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Consumer Protection Litigation with Ari Marcus

SUMMARY:

In this week’s episode of Attorney Talk, Ken Thayer interviews Ari Marcus, who is the managing partner of the Marcus Zelman Law Firm. Ari’s practice is focused on individual and class action consumer protection litigation specifically involving the Fair Debt Collection Act and Telephone Consumer Protection Act classes. During the show, Ken and Ari discuss fee shifting, class actions, finding violations, and credit scores.

 MAIN QUESTIONS ASKED:

  • What is consumer protection litigation?
  • What is fee shifting?
  • How would you describe your typical client?
  • What are some of the rules that debt collectors have to follow?
  • What are some of the penalties if debt collectors are in violation of not properly forming the notice?
  • Are you finding violations on large scale that it comes up to the level of a class action?
  • Talk about the Telephone Consumer Collections Act.
  • What is the interplay between debt collectors and debt collection attorneys?

KEY LESSONS LEARNED:

Consumer Protection Litigation & Fee Shifting

  • Protect consumers against big businesses in federal court.
  • Most of the work is fee shifting so the clients aren’t charged.
  • Fee shifting is when an attorney keeps hours on the case and cost, but if the case is won or settled, the defendant will pay the fees. This doesn’t impact what the client gets at the end of the case.

The Typical Client

  • Someone who is going through financial distress and has collection notices, letters or voicemails or foreclosures.
  • A lot of clients come via credit repair companies, foreclosure defense attorneys, bankruptcy attorneys, and personal injury attorneys.

 Debt Collectors

  • Once a debt collector gets involved, they don’t really care about the letter of protection.
  • Once a person receives a letter from a debt collector, there are certain rules that need to be complied with.
  • Any debt collector who is collecting on a debt that you don’t owe is a violation of the act.
  • If a debt is owed, but past the statute of limitations, and a letter offers a settlement, but doesn’t state it is past the statute, then that is a violation of the act.

The Fair Debt Collection Practice Act (1977)

  • This is a remedial statute that is technical in nature.
  • Any technical violation, whether there is or isn’t intent, is a violation of the Act.
  • A lot of the Act is common sense in that debt collectors can’t deceive, lie, harass, or make false threats.
  • In the first communication, they have to notify you of your rights to dispute a debt.
  • A lot of the cases arise as debt collectors try to shorten the notice and add things.
  • The act says that the debt collector has to pay the consumer up to $1K for the violation. However, this isn’t a per violation statute.
  • Most of the letters sent are templates. If there is a violation, it will be pursued as a class action.
  • As a class action, the violators would have to pay 1% of their net worth and $1K to the client, incentive award, attorney fees, and the class action administration cost.

 Finding Violations

  • Part of the reason in founding the Fair Debt Collection Practice Act was because they wanted to put the onus on the debt collector.
  • If the intent of the debt collector is to collect money, then they will inevitably violate the law, as they will keep pushing until they cross the line.

Telephone Consumer Collection Act

  • This is a per violation statute.
  • If you get any calls on your cell phone from an auto-dialer, you are entitled from $500-$1,500 per call. This is for both solicitation and debt collection purposes.
  • The only time companies are allowed to call you in this manner is if you have given them express consent.
  • The issue that has arisen is ‘how can you revoke consent.’ The FCC, in June of 2015, said that anyone can revoke consent, which can be done in any reasonable manner.
  • A large part of the practice is from people who have reassigned cell phone numbers, as this is still a violation.

Credit Scores

  • The three bureaus reached an agreement with the Attorney General in New York that a medical debt won’t be reported for an agreed period of time.
  • Similar to the Fair Debt Collection Act, you get up to $1,000 for the violation, plus actual damages.
  • If your score has gone down, then it’s easier to prove for damages.
  • Ari is looking for statutory damages on behalf of the client, plus actual damages.
  • Once a consumer makes a first payment, even if the statute of limitations has expired, the statute restarts.
  • Your credit score impacts every aspect of your life including insurance, getting a job, and buying or renting a house.
  • A lot of people end up paying a debt they don’t owe, as they don’t want to deal with the credit bureau.

Links to Resources Mentioned:

Marcus Zelman

Ari@marcuszelman.com

732-695-3282

 

CLICK TO TWEET:  

What is fee shifting & what does it have to do with debt collection law? Find out w/ @MarcusLawLLC @gaylordpoppllc http://www.gaylordpopp.com

 

How is the Telephone Consumer Collections Act affecting your clients? Find out w/ @MarcusLawLLC @gaylordpoppllc http://www.gaylordpopp.com

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