A District Court judge in Virginia has granted default judgment against each of the defendants in a civil lawsuit filed by the Consumer Financial Protection Bureau and the Attorneys General of New York, Massachusetts, and Virginia against a company accused of taking advantage of immigrants, ruling the defendants are in civil contempt and that “if default judgment is to ever be warranted as a sanction for discovery abuses, it is emphatically so in this case.”
A copy of the ruling in the case of CFPB et al. v. Nexus Services can be accessed by clicking here.
The lawsuit, when it was filed in February 2021, was the first enforcement action after President Biden became president and fired Kathleen Kraninger as director of the CFPB, replacing her with Dave Uejio on an acting basis. The suit accused the defendants of engaging in deceptive and abusive acts by deceiving non-English speaking individuals into signing contracts to secure bonds for them to be released from federal detention centers. The individuals were allegedly coerced into signing the contracts, but the fees that were paid were for ankle monitors that were worn until the cases were resolved. The fees, unlike a bond, were never returned back to the individuals.
Ultimately, the defendants failed to respond to discovery requests from the plaintiffs, or at least make a good faith estimate to do so, ruled Judge Elizabeth K. Dillon of the District Court for the Western District of Virginia. The defendants established a pattern of “knowing noncompliance” with orders from the court, including failing to retain counsel in a timely manner, refusing to respond to a show cause order, and an unexcused absence from a telephone hearing.
