EMERGING TRENDS IN LITIGATION AND LEGAL UPDATE FOR 2016 July 20, 2016 _____________ Webinar EMERGING TRENDS IN LITIGATION AND LEGAL UPDATE FOR 2016

SPEAKERS Mark E. Ellis Andrew M. Steinheimer Amanda N. Griffith ELLIS LAW GROUP, LLP 740 University Avenue, Sacramento, CA Ph.: 916-283-8820 Web: Ellislawgrp.com SPEAKERS

This presentation will address trends we see in litigation against collection agencies and provide an update with respect to some legal issues that affect collection agencies. Overview

We are seeing more class actions under: TCPA EFTA California Penal Code § 632 Class Actions

Decisions from the Supreme Court Campbell-Ewald Co. v. Gomez (2015) 136 S.Ct. 663. The United States Supreme Court rejected the argument that a Rule 68 Offer of Judgment to the individual named plaintiff can moot a case and thereby avoid a class action. Court ruled that the unaccepted offer had no legal effect on the plaintiff’s claims. However, the dissent points out that the Court left open the possibility of mootness if the defendant not only makes the offer of judgment but also tenders the money to the plaintiff or potentially the court. Decisions from the Supreme Court

EFTA Who does the EFTA apply to? •Applies to withdrawals made from consumer accounts. • Does not apply to payments made from commercial accounts or credit cards. Ironforge.com v. Paychex, Inc., 747 F.Supp. 2d 384, 402 (W.D. NY 2010). EFTA

What is an EFT? Electronic Fund Transfer = “any transfer of funds other than a transaction originated by check, draft, or similar paper instrument, which is initiated through an electronic terminal, telephonic instrument, or computer or magnetic tape, so as to order, instruct, or authorize a financial institution to debt or credit an account.” 15 U.S.C. § 1693(a)(7). EFTA

EFTA What is not an EFT? •Draft Checks Deposited In Person • Attempting a transfer. See McFarland v. Wells Fargo Mortgage, Inc. 2006 WL 2830025, *4 (W.D. Mich. 2006). • Substantially recurring intervals? EFTA

EFTA What is proper consent? “Wet ink” signature? Oral recording?   • Providing a copy of the agreement to the consumer. EFTA

Fair Credit Reporting Act and California Consumer Credit Reporting Agencies Act FCRA/CCRAA

Current Trends in Litigation Investigating Disputes Properly Updated Credit Reports Reporting Debts That Are Subject to Bankruptcy FCRA/CCRAA

Furnisher’s Duty to Investigate Dispute received from the CRA directly Dispute received from the consumer FCRA/CCRAA

What is considered a reasonable investigation? Consider all materials provided Verify the account with the creditor Deletion of the account? - According to the CFPB, deletion is not an alternative to conducting an investigation. FCRA/CCRAA

Disputes What constitutes a dispute? Potential FDCPA liability Trend: Faxed dispute letters FCRA/CCRAA

Reporting Debts Subject to Bankruptcy Collecting Debts Subject to Bankruptcy – in general - Notice of the Bankruptcy? Chapter 7 Chapter 13 Trend: The account continuing to report as “open” or “in collections” FCRA/CCRAA

Liability under the CCRAA Federal Preemption Civil Code § 1785.25(a) Violation must have been willful FCRA/CCRAA

Future of Credit Reporting Medical Debts - 6 month waiting period before reporting Reporting Items that did not arise from a contract or agreement to pay - Example: Fines and Tickets - Prohibited. FCRA/CCRAA

FDCPA/Time-Barred Debts Collecting Time-Barred Debts FDCPA/Time-Barred Debts

• CFPB’s take • No litigation Time-Barred Debts

Does the letter mislead the least sophisticated consumer about the enforceability of the debt. Time-Barred Debts

Time-Barred Debts • Threats of litigation • “Further action” • “Settlement” offers Time-Barred Debts

Know Thy Enemy Lemberg v. Tammy Hussin Insight into how plaintiff’s attorneys operate. Know Thy Enemy

Mark E. Ellis, Esq. mellis@ellislawgrp.com THANK YOU Mark E. Ellis, Esq. mellis@ellislawgrp.com Andrew M. Steinheimer asteinheimer@ellislawgrp.com Amanda N. Griffith agriffith@ellislawgrp.com ELLIS LAW GROUP LLP 740 University Avenue, Suite 100 Sacramento, CA 95825 Ph: (916) 283-8820 Fax: (916) 283-8821

Speaker Bios – Mark E. Ellis Mark E. Ellis is the founding and managing partner of the Ellis Law Group LLP. He is a California State Bar Certified Specialist in legal malpractice. His practice also includes defending collection agencies in litigation related to the Fair Debt Collection Practices Act (FDCPA), the Fair Credit Reporting Act (FCRA), and the Telephone Consumer Protection Act (TCPA), as well as their state equivalents. He has practiced in the area of FDCPA defense for over 25 years and has defended well over a thousand of these suits. In fact, Mr. Ellis and his firm have successfully tried several FDCPA cases over the years. Ellis Law Group acts as Regional Panel Counsel for Traveler’s Insurance under the ACA’s industry insurance program. Mr. Ellis is a MAP member and past Chairman of MAP for California. He regularly lectures and writes in the areas of FDCPA, TCPA and FCRA defense. Please visit our firm website at www.ellislawgrp.com for further information about Mr. Ellis. Speaker Bios – Mark E. Ellis

Speaker Bios Andrew M. Steinheimer Mr. Steinheimer is a partner in Ellis Law Group LLP. Mr. Steinheimer has a broad civil litigation practice and represents individuals, professionals and businesses in all aspects of litigation.  Mr. Steinheimer also has developed an expertise in defending claims brought under the federal Fair Debt Collection Practices Act (“FDCPA”) and the Fair Credit Reporting Act (“FCRA”), and has defended hundreds of such cases in state and federal court. Mr. Steinheimer has lectured on the FDCPA, California Rosenthal FDCPA and Fair Credit Reporting Act to attorneys and trade organizations. Please visit our firm website at www.ellislawgrp.com for further information about Mr. Steinheimer. Speaker Bios Andrew M. Steinheimer

Speaker Bios – Amanda N. Griffith Ms. Griffith joined Ellis Law Group in 2012 upon passing the California state bar. Since joining the Ellis Law Group, Ms. Griffith practices has focused on commercial law including FDCPA, FCRA/CCRAA, TCPA, and EFTA litigation. She regularly handles cases on behalf of debt collection agencies in both state and federal court, including class action litigation.   Ms. Griffith received her Bachelor’s of Arts Degrees in Government and Business Management in 2009 from University of Redlands in Redlands, California. She earned her law degree cum laude in 2012 from California Western School of Law in San Diego, California. During her tenure at California Western she received the American Jurisprudence Awards in Constitutional Law and Securities Regulation. Speaker Bios – Amanda N. Griffith