Judge Denies MTD in FDCPA Case Over Expedited Fee Charge

A District Court judge in Oregon has rejected a Magistrate Court’s recommendation to dismiss a lawsuit filed against a law firm accusing it of violating the Fair Debt Collection Practices Act by charging an expedited service fee when it filed Statements of Costs with the court after obtaining default judgments.

A copy of the ruling in the case of Chase v. Gordon, Aylsworth & Tami, P.C., can be accessed by clicking here.

The defendants obtained default judgments in state courts against the plaintiffs for unpaid debts. After obtaining the judgments, the defendants filed Statements of Costs with the state court that included a $45 fee for expedited service. The state court allowed the fee, which, along with the judgments, were paid in full by the plaintiffs. The defendants argued the expedited service was necessary, to which the plaintiffs disagreed.

The defendants attempted to argue that the Rooker-Feldman doctrine precluded the District Court from ruling on the issue, because the state court had already allowed the fee to be charged.

But because the plaintiffs are not seeking to have the state court judgments set aside, the Rooker-Feldman doctrine does not apply, according to Judge Michael Simon of the District Court for the District of Oregon.

The complaint “alleges that expedited service of the collection complaints was neither necessary nor actually performed and that GAT’s claimed ‘actual cost’ for service exceeded the real cost of such service,” Judge Simon wrote. “Plaintiffs also allege that GAT misled them when it stated in its collection complaints that its client sought only ‘actual costs’ incurred, in addition to the underlying debt.”

Judge Simon also determined that the plaintiffs have not had a “full and fair” opportunity to be heard regarding their claims about the expedited service fee being unnecessarily charged.

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