Serving MD, DC, & VA

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Annapolis, MD 21401

Month: June 2019

Post-Filing Modification Prevents Student Loans From Being Discharged in Bankruptcy


Naffis v. Xerox Education Services, LLC AP No. 15-0078 February 6, 2019 Consumer sought to discharge student loans but after filing the bankruptcy, the consumer consolidated his loans, which made them a “post-petition” debt and therefore not dischargeable. The consumer then Amended his Complaint to add violations of the Fair Debt Collection Practices Act (“FDCPA”) and the Maryland Consumer Debt Collection Act (“MCDCA”) because the servicer persuaded him to consolidate his loans, causing him to lose the opportunity for discharge. The servicer, Xerox Education Services, LLC (“XES”) filed a motion for summary judgment. The Court held that because the student loans were not in default at the time XES became the servicer, the FDCPA does not apply to them in this case.  The FDCPA states that “the term debt collector does not include any person collecting or attempting to collect any debt owed or due or asserted to be owed…Read More

Collateral Legal Disputes Not Appropriate For FCRA Action


Bornstein v. Trans Union LLC, et al, CV-18-04773-PHX-JJT June 5, 2019 Doctor’s office failed to bill insurance on time and did not get reimbursed.  A healthcare collection company assumed the debt and debt showed up on Plaintiff’s credit report.  Plaintiff sued under the FDCPA and FCRA stating a claim of negligence and willfulness for failing to remove the tradeline since she didn’t owe the debt, her insurance should have paid. Court grants Defendants’ Motion to Dismiss the FCRA claims as whether or not she owed the money is a legal question, not a factual question.  Therefore the report is not factually inaccurate.  Citing Carvalho, the Court said “because CRA’s are ill equipped to adjudicate contract disputes, courts have been loath to allow consumers to mount collateral attacks on the legal validity of their debts in the guise of FCRA reinvestigation claims.” The Court held that the Plaintiff’s Complaint raises a…Read More