Archives for December 2017

DALLAS, Texas -– SWC Group selected Ronald McDonald House of Dallas (RMHD) as their third quarter 2017 Charities of Choice. Employees from their Carrollton, TX office volunteered to prepare and serve breakfast for families staying at the Dallas house, and raised a total of $1,105 in donations.

“It costs RMHD approximately $125 per night to host a family, but they only ask families to contribute $15 night and will not turn anyone away who cannot pay,” says Jeff Hurt, CEO. “We choose to continue supporting RMDH in their mission, so they may continue to provide opportunities of closeness for families and their loved ones.”

Employees were separated into teams and competed to see who could raise the most money. Team members coordinated a number of different fund raising activities throughout the company floor. The team who raised the most money was awarded a paid volunteer day in order to serve lunch to the families at the RMHD.  The winning group, the administrative “Consumer Account Resolution Team” selected the menu and submitted it for approval.  On November 22, 2017 the team purchased, cooked and served the food, and cleaned the kitchen afterwards. It was a great team building experience for SWC Group employees.

“RMHD does great work to help out our local community and we are honored to donate funds for them, and thankful for the opportunity to serve those families in need,” says Hurt. “We look forward to volunteering with them again.”

About SWC Group

SWC Group is one of the nation’s leading providers of accounts receivable management and consumer service solutions.  They bring over 40 years of proven experience in the government, tolling, utility, telecommunications, cable, property management, and education industries. SWC Group annually manages billions of dollars in receivable accounts, proudly serving organization of all sizes from Fortune 500 private firms to small public agencies.

 

The Eastern District of New York issued a scathing opinion about reverse Avila claims and issued a crushing blow to the plaintiffs’ bar in the decision for Kraus v. Professional Collections Bureau of Maryland, Inc., 2017 WL 6398744 (E.D.N.Y. Nov. 27, 2017). The decision (read it here) provides an excellent policy argument regarding the absurdity of reverse Avila claims and how they have morphed the FDCPA from a shield to a sword for consumers. The decision also finds that a settlement offer letter with a deadline satisfies Avila’s requirement to clearly state that a specific amount paid by a specific date would satisfy the debt. 

Most importantly, the court flat-out said what the industry has been saying for years regarding the plaintiffs’ bar’s abuse of the FDCPA: 

While the Court struggles to see how Avila protects consumers, little imagination is required to envision how the plaintiffs’ bar will make use of it. During oral argument, plaintiff’s counsel advised the Court that many cases have been filed as a result of the Avila decision. No doubt this is true. But are those cases serving to root out genuine instances of debt-collection abuse? Or are they, instead, serving largely to facilitate debt evasion and to prop profits among the plaintiffs’ bar? With the FDCPA, Congress intended to “arm[ ] consumers with a shield against the overly zealous debt collector.” The Court worries that, by carrying the least-sophisticated-consumer standard and strict liability to an illogical extreme, this circuit has fashioned that shield into a sword.(Citations omitted.)

Interestingly, unless the below arguments were brought up by PCBM during oral arguments, the court came to these conclusions on its own. PCBM’s motion to dismiss contained a single, completely different argument. 

The Decision’s Policy Argument 

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Judge Glasser states that Avila and its progeny have lost sight of the purpose of the FDCPA: to protect consumers from abusive debt collection practices. The decision rips into the widespread abuse of the FDCPA, which caused it to become a debt relief statute rather than a shield for consumers as it was initially intended to be. When asked during oral argument why his client sought his assistance, plaintiff’s counsel stated it was because she was in financial distress and was seeking some relief – not mentioning anything about feeling abused by the letter received.

Specifically regarding Avila, the decision states that there is nothing ambiguous, deceptive, or misleading about a letter that accurately conveys the balance but is silent as to interest. Judge Glasser slams the argument, stating it is as plausible as alleging that the letter is ambiguous about the existence of Bigfoot. (Yes, Bigfoot was referenced.) 

The court ultimately finds that “[a] debtor who assumes his account balance will never increase, simply because a collection letter provides no information regarding interest, does so unreasonably, and this irrationality should not be rewarded by courts at the expense of non-abusive debt collectors.”

Second Prong of Avila Satisfied 

The court avoids going against precedent in the Eastern District by providing a conclusion that the settlement offer in PCBM’s letter satisfies the second prong of Avila. According to Avila, if interest is accruing, the letter must inform the consumer that the balance may increase or, in the alternative, clearly state a specific amount paid by a specific date would resolve the account. 

PCBM’s letter clearly stated that it would accept payment of $1552.45 on or before June 20, 2016 to settle the account.  According to Judge Glasser, this is sufficient. 

Conclusion 

This is the blow that the industry has been waiting for. No article will do this decision justice, so it is recommended that the decision is read in full by all in the industry. Once again, read it here.

insideARM maintains a free FDCPA resources page to provide the ARM community a destination for timely and topical information on the Fair Debt Collection Practices Act (“FDCPA”). This page is generously supported by TransUnion. See the page here or find it in our main navigation bar from any page on insideARM under Compliance Resources.

The centerpiece of the page is a chart of significant FDCPA cases. Case information and analysis is provided by Joann Needleman, a Clark Hill attorney and leader of the firm’s Consumer Financial Services Regulatory & Compliance Group. Click on the link in the chart for the complete text of the decision. Where insideARM has already published a story on the case, we provide a link to the story.

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Here’s a rundown of just some of the FDCPA cases in the spotlight as 2017 draws to a close.

Rhein v. Forster, Garbus & Garbus, LLP

The gist: A settlement letter did not provide details on potential tax consequences of taking a settlement offer. The court determined that this failure alone is not sufficient to state a claim under the FDCPA.

Richard Leonard V. Zwicker & Associates, P.C.

The gist: Circuit court affirmed dismissal of a class action based on an allegation that the collector did not identify a creditor’s full business name. In this case, the letter identified the creditor as American Express, which court felt was sufficient.

Bernal v. NRA Group, LLC

The gist: This bench trial centered on whether creditor’s legal counsel expenses can be considered “costs,” eligible to be collected from a consumer. Turns out, the creditor’s contract specifically provided that consumer would pay all costs of collection, which made it easy for the court to side with the defendant.

McAdory v. M.N.S & Associates, LLC

The gist: This case contemplated the role of active debt collectors versus passive debt buyers. The court found that a passive debt buyer defendant was not considered a debt collector, since it had no interaction with consumers and did not directly engage in collection activities.

Macelus v. Capital Collection Service

The gist: Court found that a dunning letter sufficiently identified the defendant as the current creditor even though both the creditor medical facility and agency debt collector are both identified in the letter. While the court did not see any reason for the confusion and found the suit frivolous, it stopped short of issuing sanctions.

Frank Bandas, Plaintiff, v. United Recovery Service, L.L.C., Defendant

The gist: In this case, plaintiff alleged that a collection letter threatened litigation in stating, “We wish to make this appeal to you as one reasonable party to another. Send us your full payment today or contact this office at once to make suitable payment arrangements so that no further procedures need to be taken in this matter.” The court agreed with the plaintiff.

Homer v. Law Offices of Frederic I. Weinberg & Associates, P.C.

The gist: In this case bound for the appellate division, a validation notice that began with, “unless we hear from you” was found to have implicitly confused and shortened the time period that a least sophisticated consumer would normally have to dispute a debt. In addition, the court found that this language overshadowed the validation notice. Court noted that section 1692g is susceptible to two interpretations—one that a debtor may dispute the debt orally, and the other that he may dispute it either orally or in writing. Since this can cause confusion for a consumer about his rights, the third circuit has found that mirroring statutory language does not excuse the debt collector from explicitly advising consumers that a dispute must be in writing to be valid.

Arias v. Gutman, Mintz, Baker & Sonnenfeldt LLP

The gist: In this case, a law firm garnished a consumer’s bank account to satisfy an outstanding debt. The consumer’s bank noted that some of the consumer’s funds were subject to exemption from garnishment, and the debtor filed an exemption, to which the law firm objected. At the state court level, the law firm withdrew its objection and released the account. However, the consumer filed suit, claiming that the law firm’s objection was false, misleading and unconscionable. The lower court dismissed the case, finding that the law firm was not in violation of state law. Later, the second circuit reversed on that decision, holding that the law firm had no good faith basis for its objection, and that its actions would mislead a “least sophisticated consumer” even if it did not mislead this consumer.

Nieasha Thomas v. Midland Credit Management, Inc.

The gist: In this case, the plaintiff received a collection letter stating that the interest on her outstanding debt was $0.00, leaving her in doubt about whether or not interest was accruing on her debt. The court ultimately found that the consumer had a claim, and the right to know whether interest would accrue on the account into the future.

CARROLLTON, Texas — During November 2017, the CMI Group (CMI) organized a company-wide event, partnering with the Children’s Advocacy Center for Denton County (CACDC) to provide 12 families with a total of 33 children a magical Christmas this year. This project focused on fulfilling the holiday needs and wishes of children who have been victims of sexual or physical abuse.

The CACDC is committed to a multidisciplinary response to child sexual abuse. Children who grow up in violent homes are six times more likely to commit suicide, 24 times more likely to commit sexual assault crimes, 74 times more likely to commit crimes against persons, and 50 times more likely to abuse drugs or alcohol.  Established in 1997, the CACDC coordinates with law enforcement, child protective services, and medical and mental health professionals to help children and their non-offending family members seek justice and find healing.  (Source: www.cacdc.org)

“In 2016, CMI provided gifts for 10 CACDC families. In 2017, our goal was to beat last year’s donations and we did just that! CMI was able to fulfill more of CACDC’s total need and we are thrilled at the success of the project. Giving back to the community is important to us at CMI, and that is evident in the generosity our employees showed during this project,” said Chelsea Carter, call center coach and coordinator of the event. 

About The CMI Group

Founded in 1985, CMI is a full-service receivable management firm providing leading-edge solutions to customers nationwide. Through its subsidiaries, CMI delivers innovative first-and third-party revenue cycle, accounts receivable management, and BPO solutions resulting in enhanced operational efficiency and increased revenue for its customers. Serving a multitude of industries, CMI has headquarters in Carrollton, TX, with satellite offices in Dallas and Rochester, MN. For more information, visit www.thecmigroup.com.

TAMPA, Fla. — Preferred Collection and Management Services, Inc., in Tampa, Florida has a “Preferred Gives Back” program created by CEO and past president of the Florida Collectors Association, David Kelley. Preferred participates in a multitude of charity events throughout the year. This is the first year, however, that they participated in the John Winter Memorial Teddy Bear Round Up which runs from November 24^th to December 18^th every year. Winter was a Tampa meteorologist for WFLA News Channel 8 and a member of the Rough Riders who often spoke of taking Teddy Bears to children in hospitals during his morning forecast.

The Tampa Rough Riders were formed to preserve the memory of President Theodore Roosevelt and his service with the First U.S. Volunteer Cavalry when they fought in the Spanish-American War in 1898. For several years the Rough Riders spent their own money to buy new teddy bears to take to the children in hospitals which later expanded to what it is today. They tend to stick specifically to stuffed bears because Teddy Roosevelt is the name sake for the “teddy bear.”  They deliver to many other places and not just children in hospitals but to children living in shelters, senior citizens, cancer patients and wounded warriors at the Haley V.A. Center. According to Tony Bimonte, Teddy Bear Committee Chairperson for the Rough Riders, they pretty much cover every hospital in Tampa, Saint Petersburg and Bradenton that they receive an invite from.

Erin Swartz, who coordinated this first time event said, “Preferred knows that people don’t get sick or need a dose of happiness just around Christmas time so we will work on collecting bears throughout the year for the Rough Riders so we can continue to bless those who are going through a difficult time.” Pictured below are some of the management and staff that collected more than 30 bears for the program.

As the adage goes, the only thing that is constant is change—just ask an attorney or compliance professional servicing the accounts receivables industry. The last decade has ushered in profound changes on the technological, economic, and regulatory/legal fronts, leaving in their wake a reshaped landscape, with only those companies that are able to absorb and adapt to change still standing.  This article takes a look at regulatory change management, what it is, and why it is so important for companies engaged in debt collection.

What Is Regulatory Change Management?

Regulatory change management is the process of preparing and adapting to changes in regulatory and other legal requirements. Said differently, regulatory change management is compliance management.  Complying with the law requires, naturally, knowing what the law is; but this is easier said than done. Debt collection, and related activities like credit reporting, are highly regulated by multiple, overlapping statutes, rules, court decisions, and government authorities. 

Changes to laws and regulations come in many flavors. Legislatures pass amendments or new laws.  Executive agencies issue new rules or revise existing ones and issue guidance in various formats that broadcast their expectations, but which also may be binding.  Enforcement agencies, such as the Consumer Financial Protection Bureau (CFPB), the Federal Trade Commission (FTC), and state attorney general offices, bring enforcement actions that signal their understanding of what the law requires.  Finally, courts frequently weigh in and resolve disputes, making and changing the law. 

What Are the Core Elements of a Regulatory Change Management System?

Effectively implementing changes to business processes in order to comply with changes in the law or to incorporate best practices can be challenging, depending on the size and complexity of the change and how many (and which) of the company’s systems, teams, and processes are impacted. 

Take the example of out-of-statute debt disclosures. By 2012, the FTC, followed by the CFPB, signaled through enforcement actions that the failure to affirmatively disclose to consumers that any debt being collected that was past the applicable statute of limitations likely would be considered a prima facie case of threatening to sue on out-of-statute debt, in violation of the FDCPA. Meanwhile, several states passed laws or regulations to require such a disclosure.  Debt collection companies had to decide whether to proactively implement such a disclosure across the board, even in states where it is not legally required, and further had to decide (1) which letters should include the disclosure, (2) whether to make verbal disclosures, (3) what language to use, and (4) how quickly to roll out, given other legal and business priorities.

Technical implementation of such a new disclosure also involves a series of decisions, such as:  (1) What IT systems need to be programmed to properly trigger the inclusion of the disclosure?  (2) What vendors need to be involved in updating the letter templates and coding?  (3) Who is responsible for drafting and approving the language?  (4) Who is responsible for testing that the disclosures are being included in the correct letters?  (5) Where should the disclosure be placed, and how does it impact other mandatory disclosures?  (6) What policies, procedures, training materials, and quality control processes need to be updated?

As this example illuminates, a robust system must be able to:

1. Identify developments in law that potentially impact the company’s compliance profile;
2. Analyze these developments to determine applicability and, if applicable, scope of impact;
3. Implement business process changes to conform to the new or changed requirement/prohibition; and
4. Document the changes by updating and drafting written policies and procedures to reflect such changes.

Identification:  There is no one-size-fits-all approach for tracking potentially applicable developments.  Depending on your compliance and risk profile and budget, there are a variety of resources you can subscribe to, join, or purchase, including:

• Membership in one or more trade associations that monitor regulatory changes in the industry.
• Purchase of a subscription service / database.
• Free alerts from regulatory agencies, law firms, and consulting firms that publish relevant content.
• Retaining one or more law firms or consulting firms with subject-matter expertise.

The key is ensuring there are no material gaps in coverage. 

Analysis:  The devil is always in the details; once a regulatory development is identified, it must be analyzed carefully against the company’s operations to assess whether and how it applies.   The nature and scope of the change largely will dictate the resources that will be needed.  For example, a change in how often a consumer can be contacted will require considerably different resources than a requirement regarding the type of documentation needed to bring a collections lawsuit.  That said, a “first cut” analysis often can be made by compliance or legal counsel.   

Ultimately, you need a final, sound determination of whether the regulatory development applies and, where it does, a list of all business processes, departments, systems, and policies and procedures that are impacted and how.  

Implementation:  After determining application and scope, an implementation plan should be prepared that identifies relevant action items, assigns ownership of each action item, and sets deadlines.  In addition, consider whether the change necessitates any type of employee-, consumer-, or client-facing communication or training. 

Documentation:  The final step is documenting the change(s) by updating written policies, procedures, training materials, etc. to reflect the change(s).  In some cases, new documents will need to be prepared.  Finally, consider whether any compliance testing or quality controls need to be created or updated to ensure what was changed is working as expected. 

Why Is Regulatory Change Management Important?

In an industry where regulatory developments occur weekly, if not daily, the inability to smoothly and effectively manage change could, at a minimum, significantly disrupt day-to-day operations and business performance.  At maximum, failure to comply with regulatory requirements or expectations could result in a regulatory investigation, a poor supervisory examination, or a private lawsuit.  These events are costly and distracting, regardless of the ultimate outcome.

You may be thinking, “But what about the bona fide error defense available under the FDCPA?”  As the Supreme Court found in Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 130 S.Ct. 1605 (2010), the bona fide error defense does not apply to mistakes of law, only mistakes of fact.   

Prompt identification and implementation of legal and regulatory developments, even before they become officially “binding,” are more critical than ever following Oliva v. Blatt, Hasanmiller, Leibsker & Moore LLC, 825 F. 3d 788 (7th Cir. 2016).  Some background is in order.  The FDCPA requires collection lawsuits to be brought in the “judicial district or similar legal entity” where the debtor lives or where the contract sued upon was signed.  In a 1996 case, Newsom v. Friedman, the 7th Circuit held that Illinois’ Circuit Courts constituted “judicial districts,” and that the intra-Circuit municipal districts were not separate “judicial districts” for purposes of venue selection under the FDCPA.  Eight years later, in Suesz v. Med-1 Solutions, LLC (2014), the 7th Circuit overturned Newsom, holding that “the correct interpretation . . . is the smallest geographic area that is relevant for determining venue in the court system in which the case is filed.” 

The firm filed a lawsuit against Oliva in a municipal district, which was permissible under Newsom, but not under Suesz, which was decided while the action against Oliva was pending.  The firm voluntarily dismissed the action after Suesz, and Oliva subsequently sued the firm.  On appeal, the 7th Circuit held that the “new rule” instituted by Suesz applied retroactively and that reliance on Newsom was a mistake of law that foreclosed the bona fide error defense.  Understandably, this case has set off alarm bells in the industry, but it also reinforces the need for debt collection companies to establish strong regulatory change management programs to promptly identify and adapt to change.   

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Alexandra Megaris is Counsel with the law firm Venable. Her practice focuses on regulatory investigations and government enforcement matters involving state attorneys general, the Federal Trade Commission (FTC), Consumer Financial Protection Bureau (CFPB), state regulatory agencies, and the U.S. Congress. She also works closely with Venable’s federal and state government affairs teams in advocating for clients before these agencies.

 

ACA International announced yesterday the release its 2017 Ernst & Young survey results, which provide an in-depth overview of the economic importance of the third-party debt collection industry on the U.S. and individual state economies. According to its member alert,

Based on data from 2016, the report details the industry’s contribution to employment, asset recovery and other fiscal categories. Since 2013, the last year a similar survey was conducted, the amount of debt collected has increased by 42 percent, which translates to a return of $67.6 billion to creditors in 2016.

Key national findings of this landmark study include:

• Recovering Assets:  A total of $67.6 billion was recovered on behalf of creditor clients. The collection of consumer debt provides a valuable benefit to American households, as third-party debt collection efforts represent $579 in savings on average per household by keeping the costs of goods and services lower.
• Job Creation:  Third-party collection agencies directly employed 129,262 people with a payroll of $4.9 billion. Indirectly, the industry influenced creation of more than 89,000 jobs.
• Paying Taxes:  Third-party collection agencies and their employees paid $852 million in federal taxes, and $677 million in state and local taxes. The ancillary impact of the industry generated a total $1.6 billion in federal taxes paid and $1.28 billion in state and local taxes.
• Giving Back:  Third-party collection agencies and their employees contributed $17.7 million and volunteered 521,700 hours to charitable community causes.

The report, which also includes detailed state data, is available as a resource to you as part of ACA International’s commitment to advancing the industry through advocacy, research and education.

Click here to review the complete Ernst & Young report, “The Impact of Third-Party Debt Collection on the US National and State Economies in 2016.”
 

Last week the U.S. Department of Education, Office of Federal Student Aid (FSA) announced its next step in its vision to create the “Next Generation (NextGen) Financial Services Environment.”

First, a little background

In June 2017 insideARM reported on the appointment of Dr. A. Wayne Johnson as the new head of FSA. In that announcement, Education Secretary Betsy DeVos said,

“Wayne is the right person to modernize FSA for the 21st Century. He actually wrote the book on student loan debt and will bring a unique combination of CEO-level operating skills and an in-depth understanding of the needs and issues associated with student loan borrowers and their families. He will be a tremendous asset to the Department as we move forward with a focus on how best to serve students and protect taxpayers.” 

Fewer than 60 days later, on August 1, 2017, ED announced the “Next Generation Processing and Servicing” plan. In that release, Dr. Johnson said,

“The FSA Student Loan Program represents the equivalent of being the largest special purpose consumer bank in the world. To improve customer service, we will take the best ideas and capabilities available and put them to work for Americans with student loans. When FSA customers transition to the new processing and servicing environment in 2019, they will find a customer support system that is as capable as any in the private sector. The result will be a significantly better experience for students – our customers – and meaningful benefits for the American taxpayer.”

insideARM reported at the time that the anticipated FSA Next Generation Processing and Servicing Environment will provide for a single data processing platform to house all student loan information while at the same time allowing for customer account servicing to be performed either by a single contract servicer or by multiple contract servicers. We commented,

In our opinion, a single database that contains all information and activity on a consumer’s account is an absolute necessity. The Department currently has four primary servicers: Navient, NelNet, Great Lakes Educational Loan Services, and FedLoan Servicing. It is absolutely crazy for a borrower with multiple loans to potentially have accounts with multiple servicers that do not communicate nor share the same database.

In related news, on October 20, 2017 insideARM reported that one of the primary servicers, Nelnet, announced its intentions to acquire another of the primary servicers, Great Lakes Educational Loan Services, Inc. The two companies have been working for some time on a project to develop a servicing platform which they call “GreatNet.” We suspect it has been developed with “NextGen” in mind.

The current request for information

On December 11, 2017 ED posted a Request for Advanced Market Research Information. The announcement states,

Through this initiative, FSA will create world-class, mobile-first, mobile-complete, omni-channel engagement capabilities and a state-of-the-art technical infrastructure. The new environment will increase awareness and understanding of Federal student aid opportunities and responsibilities, improve operational flexibility, and enhance cost and operational efficiency, producing better outcomes for customers and taxpayers. FSA anticipates commercial solutions will be necessary to meet the objectives of this vision.

The 18-page posting includes the diagram below, and states that the initial focus is on the area highlighted in dark blue. Of note to insideARM readers is that to the right of this area, there are “Default Management Collection System” and “Recovery” placeholders, suggesting the vision is that private collectors will ultimately use the same system as servicers. This would definitely be a win for borrowers.

 

You can view the full Request for Advance Market Research Information here.

Additional information from the notice

This is not a solicitation. No award will be made based on the information received in response to this request for advanced market research. Please note that the responses received may be subject to release if a Freedom of Information Act (FOIA) request is received. 

Responses are due by 2 pm Eastern on Thursday, January 4^th, 2018 to MPDSETeam@ed.gov.

Interested firms are strongly encouraged to register as an “Interested Vendor” on the Federal Business Opportunities website (www.fbo.gov) in order to receive timely updates regarding this initiative.

 

The far-fetched “reverse Avila” claims continue to crumble in New York district courts. On November 15, 2017, Judge McAvoy of the Northern District of New York dismissed a reverse Avila claim, which alleged that the Avila disclosure was required on a letter due to pre-judgment interest that may accrue on the account as prescribed N.Y. C.P.L.R. § 5001.  The case is Altieri v. Overton, Russell, Doerr, and Donovan, LLP (2017 WL 5508372). 

You can read the decision here.

Note: The decision also contains a discussion on a separate claim, but this summary discusses only the reverse Avila claim. 

Background

Overton, Russell, Doerr, and Donovan, LLP (“Overton”), a law firm, was hired by Bank of America to collect on an outstanding debt owed by plaintiff Christina Altieri. Overton sent a collection letter to Altieri that contained a balance but did not contain the Avila safe harbor disclosure. 

Altieri, represented by consumer attorney Mitchell Pashkin, filed a suit against Overton claiming, among other things, that due to pre-judgment interest prescribed by New York law, the letter violated the FDCPA by not including a disclosure that interest may accrue.  

Overton moved to dismiss the complaint.

Decision 

The court granted in part and denied in part the motion to dismiss. Of the six causes of action in the complaint, the court dismissed five causes of action with prejudice. The court denied dismissal of one cause of action because Overton did not address it sufficiently in the motion to dismiss. However, the court granted defendant leave to file another motion to dismiss for that claim, signaling the court’s intent to dismiss the complaint in its entirety. 

In the discussion on the reverse Avila claim, the court recognized that pre-judgment interest is speculative – a conditional future event that can only be triggered by certain actions. The court ruled that because of the conditional nature of pre-judgment interest, the balance included on the letter at the time the letter was sent was not false or misleading. 

The court, citing the U.S. Supreme Court case Ashcroft v. Iqbal, 556 U.S. 662, also dismissed two (and hopefully soon three) causes of action as “unadorned, the-defendant-harmed-me-accusations that lack factual content that allows the Court to draw the reasonable inference that Defendant is liable for the misconduct alleged.”  

Following the Decision 

Overton filed its subsequent motion to dismiss on the same day the decision came out. The hearing is set for December 22 before Judge McAvoy. 

Conclusion

Debt collectors plagued by the reverse Avila claims from the frequent-filer plaintiffs’ attorneys are slowly catching their breath. District courts throughout New York are making reasonable decisions on the reverse Avila claims for accounts that are no longer accruing interest.  The last-ditch, far-fetched reaches for Avila liability against debt collectors is failing.  

Unfortunately, it was a very costly effort from many in the industry to get to this point. The inequity of the fact that agencies get no financial recourse for successfully defending such meritless suits while consumer attorneys – not the consumers – profit by bringing them in droves is a conversation that deserves the light of day. The industry’s gratitude extends to agencies and firms such as Overton, and many who continue to defend these reverse Avila claims, for fighting the good fight.

CHAMPLIN, Minn. — Once again, Summit A•R (Summit Account Resolution) is helping to keep the Holidays bright for local families in need that are affiliated with CROSS Food Shelf. Located in Champlin, MN, Summit A•R is a well-established Minnesota Collection Agency and full service Revenue Cycle Management Company that has been in business since 1996.

In keeping with their ongoing commitment to the community, the staff and ownership’s  donations helped to impact 300 local children who will each receive a Christmas stocking full of goodies and toys as well as tooth brushes, tooth paste, etc. The staff at Summit A•R also donates it’s time on the day the gifts are distributed by helping the families with the stockings and gifts.

“It’s just a great day for our staff to be able to help make a difference” said Tim Turner, President of Summit A•R. “The goodness and generosity of our employees always touches me… collection agencies are made up of truly good people doing a much needed job and it’s great to be able to show our community this”.  Toni Olson, a Director from CROSS, had this to say: “As always, Summit A•R has answered the call in our time of need at the holidays.  We would like to sincerely thank them for their time and generosity.”

About Summit A•R 

Founded in 1996, Summit A•R (Summit Account Resolution) is a national collection agency serving health care, commercial, consumer and many other industry segments. Their focus is to “Preserve Human Dignity” with their “P.H.D.” collection philosophy. They are members of the ACA, IACC, AAHAM and BBB among other local and national organizations.  888.222.0793 or SummitCollects.com