On February 28, 2014, Hyde & Swigart filed a federal lawsuit on behalf of our client, Ms. Smith (here, an alias). In this lawsuit Hyde & Swigart alleged that the Anaya Law Group (a Westlake Village, California, law firm that collects debts) violated the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692 et seq. (the “FDCPA”) and California’s Rosenthal Fair Debt Collection Practices Act, California Civil Code §§ 1788-1788.32 (the “Rosenthal Act”) by abusively attempting to collect a debt that the Anaya Law Group alleged was owed by Ms. Smith. Hyde & Swigart alleged that one of the ways that Anaya Law Group violated the law was by attempting to collect this debt by filing a lawsuit against Ms. Smith in a California state court and taking advantage of the non-attorney status of Ms. Smith, as Ms. Smith was not trained in the law. Many times consumers, and even the law firms themselves, don’t realize that the Supreme Court of the United States has held that when a law firm collects debts for it’s clients, this activity is regulated by the FDCPA. California’s Rosenthal Act also provides that law firms are regulated in their collection activities.
In this federal lawsuit Hyde & Swigart alleged that in Anaya Law Group’s state lawsuit against Ms. Smith, Anaya Law Group sent Ms. Smith certain state Requests for Admission that were deemed admitted if Ms. Smith failed to respond (a common tactic by abusive debt collectors) and failed to advise Ms. Smith that this was the case. Hyde & Swigart also alleged that Anaya Law Group failed to include certain notices required by California’s Rosenthal Act and the FDCPA. Further, Hyde & Swigart alleged that when Anaya Law Group communicated with Ms. Smith, Anaya Law Group “overshadowed” the language required by the FDCPA and California’s Rosenthal Act because Anaya Law Group said certain things required by state and federal law, and then included language that weakened those required statements. Finally, Hyde & Swigart alleged that Anaya Law Group misrepresented the interest that Ms. Smith might have owed on the underlying debt.Since both the FDCPA and California’s Rosenthal Act are strict liability statutes, that is, these statutes require no intent on the part of the defendant (here Anaya Law Group,) Hyde & Swigart alleged that Ms. Smith was required to pay Ms. Smith $2,000 in statutory damages (statutory damages are kind of like a “fine”), any actual damages that Ms. Smith had endured, such as attorneys’ fees and costs incurred in defending herself in the state case, as well as all reasonable attorneys’ fees and costs incurred by Ms. Smith in the federal case. In other words, Hyde & Swigart asserted that Anaya Law Group should be required to pay Ms. Smith all of her reasonable attorneys’ fees and costs, statutory damages, and actual damages. (In stark contrast, consumers do not have to pay the attorneys’ fees and costs of the debt collector, even when they do not prevail, unless the debt collector can establish that the consumer was acting in “bad faith,” a very high and difficult standard.)
As often happens with debt collectors, and as Hyde & Swigart expected, Anaya Law Group ended up putting up a huge fight over the case rather than taking responsibility for its abusive conduct. From the experience of Hyde & Swigart, abusive debt collectors just can’t stop being abusive even when doing so would, as here, benefit the debt collector, and that is exactly what happened here. By fighting tooth and nail in this case, Anaya Law Group protracted litigation, which caused the attorneys’ fees and costs of Ms. Smith to increase; attorneys’ fees and costs that Anaya Law Group would eventually have to pay if they lost the case.Sure enough, on June 24, 2015, just as Hyde & Swigart expected, the court sided with Ms. Smith and entered judgment against Anaya Law Group for violations of the FDCPA and California’s Rosenthal Act. These FDCPA and California’s Rosenthal Act cases brought by consumers, with the help of lawyers like Hyde & Swigart, represent the rare situation where congress and California’s legislature side with the consumer, rather than the businesses. Consumers do not have to put up being abused by debt collectors, and when these debt collectors violate the law, as any consumer knows is a standard practice by debt collectors, savvy consumers can turn the tables on these abusive debt collectors.As courts have often noted, when a debt collector fights hard to defend itself and is thereafter unable to prevail, the court will not hear the debt collector complain about having to pay the consumers attorneys’ fees and costs, statutory damages, and actual damages. And indeed, in these cases the court has no discretion – it must award the consumer its statutory damages, actual damages, and attorneys’ fees and costs. As the Fifth Circuit stated, “[the consumer’s] counsel did not inflate this small case into a large one; its protraction resulted from the stalwart defense. And although defendants are not required to yield an inch or pay a dime not due, they may by militant resistance increase the exertions required of their opponents and thus, if unsuccessful, be required to bear that cost.” McGowan v. King, Inc. 661 F.2d 48, 51 (5th Cir. 1981).
Under the rules of ethics of many states, this article constitutes attorney advertising. Like everything on this web site, this article is designed for general information only and with the hope that consumers will learn that they do not have to endure abuse from debt collectors. Consumers can, and often do, win against those who abuse them. However, the information presented at this site, and in this article, should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. The choice of a lawyer is an important decision and should never be based solely upon advertisements. Past results afford no guarantee of future results. Every case is different and must be judged on its own merits.Hyde & Swigart is anxious to talk with you about how you have been treated by a debt collector, and Hyde & Swigart does not charge money for these discussions. Please be sure to contact us with questions you may have. If the two of us, working together, decide that a good faith lawsuit should be filed, we will not charge you any of our attorneys’ fees and costs unless we prevail for you. With this in mind Hyde & Swigart has placed easy to use evaluation forms on this website. You can find them, above, in the site’s menubar.