Class Action Lawsuit Filed as a Result of Debt Collection Letter

A debt collection law firm was hit with a class action lawsuit recently, associated with the use of an allegedly illegal debt collection letter.

Named plaintiff Jonathan Alejandro alleges he received a notice from the law firm associated with his student loan debt and that the letter led him to believe that his loans originator was planning on taking legal action, including a lawsuit to collect on the debt.

Although a debt collection letter in and of itself is not that uncommon, anyone reaching out via the phone or regular mail related to a debt must follow state and federal laws about communicating with alleged debtors.

Those who violate the law may find themselves in the midst of a lawsuit alleging unfair debt practices. Although companies do have legal avenues through which to notify a debtor about monies owed, they are expressly prohibited from violating laws.

Some consumers allege that the companies who violate debt collection laws do so because the businesses assume the consumer won’t exercise his or her rights in response. Consumers can file legal action if they have evidence of wrongdoing, as Alejandro did in this case.

In this case, Alejandro claims the letter he received was misleading and would have led anyone to believe they were going to become subject to legal action.

According to Alejandro, the debt collection letter was provided on letterhead for the law firm and states that the law firm was retained for the collection of this debt. The plaintiff in that debt collection letter lawsuit believes that the student loan debt collection was never reviewed by a lawyer and alleges that no meaningful attorney involvement has occurred in his case.

Alejandro alleges that the law firm providing the debt collection letter never actually intended to pursue further legal action against the plaintiff. As a result, he filed this debt collection letter lawsuit alleging violations of New York’s General Business Law and the federal Fair Debt Collection Practices Act.

Navient, the student loan provider, and Funding LLC, a buyer company for defaulted private student loan debt, which has the same address as Navient, are further named as defendants in the debt collection letter lawsuit. Alejandro argues the law firm should have informed the student loan originators and current manager of the debt that the letter directly violated New York state law and the FDCPA.

As a result, the debt collection letter lawsuit claims, VL Funding and Navient are vicariously liable. The plaintiff says that the letter would have led even an unsophisticated consumer to believe that imminent legal action was going to be pursued to recover the debt. The debt collection letter lawsuit is seeking to represent Class Members who received correspondence from that law firm since April 24, 2016.

The Debt Collection Letter Lawsuit is Jonathan Alejandro v. Altman Law PC et al., Case No. 2:18-CV-01914 filed in the U.S. District Court for the Eastern District of New York.

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If you live in New York and a lender or debt collector engaged in unfair debt collection practices, you may have a legal claim and could be owed compensation for violations of the Fair Debt Collection Practices Act (FDCPA).

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DISCLAIMER: Debt collection itself is not illegal. However, debt collection firms collecting on consumer debts must adhere to the FDCPA. Even though debt attorneys are investigating these companies, their debt collection practices may be legal.