Defendant in FDCPA Case Ordered to Pay $45k in Fees For Not Disclosing Subpoenaed Employee Had Suffered Stroke

A Magistrate Court judge in New York has ordered the defendant in a Fair Debt Collection Practices Act class action case to pay $44,895 in attorney’s fees to the plaintiffs for waiting six months to disclose that one of its employees — that the plaintiffs were seeking to depose — had suffered a stroke and resigned. The plaintiffs had been seeking more than $73,000 in fees.

A copy of the ruling in the case of Seaman v. National Collegiate Student Loan Trust 2007-2 et al. can be accessed by clicking here.

The plaintiffs attempted to take the deposition of an employee of one of the defendants. The defendant sought to quash the subpoena or to have the deposition be conducted via written questions because the employee suffered from stress-induced epilepsy. The motion was denied and the defendant and the employee subsequently filed an objection, but did not seek a stay. Three days after the objection was filed, the employee suffered a stroke, which caused him to resign from the company. But that was not disclosed to the plaintiffs for six months, during which time both parties were litigating the pending objections.

After the District Court judge overruled the objections, the defendant disclosed that the employee had suffered the stroke. While agreeing to have the employee conduct the deposition via written questions, the plaintiffs also filed a motion for sanctions — both monetary and non-monetary — accusing the defendant of delaying the deposition.

While the judge denied the motion for non-monetary sanctions, she did grant the motion for a monetary penalty, ordering the defendant to pay $44,895 in fees and $168 in costs.