Home / Compliance / Navient Beats Motion to Dismiss in TCPA Racketeering Case Against Consumer Attorney, Debt Relief Firms

Navient Beats Motion to Dismiss in TCPA Racketeering Case Against Consumer Attorney, Debt Relief Firms

Student loan servicer Navient Solutions has successfully defended against motion to dismiss in a racketeering lawsuit it filed last October against Krohn & Moss, a consumer law firm based in Chicago.

Navient filed the lawsuit against the firm and a number of other defendants because they allegedly were offering tutorials on how to manufacture lawsuits alleging violations of the Telephone Consumer Protection Act as a means of getting rid of their student loans.

The defendants had filed motions to dismiss on the grounds that Navient failed to state a claim, and lack of jurisdiction. Judge Leonie Brinkema of the District Court for the Eastern District of Virginia denied the motions on Jan. 12.

In its initial complaint, Navient laid out a “scheme” allegedly being perpetrated by the defendants, who would recruit individuals with student loans and then provide them with a script to read, revoking consent to be contacted via telephone. Those individuals were then told to track all incoming calls made by Navient and — based on the statutory penalty of $500 per call under the TCPA — when the total amount of damages equaled the amount of the outstanding debt, a lawsuit against Navient was filed.

In a published report back in November, one of the defendants denied the existence of any scheme.

 

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