Law Firm Loses Debt Collection Case; Plaintiff's Attorney to Seek 6-Figure Fee
A federal judge has ruled against a New York law firm in a hard-fought case over its debt-collection practices, finding after a bench trial that Upton Cohen & Slamowitz conducted a “superficial” review that didn’t meet the standard required for a collection letter from an attorney.
Section 1692(e) of the federal Fair Debt Collection Practices Act prohibits debt collectors from falsely representing that a letter is from an attorney. The Upton firm’s demand letter to Arthur Miller in a department store collection case violated this statutory provision, ruled U.S. District Judge Roslynn Mauskopf, because the Upton firm made little or no effort to verify information it received on Miller from Lord & Taylor’s outside counsel in Maryland, reports the New York Law Journal in an article reprinted in New York Lawyer (reg. req.).
The firm, which is now known as Cohen & Slamowitz, had a computer system, Mauskopf held, that permitted a debt collection letter to be based “on little more than the debtor’s identifying information, the client name and the balance due.”
Following her decision in the almost 10-year-old matter, in which Lord & Taylor sought $1,618 to satisfy an allegedly unpaid account and another $324 in attorney’s fees to collect the bill, Miller’s lawyer, Brian Bromberg, says he intends to seek a six-figure attorney fee under the FDCPA, which provides for payment of a prevailing plaintiff’s legal costs. Statutory damages for the plaintiff are capped at $1,000.
Bromberg admits that a 2005 decision by the 2nd U.S. Circuit Court of Appeals permitting a law firm collection letter to note that the file hasn’t been reviewed by an attorney somewhat limits the scope of Mauskopf’s holding, the legal publication reports. However, he says it nonetheless “digs a grave” for lawyers who pursue a collection case with “no information, no documents, and no meaningful attorney review.”
Attorney Thomas Leghorn of Wilson Elser Moskowitz Edelman & Dicker represents the Upton firm. He says the judge “got it completely wrong” and insists that the evidence shows a lawyer was involved at every step in the case.
