“Automated Debt Collection Lawsuits” Clog Courtrooms

False or Misleading Information, Illegal Debt Collection Practices

The New York Times recently published an interesting article entitled “Automated Debt Collection Lawsuits Engulf Courts.”   The article points out that with the downturn in the economy, collection lawsuits are growing in number even though many of the lawsuits are either based on stale (time barred) claims, or are based on summary file information that is insufficient to withstand a challenge.

Many of the plaintiffs in these cases are debt buyers who purchase old debt for pennies on the dollar and hope to recover 40 or 50 cents.  In many cases, the defendant (consumer) does not respond and the debt buyer gets a default judgment.

Claim information is bought and sold electronically and the data necessary to prepare a lawsuit is generated by a computer program.   By streamlining the lawsuit process, a single lawyer can “prepare” thousands of cases a year.

Often these claims are so poorly documented that an astute defendant could challenge the lawsuit and get the case dismissed, and perhaps pursue a claim for frivolous litigation against the plaintiff and its law firm.

If you have been sued by a debt buyer, do not ignore the claim – seek legal counsel and do not hesitate to demand that the plaintiff show proof that it owns the debt and that you owe the money claimed.


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Jonathan Ginsberg

For over 25 years, Jonathan Ginsberg has represented honest, hardworking men and women facing financial troubles.

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