Putting Together a FCRA Punitive Damages Case Against a Debt Buyer. Len Bennett Penny Hays Cauley

Transcription

1 F1 F1 Putting Together a FCRA Punitive Damages Case Against a Debt Buyer Len Bennett Penny Hays Cauley

2 Where to start? Putting Together a Brim Credit Reporting Case Part 1 Getting to Trial Be Patient Brim started out as a debt defense case where Ron defended him in that action and then helped guide him through the process of writing the dispute letter. Look for all possible claims and Defendants When we filed this case, Dell was the main target because they had reported the debt, sold the debt to Midland, etc We sued Midland b/c they had continued to report the account and had continued to send occasional letters to collect. However, Midland was not calling every week to collect, so it was not a typical FDCPA claim. We also filed a separate action against the CRAs Why sue the CRAs? My general practice is to sue the CRAs separately from any furnishers. Makes the cases easier to handle Fewer attorneys on each case Less defendants for the CRAs to put the blame on MOST IMPORTANT you get all of the documents you need in your furnisher case and you have an attorney on whom to serve your subpoena for trial testimony Gets extra money for your client and you How to handle the furnisher Discovery: Look for every violation FDCPA, FCRA, State law What actions did they take to comply with both statutes Take the Defendant s deposition IN PERSON Send out a 2 nd set of discovery requests after the deposition requesting every item they testified about that you don t have

3 Think About What Documents You Need For Trial? Credit Reports You must subpoena the records from the CRAs You will need their testimony for trial These depositions can be done by phone Think about whether you want to video the depo Video allows jury to see the witness Beware of technology issues Be prepared for the CRA depos because they want to help the furnisher! Establishing liability with CRA Depo? Did they receive your client s dispute letter? Did they send out an ACDV to furnisher? Did they receive a response from the furnisher within the 30 days? What was the response? Verified / Modified Did the furnisher report the account as disputed (If not, that can be an FDCPA violation) As a result of furnisher s response, acct remained on credit report If there are other negative accounts, attempt to diminish their relevance (zero balance; old; 30 day late vs. charged off) Establishing Damages with CRA Depo Establish who viewed your client s report with the incorrect/defamatory information: Go through each inquiry Establish what type of inquiry it was Inquiries only go back 2 years so if the account was improperly reporting longer than the 2 years, be sure to establish that limitation. The inquiries help confirm your client s testimony about credit denials! Was their anything else negative reporting at the same time? Minimize its impact on the report What other documents are needed for trial and how to get them admitted Do you have credit denials? If so, send a subpoena with an Affidavit so that the credit denial letter can be admitted into evidence as authentic Do you need a deposition? If the credit denial is from a local bank or mortgage company can/will they appear in person at the trial.

4 Using pleadings to educate the Judge on the facts of your case: File Motions to Compel that include facts that support not only why you need the documents requested, but also, why this case is important Don t wait until the discovery deadline to file File a Motion for Partial Summary Judgment on any issue that you believe you can win based upon the evidence. Likely you will not win, but you will educate your judge. In our case, we didn t win SJ, but we did end up with Agreed upon Statement that Judge read to the jury. Use Motions in Limine to keep out the evidence you think might be harmful to your client Present your evidence in the PreTrial Order you submit to the Court. Be willing to dismiss your weaker claims, especially if they make your case more complicated or allow in evidence you do not want to come in. I dismissed the state laws claims for defamation in order to prevent the defendant from offering evidence about my client. These cases take work! When Brim was filed, other attorneys in the District were routinely filing similar claims and settling them for $3,500! Midland was expecting the same in this case. For months, Brim was the only case I worked on in getting it ready for trial. Don t go to trial alone. If it is going to trial, get someone to help you try the case Putting Together a Brim Credit Reporting Case Part 2 Trying Your Case

5 Selecting Your Jury: What type of juror are you really looking for? Will they understand the importance of credit Will they be able to read the documents you are going to be explaining credit reports, credit denials, ACDVs What is their understanding of computers? Do they believe computers can do everything or do they believe there are limitations on what a computer should be trusted with? Voir Dire In this case, the Plaintiff purchased a computer on extended credit, but then paid it off within 30 days. His payment was misapplied to someone else s account. Has something like this ever happened to you? Have you ever been contacted by a creditor or a debt collector about a debt or an account that was previously paid off? Were you able to resolve the matter? Has anyone ever been sued on an account that you had already paid off? The evidence will show that the Defendant reported a collection account as belonging to Mr. Brim for over 2 years before it was finally corrected and removed from his credit report after this lawsuit was filed. Does anyone feel that Mr. Brim should not continue with the suit simply because the account was finally removed from his credit report? Have any of you ever worked in any type of position where you were responsible for reporting information or accounts to the credit reporting agencies? Any responsibility for investigating disputes from a credit reporting agency? Has anyone ever worked in the area of debt collections, either from a lender/creditor, for a debt collector or for a company like Midland Credit that buys from other creditors supposed delinquent credit accounts for a large discount? Have you or has anyone close to you ever worked at a job that required you to have access or review credit reports? Have you or anyone close to you ever had any training or job experience in any of the following fields: banking, mortgage lending, approving apartment or rental applications, or in retail where credit is offered? Please explain all yes answers. Does anyone have any strong personal feelings regarding the use of consumer credit in our society? Has anyone chosen not to have a credit card or credit account or finance purchases like cars or lease home appliances/furnishing purchases? OPENING STATEMENT Start from the very beginning with a simple statement of what happened and then focus on why the conduct of the Defendant is SO BAD that they should award your client damages In Brim, we focused over and over and over again on the fact that Midland received 8000 disputes EVERY WEEK and that the computer handled 95% of them without a human ever even looking at them. Len also focused on how BIG Midland/Encore was again justifying why a big award was going to be necessary.

6 Order of Witnesses Start with the Defendant s Witness They won t be ready Move on to the deposition of the corp rep Follow up with the CRAs and the documents establishing your client s case before your client ever steps up to testify Finish strong with your client. The jury has already heard all of the other evidence so your client s testimony is just the icing. Also allows your client to be more relaxed and practiced! CLOSING ARGUMENT You will know what the jury charges are going to be so set forth your case according to the jury charges so the jury can see why judgment for your client is proper. Reiterate how bad the Defendant was: Midland only paid 5% to buy Mr. Brim s debt It was out of statute Only choice was to keep it on his credit in hopes they would get paid The didn t care Mr. Brim had already paid it off The did NOTHING to investigate his disputes,etc Always give the jury a number/floor for compensatory damages. Most jurors have no idea how to calculate damages or where to start. If you give them a number they can either accept that number or work from it. Ask for punitive damages based on the conduct of the Defendant. JURY CHARGES Use case law to provide the Court updated and accurate jury charges: An investigation is defined as a detailed inquiry or systematic examination. The plain meaning of investigation requires some degree of careful inquiry by creditors. The term investigation does not include superficial, un reasonable inquiries by creditors.

7 Actual damages include recovery for any out-of-pocket expenses and economic losses, and also damages for personal humiliation, embarrassment, mental anguish, and emotional distress. An FCRA plaintiff need not state her emotional damages with particularity. Humiliation and embarrassment are cognizable injuries under the FCRA; and there is no requirement that a plaintiff provide corroborating evidence or medical testimony in support of an award of damages. A plaintiff may recover for humiliation and embarrassment even if he has incurred no out-ofpocket expenses. There is no fixed standard or measure in the case of intangible items such as humiliation, embarrassment, mental anguish and emotional distress. You must determine a fair and adequate award of these items through the exercise of your judgment and experience in the affairs of the world after considering all the facts and circumstances presented during the trial of this case.