Federal Court rules Pressler complaint violated FDCPA

Hot off the presses, below is a passage from the June 30, 2014 opinion of the Hon. Kevin McNulty, United States District Court for the District of New Jersey. The case, captioned Daniel Bock Jr vs. Pressler & Pressler, Civ. No. 11-7593 (KM)(MCA), involved a defendant who was sued by Pressler for an old credit card debt.

The defendant turned around and sued Pressler for violations of the Fair Debt Collections Act. The debtor alleged that Pressler’s attorneys do not thoroughly review the Complaints filed against debtors before they file same with the Court. The Court ruled that Pressler did violate the FDCPA, and that Pressler is liable for damages to the defendant.

The Court found that the attorney for Pressler charged with reviewing and signing Complaints spent only 4 seconds reviewing the Complaint against the defendant in this case. Below is a portion of the opinion that speaks to this issue:

From the opinion in the matter of  Daniel S. Bock, Jr. vs. Pressler & Pressler,  Civ. No. 11-7593 (KM)(MCA) (opinion dated June 30, 2014):

D. Did Pressler’s review of the state court civil complaint against Bock comply with the FDCPA requirement of meaningful attorney involvement?

Ralph Gulko, Pressler’s only attorney handling collection complaints filed
in New Jersey courts, signed the complaint against Bock. He did not draft the
complaint, and he did not carefully read and review it in any meaningful sense.
He did not conduct any inquiry concerning Midland’s claim against Bock, let
alone one which could have permitted him to form a good faith belief that the
allegations against Bock had evidentiary support and were actionable under
applicable law. Accordingly, Pressler violated the general prohibitions of 15
U.S.C. § 1692e, as well as subsections (3) and (9) in particular.

First, the undisputed evidence shows that Gulko, and by extension,
Pressler, neither drafted nor carefully reviewed the complaint. Mr. Gulko was the
only attorney involved in the entire process. He admits that the draft complaint
was on his computer screen for no more than four seconds. (Gulko Aff. at ¶ 12).
He states that his brief review consisted of comparing certain contents of the
complaint, displayed on one of his computer screens, to data appearing on his
other computer screen, to ensure the complaint’s accuracy. (Id. at ¶J 5-6, 8). The
evidence shows, then, that in those four seconds Mr. Gulko’s eyes darted back
and forth between his two computer monitors making sure the debtor name,creditor name, and amount of indebtedness stated on the complaint reflected thedata file stored by Pressler. (See id.). Gulko’s rapid look-over of the complaint

against Bock, one of 673 complaints he reviewed that day (Gulko Aff. at ¶ 12),
cannot really be considered a careful review of the complaint, let alone an
exercise of the professional skills of a lawyer.
Second, even if Gulko had somehow managed to carefully review the
complaint in those four seconds, it cannot be said that he conducted any inquiry
into Midland’s claim against Bock. There is no dispute that neither Gulko nor
any attorney at Pressler had any involvement in the Bock matter prior to Gulko’s
final review on October 20, 2010. (See Gulko Dep. Testimony at 26:14 to 27:12;
Gulko Aff. at ¶ 9; Felt Aff. at ¶J 9-26). I find that no inquiry whatever could
conceivably have occurred within the time that Gulko spent reviewing the
complaint against Bock. This fleeting review was not sufficient to permit an
attorney to form a good faith opinion concerning the evidentiary support for
Midland’s claim against Bock or the applicable legal basis for that claim. That is
an inescapable inference from the four-second duration of Gulko’s review— but
there is more. The undisputed evidence confirms that neither Gulko nor anyone
else at Pressler (including its vaunted computer system) ever reviewed basic
materials like the underlying cardmember agreement (to confirm that there was
a legal basis to collect from Bock, to confirm what law governed, and to confirm
that venue was proper). No one at Pressler reviewed the assignment that allegedly
transferred ownership of the debt to Midland. (See Bock’s Statement at ¶J 47,
50; Pressler’s Resp. Statement at ¶ 47, 50). Yet the very first allegation in the
complaint against Bock is that “[Midland Funding LLC] is now the owner of the
defendant(s) [sic] HSBC Bank Nevada, N.A. account number 5458001561298245
which is now in default.” (Williamson Cert. at Ex. B). There can be no legitimate
contention that Gulko, through reasonable inquiry, arrived at a good faith belief
in the truth of this allegation. Yet, by filing a complaint, he impliedly represented
that he had.

If there were evidence in the record that the attorney had acquired
knowledge of the pertinent contents of the cardmember agreement or the chain
of assignment through some other, indirect means, it might be possible to give
less weight to the four-second duration of review. But there is no such evidence;
Pressler took the electronic data at face value. The inquiry implied by the
attorney’s filing of the complaint simply did not occur.
Pace Pressler’s objections, the preparatory actions taken by other nonattorneys
at the firm do not insulate this complaint from a charge of deception.
Miller, 687 F. Supp. at 101 (“Even prior review of an individual debtor’s file by
another, including co-counsel, is not substitute for an independent review by the
attorney signing and issuing [a communication].”); Nielson v. Dickerson, 307 F.3d
at 635-37. Those preliminary “scrubs,” in any event, were largely concerned with
basic “pedigree” data and red flags, like bankruptcy, that would bar a suit. And,

as noted above, no person or computer at Pressler ever checked the cardholder
agreement or the chain of assignment.
In sum, the evidence shows that the only attorney involvement in
connection with Midland’s claim against Bock prior to Pressler filing suit on
Midland’s behalf was a hurried, ministerial review of the accuracy of certain
aspects of the complaint. There was no reasonable inquiry or exercise of
professional judgment. This would not meet the Lesher/Nielson standards for
meaningful attorney involvement when sending collection letters, and it does not
meet the standards for filing a complaint.
There is no genuine material issue of fact requiring trial. I hold that
Pressler, when it signed and filed the state court civil complaint against Bock,
violated the FDCPA,15 U.S.C. § 1692e.
For the reasons stated above, the motion for summary judgment of Bock
is GRANTED and the motion for summary judgment of Pressler is DENIED. The
parties shall, if they wish, submit letter briefs not to exceed ten pages as to the
appropriate measure of damages. Plaintif




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