The $8.1 million jury verdict against Midland Funding (Encore) and the jury findings

According to several articles, notorious debt buyer Midland Funding sued Chrystal A. Snow for an alleged debt and she filed a counter claim for harassment phone calls.  The jury awarded $8 million in punitive damages LAST YEAR in Dallas County Court-at-Law No. 4, case number 08-05810-D.

Snow’s attorney was Ross Teter and I’d sure like to get the docket for this case along with the motions and orders. Here’s some good info from the Law Offices of Dean Malone collection blog:

Our firm was not involved with the case, but it is our understanding that Midland Funding’s attorney did not appear for trial.

The jury determined, among other things, that Midland Funding:

  • Attempted to collect a disputed consumer debt from the consumer by causing her telephone to ring repeatedly and continuously;
  • Attempted to collect a disputed consumer debt from the consumer by making repeated and continuous telephone calls with the intent of harassing the consumer;
  • Used false representations to collect a disputed consumer debt from the consumer;
  • Used deceptive means to collect a disputed consumer debt from the consumer;    and
  • That Midland Funding would continue with the conduct described in the four bullet points above unless prohibited by court order.

The claims are NOT for violations of the FEDERAL Fair Debt Collection Practices Act, but were based on TEXAS law, the Texas Deceptive Trade Practices-Consumer Protection Act (“DTPA”).

The FDCPA does NOT allow for PUNITIVE damages unless it is a  CLASS ACTION.

The lack of punitive damages is a MAJOR flaw in the FDCPA.   Debt collectors and debt buyers have NOTHING to worry about in MOST states, with California and Texas being notable exceptions.

The “up to” $1,000 in statutory damages in the FDCPA leaves collectors laughing all the way to their offshore bank accounts.   Back in the 70s when the FDCPA was first enacted, $1,000 was a NICE down payment on a house.

Please note that the Fair Credit Reporting Act allows credit bureaus to increase the fee for consumer credit reports according to inflation (CPI). In over 30 years, the statutory damages in the FDCPA have NEVER been increased!

It’s no wonder so many collectors couldn’t care less about the FDCPA and the harassment calls are their most effective collection technique.

AUDIO: Russell Malone – Mitchell N. Kay – obnoxious collection calls

In this case, the jury awarded only $250 for ACTUAL damages and they awarded $100,000 for mental anguish.

The jury also decided that Snow’s lawyer should receive only $4,250 for his services in trial court.

I’ve had a client’s attorney claim that the $7,000 settlement was for his legal fees and he didn’t have to write a single motion, didn’t conduct discovery and the defendant never even answered the lawsuit before they settled.

Capital One stated in its motion for attorneys fees in my case, about their refusal to report the credit limits, that they incurred over $100,000 in fees!  Capital One didn’t conduct discovery, didn’t attend a trial.  Their attorneys submitted several motions to dismiss and an offer for judgment (which I declined).  Of course they spent many hours reading my websites, but still …

I think a consumer attorney deserves more than a few thousand dollars.

However, Snow’s attorney probably took the case on CONTINGENCY and he received a percentage of the award.

The Jury Findings — a great read!

According to one article, they SETTLED with Midland with a confidentiality agreement.

I assume that as in most cases with large awards, Midland threatened to appeal and they then settled.

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