Buying Lawsuits Can Be Confusing

Posted: August 24, 2016 by Nazim in Consumer Protection

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How to simplify this snake-eating-its-own-tail legal paradox? Well, it starts like this: a debt collector sued a consumer and obtained default judgment because the consumer didn’t show up in time. The consumer then sued the debt collector because the initial lawsuit didn’t comply with the relevant federal law.  While that second lawsuit was going on, the judgment of the first lawsuit was enforced by auctioning off the consumer’s things, including the rights to recover under the second lawsuit. Confused yet? It gets worse: the debt collector bought those rights. That’s right, the debt company bought the right to sue itself for about $250 (it was the only bidder). Luckily, a well-known attorney is stepping in to make sure the very purpose of the federal consumer protection law isn’t circumvented by some random state procedure.

Details at the Consumerist.

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