Portfolio Recovery Associates, LLC buys junk debt for pennies on the dollar, and then the army of attorneys file about 3,000 lawsuits per week against alleged debtors, knowing 90% won’t even go to court to protect themselves. PRA takes a default and starts garnishing bank accounts and wages. They even settled a claim by the attorney general of Massachusetts who said that the company took old folk’s pensions.

Some people might owe the alleged debts. It does not matter to PRA though whether the debt is a clerical error or the result of fraud. According to the Consumer Financial Protection Bureau, hundreds of thousands of people fall victim to PRA’s impermissible collection of inauthentic debt each year.

Federal District Court Judge Lee P. Rudofsky is presiding over a case in the Eastern District of Arkansas in which I am plaintiff against Portfolio Recovery Associates. It is not looking too good for me. I know I should win. I have known since before discovery and two years of research that I should win. But Judge Rudofsky already dismissed the vast majority of my claims on a motion for summary judgment.

I recently was dismissed as a defendant in a case where the plaintiff’s attorney, judge and court reporter fabricated hearing dialogue. Portfolio Recovery recently agreed to pay $12M in restitution and $12M in a civil fine for violating the same statutes against hundreds of thousands of victims that I claim they violated against me. So, why not believe them more than he believes me?

All I am asking for is to present my case to a jury. Another PRA victim sued the company in 2015 and was awarded $82M in punitive damages on top of $250,000 in actual damages and $1,000 in statutory damages. PRA appealed. The case was remanded after settlement and before the appellate court issued an opinion based on the briefs.

You can scroll down to download the original version of the trial court order below. The footnotes were deleted or made part of the text body in this cut and pasted version. I added a few comments of my own in straight parenthesis or red.

IN THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI
AT KANSAS CITY

PORTFOLIO RECOVERY
ASSOCIATES, LLC, A LIMITED
LIABILITY COMPANY,

Plaintiff/Counterclaim Defendant,

Case No. 1216-CV34184
v. Division 9

GUADALUPE MEJIA,

Defendant/Counterclaim Plaintiff.

JUDGMENT/ORDER
Pending before the Court is Counterclaim Defendant Portfolio Recovery Associates,
LLC’s (“Defendant’s”) Motion For Judgment Notwithstanding The Verdict, Or In The
Alternative, To Amend, Modify, And/Or Remit The Judgment. The Motion is denied.

Background
On October 31, 2014, this Court entered Judgment for the Plaintiff on her malicious
prosecution counterclaim and her Fair Debt Collections Practices Act (“FDCPA”) counterclaim
and ordered that trial proceed on damages only. On May 4, 2015, this case came before the
Court for trial on damages only. On May 11, 2015, the jury awarded Maria Guadalupe Mejia
Alcantara (“Plaintiff”) $250,000.00 in compensatory damages and $1,000.00 in statutory
damages on her FDCPA claim. The jury also awarded her $250.000.00 in compensatory damages on her malicious prosecution claim and found Portfolio liable for punitive damages.

After further deliberation, the jury awarded $82,009,549.00 in punitive damages.

Following trial, the Court entered Judgment in favor of Plaintiff and against Defendant
for punitive damages in the amount of $82,009,549.00, compensatory damages in the amount of
$250,000.00, statutory damages in the amount of $1,000.00. The Court further awarded Plaintiff
attorney’s fees and expenses as follows: (a) actual damages in the amount of $9,995.00 for the
attorney’s fees associated with the her defense; (b) attorney’s fees in the amount of $276,025.00
under the FDCPA; and (c) expenses in the amount of $33,222.97 under the FDCPA.

The pending motion was timely filed and contains numerous issues. The Motion is
denied, but the Court will specifically address the Defendant’s request for review of the jury’s
punitive damage award.

The Court acknowledges the purpose of punitive damages is to serve the State’s interest
in punishment and deterrence, and that these interests cannot be served unless potential
defendants have fair notice, not only of the conduct that will subject them to punishment, but
also of the severity of the penalty that a State may impose. “The decision to punish a tortfeasor
through an award of punitive damages is an exercise of state power that must comply with the
Due Process Clause of the Fourteenth Amendment of the United States Constitution and with
Article I, section 10, of the Missouri Constitution.” Mansfield v. Horner, 443 S.W.3d 627, 643
(Mo. Ct. App. 2014) (internal quotations and citations omitted).

Thus, the Court must review the punitive damage award to determine whether it is
“grossly excessive.” Id. Such analysis includes review of three guideposts: 1) the degree of
reprehensibility of a defendant’s conduct, 2) the ratio of the punitive award to the actual and
potential harm from the defendant’s wrongdoing, and 3) the criminal and regulatory sanctions for
comparable misconduct. BMW of North America v. Gore, 517 U.S. 559, 574-75 (1996).

[Such as the 2015 civil fine against PRA for $8,000,000 and the agreement to pay a civil fine of $12,000,000 made on March 23, 2023.]

Guidepost One
“The most important indicium of the reasonableness of a punitive damages award is the
degree of reprehensibility of the defendant’s conduct.” State Farm Mut. Auto. Ins. Co. v.
Campbell, 538 U.S. 408, 419 (2003) (internal quotation and citation omitted). The Supreme
Court suggested several factors should be considered when determining reprehensibility of
conduct: “the harm caused was physical as opposed to economic; the tortious conduct evinced an
indifference to or a reckless disregard of the health or safety of others; the target of the conduct
had financial vulnerability; the conduct involved repeated actions or was an isolated incident;
and the harm was the result of intentional malice, trickery, or deceit, or mere accident.” Id. at 419
(citation omitted).

Here, although the potential harm to the Plaintiff may be considered economic, there was evidence Defendant’s conduct had a physical and health-related impact on this particular Plaintiff, her financial vulnerability was particularly concerning. Plaintiff, although working, was in financial distress. She spoke limited English. She did not understand the legal system and had no
financial ability to hire an attorney. She was afraid she would lose all she had worked for – her
home of twenty years, her family, and her freedom. And, throughout this litigation, Defendant
preyed upon those fears. Further, Defendant’s conduct “involved repeated actions” in many
respects.

From the beginning of the litigation, Defendant attempted to use the fact Plaintiff had no
social security number to intimidate her. Defendant represented to the Court and Plaintiff it
could not mount a defense to Plaintiff’s claims or dismiss its claim against her until her social security number was revealed.

[In my case, PRA is well aware that I have had biased judges make Draconian orders against me and that I dread fighting anymore of my own cases without an attorney to represent me.]

Eventually it was discovered an attorney had disclosed to Defendant, before Plaintiff filed her counterclaim, Plaintiff had no social security number. And at trial, evidence established Defendant resolved claims, in many instances, without disclosure of
a social security number.

[PRA demanded that I tell them the last four digits of my social security number before they would tell me what company was calling me.]

Defendant repeatedly was put on notice Plaintiff was not the correct person, but pressed
forward with the lawsuit against her anyway. To locate the debtor account holder, Defendant
relied on a Lexis Nexis search of a very common Hispanic name – the accuracy of which was
specifically disclaimed. Defendant was warned it should independently verify the information.

Defendant’s collection law firm, Gamache and Meyers, P.C., reviewed an Experian report that
did not verify Plaintiff’s address, and in fact, indicated a Kansas address.

The day after the collection suit was served on Plaintiff, she appeared at legal aid
distraught and crying. Suzanne Gladney, a practicing attorney for thirty-seven years, testified
she spoke to three people at Gamache and Meyers and told them they had the wrong person,
gave them identifying details about Plaintiff (she lived in Missouri, owned her home, never had a
credit card) and attempted to fax to the law firm Plaintiff’s passport, which the firm refused. She
told them Plaintiff did not have a social security number, and Gladney attempted to obtain the
fraud affidavit Defendant wanted filled out. In response, Defendant arrived in Court prepared to
seek a default judgment against Plaintiff.

[PRA and Judge Rudofsky faulted me for not filling out the fraud affidavit presented to me, as if filling it out would make one bit of difference.]

As the lawsuit progressed, Defendant obtained account documents showing credit card
payments were being made on the account from the Kansas address, as opposed to Plaintiff’s
address.

[The account documents in my case did not even show where any purchase was made. For the first eight months of litigation PRA claimed there were no statements at all. Then they claimed to find the “charge-off statement” but did not produce any statements that showed payments or purchases. It seems likely that PRA has those statements, and they would show that the charges were made by some other “Laura Lynn”, someone named “Laura Lyman” whom PRA named on one letter it addressed to me, or one of my less than honest exes. Like, if the charge was made at a brothel in Nevada while I was at a family function in Los Angeles, it was probably made by the fraudster Mike Pietrczak who wrote that his lawsuit against me was part of a fraudulent scheme.]

Plaintiff denied the debt in her Answer and responded, under oath, to interrogatories,
document requests, and requests for admissions (63 questions but ironically Defendant did not
request Plaintiff’s date of birth or social security number) providing even more personal
information establishing Plaintiff was not the debtor Defendant was seeking. But, Defendant
continued to pursue its suit.

At trial, Defendant admitted it maintained its lawsuit against Plaintiff, not merely to
collect the $1,137.14 credit card debt owed, but because she filed a counterclaim.

[PRA attorney James Trefil of Troutman Pepper said it zeroed out my balance “in light of” the lawsuit I filed.]

When Defendant did dismiss the case against Plaintiff, it did so “without prejudice” and threatened to
refile against her even though it had no reason to question her and the conclusive evidence she
was not the debtor.

[PRA said it waived the alleged debt against me, but, after seeing how partial Judge Rudofsky was to them, tried to intimidate me into confessing to the debt.]

Defendant testified through its attorneys and corporate representative that its business
model did not include independent investigation of an accused’s claim she did not owe the debt
at any point from purchase of the debt to litigation – even if legitimate concerns were raised. It
maintained it is the wrongly accused’s burden to dispute the debt, prove it is not theirs, and
provide to Defendant personal information.

[And Judge Rudofsky agrees with PRA.]

Defendant testified the fault for the present litigation was Plaintiff’s. Defendant made no apologies, testified its policies were sound, and no changes were anticipated.

[All the while, as in my case, PRA was negotiating with the CFPB to curtail its miscreant conduct.]

Throughout the case, Defendant demonstrated a disrespect for the law. Numerous
discovery abuses resulted in the Court sanctioning Defendant. Defendant argued at trial, had
Plaintiff merely filled out a “fraud affidavit,” the case could have been resolved.

[Pff.]

However, that fraud affidavit would have required Plaintiff to perjure herself, a fact communicated to
Defendant through Plaintiff’s counsel.

[PRA did not tell me anything about where or on what my alleged debt was incurred; they wanted me to swear under penalty of perjury who I suspected made the charge. I mean, come on guys, give me a little hint here.]

During trial, collection counsel testified about a manufactured letter, supposedly representative of a letter sent to Gladney, but containing an address different than the address provided by Gladney. Counsel acknowledged that the original should have been maintained but was “lost.”

[PRA has a bit of practice now. Since there was no Old Account Level Documentation on my account, PRA “found” a statement eight months after their investigation was supposedly “completed”.]

Evidence was presented establishing Plaintiff’s experience was not an isolated incident.
Brian Logan, an active member of the military, was harassed for years by the Defendant until he
complained to the Missouri Attorney General’s Office. He offered to fill out a fraud affidavit
and when he provided his address for that purpose, he received only bills and no fraud affidavit.

Defendant accused Logan’s wife of having an affair as an explanation for the existence of the
account.

Dr. Ronald Harstad and his wife were harassed and berated by Defendant even though
he disputed the debt in writing. His hiring of an attorney and filing of a counterclaim finally
ended the matter, and he did not have to fill out a fraud affidavit. Evidence showed Defendant
receives more complaints than any debt buyer in Missouri. And, at least 375 mistaken identity
claims have been raised against Defendant. These claims were the subject of discovery abuse litigation. The Court read an adverse
inference instruction because it was determined Defendant never did provide all the claims
discovery as ordered by the Court.

[Portfolio Recovery did not tell me who provided their phone service and Judge Rudofsky acted like their own notes would suffice as evidence of when and how many calls they made to me.]

Based on the evidence before it, the Court finds
Defendant’s conduct to be intentional and malicious.

Guidepost Two
In awarding punitive damages, “courts must ensure that the measure of punishment is
both reasonable and proportionate to the amount of harm to the plaintiff and to the general
damages recovered.” Campbell, 538 U.S. at 426. The Court has repeatedly rejected that the
difference between a reasonable and grossly excessive award can be determined by “a simple
mathematical formula, even one that compares actual and potential damages to the punitive
award.” Id. at 424-25 (internal quotation and citation omitted). And, while the Supreme Court
noted “[s]ingle-digit multipliers are more likely to comport with due process, while still
achieving the State’s goals of deterrence and retribution, than awards with ratios in range of 500
to 1,” id. at 425 (citation omitted), due process may still be satisfied by a higher ratio where “a
particularly egregious act has resulted in only a small amount of economic damages,” id.
(citation omitted), or “where the injury is hard to detect or the monetary value of noneconomic
harm might have been difficult to determine.” Gore, 517 U.S. at 582.

Where larger discrepancies between the size of the compensatory damages and punitive
damages have been allowed, the Court has relied on the idea that they must weigh the actual and
potential harm to the plaintiff the defendant’s conduct caused. See TXO Prod. v. Alliance Res.
Corp., 509 U.S. 443, 460 (1993) ($19,000 in actual damages and $10 million in punitive
damages, a 526-to-1 ratio, for slander of title); see also, Lynn v. TNT Logistics N. Am. Inc., 275
S.W.3d 304, 311-13 (Mo. Ct. App. 2008) (9 to 1 ratio applied by the trial court too low to punish
and deter a defendant; 75 to 1 ratio applied); Estate of Overbey v. Chad Franklin Nat’l Auto
Sales, 361 S.W.3d 364, 373 (Mo. 2012) (ratio of 111 to 1 upheld); Lewellen v. Franklin, 441
S.W.3d 136 (Mo. 2014) (double-digit ratio endorsed after considering defendant’s lack of
remorse, refusal to rectify reckless practices, and refusal to comply with discovery); Smith v.
New Plaza Pontiac Co., 677 S.W.2d 941 (Mo. Ct. App. 1984) ($400 in actual and $30,000 in
punitive damages, a 75-to-1 ratio, for making misrepresentations about the condition of a used
car); Kemp v. Am. Tel. & Tel. Co., 393 F.3d 1354 (11th Cir. 2004) ($115 in compensatory
damages and $250,000 in punitive damages, a 2,172-to-1 ratio, for fraudulent billing practices);
Parrott v. Carr Chevrolet, Inc., 107 P.3d 473 (Or. 2001) ($11,496 in compensatory damages and
$1 million in punitive damages, an 86-to-1 ratio, for misrepresentations related to the sale of a
vehicle). Here, the Court finds the Defendant’s actions are particularly egregious. After review
of the jury’s awards and the evidence before the Court, the measure of punishment is both
reasonable and proportionate to the amount of harm and potential harm to the plaintiff and to the
general damages recovered.

Guidepost Three
“A reviewing court engaged in determining whether an award of punitive damages is
excessive should ‘accord ‘substantial deference’ to legislative judgments concerning appropriate
sanctions for the conduct at issue. ’” BMW of North America, Inc., 517 U.S. 559, 583 (1996)
(quoting Browning–Ferris Industries of Vt., Inc. v. Kelco Disposal, Inc., 492 U.S. 257, 301
(1989)) (O’Connor, J., opinion concurring in part and dissenting in part). There are no
comparable criminal penalties to be considered here.

Conclusion
The Court finds the harm to Plaintiff was the result of intentional malice and not mere
accident. This Defendant owns debt in all 50 states – 750,000 accounts in Missouri, 37,500 of
which are in litigation. It shows no remorse. It’s business model is irresponsible and preys
against the financially vulnerable. The Court does not intend to make any comment on the debt buying industry generally and is
limiting its analysis to the evidence presented in this case about this Defendant.

This Defendant does not respect the Court’s rules. And,
especially reprehensible is Defendant’s use and abuse of our court system to harm the Plaintiff.
Under the facts presented in this case, the Court cannot find that the jury’s punitive damage
award – equating to half of Defendant’s net profits for one year – is grossly excessive. The Court is not relying on the wealth of the Defendant to justify the award, but rather the reprehensibility of Defendant’s conduct.


It is hereby ORDERED Counterclaim Defendant Portfolio Recovery Associates, LLC’s Motion For
Judgment Notwithstanding The Verdict, Or In The Alternative, To Amend, Modify, And/Or
Remit The Judgment is denied.

JOEL P. FAHNESTOCK, JUDGE
CERTIFICATE OF SERVICE
This is to certify that a copy of the foregoing was hand delivered/faxed/emailed/mailed and/or sent
through the eFiling system to the following on 4th day of November, 2015:
EDWARD J. MYERS, Attorney for Plaintiff, GAMACHE & MYERS PC, 1000 CAMERA AVE – STE
A, SAINT LOUIS, MO 63126, (314) 835-6604, EdwardMyers@GMCollects.com
GINA MARIE CHIALA, Attorney for Defendant, 1627 MAIN STREET, SUITE 900, KANSAS CITY,
MO 64108, (816) 531-2147, GinaChiala@jobsandfreedom.org
SUNMIN JEREMIAH HONG, Attorney for Plaintiff, 231 S BEMISTON AVE, SUITE 1111, ST LOUIS,
MO 63105,
DALE K IRWIN, Attorney for Defendant, SLOUGH CONNEALY IRWIN, & MADDEN LLC, 1627
MAIN STREET, SUITE 900, KANSAS CITY, MO 64108, (816) 531-2147, dirwin@scimlaw.com
JOSHUA C DICKINSON, Attorney for Plaintiff, 1000 WALNUT ST STE 1400, KANSAS CITY, MO
64106, (816) 474-3216, jdickinson@spencerfane.com
KERSTEN LEIGH HOLZHUETER, Attorney for Plaintiff, SPENCER FANE BRITT & BROWN LLP,
1000 WALNUT STREET, SUITE 1400, KANSAS CITY, MO 64106, (816) 474-3216,
FRED L SLOUGH, Attorney for 3rd Party, SLOUGH CONNEALY IRWIN & MADDEN, 1627 MAIN
SUITE 900, KANSAS CITY, MO 64108, (816) 531-2147, fslough@scimlaw.com
ELIZABETH C CARVER, Attorney for Plaintiff, BRYAN CAVE 3600, 211 N BROADWAY, ST
LOUIS, MO 63102-2733,
ROBERT M. THOMPSON, Attorney for Plaintiff, ONE KANSAS CITY PLACE, 1200 MAIN ST, STE
3800, KANSAS CITY, MO 64105, (816) 855-3233, rmthompson@bryancave.com
Law Clerk, Division 9

When an attorney signs a court document or contributes to the advocacy of that document, the attorney is certifying that “the denials of factual contentions are warranted on the evidence or, if specifically so identified, are reasonably based on belief or a lack of information.” This is found in Federal Rules of Civil Procedure 11, and most state courts have a similar rule.

I am not an attorney, this is not legal advice, but what it means to me is that an attorney is not allowed to knowingly lie on court documents.

I filed a lawsuit against a debt collector named Portfolio Recovery Associates LLC because PRA called me hundreds of times from neighbor spoofing telephone numbers, wouldn’t say the company name or what it was about unless I agreed to a tape-recorded interrogation beforehand, and (not that it should matter), I did not owe the alleged debt they were calling about.

Attorneys for Portfolio Recovery, David Mitchell from Rose Law Firm in Arkansas, John “Jed” Komisin and James Trefil of Troutman Pepper Hamilton Sanders in Virginia responded by saying, among other lies, that I owed $2,297.63 when the calls were made and that PRA waived the debt “in light of” the litigation I filed.

This is preposterous on its face. Why would a debt collector waive a debt because someone filed a lawsuit and not use the waiver as a bargaining chip for a settlement? They wouldn’t.

Interestingly, a Trump appointed judge named Lee P. Rudofsky accepted the silly lie by PRA’s attorneys as true.

At the time the lawyers wrote and filed their lie, PRA had no documentation of the alleged debt. They did not even produce the alledged portfolio that allegedly had a single line item on a list of millions of debts. PRA could never find documentation of what or where a purchase was made with the credit card associated with the account. They could find no contract between me and the credit card company that they were willing to share. (That may be because the credit card agreement, if it existed, had an arbitration clause and PRA does not like to arbitrate against self-represented litigants.)

The first form letter PRA sent to me which showed a balance of zero had someone else’s name and account number on it. Supposedly there was a clerical error inputting data. Does anyone else see the irony? Attorneys are defending the legitimacy of an alleged debt and in the same breath, claiming there was a simple data entry error made on the account, where someone else’s data was swapped in for the data on my account.

Portfolio Recovery is notorious for trying to collect debts from portfolios they and their attorneys know are riddled with errors.

The CFPB has obtained multi-million-dollar settlements against PRA for the exact conduct. In fact, the debt they tried to collect from me was from one of the portfolios that resulted in a settlement in 2015. After this post was originally written, PRA settled with the CFPB for another $24 Million for allegations that PRA violated the 2015 consent agreement against hundreds of thousands of people.

The problem is plaintiff’s attorneys are not willing to take Fair Debt Collection Practices Act cases to trial. They encourage the victims to settle for a pittance. I am posting one settlement of a class action against PRA below. The 74 class members received about $135 each. The attorneys requested $25,000 for themselves as fees.

Until the debt collector is required to pay significant punitive damages for its conduct, it will not comply with the law and the attorneys will continue to lie in court, inflicting even more emotional distress on the victims. The 2015 settlement had a punitive element of $8,000,000. That did not stop PRA from repeat offending. The 2023 settlement had a $12,000,000 fine. But PRA still refuses to come clean on our case and let a jury decide what it is worth based on the facts.

My suggestion, if you are receiving calls where the caller says “this is John Smith calling for Your Name” and then asks you to verify your identity by answering questions like your birthdate and address, tape record the calls. The newly activated “Regulation F” requires debt collectors to abide by a verbal cease and desist request if their communication is verbal. Record your calls because PRA lies about how many times they called a person. Take screen shots of calls coming to your phone. Call the numbers back and record the message that tells you whose phone you are calling.

Document, document, document.

You may be able to file a suit on your own behalf by using an existing suit as a template. Otherwise, you can go to the CFPB and contribute to the next action the government agency takes against PRA. If you have solid evidence that the defense attorneys lied on their documents, you may be able to win a motion for sanctions according to Rule 11. A better option is reporting the unethical conduct to the State Committee on Professional conduct AKA the Bar.

Don’t let these guys bully you. Get loud.