A District Court judge in New Jersey has cited the principal of a debt collection company for contempt of court for failing to respond to a proposed class action lawsuit and pay a default judgment of $7,671.50 after the company was sued for allegedly violating the Fair Debt Collection Practices Act by not communicating to credit reporting agencies that the plaintiff had disputed the debt in question.
The contempt order against the Chief Executive Officer of DRS Financial, which was doing business as Capital Collection Service, was filed after he had failed to respond to the original complaint, failed to answer an information subpoena, failed to respond to a show cause order, and failed to appear before the judge during a virtual hearing earlier this month. The case in question is Smith v. DRS Financial.
The order, signed by Judge Joseph Rodriguez of the District Court for the District of New Jersey, instructs the U.S. Marshals to execute a civil warrant if the CEO does not answer the Marshals’ call or fails to contact the court as instructed to do so by the Marshals.
The lawsuit against DRS Financial was filed in January 2020. In November, the judge granted the plaintiff’s motion for default judgment, awarding him $1,000 in statutory damages and reasonable attorneys’ fees of $6,671.60. At the time, Judge Rodriguez said he was taking into account the alleged violations as well as the “nature of noncompliance” by the defendant.
The defendant was sued for allegedly violating Section 1692e(8) of the FDCPA by using false, deceptive, or misleading representations in attempting to collect on a debt. The complaint sought to include anyone else in New Jersey who had disputed a debt with the defendant that was not reported to the credit bureaus as disputed.
