A Montana federal jury ordered collection law firm Johnson, Rodenburg & Lauinger to pay a disabled former janitor $311,000 in damages because it pursued his $3,000 credit card debt after the statute of limitations had expired.
The 9th Circuit (Montata) Court found the firm violated federal and state fair debt laws, as well as state torts of malicious prosecution and abuse of process.
Tim McCollough claims that he and his wife fell behind on their credit card bills after he suffered a brain injury while working as a school custodian. He stopped making payments on his account with Chase Manhattan Bank in 1999, leaving an unpaid balance of approximately $3,000
McCullough received $736 a month in Social Security benefits. He told the court that Chase "harassed and insulted him" by calling at all hours when his Workers' Compensation insurance ran out.
McCullough eventually retained a lawyer, sued for damages and a jury settled on the $311,000 sum - $250,000 of the award being for emotional distress.
A three-judge panel, which included retired Supreme Court Justice Sandra Day O'Connor sitting by designation, declined to reduce any part of the award or give Johnson Rodenburg a new trial, saying the firm's error was its own to prevent.
"Substantial evidence supports the jury's findings of both a lack of probable cause and malice," the 30-page decision, authored by Judge Sidney Thomas, states. "[McCullough] thought that the lawsuit was 'frivolous' and 'an insult,' and that he was 'being shoved around.' We thus must conclude that the award was not based on speculation and guesswork, but rather on the jury's valuation of McCollough's emotional distress."
