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7th Circuit splits over Marion County Small Claims debt collection suit

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Are Marion County Township courts “judicial districts” under the Fair Debt Collection Practices Act, thus allowing a man to sue a debt collector for bringing an action in an inconvenient township court? Depends on who you ask on the 7th Circuit Court of Appeals, as the majority ruled in favor of the debt collector Thursday.

Judges Joel Flaum, Ann Claire Williams and Richard Posner decided Mark Suesz, individually and on behalf of a class v. Med-1 Solutions LLC, 13-1821. Med-1 Solutions bought the medical debt of Hendricks County resident Mark Suesz that stemmed from treatment in Lawrence Township in Marion County. The company filed a collection action in Marion County Small Claims Court in Pike Township, on the other side of Marion County. Suesz then filed this lawsuit, seeking damages under the Fair Debt Collection Practices Act, which requires debt collectors to bring suit in the judicial district where the contract was signed or where the consumer resides.

U.S. Judge William Lawrence tossed Suesz’s lawsuit in March after finding the small claims courts were not judicial districts for the purposes of the Act.  Flaum and Williams agreed, relying on Newsom v. Friedman, 76 F.3d 813 (7th Cir. 1996). Using a similar approach as in Newsom, the majority looked at the makeup of courts in Indiana and what should be considered judicial districts here.

“[T]he township courts fall short of constituting freestanding judicial districts for several reasons. First, they fall short under our definition, because the limitations on their authority are not coterminous with township boundaries. We find it especially significant that the statute permits debt collectors to file actions anywhere in the county, rather than limiting the township courts’ reach to township borders. This filing flexibility suggests that the proper judicial district is Marion County as a whole, rather than the individual townships,” Flaum wrote.

“It is also noteworthy that the Marion County Superior Court lacks a small claims docket—which every other superior court in Indiana has. This suggests that the township courts, superior court, and circuit court are meant to function as a symbiotic whole, with the township courts obviating the need for a superior court small claims docket.”

Posner wrote a 10-page dissent, believing Newsom is unsound and needs to be overruled. He pointed out that the majority interpreted the relevant portion of the Act in a vacuum instead of against the background of debt collectors seeking to file actions in the courts that are inconvenient to debtors or where judges are unsympathetic to debtors.

“What’s true is that a debt collector is free to choose a court system (federal, county, city, or township, depending on jurisdictional requirements) in which to file. But once it makes its choice, section 1692i requires it to pick the most convenient court within the system’s territorial limits. That would be Lawrence Township court in this case,” Posner wrote.
 

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  1. Hello currently just withdrew from laporte county drug court and now I have lost the woman I love which also was in drugcourt and was put in jail without a,lawyer presentfor her own safety according to the judge and they told her she could have a hearing in two weeks and now going on 30days and still in jail no court date and her public defender talks like he,s bout to just sell her up the river.

  2. I just wanted to point out that Congressman Jim Sensenbrenner, Senator Feinstein, former Senate majority leader Bill Frist, and former attorney general John Ashcroft are responsible for this rubbish. We need to keep a eye on these corrupt, arrogant, and incompetent fools.

  3. Well I guess our politicians have decided to give these idiot federal prosecutors unlimited power. Now if I guy bounces a fifty-dollar check, the U.S. attorney can intentionally wait for twenty-five years or so and have the check swabbed for DNA and file charges. These power hungry federal prosecutors now have unlimited power to mess with people. we can thank Wisconsin's Jim Sensenbrenner and Diane Feinstein, John Achcroft and Bill Frist for this one. Way to go, idiots.

  4. I wonder if the USSR had electronic voting machines that changed the ballot after it was cast? Oh well, at least we have a free media serving as vicious watchdog and exposing all of the rot in the system! (Insert rimshot)

  5. Jose, you are assuming those in power do not wish to be totalitarian. My experience has convinced me otherwise. Constitutionalists are nearly as rare as hens teeth among the powerbrokers "managing" us for The Glorious State. Oh, and your point is dead on, el correcta mundo. Keep the Founders’ (1791 & 1851) vision alive, my friend, even if most all others, and especially the ruling junta, chase only power and money (i.e. mammon)

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