Threatening a Lawsuit on Time-Barred Debt Violates the FDCPA

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A Federal Judge in Minnesota recently ruled that a debt collection law firm and debt buyer violated the Fair Debt Collection Practices Act by threatening a lawsuit on a credit card debt that was past the Statute of Limitations.

In this case, the law firms Morris, Carlson & Hoelscher, P.A. and R.L. Morris & Associates, LLC, wrote directly to the consumer on September 4, 2008. In this letter, the law firms included a Summons and Complaint. The letter also stated that if the consumer did not address the debt, the law firms, on behalf of their client, Lake State Capital, LLC, would get a judgment against the consumer and would garnish her wages, levy against her bank account, and obtain a lien against her home. The problem with the Defendants’ threat was that the consumer had not made payment on the debt for more than six years. Pursuant to Minnesota law, a lawsuit for breach of contract must be brought within six years from the date of the breach. Credit card and debt collection lawsuits are based upon breach of contract.

The judge found that the Defendants violated 15 U.S.C. 1692e(2)(A), (5), (10), and 1692f of the Fair Debt Collection Practices. Never pay on a debt which is past the Statute of Limitations. If a debt collector harasses you and tries to make you pay on a debt that is past the Statute of Limitations call an attorney immediately. Stop debt collection harassment.

If you want to read more about the case click here.

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