A District Court judge in New York has adopted recommendations from a Magistrate Court judge and certified a class in a Fair Debt Collection Practices Act case that has been going on for nearly a decade.
A copy of the ruling in the case of McCrobie v. Palisades Acquisition XVI et al. can be accessed by clicking here.
The plaintiff defaulted on a credit card debt, which was sold to a company that filed a lawsuit against the plaintiff and obtained a default judgment back in 2007. The summons and complaint had been mailed to an address where the plaintiff no longer resided so he had no knowledge of the suit.
The judgment was later assigned to the defendant, which started garnishing the plaintiff’s wages.
In 2015, the plaintiff contacted a collection law firm — one of the defendants in this case — and requested the chain of title that proved the defendant had the right to enforce the judgment. The law firm provided a copy of the bill of sale of the portfolio, which did not reference the plaintiff or the debt specifically. The plaintiff filed a motion to vacate the judgment, which was granted, and the money that had been garnished was returned. But the vacated judgment was reinstated because the motion had been untimely. The plaintiff has not repaid any of the money to the defendant.
The plaintiff filed suit, alleging the enforcement of the judgment is impermissible.
The defendants attempted to argue the plaintiff lacked standing because the defendant had the right to the funds it originally collected, meaning the plaintiff did not suffer a concrete injury. But the plaintiff’s allegations that the defendants deprived him of $500 for several months by enforcing a default judgment using practices that violate the FDCPA and by claiming they can still enforce the judgment is enough for the plaintiff to have standing to sue, ruled Judge Lawrence J. Vilardo of the District Court for the Western District of New York.
