Lawsuits Filed Against Agencies, Creditors Decline

The number of collection agencies and creditors sued between August 1-15 totaled 426, down from 488 sued in the July 16-31 period, but up from 389 in the first half of July, according to data from U.S. District Courts.

Consumers filed an estimated 454 total lawsuits under consumer statutes in the first half of August, including an estimated 433 Fair Debt Collection Practices Act cases. Between July 16-31, consumers filed an estimated 533 total lawsuits. In the first half of July, the estimated total was 409, according to WebRecon LLC, the Grand Rapids, Mich.-based research firm that compiles the totals from the courts.

The August data, along with the FDCPA cases, includes 30 Fair Credit Reporting Act lawsuits, 15 Truth-in-Lending lawsuits and 10 Telephone Consumer Protection Act cases. There also are various state consumer statute lawsuits in the total, including 28 in California.

An estimated 469 unique plaintiffs are included in the total, including 153 who previously sued under consumer statutes. Combined, those 153 plaintiffs have filed an estimated 850 lawsuits since 2001.

Year-to-date, plaintiffs have filed 7,169 lawsuits, including 6,711 FDCPA cases. Jack Gordon, WebRecon’s chief executive, predicts FDCPA lawsuits will spike this year to nearly 12,000, up from the record 8,287 in 2009. However, he also has said that the record total would represent a cooling off in the actual growth rate, see story.

Sergei Lemberg is the most active consumer attorney this year, representing 241 consumers in lawsuits. In June, Lemberg criticized the collection industry in a statement to the press, see story, for blaming consumer attorneys for a spike in lawsuits, which he argued are rising because of increasingly aggressive tactics by collectors.

Editor's Note: To comment on this story, contact Darren Waggoner at 815.463.9008 or darren.waggoner@sourcemedia.com.