By Lauren Kirkwood
BridgeTower Media Newswires
BALTIMORE, MD — A Bethesda debt-collection law firm is facing a federal class-action lawsuit alleging it collected void and unenforceable judgments on behalf of unlicensed collection agencies in violation of the Fair Debt Collection Practices Act.
Protas, Spivok & Collins LLC knew that its client, LVNV Funding LLC, was not a licensed collection agency in Maryland and that judgments won by LVNV were therefore void, but the firm nevertheless sought to garnish the assets of the named plaintiffs, whose alleged debts LVNV had purchased before taking them to court, the suit states.
LVNV is not named as a defendant in the class-action suit.
According to the suit, which was filed in Anne Arundel County Circuit Court but transferred earlier this month to U.S. District Court in Baltimore, the plaintiff class likely includes more than 100 members from whom the law firm has attempted to collect a judgment entered in favor of an unlicensed collection agency.
“PSC has attempted to collect from Named Plaintiffs and the Class members on behalf of others, who were required to be licensed but who were not when they filed lawsuits that resulted in void and unenforceable judgments, by seeking garnishments and making threats of garnishments through the court system without the right to do so,” the complaint states. “PSC knows the named Plaintiffs’ and Class members’ judgments are void and unenforceable (as a matter of law) but it acted anyway to conceal these facts from the courts and debtors.”
Philip Collins, a partner with Protas, Spivok & Collins, declined to comment on the lawsuit.
Phillip R. Robinson of the Consumer Law Center LLC in Silver Spring, an attorney for the plaintiffs, did not return a call seeking comment on the lawsuit. Earlier this year, Robinson was part of a team that won a $38.6 million jury verdict against LVNV on behalf of a nearly 1,600-member class. LVNV has appealed the decision.
Under Maryland law, an unlicensed collection agency cannot “shield its collection activities” through the use of law firms that operate under a separate license, the suit states. However, as part of its creditor’s rights practice, Protas, Spivok & Collins filed garnishments on behalf of LVNV in Maryland courts, seeking to collect from class members, the complaint states.
The suit alleges Protas, Spivok & Collins has known that it could not collect a judgment entered in favor of an unlicensed collection agency since at least 2013, when the Court of Special Appeals held in a reported opinion that such a judgment was void.
Amy Jernigan, one of the named plaintiffs, was sued by LVNV Funding in 2009 based on a consumer debt LVNV acquired in default. LVNV won a judgment against her, and Protas, Spivok & Collins sought garnishment of Jernigan’s assets at PNC Bank in June 2015. The law firm did not disclose, to her or to the bank, that the judgment was void and unenforceable, according to the suit.
The second named plaintiff, William Bonilla, was sued by LVNV in 2009 in a similar case, the complaint states. Protas, Spivok & Collins first demanded Bonilla pay the judgment and later threatened to use the court system to collect from him. Eventually, Bonilla paid the firm $900 that it was not entitled to collect, the suit states.
The lawsuit alleges violations of the Fair Debt Collection Practices Act and seeks $500,000 in statutory damages for the class members.
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