San Jose Bankruptcy & Fair Debt Collection Practices Act Lawyer Blog

Capital One is being sued again for failing to cease and desist making telephone calls. Yet another consumer claims that Capital One continued to place telephone calls to the consumer even after the bank was informed the consumer was being represented by legal counsel.

In Hamilton v. Capital One Auto Finance, Inc., 11-cv-00584 (W.D. WV 2011), a consumer alleged Capital One has continued to place telephone calls despite knowing she was represented by a lawyer.

This is just yet another lawsuit against Capital One for what appears to be a business plan and practice of unlawfully attempting to collect debts by calling consumers directly, despite the fact the bank knew the consumer as represented by an attorney.

Under certain state's laws a creditor or debt collector cannot communicate with a consumer when it knows the consumer is being represented by a lawyer. Capital One has been sued for this very same thing several times in the last two years:

• McNamara v. Capital One Bank (USA), N.A., Case# 10-cv-00353-H (S.D. Cal. 2010)(unlawfully contacting someone represented a lawyer, engaging in conduct the natural consequence is to harass and abuse, making more than 150 calls, and multiple calls per day)


• Bowling v. Capital One Bank (USA), N.A., Case # 10-cv-01294 (W.D. WV 2010)(unlawfully contacting someone represented a lawyer, engaging in conduct the natural consequence is to harass and abuse, making repeated and continuous calls in an attempt to collect a debt- 106 calls in less than 1 month)


• Blankenship v. Capital One Bank (U.S.A.), N.A., Case # 10-cv-01153 (D. WY 2010)(unlawfully contacting someone represented by a lawyer)


• Hamilton v. Capital One Auto Finance, Inc., Case # 11-cv-00584 (W.D. WV 2011)(unlawfully contacting someone represented by a lawyer)


• Rakes v. Capital One Bank (U.S.A.), N.A., Case# 10-cv-01367 (W.D. WV 2010)(unlawfully contacting someone represented by a lawyer)


• Vest v. Capital One Bank (U.S.A.), N.A., Case # 10-cv-01095 (W.D. WV 2010)(unlawfully contacting someone represented by a lawyer)


• Wiseman v. Capital One Bank (U.S.A.) N.A., Case # 10-cv-01131 (W.D. WV 2010)(unlawfully contacting someone represented by a lawyer)

The federal Fair Debt Collection Practice act strictly regulates how debt collectors can collect debts. In part the FDCPA says:

Communication in connection with debt collection [15 U.S.C. 1692c]

(a) COMMUNICATION WITH THE CONSUMER GENERALLY. Without the prior consent of the consumer given directly to the debt collector or the express permission of a court of competent jurisdiction, a debt collector may not communicate with a consumer in connection with the collection of any debt -

(1) at any unusual time or place or a time or place known or which should be known to be inconvenient to the consumer. In the absence of knowledge of circumstances to the contrary, a debt collector shall assume that the convenient time for communicating with a consumer is after 8 o'clock antimeridian and before 9 o'clock postmeridian, local time at the consumer's location;

(2) if the debt collector knows the consumer is represented by an attorney with respect to such debt and has knowledge of, or can readily ascertain, such attorney's name and address, unless the attorney fails to respond
within a reasonable period of time to a communication from the debt collector or unless the attorney consents to direct communication with the consumer; or

(3) at the consumer's place of employment if the debt collector knows or has reason to know that the consumer's employer prohibits the consumer from receiving such communication.

Certain states, like California have state laws that regulate creditors and debt collectors, and incorporate the federal law above. See California Civil Code 1788 et seq., California Civil Code 1788.17, Alkan v. Citimortgage, 336 F. Supp. 2d 1061 (N.D. Cal. 2004), and Gonzales v. Arrow (9th Cir., September 23, 2011).

Thus, creditors, like Capital One, attempting to collect debts here in California must abide by these laws (the California Fair Debt Collection Practices Act) and cease communicating with consumers once they know the consumers are represented by a lawyer.

A San Jose, CA federal judge will allow a California identity theft victim to proceed with his lawsuit against the Bank of America. Guillen v. Bank of America, et al., (N.D. Cal. August 31, 2011). The Bank of America asked the federal court to throw out several claims of a Santa Cruz man who was the victim of identity theft.

Narcizo Zavala Guillen alleged that someone stole his identity and used his personal information to obtain two mortgage loans from Bank of America. Mr. Guillen was surprised when he received a letter from Bank of America stating the available credit limit on his credit card had been reduced to $1,000.00. In response to the letter, Mr. Guillen went to a Bank of America branch on or about January 21, 2009. There he learned that two mortgage loans had been taken out in his name. Mr. Guillen also filed an identity theft report with the Watsonville Police Department identifying the loans as fraudulent. Mr. Guillen also disputed the debt with all four major credit bureaus (Experian, Equifax, Transunion, and CREDCO).

In response, Bank of America sent Mr. Guillen a letter on June 29, 2009, wherein it acknowledged that he was indeed a victim of identity theft as to delinquent mortgages and indicated it had requested removal of the loans from Plaintiff's credit report.

Despite this acknowledgment, however, Bank of America continued to report the inaccurate information, and ultimately referred one of the delinquent mortgages to debt collector SRA to attempt to collect $145,816.20. Bank of America eventually commenced a foreclosure proceeding against the home securing the mortgages, and thereby caused the Santa Cruz County Recorder's Office to publish defamatory statements concerning Plaintiff in the foreclosure documents.

The federal court rejected the Bank of America's argument that Mr. Guillen could not bring a suit under the California identity theft statute because the bank earlier admitted he did not owe the debt. The judge noted that the Bank of America continued to try to collect from Mr. Guillen, and foreclosed on the home, even after they admitted he was a victim of identity theft. Relying on another Northern District of California decision, the court also held that federal law did not block the California Identity theft claims. California Civil Code §1798.92 et seq. Pasternak v. Transunion, 2008 U.S. Dist. LEXIS 115442, at *10-11 (N.D. Cal. 2008).

Similarly the federal court also held that federal law did not block Mr. Guillen's claims under the California Fair Debt Collection Practices Act (California Civil Code §1788 et seq.)

The federal judge also allowed Mr. Guillen to proceed with his claims under California's Credit Reporting Agency Act (California Civil Code §1785.25), alleging Bank of America reported false information to the credit bureaus.

The decision was also significant in that Mr. Guillen was able to avoid filing bankruptcy to try to stop the Bank of America from attempting to collect the alleged $145,816.20 due. So, those in California can use California's identity theft law, and related laws, to protect them when creditors and debt collectors are trying to collect money that is not actually owed.