Consumer Alleges Debt Collector Violates Wisconsin Fair Debt Collection Requirements

A consumer has filed a lawsuit against a debt collection agency, claiming she was sued in violation of Wisconsin fair debt collection requirements.

Plaintiff Maria I. recently filed a lawsuit against Midland Funding LLC and Kohn Law Firm SC, alleging that they took her to court for a debt in violation of Wisconsin fair debt collection requirements.

In May 2018, Maria was allegedly served a summons and complaint from Midland and Kohn. The complaint alleged that Maria owed a consumer debt from a Lane Bryant credit card. Midland and Kohn allegedly requested Maria pay the account in full, “including amounts that would not be due if the account were still able to be paid over time.”

Maria claims that, by suing her for the debt, Midland and Kohn have “accelerated” the debt. This means that they insisted on payment of all amounts due at once, instead of installments over time.

Wisconsin fair debt collection requirements state that a consumer debt can only be accelerated if the consumer has defaulted on the debt. Under Wisconsin consumer protection law, “[a] merchant may not accelerate the maturity of a consumer credit transaction […], unless the merchant believes the customer to be in default.”

Wisconsin fair debt collection requirements also state that creditors or merchants must send a default notice to the consumer and then wait a minimum of 15 days before filing a lawsuit.

“For 15 days after such notice is given, a customer may cure a default under a consumer credit transaction by tendering the amount of all unpaid installments due at the time of the tender, without acceleration, plus any unpaid delinquency or deferral charges, and by tendering performance necessary to cure any default other than nonpayment of amounts due. The act of curing a default restores to the customer the customer’s rights under the agreement as though no default had occurred,” states Wisconsin fair debt collection requirements section 425.105 (2).

In her lawsuit, Maria claims that she was never given notice of her default status and was unable to cure any default status on the credit account. The debt collection lawsuit also states that counsel for Midland was in charge of filing 1,385 cases in 75 days and appearing in court an average of 270 times a week. Maria argues that the counsel for Midland could not have reviewed the case material with the amount of other obligations.

“Debtors who receive a letter, call, or court paper from Kohn reasonably assume that a lawyer reviewed the matter and that the lawyer has made a legal, trained, sophisticated judgment about the validity of the debt and the ability to legally pursue collection when, in fact, based on Kohn’s practices, it is likely that no lawyer has meaningfully reviewed any matter before it is brought to suit,” the lawsuit states.

Maria seeks relief under the FDCPA and Wisconsin debt collection requirements, including statutory damages, actual damages, punitive damages, court costs, and attorneys’ fees.

The Wisconsin Debt Collection Lawsuit is Case No. 3:18-cv-00359-wmc in the United States District Court for the Western District of Wisconsin.

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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.