Discover Bank May Not Be Able to Sue PA Consumers Who Defaulted More than 3 Years Ago

by Joseph Mullaney on August 26, 2011 · 12 comments

Today, our client won a decisive FDCPA victory against Stock & Grimes, LLP and, indirectly, against Discover Bank.  Our client alleged that Discover Bank through its debt collection law firm, Stock & Grimes, sued her in Pennsylvania after the expiration of Delaware’s 3-year statute of limitations.  Her opponents predictably, and “not surprisingly” according the Court, argued that Pennsylvania’s 4-year statute of limitations should have applied.  The Court accepted our client’s arguments that because Discover Bank is located in Delaware, the Delaware 3-year statute of limitations should apply.  The Court reasoned that if Discover Bank is a Delaware bank then when our client did not allegedly pay Discover Bank, it felt the damages of the non-payment in Delaware.  The Court said, “the place where the claim in the underlying action accrued was in Delaware,” and, therefore, “because the claim accrued outside of the Commonwealth, the shorter three-year Delaware statute of limitations governed…”

Our client relied on Pennsylvania’s “borrowing statute” to import Delaware’s statute of limitation law into her action.

Our client’s win permits her to seek her substantial damages against Stock & Grimes under the FDCPA for filing the time-barred, Discover Bank lawsuit.  Her case provides a new shield for Pennsylvania consumers against stale debt collection actions, and it provides a sword under the FDCPA allowing consumers to recoup damages against the debt collectors who improperly file them in the first place.

The Court’s opinion is here: Hamid v Stock & Grimes – 12(b)(6) Denied.

Pennsylvania and New Jersey consumers who believe their fair debt collection rights have been violated are invited to click here for a no-obligation assessment of their consumer law matter.

Tagged as: debt collection, discover bank, fair debt, fdcpa, stock grimes

  • What a joke

    Yeah, they are harassing you by asking you to pay for what you have stolen by charging things you didn’t pay for. LOL
     
    Written like a true liberal puke!

  • What a joke

    Yet again, another liberal courts decision finds nothing but the American victim who should not be responsible for their actions. The statute should be universal throughout the US and should be set at 7 years. If you have credit and plan on stealing items by charging without ever intending to repay, criminal charges along with a civil charge should be applicable. Way too many know they can get away stiffing their obligations and the courts in this country are a freaking joke!
     

  • CreatureComfort

    When Discover Bank tried to collect this expired debt, this client was lucky in getting a law firm to defend her who could shield her against having to pay such a stale debt.

  • Anonymous

     An across the board statute would make things a lot less confusing and could possibly make it easier for consumers to defend themselves. I’m usually supportive of states having their own individual laws, but in this case it would be beneficial for everyone to be on the same page.

  • Mimsey

    There should be a protection against stale debt collection actions against consumers. This victory for the client shows that the little guy can actually win for a change.

  • MaybeNot

    I’m glad to see that there really is a statute of limitations on debt. It’s hard for folks who are trying to climb out of debt to have to make up for everything in the past. Otherwise, they’d never climb out.

  • Anonymous

    Wouldn’t it be easier if the statute of limitations was the same in all the states? Not just for the credit card companies, but for the consumer too. Seems like it would cut down on some of the abuse of such statutes.

  • sellmore

     I agree that the credit card companies can’t have it both ways.  It’s about time they were cracked down on, too.  The recent laws that were passed helped but aren’t strong enough.

  • Anonymous

    Her argument makes sense. If Discover Bank can incorporate in Delaware to avoid taxes, which is why so many credit card companies are based there, then the consumer should benefit from the shorter statute of limitations of 3 years. The credit cards companies can’t have it both ways.

  • Jamie

    Good to hear that the court upheld the argument that the location of the actual creditor was the applicable location to be used for determining governing laws.  Debt collection agencies are tricky and will try every angle they can.

  • Anonymous

    I am glad this woman won her case. My state has a seven year statute of limitations, and the debt collectors are more than happy to harrass you for every minute of it.

  • Anonymous

    Yet another consumer victory over sleazy debt collection practices! What kind of damages can she pursue in this case? Is it just a matter of recouping her cost of the lawsuit?

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