FDCPA

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7^th Circuit Court of Appeals

Case Name: Paula St. John et al v. Cach, LLC et al

Case No.: 14-2760; 14-3724; 15-1101

Officials: KANNE and MANION, Circuit Judges, and PEPPER,* District Judge.

Focus: FDCPA

It is not unlawful for a debt collector to file a collection lawsuit without the intent to prced to trial.

“In this respect, debt collectors who sue to recover a debt are no different from any other plaintiff. They too must weigh the anticipated costs of trial against the potential benefits when considering how far to advance the litigation. Yet, under the plaintiffs’ theory, a debt collector who foresees that it would not be cost-effective to proceed to trial on a particular debt (and who therefore has no intention of doing so) would be liable just for filing a complaint. The debt collector would thus effectively be barred from recourse to the courts, even when its claim is unquestionably legitimate, and even when no other recourse is left. The FDCPA does not compel this incongruous result. Section 1692e(5) does not punish debt collectors for engaging in a customary cost-benefit analysis when conducting litigation, nor does it constrain them to mechanically steer the proceedings toward trial with no regard for expense or efficiency”

Affirmed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.