FDCPA Lawsuit Alleges Unlawful Garnishment

A New York man filed an FDCPA lawsuit against Unifund CCR Partners and its agent Lacey Katzen LLP for alleged violations of the federal Fair Debt Collection Practices Act.

According to this Unifund FDCPA lawsuit, plaintiff James P. defaulted on a consumer credit card debt several years ago. Unifund purchased that debt and employed Lacey Katzen LLP to collect it.

Unifund sued James for the debt in 2008, winning a judgment in 2010. Two years later, Lacey Katzen filed paperwork with the court indicating the judgment had been satisfied.

Nevertheless, James alleges, in February Lacey Katzen sent a writ of garnishment to James’s employer demanding that they garnish his wages to pay the old judgment that had in fact been satisfied almost three years earlier. James’s employer complied with the writ, garnishing 10 percent of James’s gross salary for that pay period.

Based on those facts, James’s Unifund lawsuit claims only one cause of action: violation of the federal Fair Debt Collection Practices Act (FDCPA). James is seeking both actual damages and others allowed by statute under the FDCPA, as well as attorney’s fees and costs of litigation.

His FDCPA Lawsuit is Case no. 1:15-cv-00240-JTC, in the U.S. District Court for the Western District of New York.

The Fair Debt Collection Practices Act

The FDCPA provides certain protections for debtors (as well as people like James who are incorrectly treated as debtors) from debt collection abuse. The act’s definition of “debt collector” is broad enough to include not just debt collection agencies but also many other types of persons – creditors’ attorneys, for example – who attempt to collect on debts as a regular part of their business.

The law covers collection of personal, family or household debt, such as credit card or medical debt collection.

The FDCPA requires that any attempts to contact the debtor must be at a reasonable time and place. Collectors may not contact debtors at work if they’re told the debtor is not allowed to receive contact there.

The law also restricts collectors’ efforts to seek information about the debtor from third parties. Once a would-be debtor tells the collector to cease contact, the collector must honor that demand, with two exceptions: the collector may tell the debtor that there will be no more contact, and the collector may also give the debtor notice that the collector is pursuing a specific action, like a lawsuit.

Within five days of the collector’s first contact with the debtor, the collector must send the debtor a written validation notice that states the creditor’s name, the amount owed, and how the debtor should proceed to dispute the debt. If the would-be debtor responds to the validation notice within 30 days with a letter that either denies owing the money or requests verification of the debt, the collector may not contact the debtor again until the collector can provide such verification.

The FDCPA prohibits debt collection harassment, the use of false statements in the course of collection, and threatening to take certain other actions unless those actions would be lawful and the collector actually intends to take them.

The FDCPA creates a legal cause of action for anyone on the receiving end of illegal debt collection practices. Successful plaintiffs in a FDCPA lawsuit can receive actual damages as well as statutory damages up to $1,000.

They can also be awarded costs and attorney’s fees. Plaintiffs must sue the alleged violator within one year of the alleged violation. They can also report the violation to the Federal Trade Commission, the agency charged with enforcing the FDCPA.

Join a Free Unfair Debt Collection Class Action Lawsuit Investigation

If 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.