Giant Creditor, Midland Funding LLC, Loses at Trial

Modern day rebels have defeated the Imperial Storm Troopers, a.k.a. Midland Funding LLC!

A debtor sued by Midland Funding, LLC won at trial and is has now sued Midland Funding LLC for unfair practices and malicious prosecution.  

In Fresno County and the rest of California’s Central Valley, Midland Funding, LLC, has filed thousands of cases on behalf of credit card companies and other creditors.  Most of the time Midland hopes that the defendant never responds to the lawsuit.  However, if the defendant responds, they hope to settle the case before it ever goes trial.             
In Samuels vs. Midland Funding, LLC, 2013 Westlaw 466386 (S.D. Ala.), defendant Samuels fought Midland Funding.  He did not settle the case but forced them to trial and won!.  He then sued Midland funding.  This case looked at whether it was permissible for Samuels to sue Midland after it lost at trial.  So far, the court is saying that Samuels has a valid lawsuit against Midland Funding. 
Before looking at the details in this case, let’s take a step back.  Midland Funding is notorious throughout the country for buying debt in bulk.  Just like how you can go to Costco and buy a 100 rolls of toilet paper in bulk, Midland Funding purchases blocks of debt at a discount.  It then tries to collect on the debt.  Their goal is to collect more money from debtors than it cost them to buy the debt.  They are very good at what they do.  The problem bulk debt purchasers have is that they sometimes fail to obtain the documents, or understand the facts well enough to win at trial.  
 In the Samuels case, the debtor was smart.  He figured out that Midland Funding could not prove its case and refused to settle with them.  By refusing to settle, Samuels forced Midland to trial.  They were completely unprepared for trial.  They showed up with no witnesses or documents to show the debt was owed by Samuels.  Like many “bulk purchasers” of debt – they were hoping to settle the case or that Samuels would ignore the lawsuit so that it would not have to prove their case in front of a jury, or judge.  They must have been shocked Samuels took them all the way to trial because they showed up with no witnesses or evidence to prove the debtor owed the debt.  Needless to say, the Samuels won the case. 
But, the story does not end here for Midland Funding.  Samuels went on the offensive.  He filed a second lawsuit against Midland Funding for violation of the Federal Debt Collection Act and malicious prosecution.  Midland Funding’s high powered attorneys tried to kick the case out before it was tried by a judge or jury.  However, they lost the motion and tried to win on appeal.  However, they lost again.  The court held that it was concerned with bulk purchasers of debt that were unable to prove their cases.  Now it looks like Midland Funding has to convince Samuels to settle his case against them by paying money to him.  I hope Samuels takes this case to trial.  It would serve Midland Funding right if it is proven they were never in a position to win their case at the trial level. 

The lesson to take from this case is to not be afraid of these national debt companies.  Defend yourself!  Make sure the claim is valid and that the debt collector can prove its case at trial.  If they cannot do this before trial, they likely will fail at trial as well.  It is unfortunate that very few defendants in Midland Funding cases know this.  Do not be one of them. 

photo:

  http://www.flickr.com/photos/snotch/