Court Cancels Debt Collectors' $2.5M Victory In Letter Scheme

Law360 (February 7, 2020, 7:26 PM EST) -- A Texas federal judge threw out a $2.5 million jury award in favor of two debt collection agencies that alleged they were defrauded by thousands of letters disguised to look like they came from debtors disputing their bills instead of from the law firm that sent them.

U.S. District Judge Sam A. Lindsay said on Thursday that defendant Lexington Law Firm was given permission from its credit repair clients to send letters on their behalf disputing debts.

That permission meant it was not fraud for Lexington to sign the clients’ names and route the letters through the clients' states to make...

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