In November 2017, with co-counsel, New Economy Project filed a federal class action lawsuit against the debt collection law firm Houslanger & Associates, as well as its debt buyer clients Virgo Capital and Aquarius Capital, on behalf of Ramel Sanders and Antero Sarreal, both low-income New Yorkers. The lawsuit alleges that Houslanger and its debt buyer clients violated federal debt collection and state consumer protection laws by collecting on judgments they knew were obtained through fraud.
A previous class action lawsuit that New Economy Project brought with co-counsel, Sykes v. Mel S. Harris and Associates, LLC , alleged that the Mel Harris law firm and its debt buyer clients had, for years, systematically obtained court judgments through fraud. Sykes ended in a groundbreaking settlement where, for a vast majority of class members, the Sykes defendants stopped collecting on their judgments and a New York state court later vacated the judgments.
About 25,000 Sykes class members, however, did not get this relief, because the Sykes defendants had sold their judgments to third-party debt buyers – including Virgo Capital and Aquarius Capital – before the settlement in Sykes. Mr. Sanders and Mr. Sarreal seek monetary relief on behalf of themselves and these 25,000 class members.
The lawsuit, filed with co-counsel, Emery Celli Brinckerhoff & Abady LLP, Mobilization for Justice, and National Center for Law and Economic Justice, is proceeding in the U.S. District Court for the Southern District of New York.
The lawsuit is a companion to a state lawsuit that New Economy Project filed with co-counsel in New York State Supreme Court in December 2017.