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Florida firm ordered to pay $831K for foreclosure summons fraud

A Florida law firm that represented banks in numerous foreclosure actions has lost a class-action lawsuit filed by more than 1,000 homeowners. The firm, the Law Offices of David J. Stern, was ordered by the court to pay more than $831,000 in damages. The plaintiffs accused of the firm of sending them needless summonses for the purpose of overbilling them.

The class-action suit was filed in 2009, around the height of the nationwide foreclosure crisis. The plaintiffs had been served with papers by the law firm, which represented lenders who were seeking to foreclose on the plaintiffs' property.

Many of the plaintiffs were single and did not rent out any portion of their property. However, they received separate summonses for nonexistent persons, addressed to "John and Jane Doe," "unknown spouse" or "unknown tenant." The plaintiff would be charged for delivery of these summonses, typically $45 apiece.

The plaintiffs argued that there is no legal justification to issue a summons to an unknown person. The judge agreed, and ruled that the firm's charging the plaintiffs violated state law, including the Florida Consumer Collection Practices Act and the state Deceptive and Unfair Trade Practices Act.

In her order, the judge noted that the firm was well versed in the law, and should have known that this practice was illegal.

The award for each individual plaintiff will range from $451.67 up to $2,700. Not much, but the total damages of $831,110 will hopefully send a message to the defendant that his business practices were illegal and unethical. He has also been disbarred.

Foreclosure can be scary, but there are things that a Florida homeowner can do to defend him- or herself, and possibly keep his or her home. An attorney can help you defend your legal rights.

Source: The Palm Beach Post, "Class action win against foreclosure king Stern," Kim Miller, Jan. 27, 2014

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