Collection Law Doesn’t Apply To People With Lawyers, Circuit Rules | Courthouse News Service
Friday, December 1, 2023 | Back issues
Courthouse News Service Courthouse News Service

Collection Law Doesn’t Apply To People With Lawyers, Circuit Rules

SAN FRANCISCO (CN) - The Fair Debt Collection Practices Act is not "a sword to be brandished by debtors who have counsel," the Ninth Circuit wrote per curiam. It ruled that RJM Acquisition did not violate the Act and owes no attorney fees for trying to collect a $1,291 debt from Kenneth Jon Guerror. The circuit said the Act extends less protection to consumers with lawyers because "unsophisticated consumers are easily bullied and misled. Trained attorneys are not."

RJM sent two collection letters to Guerrero in Hawaii. Guerrero's attorney, John Harris Paer, threatened to sue RJM for unfair debt-collection practices unless RJM paid his client $3,000. RJM mailed verification of the debt, but instead of trying to settle it, Paer "succeeded in morphing it into a federal battle royale complete with attorneys' fees far in excess of the amount in controversy," the circuit wrote. Paer sought $45,000 in fees. Judge Fletcher dissented in part, arguing that legal representation should not strip consumers of protections under the Act. See ruling in .

Categories / Uncategorized

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.