A motion has been filed in a West Virginia federal court to approve a settlement in a class action Fair Debt Collection Practices Act and West Virginia Consumer Credit Protection Act case that will see the defendant pay $995,000 after it was accused of sending letters that did not include updated language required under state law when attempting to collect on time-barred debts.
The unopposed motion to settle in the case of Adkins & Short v. Midland Credit Management can be accessed by clicking here.
A District Court judge had granted a motion for summary judgment filed by the plaintiffs back in 2019, after the original complaint was filed in 2017. The defendant attempted to invoke the FDCPA’s bona fide error defense but did not produce sufficient evidence to prove it maintained procedures to prevent this kind of violation. In July 2017, the WVCCPA was updated and required collectors to include a statement in collection letters when attempting to collect on time-barred debt. The defendant did not updated its letters until two months after the law was updated.
The plaintiffs ultimately dismissed their FDCPA claims and proceeded on the WVCCPA claim alone. After the plaintiff’s motions for class certification and summary judgment were approved, the defendant filed a motion to compel arbitration and an agreement was reached to remove more than 5,300 members from the proposed class.
Midland denied all the allegations and claims as part of the settlement.
There are 1,022 members of the class who received letters without the updated language, and they will split two-thirds of the settlement total, with the remaining one-third going to the plaintiffs’ attorneys. The named plaintiffs will receive $10,000 each. A published report indicated that the members of the class will receive up to $807 each, if the settlement is approved by the judge.
