Sunday, February 22, 2015

District Courts Dismiss FDCPA Claims as Time Barred


Two district courts have dismissed FDCPA claims based upon underlying collection lawsuits as being time barred.


In Komisar v. Blatt, Hasenmiller, Leibsker & Moore, C.A. No. 14-c-17950 (N.D. Ill. Jan. 29, 2015), the plaintiff alleged that the defendant law firm violated 15 U.S.C. §1692i by filling suit against the consumer in the wrong municipal district.  A default judgment was entered against the consumer on October 10, 2013.  The FDCPA suit was filed October 10, 2014.  The law firm moved to dismiss contending that the suit was time barred. The court agreed, holding that the statute of limitations began to run when the collection action was allegedly filed in the improper venue and not when the resulting judgment was entered.  The court further rejected the plaintiff’s argument that the violation was a continuing violation and thus, the action was timely.  “The FDCPA prohibits “bringing” a legal action in an improper forum.  Thus, the violation and injury occurs as soon as the debt collector brings the lawsuit in the improper forum, in other words the moment the complaint is filed.”


Similarly, in Wies v. Cavalry SPV, L.L.C., C.A. No. 1:14-cv-187 (Feb. 11, 2015), the plaintiff alleged that the debt buyer and its collection lawyers violated the FDCPA by seeking to collect post charge off interest in the collection suit.  The plaintiff alleged in his complaint that the debt was originally owed to Bank of America/FIA Card Services and was charged off.  The plaintiff contended that Bank of America/FIA Card Services waived any interest from that point forward.  The plaintiff further contended that after purchasing the debt, Cavalry filed a collection law suit seeking to recover the debt, "plus interest and court costs."  The collection suit was filed January 2, 2013.  Cavalry  subsequently filed a motion for summary judgment on May 13, 2013 supported by an affidavit attesting to the balance owed and including post charge off interest at the rate of 24.99% per annum.  Plaintiff contended that the motion for summary judgment in the collection action violated the FDCPA and that since the FDCPA litigation was filed within one year of the motion for summary judgment, it was timely.  The court disagreed and granted the defendants' motion to dismiss, holding that defendants' attempt to collect interest that was waived by the original creditor began to run when the collections action was filed and that the motion for summary judgment in that action did not create a separate and discrete violation of the FDCPA.

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