Judge Michael Ciaffa
In a case of first impression, the court had to determine whether a debt buyer, suing as the alleged assignee of a claimed consumer debt, may be countersued for violating GBL §349 based on allegations that it commenced the lawsuit without any evidence that could prove the claim. The court held that deceptive conduct by a debt buyer in the course of civil litigation may violate a consumer’s legal rights under §349. The court added that, when a debt buyer seeks the courts’ aid in enforcing an assigned debt claim, it should not commence the action unless it can readily obtain admissible proof that would make out a prima facie case. The court further noted that such proof should include evidence that it actually owns the debt, that the defendant was given notice of the assignment, and that the underlying debt claim is meritorious. The court concluded that if the debt buyer commences such action without having such readily available proof, it may end up losing the case and may also be found liable for damages and attorney fees.
