An accident or serious injury can have devastating ramifications for the victim's finances. All of a sudden, a credit report is obtained, collectors begin to call, or a car is repossessed.
If your client has been hurt and is feeling pressure from unfair collection practices, the repossession of a vehicle, or credit reporting issues, contact us to discuss state or federal consumer protection laws that may be able to provide some relief.
Below are some examples where consumer rights litigation often intersects with personal injury and workers’ compensation law.
Your Client's Bill is Assigned to a Collection Agency
After your client is injured in a car accident, the medical provider assigns the bill to a collection agency, even though the bill should be paid by a worker comp plan or a carrier. Does the collection agency have the right to obtain your client’s credit report as part of its attempt to collect the debt from the worker? Probably, since the attempt to collect on an alleged obligation is a permissible purpose even if the claim later fails. Fair Credit Reporting Act, 15 USC 1681b.
Notification of Legal Representation
You notify a medical debt collector (A) that you represent your injured client, Mr. Smith, and that all future communications should be directed to you. The collector later sells or transfers the medical debt, alleged to be due to a new collection agency (B). Is collection agency B bound by the earlier representation letter you sent to collector A? The weight of authority is no; you have to notify each new collector of the representation. Conversely, each assignee collection agency must send out a fresh Notice of Validation Rights to the consumer, even if the predecessor collection agency did. Hernandez v. Williams, Zinman & Parham, PC., 829 F.3d 1068 (9th Cir. 2016).
Your Client's Credit Report is Obtained
After your client is injured in a car accident with a drunk driver, his worker compensation insurance carrier obtains his credit report to investigate possible fraud or other income. Is this permissible because the client has placed his finances "in issue"? Probably not. Investigation of an insurance claim is generally not a proper purpose for a carrier to obtain a consumer credit report on a claimant. 15 U.S.C. 1681b
Ancillary Collection Charges
A medical debt collector charges its hospital client a 10% commission and adds a $200 collection fee to an overdue medical bill of $2000. Is there anything you can do, other than complain that this charge was never agreed to? Yes. Collecting or attempting to collect ancillary amounts like this violates the Fair Debt law, unless the amount was agreed to or is expressly permitted by statute or other law. 15 U.S.C. 1692f.
We at Flitter Milz, P.C., hope that you and your loved ones remain healthy and safe throughout this difficult time. We want you to know that our firm is open to serve your legal needs. Our staff is available by phone, email, or video conference. Please feel free to call with any questions or specific concerns.
Take care and be safe.
Cary Flitter & Andy Milz
Toll Free: 888-668-1225