Articles Posted in Class-Action

 

What Do You Do When a Debt Collector Calls? Tips On What They Can and Cannot Do
3/10/2010
Source: By Kalamazoo Gazette staff

The Fair Debt Collection Practices Act lays out clear rules about what debt collectors can and can’t do — and it allows you to sue if you believe your rights have been violated.

Here’s what you need to know if a debt collector calls you:

Calls
Debt collectors can call only between 8 a.m. and 9 p.m. They can call you at work, but have to stop if you tell them your boss doesn’t approve.

You can write to a collection agency to demand it stop calling you at home, too, but that won’t make a legitimate debt go away: A creditor could choose to note the debt on your credit report or seek a court judgment against you.

In writing
Within five days of contacting you by phone, the debt collector must send you a letter telling you the amount you owe, the name of the creditor you allegedly owe it to and instructions for disputing if you don’t believe the debt is yours. If you get a collection call, log the date on your calendar and start looking for that letter.

Taping
If you’re getting calls you believe are abusive, you might consider taping them. Most states, including Michigan, allow you to record phone calls as long as one party to the conversation (for example, you) knows the call is being recorded. A few states require everyone on the line to know. Check the rules before you tape.

Record-keeping
Getting one debt collection call could mean you’re in for others. That’s because debts may be resold over and over. Or if a consumer demands verification, the account may be bounced back to the original account holder, who ships it off to a new debt collector. To protect yourself, keep copies of letters, logs of calls, canceled checks or other documents relating to the account — and plan to keep them for years.

Fighting back
If you suspect a debt collector isn’t playing fair, complain to both the Federal Trade Commission (1-877-382-4357) and to the [Illininos] attorney general.

You also can stop repeated or harassing calls by going to court [and hiring an attorney].

More information
The FTC’s free Fair Debt Collection fact sheet is available online at this location or call 1-877-382-4357.

Calling No-Nos
Debt collectors are forbidden to:

• Harass you or people who know you.
• Talk to anyone except you (or the attorney that you designate) about the debt.
• Call people you know for any reason except to locate you.
• Physically or verbally threaten you.
• Swear at you or call you names.
• Call you repeatedly (or call you right back if you hang up on them).
• Imply they’re government employees or work with government agencies.
• Say they’re attorneys, if they’re not.
• Falsely imply you’ve committed a crime (debts are civil, not criminal).
• Misrepresent the amount you owe.
• Ignore your written denial of the debt. (They need to show you proof it’s yours or assure you the matter has been dropped.)

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Our Naperville wage and hour rights attorneys noted a recent ruling out of Massachusetts that could be important for police officers and firefighters around the United States. In Calvao et al. v. Town of Framingham, No. 09-1648 (1st.Cir. March 17, 2010), the First U.S. Circuit Court of Appeals ruled that employers don’t have to notify their public safety workers when they take advantage of a special provision in the Fair Labor Standards Act that exempts them from the ordinary 40-hour work week. Instead, these employers are permitted to establish “work periods” of seven to 28 days, after which the employees must be paid overtime. The plaintiffs, a class of about 100 Framingham, Mass. police officers, believed that the Town of Framingham was not eligible for this exemption because it never “established” the work period by notifying them of its existence.

The FLSA was amended in 1966 and 1974 to apply to state and municipal workers. This triggered concerns about costs from local governments, which ended partially with Congress enacting the section of law at issue in this case, which allows a longer period before overtime is triggered, to account for the unpredictable nature of public safety work. The Town of Framingham circulated a memo in 1986 declaring that the work period for police and fire personnel was 24 days. This worked out to about 43 hours in a seven-day period before overtime was triggered. Fourteen years later, in 2000, the police officers’ union negotiated a change in schedule from four days on and two off to five days on and three off. Both fit into the 24-day schedule. In 2005, the officers brought the instant action, suing for a declaratory judgment that they had been denied overtime because the work period had never been “established” as required by federal law. The trial court granted partial summary judgment to the defendants on this issue, and the officers appealed.

They had no better luck at the First Circuit, which found no evidence for their argument in the text of the statute, its legislative history or Department of Labor guidelines. The text of the law at issue does not require notice, the court wrote, or even suggest how an employer might establish its work period. The statute doesn’t explicitly prohibit giving notice, but Congress did explicitly give responsibility for enforcing FLSA regulations to the Secretary of Labor. Regulations enacted by people in that role “make it clear the Secretary rejected a notice requirement,” the court wrote. In fact, the Secretary in office at the time reviewed and rejected a proposed notice requirement, noting that the Act does not require one. In addition, legislative history shows that Congress expressly rejected a proposal to require employee agreement before the work period could be established.

Finally, the court rejected the officers’ argument that a Department of Labor letter ruling mandates a notice requirement. The issue was never brought up in district court and would be waved in any case, it wrote, but is also inappropriate for three reasons. One is that the letter never mentioned a notice requirement, instead saying that “”[a]n employer must designate or otherwise objectively establish the work period . . . and pay the affected employees in accordance with its provisions.” The letter was also responding to a specific court case raising issues not relevant in the instant action. And opinion letters don’t have the force of rulings, the court said, especially since the Secretary of Labor has already reached the opposite conclusion from the one the officers sought here. Thus, the summary judgment ruling by the district court was affirmed.

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Debt collectors are prohibited by federal law from engaging in deception, extortion, threats, lies, and invading your privacy by calling your friends, neighbors and employers. This video exposes illegal debt collection practices and explains practices which violate the law such claiming that you owe money which is owed by others, calling your workplace and revealing the debt, or threatening to bring suit or obtain a judgment with no intent to do so. Many debt collectors are pressured to meet sales quotas and engage in abuse to make money. Debt collectors can be persistent but they can’t abuse or lie to you to get the bills paid.

Our Oak Brook consumer rights private law firm handles individual and class action predatory lending, unfair debt collection, lemon law and other consumer fraud cases that government agencies and public interest law firms such as the Illinois Attorney General may not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. The Chicago consumer attorneys at DiTommaso Lubin are proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to consumer fraud and consumer rip-offs, and in the right case filing consumer protection lawsuits and class-actions you too can help ensure that other consumers’ rights are protected from consumer rip-offs and unscrupulous or dishonest practices.

Our Waukegan and Wheaton consumer lawyers provide assistance in fair debt collection, consumer fraud and consumer rights cases including in Illinois and throughout the country. You can click here to see a description of the some of the many individual and class-action consumer cases we have handled. A video of our lawsuit which helped ensure more fan friendly security at Wrigley Field can be found here. You can contact one of our Chicago consumer law lawyers who can assist in lemon law, unfair debt collection, predatory lending, wage claims, unpaid overtime and other consumer, consumer fraud or consumer class action cases by filling out the contact form at the side of this blog or by clicking here.

 

As Illinois wage and hour rights attorneys, we were interested in a decision establishing the scope of state courts’ right to enforce judgments obtained in other states under the Constitution’s “full faith and credit” clause. Nazario et al. v. O.J. Thrall Inc., et al., 1996 WL 285541 (Conn.Super. 1996) allowed Puerto Rican farmworkers to enforce their default judgment against a Connecticut farm operator. The Connecticut Superior court found that because the farm operator used Puerto Rican logistic, recruitment and screening services, it had enough “minimum contact” with the territory for the Puerto Rico court to establish personal jurisdiction.

Defendant O.J. Thrall, Inc. grows tobacco in Connecticut. It recruited 51 Puerto Rican workers for its growing season through an interstate clearance system created by the federal Wagner-Peyser Act. That law also regulates working conditions and pay for domestic farmworkers, including the Puerto Rican farmworkers. The workers were in Connecticut between June 12, 1991 and July 19, 1991, when they were discharged. Upon their return, they sued Thrall in Puerto Rico Superior Court for breach of contract and the federal clearance order. That court determined that it had personal jurisdiction in the case because Thrall had done business in Puerto Rico through the Wagner-Peyser job clearance system. Thrall was properly served, but the case ended in a default judgment. The workers were awarded $2,084 each in unpaid wages and $190 each in air travel expenses, plus attorney fees.

The workers then sought to enforce their judgment in Connecticut, where Thrall had its operations. Thrall fought that action, arguing that it didn’t have sufficient minimum contacts with Puerto Rico to establish personal jurisdiction. The Connecticut Superior Court started by noting that this was an issue of first impression in the state, as the only previous Wagner-Peyser Act case had to do with subject matter jurisdiction. The Constitution requires state courts to give one another’s decisions “full faith and credit,” it noted, but also limits their personal jurisdiction over nonresidents through the due process clause of the Fourteenth Amendment.

It first took up Thrall’s argument that the clearance orders it extended under Wagner-Peyser were not offers of employment, as required to establish “minimum contacts” with Puerto Rico. The Connecticut court rejected that argument. Of the 12 cases it found in the United States and Puerto Rico that discussed whether a clearance order is an offer of employment or a contract, only two declined to make such a finding. One declined to make any finding on the subject, while another found that another contract was the controlling contract. Furthermore, the court wrote, the clearance order specifically said it “describes the actual terms and conditions of the employment being offered by me and contains all the material terms and conditions of the job,” followed by the signature of Thrall’s Vice President. For those reasons, the court found that the clearance order was a unilateral contract containing an offer of employment.

The court next addressed Thrall’s argument that the local Department of Labor office in Yauco, Puerto Rico, which recruited the workers, was not Thrall’s agent and had no authority from the company. Under Connecticut caselaw, the court said, it must review whether the Wagner-Peyser Act creates an agency relationship between firms and the federal Department of Labor. This Depression-era law allowed the federal government to establish employment offices giving preference to U.S. and Puerto Rico workers over foreign workers. When hiring the workers, the court wrote, Thrall delegated its hiring authority to the Yauco office, specifically referring workers to that office rather than merely using it as a referral source. This established an agency relationship between the Yauco DOL and Thrall, the court wrote. However, the office was not under Thrall’s control, the court said, citing caselaw from around the U.S. Thus, the agency relationship was implied, not stautory. However, this was still sufficient to establish jurisdiction.

Finally, the court addressed Thrall’s argument that it had transacted no business in Puerto Rico, aside from the clearance order it was required by law to file in order to use the foreign worker program. In support, it cited a dissent from a New York case with similar facts, Rios v. Altamont Farms, Inc., 100 A.D.2d 405, 475 N.Y.S.2d 520 (N.Y.A.D.1984), which allowed Puerto Rico courts personal jurisdiction over a New York apple grower. In that case, the court wrote, the facts satisfied both parts of the two-part test laid down by the Supreme Court in International Shoe Co. v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945). The defendants used Puerto Rico services with certain awareness that their job offers would be extended in the territory, satisfying the “minimum contact” requirement. Jurisdiction was fair because a hearing in Puerto Rico imposed less burden on the defendant than a mainland hearing would impose on plaintiffs, whom the government has an interest in protecting. All of these considerations applied to the instant case as well, the court said. Thus, the judgment may be enforced against Thrall in Connecticut.

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The National Association of Consumer Advocates is the premier lawyers organization for pursuit of consumer rights. Its website is one of the best resources for consumer law issues. You can view the website by clicking here.

The website has this to say about predatory lending practices:

Predatory Lending Practices

 

In a wage-and-hour class action, the Illinois Second District Court of Appeal reversed all parts of a Kane County trial court’s ruling denying class certification. Our Chicago unpaid overtime lawyers were interested to read the ruling in Cruz et al v. Unilock Chicago, Inc., 383 Ill.App.3d 752, 892 N.E.2d 78, 322 Ill.Dec. 831 (2008), because it helped establish that trial courts may go beyond the complaint to determine class certification — but reminded them that they should not determine class certification on the merits of the case.

Wilfredo Cruz and the four other lead plaintiffs worked at Unilock Chicago’s Aurora manufacturing plant, which makes cement paving “stones.” They were hourly employees with a half-hour lunch break. In their complaint, the plaintiffs said they were required to be at their stations 10-15 minutes before work started, in uniform, to discuss anything the previous shift needed them to know. This required employees to show up 15-30 minutes early to change and get to their stations. Similarly, they say they were required to wait for the next shift to arrive before leaving, brief that shift, clean up and change. They say they punched in for these times, but Unilock had an automatic system that deducted up to 30 minutes before a shift and 15 minutes afterward, in order to meet the company’s labor budget. Furthermore, they claim that Unilock automatically deducted the 30-minute lunch break from their time records, then regularly required them to cut short or work through lunch. If necessary, these deletions would be backed up by a manual edit by the plant’s manager, who removed time before or shifts that went past the 30- or 15-minute defaults.

Unilock disputes much of this. It concedes that time records were manually edited, but said this was necessary because workers forgot to punch in or out, and that edits were confirmed with shift supervisors. This actually added time, it argued. Nonetheless, the plaintiffs sued, claiming that all of these practices resulted in underpayment of both regular time and overtime. Citing violations of the Illinois Wage Payment and Collection Act and the Minimum Wage Law, they moved to certify a class of more than 300 current and former hourly employees who had worked at Unilock’s Aurora plant since June of 1999. The trial court denied this motion for class certification, saying that plaintiffs had failed to meet any of the four standards for class certification. Plaintiffs appealed, arguing that the trial court improperly made findings of fact and rulings that assessed the merit of the claims themselves, rather than of the class certification request.

The Second District agreed. It started its analysis by refereeing the parties’ disagreement about whether courts may consider facts and allegations beyond the complaint in order to determine class certification. After a review of caselaw, the court decided that they can, relying in part on Szabo v. Bridgeport Machines, Inc., 249 F.3d 672 (7th Cir.2001). However, it was careful to say that courts should look into whether the plaintiff’s claim would satisfy the requirements for class certification, not the merits of the claim itself.

The Third next agreed with plaintiffs that the trial court had impermissibly decided several class certification issues on the merits of the case. For example, the trial court relied on depositions and pleadings when it determined that nobody had lost pay because employees who arrived early were permitted to leave early, “accept[ing] as conclusive the defendant’s evidence.” This and other examples are factual determinations that should not be determined at the class certification stage, the appeals court said. Many applied to the numerosity requirement of class certification. Not only were the trial court’s reasons for ruling on numerosity improper, the appeals court said, but evidence submitted by plaintiffs shows that 80 to 90 employees did not receive overtime, and defendants offered nothing in support of their assertion that this evidence was manipulated. For that and other reasons, the appeals court found sufficient evidence that the proposed class met the numerosity requirement.

It then addressed the requirement that class members have common questions to decide, which predominate over other issues in their cases. Again, it found that the trial court was incorrect in determining that these issues didn’t exist. The trial court wrote that there was no commonality or predominance because there was no evidence supporting the plaintiffs’ contentions about widespread unfair policies or time record manipulation. The plaintiffs argued that these conclusions ignored evidence or improperly reached the merits of the claim, and the appeals court agreed. The existence of disputed policies like requirements to work through lunch or editing time records is a common question, the appeals court said, regardless of how strong the evidence for it is at the pretrial stage. It would also be a predominant issue if the trial court determines that there was such a policy — which is a question for the merits of the claim, the court noted.

Finally, the appeals court rejected the trial court’s determination that the class representatives are inadequate because plaintiff Cruz had been a low-level supervisor. The trial court incorrectly relied on caselaw that isn’t sufficiently similar, the appeals court wrote, to determine that a supervisor cannot represent a class including the supervised. When the supervisor’s interests are the same as those of the supervisees and he or she did not participate in the alleged wrongdoing, it is inappropriate to deny his or her adequacy. Jefferson v. Windy City Maintenance, Inc., No. 96-C-7686, 1998 WL 474115 (N.D.Ill. August 4, 1998). Furthermore, if evidence implicating Cruz arises in discovery, the appeals court said, he can be discharged without discharging all the representatives. Thus, it reversed the trial court on all counts and remanded the case to Kane County circuit court with instructions to certify the class.

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DiTommaso Lubin is a litigation firm with many local clients in the Chicago-land area. Our Oak Park wage and hour attorneys recently came across an interesting case about a class-action filed in the circuit court of Cook County. Lewis v. Giordano’s Enterprises Inc. pits Plaintiff Mina Lewis, an hourly employee, against her former employer, Giordano’s, who owns and operates multiple restaurants in the Chicago metro area. The lawsuit alleged violations of the Illinois Minimum Wage Law (IMWL) and the Illinois Wage Payment and Collection Act (IWPCA) for Defendants’ automatic deduction of $0.25 per hour in exchange for making food and drink available to working employees.

This particular opinion was rendered by the Appellate Court of Illinois First District, Third Division in response to an interlocutory appeal filed by the Plaintiff. For those readers unfamiliar with legal jargon, an interlocutory appeal is a way for a party to appeal a specific issue in an ongoing case. Normally, a party must wait for a decision by the trial court before bringing an appeal to an appellate court.

In Lewis v. Giordano, the Plaintiff moved for class certification in early 2007 and the hearing on the matter was scheduled for November 14th of that year. Defendants then filed for and received several extensions of time to delay the trial court from ruling on the class certification question. Defendant obtained leave of the court initially because they had retained additional counsel shortly before the hearing date, and won a second motion to delay the ruling because of ongoing settlement discussions.

Plaintiff discovered later that during the time period after moving for class certification, Defendants obtained signed releases from employees that absolved Giordano’s of all liability arising out of the wage violations alleged in Plaintiff’s complaint. Defendants incentivized the employees to sign the release by offering them a one-time payment of ten dollars. Upon discovery of this information, Plaintiff filed a motion to prevent Defendants from obtaining any more releases and informed the trial court that there had been no good faith settlement negotiations during the time period that Defendants’ filed their motions to delay the class certification hearing. Plaintiffs also requested that the court declare all of the releases void as a matter of law. The trial court partially granted Plaintiff’s motion by enjoining Defendants from obtaining any more releases and declaring the releases obtained after the November 14th hearing date to be void. Plaintiff then filed the interlocutory appeal to the Appellate Court to have the releases signed prior to November 14th voided as well.

The Court reviewed the issue de novo to determine whether releases of claims from putative class-members obtained by an employer while a motion for class certification has been filed but not yet ruled upon are void as a matter of Illinois law. Upon review, the releases signed by employees whose wages dropped below the minimum wage rate because of the $0.25 deduction were expressly void under section two of the IMWL. The remaining releases obtained after Plaintiff filed her motion for class certification were declared void as well. The Court reasoned that public policy dictated that once a motion for class certification is filed, a defendant employer may not solicit or accept releases from putative class-members.

Lewis is a boon for potential wage and hour litigants, and serves as an inducement to Plaintiffs and their attorneys to get on the ball after filing a class action wage and hour lawsuit. The lesson here is straightforward; an experienced and prudent Aurora wage and hour attorney can prevent a Defendant from obtaining releases that will erode the number of potential class members by promptly filing a motion to certify the class after filing suit.

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A recent decision by the U.S. Court of Appeals for the District of Columbia caught the attention of our Illinois overtime rights attorneys. In Robinson-Smith v. Government Employees Insurance Co., No. 08-7146 (D.C. Cir. Jan. 5, 2010), more than 200 auto damage adjusters sued auto insurance company GEICO for unpaid overtime. The adjusters claimed that they were incorrectly classified as administrative employees, making them exempt from overtime laws. A federal district court agreed and granted summary judgment to the workers. However, the D.C. Circuit reversed that decision, saying the claims adjusters meet the definition of administrative employees because they exercise “some discretion” on the job.

The case turns on whether the adjusters exercise “discretion and independent judgment with respect to matters of significance,” as required by the Department of Labor definition of an administrative employee. The adjusters claimed they did not have sufficient discretion or independence, in part because they estimate only the price of auto damage and not liability. The trial court agreed, finding that supervisors have to sign off on some of the adjusters’ decisions, and their decisions were largely constrained by GEICO training and standards. But the appeals court opinion, authored by Judge Karen L. Henderson, said it was undisputed that the adjusters exercised at least some discretion. Because the DOL test does not include a requirement for how often that discretion is exercised or whether it’s a primary duty, the judge wrote, some discretion is enough to make the adjusters ineligible for overtime.

The case follows a similar decision from the Ninth Circuit in In re Farmers Ins. Exch., Claims Representatives’ Overtime Pay Litig., 466 F.3d 853 (9th Cir. 2006). That case had very similar facts, and was also overturned at the appeals level by a court that found the definition of “administrative employee” sufficient for claims adjusters. Like that decision, the D.C. Circuit’s decision in Robinson-Smith overturns only a grant of summary judgment for the claims adjusters. This means both sides will still have a chance to prove their claims at trial.

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As Chicago employee rights attorneys, we were interested to see what may have been the first unpaid overtime filing of 2010 in the U.S. District Court for the Northern District of Illinois. Harris v. Cheddar’s Casual Café, No. 20-cv-0045 (N.D. Ill.) was filed Jan. 5 by three former servers and bartenders who seek to certify a class of current and former employees denied overtime and tips by the Cheddar’s Casual Café chain of restaurants. Plaintiffs Donny Harris, Keith McKinstery and Shaniqua Bell allege that managers at a Cheddar’s in Boilingbrook, Ill shaved time off their timecards and required them to work off the clock in order to avoid paying overtime. They also allege that their tips were diverted to a tip pool that illegally included non-tipped workers.

The complaint in the case says plaintiffs, and other similarly situated workers, were required to clock in and out for their shifts using the chain’s computerized system. They allege that the restaurant, and manager Solomon Tristan, illegally manipulated the timesheets created by that system to remove hours. They also allege that they were encouraged to work before clocking in and after clocking out, further denying them overtime. Furthermore, the plaintiffs say, they were compelled to participate in a tip pool that included the restaurant’s “quality assurance” workers, who they say are not tipped employees. Under federal law, employers may not pay tipped employees less than minimum wage unless they are allowed to keep all their tips, or contribute only to a legal tip pool. Thus, the complaint said, Cheddar’s policies violate the Fair Labor Standards Act.

At Nationwide Consumer Rights, our Wheaton, Ill. overtime attorneys see cases like this frequently. Hourly employees such as waiters and bartenders are regular targets for employers who prefer not to pay all of the wages they owe, and even sometimes to skim their earned tips to pay other employees. This behavior relies on employees to stay quiet, either because they don’t know they have rights or because they’re afraid of punishment for speaking up. However, federal and state law is very clear employees must be compensated for all of their time at work, and paid time and a half for any time over 40 hours in a week. Failure to follow these basic requirements exposes companies to lawsuits seeking all of the back pay owed, attorney fees and any other costs incurred. In cases of egregious law-breaking, courts may also require employers to pay punitive damages — money intended to penalize willful law-breaking.

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The below short video documentary shows that wage theft is a real and growing problem.

In our work as Illinois and nationwide wage and hour attorneys, we frequently see workers who have been misclassified as exempt from overtime. Whether this was an honest mistake or an intentional attempt to save money, it effectively “steals” wages from the misclassified employees. DiTommaso Lubin stands up for the rights of workers in Chicago, Illinois and throughout the country who are victims of overtime wage theft, including misclassified employees as well as those pressured to work off the clock; lie on timesheets; or simply not paid an overtime rate. Our Oak Brook, Waukegan, Elgin, Warrenville, Highland Park, Lisle, Wheaton, Northbrook, Aurora, Elgin, Evanston, Joliet and Chicago unpaid overtime lawyers handle both individual and class action employment cases. Based in Chicago and Oak Brook, Ill., our Chicago overtime attorneys represent clients throughout Illinois, the Midwest and the United States.

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