Pa. Judge Denies Stay Request in Hunstein Case

A District Court judge in Pennsylvania has denied a defendant’s motion to stay a Hunstein case pending the outcome of the en banc rehearing scheduled later this month before the Eleventh Circuit Court of Appeals, ruling that regardless of how the Eleventh Circuit rules, it will not have “binding precedence” with respect to the claims being made by the plaintiff.

A copy of the ruling in the case of Palladino v. Client Services can be accessed by clicking here.

The plaintiff sued the defendant for violating Section 1692c(b) of the Fair Debt Collection Practices Act for transmitting information about the plaintiff and her debt to an unauthorized third party, in this case a vendor that was used to print and mail collection letters. Hundreds of similar cases have been filed nationwide following the Eleventh Circuit’s ruling in Hunstein v. Preferred Collection & Management Services that was released last April. In November, the Eleventh Circuit announced it was vacating the decision and would conduct an en banc rehearing of the case, which is scheduled for February 22.

The plaintiff in Palladino initially filed in state court, but the defendant had the case moved to federal court and then filed a motion to stay proceedings until the outcome of the en banc rehearing.

Given that there is no definite timeline to the Eleventh Circuit issuing a new ruling once the en banc hearing has been held, there is little reason to hold up the proceedings of this case, especially since it is not in the same Circuit, said Judge Malachy E. Mannion of the District Court for the Middle District of Pennsylvania.

Judge Mannion also had little patience for the defendant’s arguments about the harms it would suffer should it be required to defend itself if the Eleventh Circuit rules contrary to the vacated decision. “The court finds that the defendant’s allegation of ‘irreparable harm’ strains credulity, at best,” he wrote. “As district courts in other circuits have found, that it is not necessary to see how the Eleventh Circuit decides the issues of whether a similar plaintiff has standing and whether the court has jurisdiction over her claims.”

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