Hamid v. Stock & Grimes. In this consumer protection matter, a Pennsylvania consumer sued Stock & Grimes, LLP, a debt collection law firm, under the Fair Debt Collection Practices Act (FDCPA). She sued Stock & Grimes for having first sued her in a state-court debt collection action. She defended against the collection action claiming that the Pa. Borrowing Statute, 42 Pa. C.S.A. § 5521, did not permit Stock & Grimes’ client, Discover Bank, to pursue the collection action. She claimed that because Delaware law (where Discover Bank is located) had a shorter statute of limitations than Pennsylvania, the collection action was time barred. Rather than wait for the Pennsylvania courts to resolve her defenses, she settled Discover Bank’s collection action to buy her peace.
Stock & Grimes Should Reimburse the Consumer for Her Unnecessary Settlement Payment
In her FDCPA lawsuit against Stock & Grimes, the consumer claimed that the defendant owed her the settlement payment she paid to Discover Bank. She alleged that had Stock & Grimes not sued her on the time-barred debt in the first instance, she would not have had to pay a peace payment to Discover Bank to get out of the state-court litigation.
After several dismissal and reconsideration motions, discovery motions, and summary judgment motions, the consumer emerged victorious in her federal FDCPA action against Stock & Grimes. All that remained was a trial to determine her damages.
Court Allows Evidence of the Settlement Payment Against Stock & Grimes
Undeterred, Stock & Grimes then filed an in limine motion seeking to preclude the consumer from admitting evidence about her peace payment to Discover Bank. The federal court denied Stock & Grimes’ in limine motion holding, “debtors may recover the amount paid to settle a debt, if the debt collector violated the FDCPA in making the collection….” Thus, the consumer would be allowed to request a jury to award her as a damage the money she paid Discover Bank to end the improperly-filed and time-barred collection action.
Hamid v. Stock & Grimes, LLP stands for very important propositions in FDCPA law and explores the depth and breadth of damages consumers incur when unfairly sued on stale debts.