PowerPoint
Press Release
Attempt to Create FDCPA Student Loan Class Action Defeated:
Falu-Maysomet v. National Enterprise Systems, Inc
June 6, 2014

SAN DIEGO — Partners Mark Ellis and Andrew Steinheimer have defeated claims by a student loan debtor in U.S. District Court that National Enterprise Systems, Inc. violated the Federal Debt Collections Practice Act and its California law counterpart, Rosenthal FDCPA.

Falu-Maysomet v. National Enterprise Systems, Inc. involved allegations that the defendant used deception and unconscionable practices to collect a debt. Such conduct, the plaintiff further argued, warranted a class action under California law.

At issue was a notice whose cover page stated the plaintiff’s employer would be ordered to “immediately” garnish her wages unless she took “action set forth in this notice.” The cover page further stated the defendant would impose wage garnishment if the plaintiff did not enter into a written repayment agreement with the defendant within 30 days.

Although subsequent pages explained the Higher Education Act afforded the plaintiff 30 days to pursue other options to avoid wage garnishment, the plaintiff contended this information was “squirreled away” and that the cover page misled her to believe entering into a repayment agreement was her only option to wage garnishment. Jeffrey T. Miller, district judge in the U.S. District Court’s California Southern District, ruled that even the least sophisticated debtors would glean from the notice they could pursue one of several steps to avoid wage garnishment.

On the second page, for instance, were the bold and underlined words, “You have the following rights regarding this action,” followed by a bulleted list of a debtor’s HEA rights. Moreover, five out of six pages in the notice were dedicated to requesting a hearing to challenge wage garnishment.

Click here for text of the decision.

—End of Press Release—

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Articles on areas of law that were involved in this case include:

THE CURRENT STATUS OF EXCESSIVE CALL “HARASSMENT”
By Mark E. Ellis
The definition of collection call "harassment" circa 2012 under the federal Fair Debt Collection Practices Act (FDCPA) and California's Rosenthal FDCPA.

FINDING THE SILVER LINING IN JERMAN
By Mark E. Ellis
Jerman v. Carlisle is only the second case decided by the United States Supreme Court to analyze the text and legislative history of the FDCPA. 

ALRIGHT, YOU’VE BEEN SUED, NOW WHAT DO YOU DO? (Reprise)
By Mark E. Ellis
A litigation guide for collection agencies whom, odds say, will someday be sued for violating the Fair Debt Collection Practices Act (FDCPA), or some other similar law, such as California’s Rosenthal FDCPA.

2009 YEAR IN REVIEW: THE ROSENTHAL FDCPA
By June Coleman
The year 2009 saw more than 100 cases published in some fashion that referenced and interpreted the Rosenthal FDCPA. This article analyzes trends arising from these court decisions.

THE ROSENTHAL FDCPA
By Mark E. Ellis and June D. Coleman
With increasing frequency, claims have been asserted against collection agencies alleging violations of California’s Rosenthal Fair Debt Collection Practices Act (“Rosenthal FDCPA”), Civil Code sections 1788, et seq. Given this increasing interest by the plaintiff’s bar, this article offers an overview of the Rosenthal FDCPA.

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