I can’t believe this. The Supreme Court is giving docket time to the 11th Circuit Court decision on Midland Funding v. Aldelia Johnson. At issue is whether filing a proof of claim in bankruptcy court on an unextinguished time-barred debt (one where the statute of limitations has run out) violates the Fair Debt Collection Practices Act and whether the bankruptcy laws supersede and preclude applying the FDCPA to debtors in bankruptcy. Here’s how the story goes:
It’s something of a surprise for the Supremes to take this case on, but in my opinion the law should come down firmly on the side of the debtors. However, in my opinion, the justices don’t understand the how the bankruptcy system works, and I am worried that they will come down on the side of the creditors. If they’re looking to upset a whole bunch of apple carts at once, this is certainly the case to do it, as just about every Circuit Court has had similar cases. They may be looking to settle as many as possible with just this one case.
Instead, without an understanding of the Bankruptcy Code – it’s a specialty practice for a reason – what they could do is render a decision that throws time-barred debts, state statutes of limitations, and even the FDCPA into chaos. With the court splitting four-and-four, there might not even be a decision unless one justice jumps the gap to tip the balance to 5-3.
Buckle up. It could be a bumpy ride.
Now, if you are being hassled by a collections agency for a debt that is past the statute of limitations, come and talk to me. The initial consultation is free, and we can help get these bottom-feeders off your back.
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