If a collection company sues me in Chicago what should I do?

by Timothy Deffet

Since the arrival of the recession a few years ago many Illinois families have been faced with the challenge of paying their mortgage while still being able to buy groceries.  Some things such as credit card payments may fall last in line in that situation. Eventually, the credit card company may sue or may sell the alleged debt to a “third party debt buyer” to collect on the debt.

Unfortunately, many of the clients I represent are all too familiar with this scenario. I fight for people who have been injured in severe accidents.   Also, I represent people injured in trucking accidents in Illinois. Many times these people are the breadwinners in their families and with their inability to work the family economy breaks down. If you have a question about what to do after getting in a car accident see Tim’s Ten Tips. For advice on what to do after being injured in a workplace accident see my previous post here.

If you find yourself in a situation where you are being sued by your credit card company here are a few tips to get started. Facing a lawsuit can be a daunting task. However, all is not lost. Remember that you can get through this. You just have to be smart and take the time to get informed about the process. Trust me you are not the first person to be sued on a debt, nor will you be the last.  In fact, a good portion of your friends and family have probably been in this situation, whether you are aware of it or not. Don’t lose hope. You will get back on your feet.

First, collection companies are required to be licensed in Illinois-if they are not the complaint can be dismissed and there may be a claim against them for blatanly ignoring the law. Look up the company with the Illinois Department of Financial and Professional Regulation (“IDFPR”) here.

Second, you should examine the summons and complaint that is served upon you.  The summons is the piece of paper which has the caption of the case and it tells you what courthouse in Illinois the plaintiff has chosen to bring the suit, as well as what date and time to file your answer or “appearance”. An appearance is a document you file with the court and mail to the plaintiff telling them where to send documents, notices or orders on the case. Mark this down on your calendar because it is very important.

In Cook County First Municipal District cases, an appearance needs to be filed by 9:30 a.m. on the return date.  At that point, a status date (court date in which all parties must appear to inform the judge of the issues on the case) is given which you should put on your calendar. It is a good idea to file an appearance as soon as possible before the return date. The Clerk’s Office is extremely busy and may not file the appearance on time. Therefore a default judgment could be entered against you if you do not file it very soon after being served with the complaint.

Another thing to do when you examine the complaint is to look and see what entity is listed as the plaintiff. For example, if you had a credit card with Discover, are they in fact listed in the plaintiff section or does it say something like “LVNV Funding, LLC, Assignee of Discover”? If that is the case, then you have what is likely a “third party” case. This means that you have a greater chance of success in negotiating or dismissing the case outright. This is because companies like LVNV buy debts for cents upon the dollar from the company that alleges you have a debt owed.

However, LVNV many times does not keep the appropriate ownership documentation that is required to sue you. In fact, many times they sue THE WRONG PEOPLE and do it with impunity. However, they will never admit that. A seasoned attorney can file a motion to dismiss for you in this situation. In addition, this attorney could find affirmative claims against this company for filing a case without the appropriate documentation.

It is a violation of Illinois and federal law to file a case when you do not have the “assignment agreement”, which is the document which demonstrates the true ownership of the debt if it in fact has been sold from the original owner. Otherwise, the same person could be sued twice or more on the same debt even if they are not the alleged debtor or if they already paid it! Do you think this does not happen? Think again. Google “LVNV” lawsuits and you will see the nightmares numerous people have to go through defending bogus lawsuits against this company. The result is ruined credit and years of repairing it through expensive methods. For example, they were banned from operating in Maryland as mentioned here for attaching misleading or false affidavits to their complaints and suing on old debts, among other varied charges.

Third, if there is an affidavit attached to the complaint Google the person who signed it. In various instances they may have been forged or the information they have sworn to is misleading or false. Remember the whole “robosigning” epidemic with many of the larger banks in the United States? Several banks had forged signatures on mortgage documents or put these “robosigners” in rooms where they literally just signed affidavits all day without reviewing the information contained in the affidavits to see if it was in fact accurate. A discussion of  this is mentioned here. Well, the same thing has been happening with credit card or third-party cases. Companies have employees sit in a room for hours at a time and all they do is sign affidavits without verifying that any information they are swearing to is in fact accurate. The New York Times has a great article here about robosigning and Chase Bank.

Last, basic defenses may be available to you such as: 1) invalid service of the complaint (was complaint served at the right address, with the correct person?), and 2) statute of limitations (has the plaintiff waited too long to sue you on the debt and therefore the claim can be dismissed in its entirety?).

In summary, I have tried to touch on basic defenses involving credit card debts. Each state has its own laws that have to be consulted before planning your attack. Speaking with a Chicago attorney is probably a wise idea before taking any action. Most will give a free consultation. In addition, if you want a summary of possible pro bono help look at my previous blog post here.

It is important to note that this blog post is merely an introduction to defending these cases. Consultation with a Chicago or Illinois attorney well-versed in these matters is recommended.

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