Belsky Weinberg & Horowitz, LLC A Personal Injury & Workers’ Compensation Law Firm

Thousands of Debt Collection Cases Dismissed by Maryland District Court Pursuant to Settlement Agreement with Debt Collection Agencies

The following announcementwas issued by the Maryland Judiciary in its Website which affects thousands ofconsumer debtors and is reproduced here in its entirety:

"(ANNAPOLIS, Md. - July 11, 2012)On July 10, Chief Judge Ben C. Clyburn of the District Court of Marylanddismissed 3,564 debt collection cases against Maryland residents. Judge Clyburn's ordercomes after a settlement agreement with the debt collection agencies LVNV andResurgent Capital Services.

As part of the agreementreached with the Maryland State Collection Agency Licensing Board, LVNV andResurgent will pay $1 million to the state and agreed to the dismissal of casespending in Maryland District Court. Also, $3.8 million in credit will beapplied to the accounts of 6,246 consumers whose cases have been adjudicated orsettled. The settlement came after claims that LVNV and Resurgent violatedstate and federal laws about licensure and submitting false or misleadingclaims or affidavits in court.

LVNV is part of a newindustry - "debt buying," - that has clogged the dockets of small claims courtsin Marylandand throughout the country, particularly during the current recession. Debtbuyers specialize in buying debts that have been abandoned by the originalcreditors, usually credit card companies, for a tiny fraction of the amountowed. Debts may be sold to other debt buyers several times, and the documentationto prove the debt is owed sometimes is little more than the person's name, lastknown address and Social Security number.

"In this currentrecessionary economy, the District Court has been seeing an increasing numberof debt collection cases," Judge Clyburn said. "We have been responding to manyissues related to debt-buying and we now have new rules in place that help makethe process more transparent, give the judge more information, and level theplaying field for consumers."

The 3,564 cases dismissed yesterdaywere dismissed before judgment and "without prejudice," which means a case iseligible to be re-filed in the future.

Defendants whose cases havebeen dismissed or who will receive a credit will receive written notificationfrom the District Court of Maryland. To get more information, Maryland residents should contact thelocalDistrictCourt locationwhere the debt collection case was filed. In additionto sending written notices to the people affected by this settlement, theDistrict Court is directing that court records and theJudiciary Case Searchpublicrecords website be updated to show the dismissals. The records should beupdated within the next month."

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