MARTINSBURG – Borrower Linda Barr, who established that debt collectors in West Virginia must obey the same laws as lenders, settled the suit that proved her point.
U.S. District Judge John Bailey dismissed it on July 19, after Barr and NCB Management Services told him they reached agreement.
She won the suit for practical purposes on June 14, when the Supreme Court of Appeals ruled she could pursue it under the Credit Consumer Protection Act.
Bailey, unwilling to interpret state law on his own, had asked the Justices whether he could apply the Act to her harassment claim.
Justice Robin Davis answered that "a professional debt collector qualifies as a creditor."
She wrote for all five Justices that a collector qualifies as creditor whether it acts as a lender's agent or purchases the debt from the lender.
Barr bought a motorcycle for $9,000 in 2007, borrowing from HSBC Bank Nevada.
The bank repossessed the bike in 2009, and hired NCB to collect a $7,896 balance.
She sued NCB in federal court last year, claiming it misrepresented facts, communicated with her family, improperly accessed credit reports, and badgered her to pay off with her husband's credit card.
NCB moved to dismiss, arguing that only the state attorney general can sue a collector.
Bailey bounced the question to Charleston, where Attorney General Darrell McGraw pleaded as friend of the court for a ruling in Barr's favor.
McGraw deputy Jill Miles argued he can't police the market alone.
"Enforcement of a regulatory statute through individual actions serves a deterrent effect, curbing impermissible conduct by unscrupulous business," she wrote.
Mountain State Justice, American Association of Retired Persons, National Association of Consumer Advocates, and National Consumer Law Center supported Barr.
The Justices adopted their view, but Davis advised them that defenses provided to creditors by the Act would be available to collectors.
Aaron Amore of Charles Town represents Barr, along with Anthony Majestro, John Barrett, and Jonathan Marshall, all of Charleston.
Bryan Shartle of Metairie, Louisiana, represents NCB, along with Macel Rhodes of Morgantown, Patrick McDermott of Wheeling, and Sharon Hall of Pittsburgh.