Facts

On October 21, 2008, Arrow Financial Services, LLC filed a collection action against Sonya Norton, alleging that she failed to tender owed amounts to them. On December 26, 2008, the court entered a default judgment against Norton in the amount of $3,986.60. In August and September 2012, Norton's wages were garnished in the amount of $3,986.60. LVNV Funding, Inc. had acquired the judgment against her from Arrow. An attorney for the Housing and Economic Rights Advocates wrote to the Law Office of Harris & Zide stating that the wage garnishment appeared to be improper because Arrow had filed a Certificate of Cancellation with the California Secretary of State in October, and no other party established itself as Arrow's assignee of record. Harris & Zide filed a notice terminating the garnishment of Norton's wages and reimbursed some of her garnished wages. Norton filed a putative class action against LVNV Funding and Harris & Zide, alleging violations of California and federal laws for improperly collecting and attempting to collect court judgments through Arrow. The class consisted of all California residents who had judicial action to collect a judgment based on consumer debt obtained in California taken against them by LVNV Funding, LLC, after August 17, 2014, and who were the plaintiff of record at the time the judgment was entered.

PLAINTIFFS' CONTENTIONS: Plaintiffs contended that defendants violated the Fair Debt Collection Practices Act, California's Fair Debt Collection Practices Act, and California's Unfair Competition Law by taking judicial action to collect judgments that had been acquired by Arrow Financial Services without becoming the assignee of record prior to enforcing the judgment.

DEFENDANTS' CONTENTIONS: Defendants denied all contentions.

Result

$50,000 settlement. LVNV Funding, Inc. agreed to not collect or attempt to collect any judgments without first becoming the "assignee of record" or collect to attempt to collect from any closed accounts.