date of the collection letter.  So it was confusing, because the letter explained that the consumer was essentially entitled to 30 days to dispute the debt and ask for validation of the debt, but then the letter went on to demand payment without allowing the 30 day period.  There were mixed messages, which the FDCPA certainly tries to prevent. 

Under the FDCPA, debt collectors must generally halt collection actions within 30 days of sending its initial communication to the consumer.  While there can be more to the situation, in Reeves, the debt collector demanded payment within a period less than 30 days from its written communication.  The effect of that action, nullified the impact of the disclosure of the consumer’s right to the 30 day window.

One provision of the FDCPA, at 15 U.S.C. §1692g(a), requires the debt collector to make certain disclosures.  Once the debt collector makes those disclosures, the FDCPA prevents the debt collector from overshadowing those disclosures 15 U.S.C. § 1692g(b).  So in the case, the debt collector made the disclosures, but then it went on to demand payment in a way that overshadowed those same disclosures.  By overshadowing the disclosures, its actions essentially made the disclosures without effect. 

Thankfully, one individual came forward to us and we presented the case as a class action.  The judge appointed the attorneys at Greenwald Davison Radbil and Ronald S. Weiss as class counsel.  The judge certified the action as a class action and we reached a resolution with the debt collector.  Under the terms of the settlement, the debt collector was required to establish a fund to compensate the individuals that were wronged.  Notice must be sent to the individual consumers that received that collection letter and the consumer has to submit a claim form within the prescribed time frames.  More importantly, the debt collector agreed to change its collection letter and to stop the violative behavior.  The class settlement was met with support and not a single individual objected to the settlement.  Similarly, not a single class participant excluded himself or herself from the class. 

We are happy to protect the consumers.