Travis County Court at Law granted our no evidence motion for summary judgment against one of the nation’s largest and most aggressive collectors of consumer junk debt, Portfolio Recovery Associates, LLC

Travis County Court at Law granted our no evidence motion for summary judgment against one of the nation’s largest and most aggressive collectors of consumer junk debt, Portfolio Recovery Associates, LLC

April 2, 2014

The Travis County Court at Law granted our no evidence motion for summary judgment against one of the nation’s largest and most aggressive collectors of consumer junk debt, Portfolio Recovery Associates, LLC.  Previously in the same case, Portfolio and its lawyers, Anh Regent and J. David Roberson of Regent & Associates were sanctioned by the court for discovery violations and the court found they had engaged in discovery abuse and ordered them to pay defendant a total of $3,643 in attorney fees and turn over their purchase agreement, which reveals that when the banks sell the debt, they sell it “as is” and disclaim all warranties as to the accounts.  Meaning that when the debt collectors go into court claiming they can prove up the bank’s records because they “rely” upon the accuracy of those records when they buy the accounts, that’s a lie.  The disclaimers destroy any basis for them to claim they reasonably relied upon the bank’s record keeping.

Here is a portion of our motion for summary judgment that shows how the plaintiff’s use of the reliance theory under Simien v. Unifund CCR Partners, 321 S.W.3d 235 (Tex. App. — Houston [1st Dist.] 2010) is just a pack of lies and a fraud that has been perpetrated upon the courts thousands and thousands of times against ordinary consumers here in the Great State of Texas.

“The only witnesses plaintiff has identified are employees of the plaintiff.  The problem with plaintiff using its own employees as its witnesses is that plaintiff is admittedly not the original creditor.

Defendant’s Request for Admission No. 2.   Admit that Plaintiff is not the Original Creditors on the account at issue.

RESPONSE:   Admit.

 In light of this admission, the burden is on plaintiff to prove how its own employees can act as substitutes for admissible testimony from the original creditor.  Plaintiff cannot meet this burden.

Plaintiff has conceded that none of its employees have personal knowledge of the record keeping of the original creditor and none are qualified to offer testimony as a custodian of records for the original creditor.

Defendant’s Interrogatory No. 10.     If you contend that any employee, officer, agent or representative of plaintiff has personal knowledge of the record keeping systems of the original creditor and is qualified to offer testimony as a custodian of records for the original creditor in this case, state the factual and legal basis for your contention.

RESPONSE:  Plaintiff makes no such contention at this time.

Plaintiff is unable to explain how its own employees can prove up the purported business records on which it has based its entire case.

Defendant’s Request for Admission No. 7.   Admit that no employee, agent or representative of Plaintiff is a custodian of records for the Original Creditor on the account at issue in this lawsuit.

RESPONSE:   After a reasonable inquiry, the information known or easily obtainable by Plaintiff is insufficient to enable Plaintiff to admit or deny.

During the time for discovery, plaintiff never produced any documents or provided any answers to interrogatories inquiring about how the plaintiff’s own employees could authenticate or prove up records based upon their supposed “reliance” on the records they supposedly obtained from the original creditor.

Request for Production No. 14.          Identify all representations or claims made by the original creditor and relied upon by you in which the original creditor represented that the records of the subject account were accurate or reliable

Answer:           Relevant information, to the extent available and applicable, will be supplemented.

Interrogatory No. 15.  Identify all representations or claims made by the original creditor that caused you to believe you could rely upon the accuracy of its business records pertaining to this account.

Answer:           Relevant information, to the extent available and applicable, will be supplemented.

Interrogatory No. 16.  Identify any disclaimers of warranty made by the original creditor with respect its sale or assignment of the account that is the subject of this lawsuit.

Answer:           See copy of the Bill of Sale and Assignment of Assets, Affidavit of Sale of Accounts by Original Creditor, attached hereto.  Other relevant documents, to the extent available and applicable will be supplemented.

After the court granted defendant’s motion to compel on this matter, plaintiff amended its responses to identify the Asset Sale Agreement as the basis of its reliance.  The Asset Sale Agreement, which plaintiff refused to produce until ordered by the court is replete with disclaimers of warranty and disclaimers as to the reliability or accuracy of the records.  It states in bold print and capital letters that with respect to any reference to “Evidence of Indebtedness”:

THE EXISTANCE OF EVIDENCE OF INDEBTEDNESS SHALL NOT BE DEEMED TO IMPLY THAT THE DEBT EVIDENCED IS ENFORCEABLE.

The “Evidence of Indebtedness,” as defined in Section 1.13, means any of the documents, including the credit card statements.  Id.

The Asset Purchase Agreement specifically states the debt is being sold “as is” and without warranty:

Section 8.2.  No Other Representations or Warranties.  EXCEPT AS PROVIDED HEREIN, THE ASSETS ARE BEING SOLD “AS IS” AND “WITH ALL FAULTS.” WITHOUT ANY REPRESENTATION OR WARRANTY WHATSOEVER, AND SELLER SPECIFICALLY DISCLAIMS ANY WARRANTY, GUARANTY OR REPRESNTATION, ORAL OR WRITTEN, PAST OR PRESENT, EXPRESS OR IMPLIED, CONCERNING THE ASSETS, THE STRATIFICATION OR PACKAGING OF THE ASSETS.

This disclaimers show that the Asset Purchase Agreement is no evidence of reliability.  The only representations made by the original creditor in the Asset Purchase Agreement are that the original creditor had the title and right to sell the accounts and that plaintiff could get a refund for accounts that had already been discharged in bankruptcy.  Neither of these representations are any basis for reliance.  Plaintiff has no evidence to support its contention that its employees can prove up the records of the original creditor based upon reliance.”