Consumer Sues Florida Debt Collector for $800, Receives $120,000

Hollywood, FL — Scott D. Owens, a partner at Cohen & Owens, P.A. (www.DebtDefense.com), has settled a federal lawsuit filed on behalf of Steven J. Pincus against a Florida-based debt collection law firm, The Law Offices of Erskine & Fleisher. The federal lawsuit was originally filed in the Southern District of Florida on November 14, 2008 (Steven J. Pincus v. The Law Offices of Erskine & Fleisher, et al., Case No. 08-CV-81357).

On November 20, 2007, Steven J. Pincus was sued in Palm Beach County Small Claims Court for a 3.5 year old Capital One Bank credit card debt of $803.95 dollars (Capital One Bank v. Steven J. Pincus, Case No. 502007SC016285). Though Pincus disputed the debt, he offered the credit card company a few hundred dollars to simply make the case go away and move on about his life. Capital One Bank rejected his offer so Pincus decided to hire Hollywood, Florida Attorney Scott D. Owens to defend him in state court and level the playing field against the $165 billon dollar credit card giant.

To the shock and horror of Pincus, Capital One Bank and its Florida attorneys launched a crusade against the 56 year old resident of Boca Raton, forcing him to incur more than $100,000.00 dollars in legal fees. Pincus’s attorney argued that although the case was filed in Florida, the proper time frame to file suit should be determined using Virginia law, which has a three year statute of limitations as opposed to Florida’s four year statue of limitations governing credit card debts. The legal argument is considered rather novel as most attorneys are unaware that debt collection lawsuits may be subject to another state’s (shorter) statute of limitations.

“Its right there in black and white,” explained Owens, “though somewhat obscured in the six point font multi-page cardholder agreement, it does in fact state that the governing law is that of Virginia – not Florida.” Owens further elaborated, “it gets a little less clear as to what is the applicable statute of limitations in Virginia, however, in order for it to be considered a written contract and thus subject to a five year limitations period, the agreement must be signed by the consumer – the Capital One Bank cardholder agreement, like most others, is never in fact signed by anyone.” In September 2008, Palm Beach County Court Judge Ted S. Booras ultimately agreed with Pincus’s attorney, ruling that that the cardholder agreement was “an oral contract subject to Virginia’s three year statute on limitation which was violated by the filing of this action in excess of three years from the date of the last transaction.”

Shortly thereafter, Pincus turned the tables and again hired Owens, this time to go after the Capital One Bank’s attorneys in federal court. Pincus filed a one count complaint for violation of the Fair Debt Collection Practices Act (FDCPA). Owens explained, “as an original creditor, Capital One Bank is typically exempt from the FDCPA but their debt collector attorneys do not enjoy this luxury.” The FDCPA allows plaintiffs to sue for $1,000.00 dollars in statutory damages plus any actual damages suffered by the consumer. Attorneys, such as Owens, are able to file such actions because the statute allows the for the recovery of attorney’s fees and costs. The federal case was also heavily litigated but eventually the Defendants relented and settled the lawsuit on February 15, 2010 for $120,000.00 dollars. “They didn’t admit any fault,” said Owens, “but then again law firms don’t generally write large checks when they think they’re in the right.”

Mr. Owens has filed several similar actions in federal court against other Florida debt collectors. He hopes that the Pincus settlement will give pause to those debt collectors who continually file time-barred lawsuits.

About Scott D. Owens, Esq.
Scott D. Owens, is a partner at the law firm of Cohen & Owens, P.A. located in Hollywood, Florida. The focus of his practice is consumer protection, which encompasses both defending debt collection lawsuits in state court and litigating claims against debt collectors in federal court, principally for violations of the Fair Debt Collection Practices Act (FDCPA). Mr. Owens is a 2000 graduate of New England School of Law and an active member of the National Association of Consumer Advocates (NACA).