Are Judges Approving Tax Evasion on Debt Collector Portfolio Recovery Associates’ Cases?
Excerpt of class action settlement from Pollak et al v. PRA:
“PRA will provide, without imposing any condition or charge whatsoever, a credit to each account belonging to a Non-Zero Balance Class Member (“Account”), in an amount not to exceed the outstanding balance of each Account, up to $500.00 per Non-Zero Balance Class Member and collectively up to $1,092,000.00. No cash payment will result from any credit provided to a Non-Zero Balance Class Member’s account(s), and PRA agrees not to issue any Non-Zero Balance Class Member a form I099-C due to the credit.“
The PRA Group, Inc. subsidiary emphasized, toward the beginning of the settlement agreement, “PRA has denied, and continues to deny, each claim and allegation of wrongdoing Plaintiff alleges in the Litigation. PRA also has denied, and continues to deny, inter alia, any allegations that Plaintiff or the Settlement Class suffered any damage whatsoever, were harmed in any way, or are entitled to any relief as a result of any conduct on the part of PRA as alleged by Plaintiff in this Litigation.”
In the case I filed against PRA, they denied, denied, denied. Judge Lee P. Rudofsky agreed with PRA. He said I owed money to PRA and no reasonable juror would disagree with him. But PRA lawyers from Rose Law Firm, Troutman Pepper and PRA big-wig Meryl Dreano all told the judge that Portfolio Recovery set my balance to zero as a “waiver” and had no intention of filing a 1099-C due to the waiver.
Judge Rudofsky winked at PRA and said, you’re right, setting the balance to zero was a “waiver”, but don’t bother complying with the tax code. That is just for the little people.
The Pollak plaintiffs were not suing for the misrepresentation of the amount or character of a debt. They alleged that the notorious debt collector sent letters threatening litigation with no intent of litigating.
The amount per plaintiff in Pollak is under the mandatory reporting requirement of $600. The money is still taxable, and the aggregate is over a million dollars. There are other tax rules I’ve noticed where the IRS discourages breaking up payments into many small chunks as to evade detection from the IRS of what is one giant transfer of wealth, in the hopes the transfer can be made tax free. The instructions for 1099-C say: “Do not combine multiple cancellations of a debt to determine whether you meet the $600 reporting requirement unless the separate cancellations are under a plan to evade the Form 1099-C requirements.” (emphasis added) It is probably worthwhile for the IRS to investigate the number of recipients of these $500 settlements who reported the gain. This is tippy toe right up to the line. Maybe our law makers can add a few more words to the tax code. Perhaps, “all class action settlements must be reported on the new form 1099-CA.”
At least in my case, PRA could have been crediting my account to zero because I did not owe the debt, as I claimed, in which case they were not conspiring and encouraging what they believed was tax evasion. But no, PRA insisted that it was a waiver and therefore they must admit they had the intent of orchestrating tax evasion. (I’ve already informed the IRS about what transpired.)
One attorney who served PRA on both cases was James Trefil. How many other cases did Mr. Trefil participate and counsel the defendant debt buyer and convince the Courts to ignore the Internal Revenue Code?
(If you know judges who approved settlements of $600 or more per debtor with no 1099-C issued, inform us in the comments or send the case info to me at bohemian_books@yahoo.com. If you send a file stamped copy of the agreement, it will be posted as a Doc of the Day.)
Dark Money, The Federalist Society and Dangerous Judge Lee P. Rudofsky
Those of you who have read this blog since before March 16, 2022 may have noticed a distinct change in my assessment of Judge Lee P. Rudofsky and even a shift in my political leanings.
I am and have always been a Libertarian and Populist. But, not to “waste” my vote, I often register in one of the two predominant parties. For instance, in 2016, I did not want Hillary Clinton to win the presidency. My reasoning was not about the issues. It was because I had several acquaintances in Arkansas who said they worked for Hillary in different capacities, and she is a raging bitch, completely corrupt.
I thought Donald Trump running for president was a joke. Literally. “Ha ha ha, that’s so funny.” “No, he is really running for president.”
I signed up as a Republican and voted in the primaries for someone not Trump.
Unfortunately, I was torn between two men who I would love to see in the presidency. Neither is a lawyer.
Ben Carson and Rand Paul. I think if they ran on the same ticket, they could have beat Trump.
Back in March 2022, I respected Judge Lee P. Rudofsky. I thought he was on a trajectile to the U.S. Supreme Court. I wrote an out-of-character blog post, praising the young judge. “What Court Should Look Like: The Honorable Lee P. Rudofsky Presiding”
That was before I discovered Rudofsky is a liar and cheat.
It seemed like his blatant corruption from the bench would be the end of his career.
Little did I know…
Today the magic genie inside YouTube brought up a two-year-old speech it thought might interest me. It was right.
The speaker is Senator Sheldon Whitehouse, a Democrat from Rhode Island.
Everything he said sounds true to me. The main take away is that the Federalist Society inner circle, including Judge Rudofsky and appellate counsel on my case against Portfolio Recovery Associates, LLC, Misha Tseytlin, are auditioning for promotions to judgeships all the way up to the Supreme Court.
It does not matter one bit that the actors are oppressing the ordinary person. All that matters is allegiance to the moneyed elite.
This is the first time I’ve heard of Senator Whitehouse. I listen to Federalist Society presentations for fun. How did I come to the exact conclusions as this Democrat? There must be truth and spirit in what he says.
Please accept this as your FREE Doc of the Day.
FREE Downloadable Documents from FDCPA Case
My appellate brief challenging Judge Lee P. Rudofsky for granting summary judgment to defendant Portfolio Recovery Associates is due in about 49 days.
I need to file a motion to change privacy designations soon, so don’t have time to chat with you, my dear readers.
In lieu I am offering to you two documents pulled from PACER yesterday.
One is my reply to my motion for partial summary judgment. The gist is that when a debt collector agrees to zero out an account without an order from a court and does not issue a 1099-C cancellation of debt, the debt collector is admitting that the person named on the account is not liable for the alleged debt.
Portfolio Recovery Associates claimed that it just decided to zero out the debt “in light of the litigation”, and they admitted that my claim that I owed no debt was made in “good faith”, but Judge Rudofsky interpreted that to mean PRA “waived” the debt.
The second document talks about why the business records that showed my account details should not be kept confidential. Judge Rudofsky allowed for me to make the comment about the waiver and 1099-C issue, but made it clear that if I step over the line he will hit me with paying the debt buyer’s attorney fees.
If you have business documents generated by PRA that are not ordered confidential by a court, please share them with other readers by emailing a copy to bohemian_books@yahoo.com. Together we can show that, as the CFPB complained, PRA lying on affidavits in court and making collection efforts on an invalid debt is commonplace and therefore awards and settlements on state cases and FDCPA cases against Portfolio Recovery should be much higher than the usual $1,000 or $5,000 they get away with.
Help Build a Public Library of Court Documents Free of Charge to Yourself
Qu’ils mangent de la brioche.
Our courts are supposed to be transparent and accessible to the public. Most are not.
For instance, the Federal District Courts use an electronic filing system called PACER. Public Access to Court Electronic Records is not paid for in full by tax dollars and filing fees. Citizens are charged 10 cents per page to view and download documents.
There is a cap of $3.00 per document for most filings. (Transcripts have no cap.) And each person is forgiven their charges if they do not exceed $30 per quarter.
If you are a litigant in a case and use electronic filing, which requires a PACER account, you receive one free access to each document in your case that does not count toward your quarterly charges.
Some courts, including the Federal Court for the Eastern District of Arkansas, won’t let non-attorneys who represent themselves file electronically. This seems to be a violation of the right to equal protection. A pro se litigant is required to print four copies of each document she files and drive it to the courthouse or mail it and hope it arrives and is acceptable to the clerk.
Let’s say you file 100 documents, each 25 pages. That is 10,000 pages at 10 cents each to copy, which equals an expense your represented opponent does not have equal to $1,000 for copies. Delivery to the clerk, whether by mail or in person, is approximately $30, so another $3,000.
If the judge lets your opponent designate material as “Confidential”, then you need to file another set of redacted copies.
If you want a file stamped copy for your records, in case something gets changed down the way, which has happened to me, you must include the download in your quarterly charges.
For someone like me who lives on a $639 per month pension, the costs of filing can use up her entire annual income.
The electronic filing manual and Local Rules contradict each other. The former forbids any access to electronic filing by non-attorneys. The later makes it permissible but only by filing a motion and having that motion approved. I filed such a motion and Judge Lee P. Rudofsky denied it. (See the Doc of the Day, at the bottom of this post.)
Judges like Lee P. Rudofsky and Billy Roy Wilson are deceptive or flat out lie about what a pro se litigant wrote in their filings when supporting the Corrupt Judicial Officer’s opinion. The ordinary person can’t afford to pull up all the documents that were the basis for the opinion, at 10 cents per page. So, few will see what was actually written or said in depositions and hearings.
The law libraries in Arkansas do not provide free PACER access to patrons. The libraries are not given free access and cannot absorb the cost.
In the Eastern District of Arkansas, you can pull up the documents for free at the kiosk in the clerk’s office. This means you must do your research during business hours. They do not allow you to load the documents onto a thumb drive or other electronic storage. It costs 10 cents per page to get paper printouts of the documents you might want to quote.
If you happen to have documents with a PACER file stamp, please send them by email to bohemian_books@yahoo.com. They will be featured as “Doc of the Day” for FREE download by the rest of us.
Think about signing up for PACER, which is free, and let me know if you want some ideas on how to spend your $30 worth of free downloads. Your service to our country will be appreciated.
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Pop Quiz: Who said, “let them eat cake”?
A. Judge Lee P. Rudofsky
B. Marie Antoinette
C. Both of the above.
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Docs of the Day:
The Chevron Doctrine and the Hypocrisy of Federal District Judge Lee P. Rudofsky
The Doc of the Day is a link to an article posted on Defense firm Taft/’s website and reprinted on Lexology. If you are going to fight for your rights and be part of the movement to give access to our courts to the ordinary working person, you should sign up for daily emails from Lexology. It is free.
It is important when debating to understand your opponent’s argument, even before your opponent makes that argument. (I was on debate team throughout college and while at Taft High School, coincidentally named, which had one of the finest academic records for a public school in the nation.)
You don’t need to agree with your opponents to listen to what they have to say.
The Taft/ author, Sohan Dasgupta, Ph.D., got it all wrong. Judge Lee P. Rudofsky makes the same mistake.
Dasgupta claimed the defenders of Chevron U.S.A. Inc. v. NRDC “maintain that the federal agency in question knows best what the statute it routinely applies means. Unsurprisingly, that assurance does not satisfy Chevron’s detractors. Even if that is an accurate understanding of administrative practice, Chevron’s critics contend, this abdication of the judicial role allows the executive to color outside its lane and to set aside any concern about democratic accountability.”
First, I must edit the Doctor of Philosophy’s prose. He mixed metaphors. Either the executive colors outside the lines or drives outside his lane, not both.
Back to the legal principals behind the Chevron Doctrine. Critics like Judge Rudofsky don’t really want the executive to stay in his lane; The supposedly “Federalist” judges want exclusive use of the road.
As explained by Dr. Dasgupta, the Chevron “doctrine stands for the overall proposition that unless a federal agency’s interpretation of a statute is unreasonable, the agency effectively gets to decide what an ambiguous statute means. Federal judges must, in those circumstances, heed the determinations of executive branch bureaucrats, both in executive agencies and independent ones.”
He continues that Chevron’s critics “sometimes also believe that the executive branch has its own tendentious view of the law, which will affect its interpretation — a deficiency from which neutral federal judges do not ordinarily suffer. While presidential control of the political appointees in executive agencies is, of course, direct — career civil servants, on the other hand, enjoy insulation from removal by the president, who is the head of the executive branch — independent agency co-heads often are removable only for good cause.”
Herein lies the fallacy. Judge Rudofsky and his ilk claim it is not Constitutional to have appointed agency heads who cannot be removed, barring an act of God. Have you ever tried to have a federal judge removed? People have tried to have Judge Rudofsky removed, not from the bench, only from a single case. It is a daunting task.
Rudofsky not only interprets the legislature’s unambiguous language improperly, he reinvents the meaning of litigants’ rendition of the facts of the case. Then he dares the litigant, take it to appeal (which translates into the judge’s native New Yorkese as “so sue me”).
Adding insult to injury, judges invented the doctrine of Absolute Judicial Immunity, which makes it impossible to sue a judge in civil court for running all over your rights, no matter how malicious his motivations. (The executive branch enjoys the slightly lower protection of the doctrine of Qualified Immunity.)
The Rudofskys roll right over the legislature, then back up to run over litigants, then speed away spreading a bed of roofing nails behind them that are sure to disable law enforcement’s pursuit. This is the road they want our nation to be on.
I Can Stop Anytime. Really I Can.
Someone landed on a post I wrote in 2013. Out of curiosity, I read the post titled “Really, I Can Stop Any Time.”
What happened since then? Why am I writing here again?
There is so much corruption in our government. It comes from both sides. Look at Hunter Biden and William Asa Hutchinson the Third. Cocaine, gun charges, other infractions that would land the commoner’s son in jail, but Daddy is a mucky-muck, so the way-ward son not only walks, he gets to continue raking in big bucks with his law license.
My single vote does not count. There is not enough meaningful public disclosure to make an informed decision. I voted for Judge Susan Kaye Weaver in Arkansas and Donald Trump, who appointed Judge Lee P. Rudofsky to a lifetime federal position. (I voted Ben Carson in the 2016 primaries and would have been happy with Rand Paul, but the two candidates split their votes, so neither won.) Now that I’ve seen both judges working firsthand, I wish I could do a do over. (I don’t want to vote for Joe Biden, either, so I will probably “waste” my vote on the Libertarian presidential candidate or Cornel West if he runs as the “People’s Party” candidate in 2024.)
Hopefully my stories get picked up by the A.P., a big paper, or Fox News, like they did when I wrote about Alan Friedenthal (deceased) and Dr. Joseph Keenan.
I can’t imagine ending my blog now. I wrote my first book, “Balls of Crystal and Steel: What it Takes to Play Poker Without Losing Your Assets”. It was as easy as writing a blog post every day for three months. So, you can expect to see my blog spin-off a book or three about our courts.
In the meantime, I don’t plan on quitting, but am reposting the post I wrote when my ex-partner was on a downward spiral into the hell of addiction, and I had to run our business without him and win a lawsuit as a pro se litigant.
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My intention is to focus my energy and time on other pursuits.
But your comments were so kind, I am compelled to say a brief thank you.
Also, I received an inquiry about how to complain about an errant commissioner. I wrote a response and then realized it would be easy to add that response here. So here it goes:
One avenue is to file a complaint letter with the commissioner’s presiding judge. When your complaint is answered inadequately, file a complaint with the CJP.
You can also file a claim, as you found in the link [the link connects to a Japanese website now]. But judges have absolute immunity over issues where they have jurisdiction and the error was non-administrative. In practice, judges are given immunity for all wrongs they commit, the vast majority of the time.
My greatest success was trying them in the court of public opinion. Print the facts of your case. WordPress will give you a free website and is easy to use. Be careful to avoid saying anything defamatory. Stick to facts. Not opinions. Label suspicions as thus. Attribute statements. Cite cases or print transcripts. There is an absolute litigation privilege. Anything said in court [that is not sealed] can be reprinted with an indication of who said it and in what proceeding. For example, you would not write “Commissioner Friedenthal was biased and embroiled against me.” Instead you might write “Commissioner Friedenthal said on the record that he was reading my posts on CourthouseForum.” Then give a date of the hearing and the case number.
This is not legal advice. This is information I learned while studying journalism at Colorado State University.
Maybe the most important thing you can do is to meet other victims of court abuse. Choose your friends carefully. Ask to read their court documents. Use discernment.
It is uplifting when other people know you are speaking the truth. Jesus said “For where two or three are gathered together in my name, there am I in the midst of them.” (Matthew 18:20) Thank you to my friends who gathered to do His will. God Bless.
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You can reach me at bohemian_books@yahoo.com.
Find Clues Even in the Mundane
Today’s Doc of the Day might look at first glance to belong in the giant to file pile.
Lawyers come and go. Especially in a mega firm like Troutman Pepper. And it is commonplace to have an appellate law specialist handle an appeal, if one can afford one.
The name of Portfolio Recovery Associates, LLC’s attorney who will handle the appeal I filed against the debt buyer intrigued me. So, I ran it through a Dogpile search.
If you run the name I used for two decades through a search engine, you would get hundreds or thousands of pages of results. Laura Lynn is popular as a first and middle name and as a first and last name. Especially for strippers. lol. I’m not kidding. I once tried and found I was in the wrong business.
Misha Tseytlin, not so common.
It was easy to discover that the attorney PRA brought on for the appeal writes for the Harvard Law Review, is a mucky-muck at the Federalist Society and was the first Solicitor General for the State of Wisconsin. Plus, he is the head appellate attorney at Troutman-Pepper.
At first glance, that is pretty intimidating.
But analyze the meaning. The PRA Group subsidiary came out the chute claiming the case was worth no more than $5,000 plus minimal costs. They put that claim in writing in an OOJ – an Offer of Judgment – before any discovery was done.
PRA has an inhouse legal department with a few thousand employees. They hire outside firms for many of the 3,000 cases they file per week in the United States.
If they think a jury would award a mere $5,000 if the judge lets the case go to a jury, why would they use anyone other than a flunky to handle the case against a 60-year-old layperson who has a health condition that saps her energy?
Well, I am that woman. Brain fog or not, my educated guess is that PRA is afraid of losing another $62,000,000 punitive damage award. And they should be.
****Fun Facts***
Judge Lee P. Rudofsky who presides on the case also wrote for the Harvard Law Review, also is entrenched in the Federalist Society, and was the first Solicitor General for the State of Arkansas.
The Irony: Federal Judge Complained that Head of CFPB Is Tough to Fire
Thank you to the good people at the Alliance for Justice for providing the Doc of the Day.
This article “from the desk of Leslie Rutledge” was a Statement of Joint Quarters with input from Federal District Judge Lee P. Rudofsky.
Judge Rudofsky seems to be on an unconstitutional power grab of his own. It is nearly impossible to remove a Federal Judge, which appears to some judges to be a license to lie from the bench and throw cases.
Portfolio Recovery Associates Responded to Complaint About Their Abusive Defense Tactics
I filed a complaint with the CFPB about the PRA Group subsidiary lying in court and trying to force a nominal settlement by out-lawyering me. You can read it here.
Here is PRA’s response:
“Portfolio Recovery Associates, LLC (“PRA”) investigated your complaint. We take compliance with all applicable state and federal laws very seriously. The investigation found no records supporting the allegations of misconduct or harassment, including, without limitation, that PRA or its representatives acted improperly regarding the relevant account. We closed the PRA account ending in 6049 and ceased all communications regarding collection of the PRA account unless otherwise permitted or required by applicable law. We believe that no further steps in response to your complaint or follow-up actions are required at this time.
“DESCRIPTION OF NON-MONETARY RELIEF
“In response to your dispute, we closed the PRA account ending in 6049 and ceased all communications regarding collection of the PRA account unless otherwise permitted or required by applicable law.”
That’s it. Case closed.
I was allowed to file a survey response, with no personal details, that will be posted on the CFPB website, supposedly.
Here it is. A PDF is posted below so you can download it as your Doc of the Day.
The company’s response addressed all of my issues.
No.
Portfolio Recovery Associates, LLC gave a conclusionary response with no details. They failed to address my main concern, their litigation misconduct in the FDCPA case I filed against PRA. They were also able to make the account notes and documentation “under seal” so they can avoid detection of law enforcement. PRA closed my account in response to my lawsuit and set the balance to zero, but in court said I owed the money when they were collecting. The account closure letters did not say “cancelled” nor “waived” and PRA did not issue a 1099-C to me.
Consumers like me should not have to file a lawsuit to make PRA stop calling.
PRA should not demand consumers like me to fill out an intrusive identity theft / fraud letter on an alleged debt that is past the statute of limitations for legal collection and past the statute of limitations for fraud. The only purpose of the inquisition is to collect information to use to try to collect on the debt. PRA should not be able to use a refusal to fill out the fraud letter as evidence that the debt was not fraudulent, as they did in my case.
PRA should not use its superior bargaining power to strong arm a settlement offer of $5,000 from each victim and then continue to violate the FDCPA and the consent agreements with the CFPB.
I understand the company’s response to my complaint.
Yes.
I understand PRA’s response and disagree with it.
The company did what they said they would do with my complaint.
No.
Portfolio Recovery Associates said they would do nothing further with my complaint.
PRA lied when it said it closed my account “in response to [my] dispute.” They said in court that they closed my account “in light of the litigation”. In response to my dispute PRA sent the fraud / identity theft affidavit for me to fill out, even though I did not claim there was fraud. I had no idea what happened with the account because it was 10 years since the alleged charges were made and there was no documentation showing on what or where those charges were made.
PRA asked the court to make me pay their costs in my FDCPA case, in violation of 15 U.S.C. 1692(k) which only allows for costs and attorney fees where the plaintiff filed the complaint in bad faith.
Obviously, my complaint was not in bad faith, as PRA set my balance to zero and closed the account in direct response to the litigation. They also said specifically that they did not file the 1099-C because my claim of fraud was made in good faith. I have had to spend another two weeks opposing PRA’s motion and am nervous that Judge Lee P. Rudofsky, who wrote that the CFPB is on an unconstitutional power grab, will rule in PRA’s favor erroneously.
