Providing Debt Relief for Clients Throughout the State of New York

Kazlow & Kazlow/Access Group Loan Settled

Access Group Tertiary, a private student loan guarantor sued our client through their local New York attorneys, Kazlow and Kazlow, a firm we defend consumers against often. We immediately drafted an answer with all the necessary affirmative defenses, but this case had a few interesting factors to point out. First, the complaint stated that the amount being sued for was approximately $28,000, and later on, it stated that it was $28,000 along with interest which really equated to about $43,000. Our opinion was that this was deceptive and could be a potential FDCPA issue. The second issue was that our client was sued approximately five years after the alleged default. Based on Portfolio Recovery Associates v. King 2010 NY Int. 68 , the Statute of Limitations should be based on which jurisdiction the Plaintiff’s principal place of business resides. In this case that would make it a 3 year statute and the suit would be past the SOL. After making this argument, Kazlow and Kazlow stated that there was also a forum selection clause in the agreement which listed Ohio law to be used in litigation. Ohio law has a six year SOL as does New York.

As the case law on the second issue of forum selection vs. principal place of business has not been decided by the New York Court of Appeals, we decided to use this issue as leverage in our negotiations. We told Kazlow and Kazlow that that we believed there to be multiple FDCPA violations of a deceptive nature including but not limited to the fact that this action was past the SOL and that there were differing amounts in the complaint that would confuse the average consumer. Due to these issues, Kazlow and Kazlow offered an out of court settlement that totaled a reduction of about 67% off of the total balance of the student loan and gave our client a long repayment period to complete the payments at no interest. To mitigate the risk, our client accepted the offer and resolved the issue.