Friday, April 01, 2011

Lawyer's 'Boot Camps' Help Growth In Army Of FDCPA Attorneys; Contingent Fee Deals Drive Increase In Table-Turning Consumers' War On Sleazy Collectors

A recent story in the Minneapolis Star Tribune profiled consumer attorney Pete Barry, a local lawyer who's become well-known for his efforts directed not only at putting the squeeze on sleazy bill collection agencies for violating the rights of debtors under the Federal Fair Debt Collection Practices Act ("FDCPA"), but also for training other attorneys around the country through his FDCPA Boot Camp to do the same. An excerpt from the story on how his FDCPA Boot Camp for attorneys was born:
  • He quickly came to appreciate the FDCPA as a little-understood protection for consumers. The 1977 law bars collectors from using obscenities or making threats, such as telling someone they will be thrown in jail. It sets fines of up to $1,000 per lawsuit and requires offending collectors to reimburse debtors' attorneys fees. And because it focuses on collectors' practices, rather than creditors, the lawsuits can't be derailed by clauses in credit agreements requiring binding arbitration.
  • Barry became one of the first attorneys in the nation to make a living exclusively suing debt collectors. He did so just as consumer debt levels began to mushroom. Between 1997 and 2009, outstanding credit-card debt soared from $515 billion to $969 billion. By 1999, Barry was already winning five-figure settlements in FDCPA cases.
  • One day in 2001, Barry got a call from two San Diego attorneys who wanted to know how to build a practice around suing collectors. Barry jumped on a plane and spent the next five days in a Sheraton hotel there, explaining the nuances of the law over salads and Diet Cokes.
  • Soon, Barry began getting calls from attorneys everywhere. Would he do a tutorial for them, too? His boot camp was born, helping create an army of FDCPA attorneys. Just two lawyers made a living filing suits under the federal law 20 years ago. Now, there are more than 400.


  • Barry sees the boot camps as playing a vital role in keeping the collections industry in check. At a recent camp in Minneapolis, he poked fun of collectors who thought they were above the law -- until they got sued.(1)


  • For all his success, Barry may no longer be the attorney most hated by the collections industry. That distinction has passed to a handful of high-volume law firms that generate thousands of FDCPA cases a year.
  • The most prolific is a Los Angeles law firm run by Adam Krohn, a Barry boot camp graduate and founding partner of Krohn & Moss Ltd. Three years ago, Krohn's firm specialized in suing car dealers and manufacturers under state "lemon laws" that protect car buyers against defective vehicles. When auto sales tanked, Krohn turned his attention to FDCPA litigation.
  • He sent notices to many of his 40,000 past clients, announcing that his firm had begun suing debt collectors. Today, his firm files 15 percent of all FDCPA lawsuits in U.S. courts, according to WebRecon. "I wish I could tell you a great story about how my mother was driven to madness by a debt collector," Krohn said with a laugh. "But I can't. I love what I do, and I don't mind calling it a business."
  • Ten law firms accounted for 40 percent of the 9,290 cases filed nationwide in federal courts against collection firms in 2009, according to WebRecon.
For the story, (a must-read for those looking to slam sleazy collectors), see Debtors in court -- suing collectors (Pete Barry, a Minneapolis attorney, has flown all over the country conducting boot camps for lawyers, teaching them how to sue debt collectors under the federal Fair Debt Collection Practices Act (FDCPA)).

Go here for more on Barry's law firm, Barry & Slade, LLC (We Sue Abusive Debt Collectors™).

(1) Barry plays recordings from tense question-and-answer sessions known as depositions in his boot camps, the story states, and reportedly includes one from a 2005 case that Barry won by prodding a collector into admitting that he swore over the phone.

  • "Why did you call my client a low-life piece of shit?" Barry asked the collector, according to the transcript. "In about 10 seconds you're going to have that answer, Mr. Barry," the man replied. "I'd like the answer now, please," Barry said. "Well, you have to get it when I give it. ..." the collector said. "I'm asking you, and I'm going to ask you again, the question is, why did you call my client a low-life piece of shit?" Barry said. "Because in my opinion, a person who doesn't pay his bills ... is a person who in my opinion is a low-life piece of shit," the man replied.

According to the story, the collector lost, Barry and his client were awarded $275,000 in a legal settlement, and is just one of more than 2,000 such cases he has pressed in the past decade. Barry works on a contingency basis, meaning he doesn't collect attorneys' fees unless he wins, the story states.