Josh Goodnewt attended a webinar hosted by the National Association of Consumer Advocates last week about what to do to help victims of online lending schemes. This post contains some general information about steps you may want to consider taking if you are tangled up with an online lender. As always, please consult with legal counsel about your particular situation before acting.

Hopefully you found this post before you ever borrowed money from an internet lender, and you’re just searching for information about whether you should get a loan from an internet lender. If so, don’t do it. Unlicensed online lending is illegal in the Commonwealth of Kentucky. And it’s a trap.

Well, actually it’s several traps:

First, before you ever borrow, just putting your information into an internet lender's website opens you up to wrongdoers. The website you give your information to is most often not the lender. Instead, it is a lead generator — meaning you give them information, and they sell it as a “lead” to potential lenders who will then offer you a loan. Once that information is in that lead generator’s hands, they may keep selling it or misuse it and you could lack much of a recourse if they do.

Second, once you get the loan you’re charged exorbitant interest rates so that even if you timely make your payment, you may never actually pay down the principal balance.

Third, you are often required to authorize the lender to take money directly from your account via ACH (automated clearinghouse) transactions or EFT (electronic funds transfer) payments. The lender will continue to withdraw these payments until the balance is paid off. Since the interest rate is so high, you won’t likely be able to pay down the loan and the withdraws will continue perpetually.

Fourth, if you find a way to stop making payments, you’re in for a lot of harassment. Any information you gave that lead generator now may be used to harass or threaten you. They will not necessarily limit to calling you on whatever phone number you left them, but may call your employer if you listed it, or anyone you listed as your references. They may report the debt to credit reporting agencies and damage whatever credit you may have, which may affect your ability to gain future employment or an apartment.

So, hopefully you didn’t open yourself up to any of that! Unfortunately you probably have, and if so there are a few steps you can take.

1. Withdraw your ACH authorization for ALL DEBITS by notifying the lender in writing. You can mail it to their address or attach it to an email.
2. Notify your bank immediately that you have withdrawn your authorization for ALL DEBITS from that lender. Tell your bank that these and future debits from that lender are “Unauthorized Debits”
3. Open up a new bank account at a different financial institution and notify any direct depositors of the new account.
4. Close the account the lender is debiting.
5. Dispute with the bank ALL of the debits made by the online lender.

If you have borrowed money from an online lender, following these steps may be your best bet to ending the constant withdrawals. Remember, you have done nothing wrong. If your lender lacks a license in Kentucky, you are being scammed by an illegal lender and you are under no obligation to pay the lender back. KRS 286.4-991.

Unfortunately, there is rarely much that can be done to these scammers. However, if you have any questions about any of the above, feel free to contact us at Ben Carter Law, PLLC.

When people ask me what I do, I usually tell them, "I make bad jokes on the internet." When they ask me what I do for money, I tell them I'm a consumer lawyer. If they're not too proud to admit to not knowing what consumer law is, they'll ask, "What is consumer law?" 

Here is a little mailer I sent out to fellow lawyers last year explaining what kinds of cases I handle as a "consumer lawyer".

Somehow, though, I think that just describing the kind of work that consumer lawyers do and the kinds of cases they take misses the point a bit. It gets to the what, but not the why of consumer law. 

But, I recently had the opportunity to speak to about a hundred newly-minted attorneys at the KBA's New Lawyer Program about Kentucky consumer law. My Lebowski-themed presentation about consumer law touched on many of the same areas I listed in the mailer: the Kentucky Consumer Protection Act, debt collection abuse, insurance bad faith, auto fraud, the Kentucky Lemon Law, etc. 

Before I ran through those specific state and federal statutes protecting consumers, though, I gave Kentucky's newest lawyers my freshest take on what consumer law is. I told them that being a consumer lawyer means applying all of your skill, training, and heart to the legal problems that impact low- and middle-income Americans. It means using the laws (common, local, state, and federal) to protect the bottom lines of the most fragile budgets in America. 

Rather than defining consumer law as a kind of case or a particular set of statutes, I want to broaden my definition of consumer law to "practicing law with the goal of helping low- and middle-income American families achieve and sustain financial stability". 

This definition allows me a broader self-concept of "what I do", aligns me more explicitly with the work of allies seeking those same ends through lobbying and public education efforts (rather than my more litigious efforts), and provides me a "North Star" when charting the work I want my firm to do. way forward for my firm. helps me evaluate the direction I want to take my firm. Anything that threatens the financial stability of economically vulnerable people—foreclosure, eviction, abusive debt collection, auto fraud, unfair or misleading business practices, repossession, bad faith claims adjusting from insurance companies—that's what I fight.

Practicing with a goal of helping people avoid the threats to their bottom line motivates me to pay attention to the evolving landscape of threats out there. Every year, it seems, there's a new problem, whether it's vacant and abandoned property, unpaid tax bills on real estate, starter interrupt devices on cars. There's a scammer born every minute. 

Practicing consumer law is much, much broader than using the statutes we typically think of when we think of "consumer law" statutes. It means aligning yourself with  economically fragile families and individuals and using the best, bravest version of yourself to defend them from the flinty-eyed predators stalking your clients and senseless corporate machinery that will consume them without ever thinking once.

In case you were wondering what weaving references to The Big Lebowski into 35 slides about Kentucky consumer law looks like, well, wonder no more. 

PDF of full presentation here: Kentucky Consumer Law Presentation, Lebowski-ized

Tomorrow, I have the opportunity to talk for an hour about consumer law at the Kentucky Bar Association's New Lawyers Program. In anticipation of the presentation (and so I didn't have to fill my slides with text), I prepared a non-comprehensive outline about many of the common law causes of action, state laws, and federal statues that constitute "Consumer Law". 

Below is the outline with some hyperlinks, but because the formatting will never be right in this post, here is a .pdf of the Kentucky Consumer Law Outline. Use it instead. In case you thought it might be, I need to say that this consumer law outline is absolutely not legal advice, dummy.  

And, yes, the presentation will have a Lebowski theme. 

I do mind, man. The dude minds. This aggression will not stand, man. 

▾    1    Kentucky Consumer Protection Act

    ▾    1.1    Legislative Intent

    •    1.1.1    KRS 367.120 “The General Assembly finds that the public health, welfare and interest require a strong consumer protection program to protect the public interest and the well-being of both the consumer public and the ethical sellers of goods and services…”

    •    1.1.2    “The Kentucky legislature created a statute which has the broadest application in order to give Kentucky consumers the broatest possible protection for allegedly illegal acts. In addition, KRS 446.080 requires the statutes of this Commonwealth are to be liberally construed.” Stevens v. Motorist Mutual Ins. Co., Ky. S.W. 2d 819 (1988). 

    ▾    1.2    Who is protected?

    ▾    1.2.1    Statutory Language

    •    1.2.1.1    Any person who purchases or leases goods or services primarily for personal, family or household purposes and thereby suffers any ascertainable loss of money or property, real or personal, as a result of the use or employment by another person of a method, act or practice declared unlawful by KRS 367.170, may bring an action under the Rules of Civil Procedure in the Circuit Court in which the seller or lessor resides or has his principal place of business or is doing business, or in the Circuit Court in which the purchaser or lessee of goods or services resides, or where the transaction in question occurred, to recover actual damages. The court may, in its discretion, award actual damages and may provide such equitable relief as it deems necessary or proper. Nothing in this subsection shall be construed to limit a person's right to seek punitive damages where appropriate. Ky. Rev. Stat. Ann. § 367.220

    ▾    1.3    Who’s Covered in Practice

    ▾    1.3.1    A person (not business) who “purchases or leases goods or services primarily for personal family, or household purposes”

    •    1.3.1.1    But the absence of a finding of a valid contract is not fatal to a claim for unfair trade practices under the KCPA as it would be to a breach of contract claim. Nothing in the KCPA—particularly KRS 367.170 and KRS 367.220—explicitly requires that a binding contract be reached for a purchaser damaged by unlawful trade practices to have a private right of action. Rather, because Piles and Warner qualified as purchasers under the KCPA, they were entitled to sue for any damages resulting from unfair trade practices by Sonny Bishop Cars under KRS 367.220. Craig & Bishop, Inc. v. Piles, 247 S.W.3d 897, 903 (Ky. 2008);

    ▾    1.3.2    Renters

    •    1.3.2.1    In both matters the tenant asserts that the landlord's failure to make needed repairs and his violations of the local housing code constitute unfair, false, misleading or deceptive acts. As a violation of a housing code does not create a cause of action in favor of the tenant, the failure of the landlord to comply with a housing code cannot be deceptive in the absence of an express covenant or agreement that the landlord would comply with such housing code. Likewise, in the absence of a duty or obligation *519  to make repairs to a rental unit, the failure to make such repairs cannot be construed to constitute an unfair, false, misleading or deceptive act. Miles v. Shauntee, 664 S.W.2d 512, 518-19 (Ky. 1983)

    ▾    1.3.3    Homebuyers/Homeowners

    •    1.3.3.1    “That brings us to the violation of the Kentucky Consumer Protection Act, KRS 367.110, et seq. The jury did make a finding of a breach, but with zero damages. We need not get into a discussion as to whether the verdict is an oxymoron because we do not believe that the Kentucky Consumer Protection Act applies to real estate transactions by an individual homeowner.” Craig v. Keene, 32 S.W.3d 90, 91 (Ky. Ct. App. 2000)

    •    1.3.3.2    Summary: Buyers of “as is” mobile home can still maintain causes of action for fraudulent misrepresentation and KCPA. Elendt v. Green Tree Servicing, LLC (Ky.App. 2014) 443 S.W.3d 612.

    ▾    1.3.4    People Seeking the Extension of Credit

    •    1.3.4.1    A federal court has interpreted case law and the KCPA to determine that the sale of credit, so long as it was purchased for personal use, is covered by KCPA. Stafford v. Cross Co. Bank, 262 F. Supp. 2d 776, 792-3 (W.D.Ky. 2003).

    ▾    1.3.5    Purchasers of Insurance Policies

    •    1.3.5.1    “It is the holding of this Court that the Kentucky Consumer Protection Act provides a homeowner with a remedy against the conduct of their own insurance company pursuant to KRS 367.220(1) and KRS 367.170.” Stevens v. Motorists Mut. Ins. Co., 759 S.W.2d 819, 821-22 (Ky. 1988)

    ▾    1.4    What are they protected from?

    ▾    1.4.1    Statutory Language

    •    1.4.1.1    KRS 367.170: (1) Unfair, false, misleading, or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful.

(2) For the purposes of this section, unfair shall be construed to mean unconscionable.

    •    1.4.1.2    “The terms ‘false, misleading and deceptive’ has sufficient meaning to be understood by a reasonably prudent person of common intelligence. Therefore, when the evidence creates an issue of fact, that any particular action is unfair, false, misleading or deceptive it is to be decided by a jury.” Stevens v. Motorist Mutual Ins. Co., 759 S.W.2d 819, 820 (Ky. 1988). 

    ▾    1.5    What are they not protected from?

    ▾    1.5.1    Not covered: incompetence

    •    1.5.1.1    “While there can be no doubt Gamble was initially buried in the wrong plot in contravention of the burial contract, ‘[n]ot every failure to perform a contract is sufficient to trigger application of the Consumer Protection Act. The statute requires some evidence of “unfair, false, misleading or deceptive acts” and does not apply to simple incompetent performance of contractual duties unless some element of intentional or grossly negligent conduct is also present.’” Keaton v. G.C. Williams Funeral Home, Inc., 436 S.W.3d 538, 546 (Ky. Ct. App. 2013) quoting Capitol Cadillac Olds, Inc. v. Roberts, 813 S.W.2d 287, 291 (Ky.1991).

    ▾    1.5.2    Not covered: “mere breach of promise”

    •    1.5.2.1    A mere breach of promise does not constitute an unfair, false, misleading or deceptive act. The facts in Miles v. Shauntee indicate that the landlord made assurances of repair which were never significantly honored or fulfilled. This Court cannot hold as a matter of law that such assurances constitute unfair, false, misleading or deceptive acts declared unlawful under the Consumer Protection Act. Miles v. Shauntee, 664 S.W.2d 512, 519 (Ky. 1983).

    ▾    1.5.2.2    But, breach of promise to do something in the future is actionable when there is no present intent to perform that future act.

    •    1.5.2.2.1    An accepted rule is, a misrepresentation, to be actional, must concern an existing or past fact, and not a future promise, prophecy, or opinion of a future event, unless declarant falsely represents his opinion of a future happening.” “One may commit ‘fraud in the inducement’ by making representations as to his future intentions when in fact he knew at the time the representations were made he had no intention of carrying them out.” 

PCR Contractors, Inc. v. Daniel, 354 S.W.3d 610, 614 (Ky. App. 2011) quoting Bear, Inc. v. Smith, 303 S.W.3d 137, 142, 614 (Ky. App. 2010).

    ▾    1.6    Damages

    ▾    1.6.1    Compensatory Damages

    ▾    1.6.1.1    Logical and natural consequences

    •    1.6.1.1.1    Diminished value

    •    1.6.1.1.2    Higher repair costs

    •    1.6.1.1.3    Time missed from work dealing with issue

    ▾    1.6.1.1.4    Inconvenience

    •    1.6.1.1.4.1    Clearly, the inconvenience award was not duplicative of the loss of use award. No loss of use award was permitted for Piles.21 Thus, without an inconvenience award to her, Piles would stand to recover no compensatory damages at all, despite testimony that she had to miss work and suffered difficulties at her job caused by constant telephoning and trips to the dealership. Craig & Bishop, Inc. v. Piles, 247 S.W.3d 897, 907 (Ky. 2008);

    ▾    1.6.1.2    Mental and emotional suffering

    ▾    1.6.1.2.1    No case that says damages for mental and emotional suffering are available under KCPA. No Kentucky case says they’re not. 

    •    1.6.1.2.1.1    “Defendants also assert that Plaintiffs are not entitled to mental suffering or emotional distress damages. Kentucky courts have been clear that these types of damages are not recoverable under a contract-type cause of action. See, e.g., Combs v. Southern Bell Tel. & Tel. Co., 38 S.W.2d 3, 5, 238 Ky. 341, 345-46 (Ky.1931). Plaintiffs cite no persuasive authority to the contrary. No Kentucky court has concluded that the KCPA entitles plaintiffs to mental suffering or emotional distress damages. This Court declines to do so now.” Peacock v. Damon Corp., 458 F. Supp. 2d 411, 420 (W.D. Ky. 2006);

    ▾    1.6.2    Rescission (equitable relief)

    •    KRS 367.220 explicitly allows the Court the power to “in its discretion, award actual damages and may provide such equitable relief as it deems necessary or proper.”

    ▾    1.6.3    Punitive Damages

    •    1.6.3.1    KRS 367.220(1): Nothing in this subsection shall be construed to limit a person’s right to seek punitive damages where appropriate. 

    ▾    1.6.3.2    Because actual damages will likely be relatively small, punitive damages in consumer cases can be larger than punitive damages in other kinds of cases.

    •    1.6.3.2.1    “It appears that the amount of the punitive damages award was rationally imposed by the jury to serve the deterrent effect for which punitive damages were designed, especially in consumer protection cases where the economic harm is relatively small.” Craig & Bishop, Inc. v. Piles, 247 S.W.3d 897, 906–07 (2008);

    •    1.6.3.2.2    The United States Supreme Court has provided three factors trial courts may consider:

1) the degree of reprehensibility of the conduct; 

2) the disparity between the actual harm and the punitive damages, generally expressed as a ratio; and

3) a comparison of penalties that could be imposed for similar conduct in similar analogous cases.   

Paraphrasing BMW v. Gore, 116 S.Ct. 1589, 1598–99 (1996.)

Of these three factors, the first—the degree of reprehensibility of the conduct—is the most important. See State Farm Mutual Automobile Insurance Co. v. Campbell, 538 U.S. 408, 419 (2003)

    ▾    1.6.4    Attorney’s fees should be included in the damages awarded when determining the reasonableness of the ratio between actual harm and punitive damages.

    •    1.6.4.1    In Willow Inn, Inc. v. Public Service Mut. Ins. Co., the Third Circuit Court of Appeals included the attorney’s fees into the ratio calculus of an insurance bad faith case (called a Section 8371 action in Pennsylvania). It explained, “Section 8371's attorney fees and costs provisions vindicate the statute's policy by enabling plaintiffs such as Willow Inn to bring § 8371 actions alleging bad faith delays to secure counsel on a contingency fee. Moreover, “one function of punitive-damages awards is to relieve the pressures on an overloaded system of criminal justice by providing a civil alternative to criminal prosecution of minor crimes,” Mathias v. Accor Economy Lodging, Inc., 347 F.3d 672, 676 (7th Cir.2003), and the structure of § 8371 enlists counsel to perform a filtering function akin to prosecutorial discretion, because rational attorneys will refuse to work on a contingent fee arrangement when their investigation reveals the bad faith allegations of prospective clients to be meritless.” Willow Inn, Inc. v. Pub. Serv. Mut. Ins. Co., 399 F.3d 224, 236 (3d Cir. 2005).

    •    1.6.4.2    The Third Circuit noted that its decision to include attorney’s fees in the ratio analysis “is supported in the case law” and explained that a recent Pennsylvania state court decision also included the attorney’s fees incurred in a bad faith claim in the ratio analysis. This position has also been adopted by the 11th Circuit in Action Marine, Inc. v. Cont’l Carbon Inc., 481 F.3d 1302 (11th Cir. 2007) and Illinois state courts in Kirkpatrick v. Strosberg, 894 N.E.2d 781 (Ill. App. Ct. 2008).

    ▾    1.6.5    Attorney’s Fees

    •    1.6.5.1    KRS 367.220(3) In any action brought by a person under this section, the court may award, to the prevailing party, in addition to the relief provided in this section, reasonable attorney's fees and costs.

    •    1.6.5.2    The seminal case on the award of fees pursuant to the Kentucky Consumer Protection Act is Alexander v. S&M Motors, Inc., 28 S.W.3d 303 (Ky. 2000). That case holds that the award of fees is in the sound discretion of the trial court. In Alexander, the Kentucky Supreme Court explained that permitting the additional recovery of attorney’s fees in consumer protection cases serves two purposes. First, it is “intended to compensate the prevailing party for the expense of bringing an action under the statute.” The Court continued, “[a] further aim is to provide attorneys with incentive for representing litigants who assert claims which serve an ultimate public purpose (i.e. a deterrent to conduct resulting in unfair trade practices which perpetrate fraud and deception upon the public.)” Alexander at 305.;

    ▾    1.6.5.3    Attorney’s fees are determined by using the “lodestar method”

    •    1.6.5.3.1    In Hensley v. Eckerhart, 461 U.S. 424, 429 (1983), the United States Supreme Court noted that “the most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate.”

    •    1.6.5.3.2    You must keep your time contemporaneously. I suggest using a time-tracking service like Harvest (https://www.getharvest.com/) to capture and track time. 

▾    2    Kentucky Lemon Law (KRS 367.840, et seq.)

    ▾    2.1    Purpose

    •    2.1.1    Kentucky’s “Lemon Law” is intended to accomplish three goals: (1) To protect consumers who buy or lease new motor vehicles that do not conform to applicable warranties by holding manufacturers accountable for certain nonconformities; (2) To limit the number of attempts and the amount of times that a manufacturer or its agents shall have to cure such nonconformities; and (3) To require manufacturers to provide, in as expeditious a manner as possible, a refund, not to exceed the amount in KRS 367.842, or replacement vehicle that is acceptable to the aggrieved consumer when the manufacturer or its agents fail to cure any nonconformity within the specified limits.

Ky. Rev. Stat. Ann. § 367.840

    •    2.1.2    Note: the Magnuson-Moss Warranty Act (15 USC § 2301, et seq.) may also offer remedies for breach of warranty issues arising from the sale of a new vehicle. 

    ▾    2.2    Application

    •    2.2.1    Kentucky’s Lemon Law applies to new motor vehicles and not to: (a) Any vehicle substantially altered after its initial sale from a dealer to an individual; (b) Motor homes; (c) Motorcycles; (d) Mopeds; (e) Farm tractors and other machines used in the production, harvesting, and care of farm products; or (f) Vehicles which have more than two (2) axles.

Ky. Rev. Stat. Ann. § 367.841

    ▾    2.3    Process

    ▾    2.3.1    KRS 367.842 outlines the process and rights of consumers afflicted with a “lemon”.

    ▾    2.3.1.1    Consumers must give the manufacturer a “reasonable number” of attempts to repair any nonconformity.

    •    2.3.1.1.1    A presumption that the consumer has given the manufacturer a reasonable opportunity to repair the vehicle if he or she has a) returned the vehicle for repair of the same nonconformity 4 times or b) lost use of the vehicle for the nonconformity for more than 30 days. 

    •    2.3.1.2    The nonconformity must “sustantially impact” the “use, value, or safety” of the motor vehicle”.

    •    2.3.1.3    The consumer must report the failure to repair the nonconformity in writing to the manufacturer in the first 12 months or 12,000 miles of use, whichever comes sooner. 

    •    2.3.2    KRS 367.842(4) requires consumers to particpate in an informal dispute resolution process before filing suit

    ▾    2.3.3    Damages

    ▾    2.3.3.1    The consumer can choose between replacement of the vehicle or refunding the money he or she paid for the vehicle.

    •    2.3.3.1.1    Under KRS 367.842(2), “the manufacturer, at the option of the buyer, shall replace the motor vehicle with a comparable motor vehicle, or accept return of the vehicle from the buyer and refund to the buyer the full purchase price. The full purchase price shall include the amount paid for the motor vehicle, finance charge, all sales tax, license fee, registration fee, and any similar governmental charges plus all collateral charges, less a reasonable allowance for the buyer's use of the vehicle.

    •    2.3.3.2    A court may award reasonable attorney's fees to a prevailing plaintiff. KRS 367.842(9)

▾    3    Kentucky Repossessions

    •    3.1    There is an entire book published by the National Consumer Law Center on protecting consumers from repossession, prosecuting wrongful repossession, and helping consumers recover from repossessions.

    ▾    3.2    Reposssessions in Ketucky are governed by KRS 355.9-601, et seq.

    •    3.2.1    Repossessions must be 1) after default and must not 2) breach the peace.  KRS 355.9-609

    •    3.2.2    The repossessing business can resell the collateral but only after providing notice to the consumer KRS 355.9-610 and 9-611.

    •    3.2.3    Remedies for violations of UCC’s repossession provisions are located at KRS 355.9-625. 

▾    4    Usury

    ▾    4.1    Legal rate of interest

    ▾    4.1.1    KRS 360.010 states that the legal rate of interest is 8%

    •    4.1.1.1    On loans of $15,000 or less, the parties can contract for up to 19%, and

    •    4.1.1.2    On loans greater than $15,000, the parties can contract for whatever interest rate they want. 

    ▾    4.1.2    Damages under KRS 360.020

    •    4.1.2.1    The taking, receiving, reserving, or charging a rate of interest greater than is allowed by KRS 360.010, when knowingly done, shall be deemed a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it, or which has been agreed to be paid thereon. In case the greater rate of interest has been paid, the person by whom it has been paid, or his legal representatives, may recover, in an action in the nature of an action of debt, twice the amount of the interest thus paid from the creditors taking or receiving the same: provided, that such action is commenced within two (2) years from the time the usurious transaction occurred.

    •    4.1.3    Often, businesses effectively charge interest greater than the legal or contractual rate by padding the deal with additional charges and fees. You must acquaint yourself with the case law on these statutes to determine whether certain charges are “interest” and therefore usurious. 

▾    5    Federal Laws

    ▾    5.1    Fair Debt Collection Practices Act (FDCPA)

    •    5.1.1    Protects people from abusive debt collection practices

    •    5.1.2    15 USC 41 § 1692, et seq. http://www.law.cornell.edu/uscode/text/15/chapter-41/subchapter-V

    •    5.1.3    Prohibits false or misleading representations, unfair practices, harrassment or abuse

    •    5.1.4    Again, the National Consumer Law Center publishes an entire book on this subject and some practitioners focus exclusively on prosecuting these claims.

    •    5.1.5    Report on Debt Collection from the Center for Responsible Lending: http://www.responsiblelending.org/state-of-lending/reports/11-Debt-Collection.pdf

    ▾    5.1.6    Damages

    •    5.1.6.1    § 1692k allows people to recover their actual damages suffered as a result of the violation, up to $1,000 in statutory damages, and attorney’s fees 

    ▾    5.1.7    This area of law is extremely rewarding and challenging. Abuse is rampant and the issues that arise are novel and nuanced.

    •    5.1.7.1    Conway v. Portfolio Recovery Associates, LLC, 13 F.Supp.3d 711 held that a person stated a cause of action for FDCPA violations when a debt collector that received payments in Virginia sued on the debt in Kentucky. Conway’s attorney argued that the debt collector violated the FDCPA because it sued beyond the statute of limitations of the debt and the Court held that the SOL that applied was Virginia’s (3 years), not Kentucky’s (5 or 15 years).  

    ▾    5.2    Fair Credit Reporting Act (FCRA) 15 USC § 1681 et seq. 

    •    5.2.1    Provides a mechanism for consumers to dispute inaccurate information on their credit reports and imposes penalties on credit reporting agencies and furnishers of credit information for failure to correct inaccuracies.

    •    5.2.2    FTC’s Summary of Consumer Rights under FCRA: https://www.consumer.ftc.gov/articles/pdf-0096-fair-credit-reporting-act.pdf

    ▾    5.2.3    Damages (§ 1681(n))

    •    5.2.3.1    Actual damages in any amount or statutory damages not to exceed $1,000

    •    5.2.3.2    Punitive damages

    •    5.2.3.3    reasonable attorney’s fees

    ▾    5.3    Truth in Lending Act (TILA) 15 USC ch 41  § 1601 et seq.

    •    5.3.1    Standardizes how fees and interest are calculated in consumer finance transactions

    •    5.3.2    Creates environment in which consumers can comparison shop by requring businesses to calculate the “true cost” of the loan and the “real” interest rate after taking into account fees, charges, and other costs of credit

    •    5.3.3    TILA’s specific requirements are in the awesome-sounding “Regulation Z”: 12 CFR 226

    ▾    5.4    Real Estate Settlement and Procedures Act (RESPA)

    •    5.4.1    The CFPB’s new Regulation X provides a private cause of action for violations of many of the regulations governing mortgage servicers. Read more here: http://www.consumerfinance.gov/regulations/2013-real-estate-settlement-procedures-act-regulation-x-and-truth-in-lending-act-regulation-z-mortgage-servicing-final-rules/

    ▾    5.5    Telephone Consumer Protection Act (TCPA): 47 USC § 227

    •    5.5.1    The Telephone Consumer Protection Act prohibits obnoxious and costly use of telephones. It limits the circumstances under which businesses can contact consumers and places meaningful restrictions on telemarketers and the use of automated dialing systems (“autodialers” or “robodialers”), text messages, voice recordings, and fax machines. 

    ▾    5.5.2    Damages

    •    5.5.2.1    Actual damages

    •    5.5.2.2    Statutory damages up to $1,500 per violation

    •    5.5.2.3    No attorney’s fees under the TCPA

▾    6    Other Causes of Action

    ▾    6.1    URLTA (Uniform Residential Landlord Tenant Act) KRS 383.505

    •    6.1.1    KRS 383.500 requires local governments to adopt URLTA in its entirety and without amendment. As of 2009, the following jurisditions had adopted URLTA’s provisions: Barbourville, Bellevue, Bromley, Covington, Dayton, Florence, Lexington-Fayette County, Georgetown, Louisville-Jefferson County, Ludlow, Melbourne, Newport, Oldham County, Pulaski County, Shelbyville, Silver Grove, Southgate, Taylor Mill and Woodlaw. 

    ▾    6.1.2    Remedies include a private right of action

    •    6.1.2.1    KRS 383.520: (1) The remedies provided by KRS 383.505 to 383.715 shall be so administered that an aggrieved party may recover appropriate damages. The aggrieved party has a duty to mitigate damages. (2) Any right or obligation declared by KRS 383.505 to 383.715 is enforceable by action unless the provision declaring it specifies a different and limited effect.

    •    6.1.2.2    No decision on whether attorney’s fees are “appropriate damages” under URLTA. 

    ▾    6.2    Equitable Estoppel: Fluke Corporation v. LeMaster, 306 SW 3d 55 (Ky. 2010). 

    •    6.2.1    Under Kentucky law, equitable estoppel requires both a material misrepresentation by one party and reliance by the other party:

The essential elements of equitable estoppel are[:] (1) conduct which amounts to a false representation or concealment of material facts, or, at least, which is calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert; (2) the intention, or at least the expectation, that such conduct shall be acted upon by, or influence, the other party or other persons; and (3) knowledge, actual or constructive, of the real facts. And, broadly speaking, as related to the party claiming the estoppel, the essential elements are (1) lack of knowledge and of the means of knowledge of the truth as to the facts in question; (2) reliance, in good faith, upon the conduct or statements of the party to be estopped; and (3) action or inaction based thereon of such a character as to change the position or status of the party claiming the estoppel, to his injury, detriment, or prejudice.

    ▾    6.3    IIED

    •    6.3.1    In certain circumstances, unscrupulous businesses’ actions will rise to the level of Intentional Infliction of Emotional Distress.

    •    6.3.2    Our Commonwealth first adopted the tort of intentional infliction of mental distress in the case of Craft v. Rice, Ky., 671 S.W.2d 247 (1984). In Craft, we adopted Restatement (Second) of Torts, section 46, and recognized the elements of proof necessary for this new tort: 1. The wrongdoer's conduct must be intentional or reckless; 2. The conduct must be outrageous and intolerable in that it offends against the generally accepted standards of decency and morality; 3. There must be a causal connection between the wrongdoer's conduct and the emotional distress; and 4. The emotional distress must be severe. Kroger Co. v. Willgruber, 920 S.W.2d 61, 65 (Ky. 1996)

    ▾    6.4    Breach of Contract

    •    6.4.1    Of course, in many cases, not only will you have KCPA violations and tortious activity, you will also have breach of contract claims. 

    ▾    6.5    Insurance Bad Faith

    •    6.5.1    Kentucky’s Unfair Claims Settlement Practices Act (KRS 304.12-230) supplements common law “bad faith” administration of insurance claims.

    •    6.5.2    It prohibits specific activities that are unfortunately common during the process of making a claim for coverage including, but not limited to, “failing to acknowledge and act reasonably promptly upon communications”, failing to investigate claims, “failing to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed”, and “not attempting in good faith to effectuate prompt, fair, equitable settlements of claims in which liability has become reasonably clear.” Reading the entire statute and surrounding jurisprudence is, of course, necessary. 

    ▾    6.6    Fraud

    ▾    6.6.1    Elements

    •    6.6.1.1    In a Kentucky action for fraud, the party claiming harm must establish six elements of fraud by clear and convincing evidence as follows: a) material representation b) which is false c) known to be false or made recklessly d) made with inducement to be acted upon e) acted in reliance thereon and f) causing injury. Wahba v. Don Corlett Motors, Inc., Ky.App., 573 S.W.2d 357, 359 (1978). United Parcel Serv. Co. v. Rickert, 996 S.W.2d 464, 468 (Ky. 1999)

    ▾    6.6.2    Promises of future performance

    •    6.6.2.1    An accepted rule is, a misrepresentation, to be actional, must concern an existing or past fact, and not a future promise, prophecy, or opinion of a future event, unless declarant falsely represents his opinion of a future happening.” “One may commit ‘fraud in the inducement’ by making representations as to his future intentions when in fact he knew at the time the representations were made he had no intention of carrying them out.” 

PCR Contractors, Inc. v. Daniel, 354 S.W.3d 610, 614 (Ky. App. 2011) quoting Bear, Inc. v. Smith, 303 S.W.3d 137, 142, 614 (Ky. App. 2010).

    ▾    6.6.3    Fraudulent Omission

    •    6.6.3.1    This subset of “fraud” is a common cause of action in consumer law practice.

    •    6.6.3.2    To prevail on a claim of fraudulent omission, a plaintiff must prove: (a) a duty to disclose a material fact; (b) a failure to disclose a material fact; and (c) that the failure to disclose a material fact induced the plaintiff to act and, as a consequence, (d) to suffer actual damages. Rivermont Inn, Inc. v. Bass Hotels & Resorts, Inc., 113 S.W.3d 636, 641 (Ky.App.2003). A caveat to the necessary elements under either claim is that “mere silence does not constitute fraud where it relates to facts open to common observation or discoverable by the exercise of ordinary diligence, or where means of information are as accessible to one party as to the other.” Bryant v. Troutman, 287 S.W.2d 918, 920–921 (Ky.1956). Waldridge v. Homeservices of Kentucky, Inc., 384 S.W.3d 165, 171 (Ky. Ct. App. 2011).;

    •    6.6.3.3    A duty to disclose facts is created only where a confidential or fiduciary relationship between the parties exists, or when a statute imposes such a duty, or when a defendant has partially disclosed material facts to the plaintiff but created the impression of full disclosure. Dennis v. Thomson, Ky., 240 Ky. 727, 43 S.W.2d 18 (1931). Rivermont Inn, Inc. v. Bass Hotels & Resorts, Inc., 113 S.W.3d 636, 641 (Ky. Ct. App. 2003);

    ▾    6.6.3.4    Beyond these three situations cited in Rivermont in which a duty arises, Kentucky courts have found other circumstances in which a party may commit fraudulent concealment:

    •    6.6.3.4.1    A duty to disclose may arise from a fiduciary relationship, from a partial disclosure of information, or from particular circumstances such as where one party to a contract has superior knowledge and is relied upon to disclose same. Smith v. Gen. Motors Corp., 979 S.W.2d 127, 129 (Ky. Ct. App. 1998)

    •    6.6.3.4.2    We may readily agree with the appellants that mere silence with respect to something related to a transaction is not necessarily misrepresentation and does not itself constitute fraud. However, it is otherwise when the circumstances surrounding a transaction impose a duty or obligation upon one of the parties to disclose all the material facts known to him and not known to the other party. The suppression or concealment of the truth under such circumstances may constitute a means of committing a fraud as well as misrepresentation openly made. Since the beginning of our jurisprudence, the principle has been consistently adhered to that the concealment by a seller of a material defect in property being sold, or the suppression by him of the true conditions respecting the property, so as to withhold from the buyer information he is entitled to, violates good faith and constitutes deception which may relieve the buyer from an obligation or may permit him to maintain an action for damages or to vacate the transaction. Hall v. Carter, 324 S.W.2d 410, 412 (Ky. 1959)

    ▾    6.7    Negligent Misrepresentation

    •    6.7.1    A majority of jurisdictions have adopted Restatement (Second) of Torts § 552, which outlines the elements of negligent misrepresentation as follows:(1) One who, in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information. (2) Except as stated in Subsection (3), the liability stated in Subsection (1) is limited to loss suffered (a) by the person or one of a limited group of persons for whose benefit and guidance he intends to supply the information or knows that the recipient intends to supply it; and (b) through reliance upon it in a transaction that he intends the information to influence or knows that the recipient so intends or in a substantially similar transaction. Presnell Const. Managers, Inc. v. EH Const., LLC, 134 S.W.3d 575, 580 (Ky. 2004)

▾    7    Foreclosure Defense

    •    7.1    See outline that follows

    ▾    7.2    Foreclosure Defense includes helping your client rigorously pursue all loss mitigation options

    •    7.2.1    http://www.makinghomeaffordable.gov/for-partners/understanding-guidelines/Documents/mhahandbook_41.pdf

The New York Times wrote a good article a couple of weeks ago on a phenomenon I’m seeing more and more in my car fraud practice: used car dealers are now installing GPS and SID (Starter Interrupt Devices) on the cars they sell. While everyone knows what a GPS does, these GPS devices don’t sit on the dashes of cars and help drivers navigate to their destinations. Instead, they allow dealers and finance companies to track the whereabouts of cars for repossession. 

Meanwhile, the Starter Interrupt Device is less well-known and even more dangerous. It does exactly what it says it does: it allows a dealer or finance company to interrupt (i.e. prevent) the car from starting. Dealers and finance companies can “flip the switch” on the SID remotely. So, they never have to leave their office (and sometimes can deploy it from a smartphone) and with the flip of a digital switch can make a vehicle stop working. (If properly installed, the SID will not stop a vehicle that is in motion, but that does not fix the safety concerns of being stranded.)

Some dealers disclose the existence of these devices to consumers, some don’t. Those who do disclose their use of the device often try to explain that these devices “help locate the vehicle if it is stolen”. While that may be true, the actual purposes are to a) locate the vehicle for repossession and b) incentivize the consumer to make payments by preventing the consumer from using the vehicle if he or she misses a payment. 

The used car industry’s expanding use of these devices raises many potential legal issues that have yet to be litigated in Kentucky. A leading attorney advising the used car industry has described both 1) failing to disclose a GPS or SID and 2) charging consumers for the devices as among the “Ten ‘Worst Practices’ for Dealers”. Failing to disclose the existence of a GPS and/or SID on a new or used vehicle may be a violation of the Motor Vehicle Retail Installment Sales Act. 

Another area ripe for abuse is in the repossession of a vehicle by use of a Starter Interrupt Device. Aside from the safety issues raised by someone crippling a vehicle remotely, a dealer’s use of a Starter Interrupt Device can potentially violate, among other laws, the Uniform Commercial Code and the Kentucky Consumer Protection Act. 

If you discover that a car dealer sold you a vehicle equipped with a GPS or SID unit without disclosing it to you, you need to contact an attorney to explore your legal rights. You can find a consumer attorney in your state at the National Association of Consumer Advocate’s website.  

Last night, I had a chance to watch John Oliver's great takedown of one of America's worst industries: the payday loan industry. 

The whole thing is great, but I seriously want a Kickstarter to buy TV time for Sarah Silverman's ad at the end of this clip about the best options for people considering taking out a payday loan. 

In Kentucky, payday loan companies charge an average annual interest rate of 391%. The Kentucky Coalition for Responsible Lending is trying to pass legislation that would cap that interest rate at the still-exorbitant price of 36%. I applied to become a member of KCRL today. You should, too. 

If you are struggling with repaying payday loans or other debts, please contact an attorney to get advice on the best way to gain control over your financial life. 

I spent Tuesday, Wednesday, and Thursday of this week trying a car fraud case in Jefferson Circuit Court. It was my first trial as a lead attorney and the first case Ben Carter Law has taken to trial. 

My client, Renay Seals, alleged that the Defendant, Mak Cars, Inc dba Unique Motorsports (Mak Cars also does business in Louisville as Hot Deals on Wheels Used Cars) sold her a car with more than 245,000 miles on it after assuring her that a) the car only had 54,000 additional miles on it beyond the 21,420 on the odometer and b) the car was eligible for a 24 month/24,000 mile warranty. 

Tommie Seals, Renay's son, with the 2006 Dodge Charger the day after Renay purchased it from Mak Cars, Inc. Tommie and Renay would learn the truth about the car—that it had at least 245,000 miles on it and was not eligible for an extended warranty—a month later. 

The jury found that Mak Cars, Inc violated the Kentucky Consumer Protection Act and ordered the Defendant to pay Renay: 

• $13,927.42, the price Renay paid for the 2006 Dodge Charger;
• $5,000 for the anxiety, humiliation, and frustration Mak Cars's deception caused her; and
• $245,000 in punitive damages. 

The jury also found that my client was 10% responsible for what happened, which reduces the amount of the judgment for the purchase price and mental suffering by the same proportion. 

There are three great things about this verdict. (Okay, there are a lot more than three, but I want to talk about three here.)

First, Renay is from Louisiana. The only experience she had with Louisville, Kentucky was coming here to look at a car she thought had 21,240 miles on it and getting hosed. With its verdict, the jury said, "What happened to you is not acceptable. It's not how we treat people here." Renay and her son left Louisville yesterday knowing that Louisville, Kentucky has good people in it. 

Second, I had a chance to talk with some jurors after the case. One of them said, "Do you know why we set punitive damages at $245,000?" We had set the maximum amount we could recover at $250,000, so I told her I just thought they didn't want to give the max.

"No, we set it at $245,000 because that was how many miles the car had on it. We thought that would be an appropriate symbol to deter other dealers from doing something like this."

AWESOME. This shows the jury was thinking even harder than I was about this case. Which I didn't think was possible until it was. 

Third, another juror told me that the jury wanted to write on the verdict that Renay had to spend a little bit of the money it ordered Defendant to pay her to return to Louisville and attend Derby next year. This jury was truly appalled that someone from out of town was treated so badly by a Louisville business.

Yesterday was a great day for my client: the jury validated her 18-month fight both out and then in court with a company that had done her wrong. It was a great day for me: it was a scary thing to go to trial on my own for the first time. And, I hope, the jury's verdict will help other Kentucky consumers and their attorneys get fair compensation for wrongs done to them.

Before Renay and Tommie hit the road yesterday, I made them let me take a selfie with them. 

Photo credit to dreamsjung. Click photo to view his Flickr page. 

Last fall, the National Consumer Law Center released a report, "No Fresh Start: How States Let Debt Collectors to Push Families into Poverty" in which it surveyed the exemption laws in each state. Exemption laws are laws that describe the limits of what a creditor can take from a debtor in order to collect on a judgment.

How much of a worker's paycheck can a creditor garnish? Can it foreclose on a debtor's home? Can it seize the debtor's car? What about household goods? Can a creditor take those to collect a debt?

These questions are largely answered by state, not federal, law. And, if you're a debtor in Kentucky, the answers are not good. The NCLC gave grades to all fifty states based on the protections the state has in place to ensure that a creditor's collection efforts cannot push a hard-working family into destitution.  

Kentucky is one of four states to receive an "F". (Mississippi, Michigan, and Delaware were the other three.)

The NCLC graded the states on the following criteria: 

• Preventing debt collectors from seizing so much of the debtor’s wages that the debtor is pushed below a living wage;
• Allowing the debtor to keep a used car of at least average value; 
• Preserving the family’s home—at least a median-value home;
• Preventing seizure and sale of the debtor’s necessary household goods; and
• Preserving at least $1200 in a bank account so that the debtor has minimal funds to pay such essential costs as rent, utilities, and commuting expenses.

Kentucky failed all of these tests. 

• Kentucky workers can keep only 75% of their paychecks (or 30 times the federal minimum wage). Some states prevent garnishment of wages altogether. Others set the limit of what can be garnished at a much lower percent than 25% of a worker's check. 
• Kentucky gets a "D" for protecting a debtor's car. Kentucky law protects cars up to $2,500 in value. Any more than that and a creditor can seize the car to collect on a judgment. Other states protect cars worth up to $20,000 (Kansas) while others set the limit much higher than the unreasonable $2,500 Kentucky law provides (many states protect cars worth up to $7,500 or $10,000). 
• Kentucky homeowners who owe a creditor money have essentially no protection. Kentucky law protects the value of a home up to $5,000. NCLC rightfully gives this law an "F". Seven states protect homes from collection efforts regardless of value, while another 5 states protect homes up to the median value of a home ($211,312). 
• Kentucky law protects $3,000 worth of a debtor's household goods. This earns us another "F". Eight states protect all necessary household goods and another nine protect at least $10,000 of household goods.
• Finally, Kentucky law provides no protection from seizure of funds in a debtor's bank account. Other states set a limit of $1,200: below that amount, creditor's cannot go. Another "F" for Kentucky. 

The NCLC has drafted a Model Family Financial Protection Act that will protect the basic dignity and financial integrity of Kentucky's families, even those struggling to repay debts. I encourage my politically-minded friends and my friends that are legislators to take a close look at the NCLC's report and recommended legislation and work to do a better job protecting our families from debt collection efforts that push them into poverty and bankruptcy. 

At Ben Carter Law, I defend people from baseless collection efforts, prosecute debt collection abuses, and help people file for bankruptcy to get a clean financial slate. But, I wish Kentucky's laws did more automatically to help families protect the basic necessities of life from collection efforts and trust that the day is coming that the legislature will change the laws to benefit Kentucky's families, not creditors.  

Yesterday, Brian Cook, John Bahe, and I filed a lawsuit in Jefferson County Circuit Court against Bridal Warehouse, Inc. The lawsuit alleges that Bridal Warehouse has violated Kentucky's Consumer Protection Act by engaging in false, unfair, deceptive, and misleading acts and practices for many years. 

Specifically, the suit alleges that Bridal Warehouse has promised to "special order" new dresses from the manufacturer to thousands of brides. Rather than doing what they promised to do, the company would deliver to their customers a used dress from the floor of one of their other store locations. In other words, instead of delivering to their customers a new dress from the manufacturer, Bridal Warehouse would deliver dresses that had been used by other customers. Many customers were charged a premium for this "special order" from the manufacturer. 

Bridal Warehouse, Inc. has four store locations: 

• Louisville, Kentucky
• Elizabethtown, Kentucky
• Nashville, Tennessee
• Evansville, Indiana

The lawsuit seeks class certification for the injured customers who are residents of Kentucky. Here is a copy of the Complaint we filed against Bridal Warehouse, Inc. 

If you placed a "special order" for a dress from Bridal Warehouse, Inc. in the last 15 years, you may be a member of the class of injured individuals. For more information about the suit or to ask us to review your case, fill out this form or contact us by calling 502-587-2002. 

I read an article recently that explained that Kentucky was one of only eight states that had a statute that required that employers allow employees to take (and be paid for) at least two 10-minute breaks during an eight hour workday.  

I have to say, as a Kentuckian I have grown accustomed to seeing Kentucky appear at the bottom of lists we would like to be at the top of and the top of lists we'd like to be at the bottom of. So, discovering that we offer workers the basic protection and dignity of two ten-minute breaks during a day's work was heartening. The Department of Labor provides summaries of mandatory rest periods and lunches in Kentucky and across the nation. 

Of course, having the statutory right to a break and actually getting the break are two separate matters. In this lawyer's opinion, employers who do not provide workers with those breaks are violating Kentucky's wage and hour laws. These employers are opening themselves up to potential liability for money damages awarded to their employees for denying their employees these breaks.  

If you or someone you know is working for a business that does not provide its employees the breaks its workers are entitled to by statute, you should contact an attorney today. 

Earlier this year, I asked Kentucky cyclists what their greatest fears were. In a totally unscientific tallying of the responses, here's my impression: The two most commonly cited fears were, unsurprisingly, getting hit by a moving car and getting doored. I can sympathize. I'm looking in the rear window of every single parked car I ride past  to see if there is a driver getting ready to exit the vehicle and throw me into traffic. 

I also asked what Kentucky cyclists fear that I had not considered. Boy, you all are creative bunch. Among the things you fear (and that I now have to consider) are:  

• Handle bars torque while at top speed going downhill.
• Vision impaired in both eyes due to cloud of gnats.
• Having your butt crack peek out of your pants as you bend forward to reduce wind resistance.
• Having a can thrown at you from a passing car window, looking down and then being smashed by a semi only to then have a bee sting you! 
• Being lasso'd in the middle of fricken nowhere and thrown in the back of a truck of a psycho woman and carted off to some hole in the ground.
• When in Kentucky... being bitten by dogs.
• Unexpected rain.
• River Road and people from the East end.
• I can't say that every single thing on this list is actionable in a court of law, but if you or a bicyclist you know are injured by a driver's carelessness, please, get a lawyer. If it's me, great. If not, that's fine, too. But, you need to get a lawyer so that the driver compensates you for all of your injuries. This includes your medical bills, lost time at work, property damage, and your physical pain and emotional suffering. 

My client comes into my office after having been served by the Sheriff with a Complaint. Or, I file a Complaint for a client and then get an Answer back from the Defendant's attorney. The first thing I do in either situation is try to learn a little bit about the attorney representing the other side. I go to Google. I type in the attorney's name and the city and state in which they practice.  

Many times (and all-too-often), I get a page of results from sites like yellowpages.com, manta.com, topix.com, merchantcircle.com, and switchboard.com. That is to say, I get a bunch of garbage. 

I am consistently shocked at how little Kentucky attorneys seem to care about how they look online. I understand some established attorneys don't need  a website to get clients. But, even if you're not looking to find clients online, people (other attorneys) are still searching for you online. And, we're judging you. We're sizing you up.

I use the care you put into your website as a rough analog for how much care you're going to put into your client's case. If you don't care enough to have at least a homepage to present to the world, how hard are you going to research that response to my Motion for Summary Judgment? How hard are you going to think about the discovery requests you send? 

Is it a perfect test to use for sizing up my opposition? Nope. There are certainly some attorneys who have whipped me pretty hard who have abysmal or nonexistent websites. But, it works more often than not.  

Look, if your litigation strategy is inspired by Muhammad Ali's Rope-a-Dope, well congratulations: it's working. When you don't have a website, I'm totally underestimating your devotion to your craft and the care you bring to it. 

I'm guessing that judging attorneys by their websites didn't used to be as useful or accurate as it is today. But, that's because it used to be hard to have a website. Now, it couldn't be easier (or less expensive). The fact that it's 2013 and you still don't have a website is inexcusable. My site is hosted on Squarespace.com. I pay Squarespace $8 a month for this site.

EIGHT DOLLARS. 

If you want help getting set up on Squarespace, let me know. I have helped other attorneys and can help you individually. Or, if enough people express interest, would consider doing like a half-day workshop to help lawyers launch their websites in a single morning. Individual help costs $1,500. The workshop would, I expect, cost around $400 and would happen on a Saturday morning.

If you suspect you or your client is a victim of automobile fraud, one of the first things you will need to do is figure out who owns the dealership. This can be difficult because many dealerships are simply "doing business as" [name of dealership]. They are doing business under an assumed name while being owned by another company, partnership, or individual.  

The first place to look for ownership interests is the Kentucky Secretary of State's website. There, you can enter the name of the car dealership and, hopefully, find an active company, partnership, or certificate to do business under an assumed name.  

Consumer laws exist to protect Kentuckians from some car dealers' abusive sales tactics. 

Unfortunately, sometimes that doesn't work. The next step is to file a Request to Inspect Public Records from the Kentucky Motor Vehicle Commission. I did this yesterday in a case I'm researching against a dealership that, I believe, wrongfully repossessed my client's car (and did so in a fraudulent, abusive, inhumane way). When I called the Motor Vehicle Commission, I asked how I would request the dealership's most recent application for a license to sell cars in Kentucky and was told that they could fax or mail me the Request to Inspect Public Records. 

"I's not available on your website?" I asked. 

"No. I can fax it or mail it to you."  

Here is a .pdf of the Request to Inspect Public Records from Kentucky's Motor Vehicle Commission. Use it to request the most recent application for a car dealer's license. Here is a copy of the blank application to become a car dealer in Kentucky. It will give you a sense of the information you will get by requesting the dealer's license application. 

Of course, if you are a consumer and you suspect you have been victimized by a car dealer through fraudulent or scammy tactics, you should consult a lawyer to determine what, if any, legal recourse you might have to fix the fraud, unwind the deal, or pursue the dealer for money damages. This is not the post to explain the many, many ways that car dealers can take advantage of consumers through odometer rollbacks, fraudulent omissions of material facts, scammy financing, yo-yo sales, and wrongful repossessions. This is just to say that you should contact a lawyer because laws exist to protect consumers from the predatory tactics some car dealers use to make a quick (and highly profitable) sale. 

Riding my dad's old Raleigh ten-speed to my law office this morning, I started thinking about all the things that could go wrong for a bicycler, all the things that have  gone wrong for me. Being a bicycler is a lot like being a lawyer: it feels like the right thing to do, but seems fraught with more peril than is necessary. So, bicyclers, what do you fear when you hop in the saddle? (Because some of these events pose the risk of serious injury or death, when gauging your fears, weigh your perceived likelihood of the event occurring multiplied by the consequences of that event's occurrence.)

I'll tally these answers up and report back next week.  

When I proposed this idea to city officials in Louisville last month they literally laughed at me.  

 "Possibility City". 

Today was my first day of cycling to work. New house + new office = new commuting opportunities.

I'm a bicycling lawyer and I sue reckless or negligent drivers. 

I rode my bike every day to law school down Nicholasville Road in Lexington, so I'm accustomed to riding in traffic. But, I have found Louisville to be uniquely unfriendly to cyclists. On-street parking makes the possibility of getting doored everpresent and there are no protected bicycle lanes. If Louisville is going to grow into the Possibility City it aspires to be, we have to do a better job accommodating cyclists. 

The tragedy here is that Louisville would make a GREAT cycling city if it invested in bicycling infrastructure. The river, the views, the neighborhoods, the usually-gentle weather, and the relatively flat terrain all make Louisville perfect for cyclists. 

It took me 20 minutes and 45 seconds door-to-door (my route). I could have ridden faster, but cycling to work is a delicate balance of a number of factors: a) reducing your time in the seat while b) regulating body temperature so your officemates don't vote you and your B.O. off the office island and c) being safe.  

Speaking of being safe, I want to take a moment to rant about cyclists and motorists. Riding into work, I thought, "Maybe I should get a big patch made for my bag that says,

I'm a lawyer and I sue reckless drivers.

bencarterlaw.com

I wondered if that might give me a modicum of added protection against abuse by motorists. At the same time, I have seen some dumb, dumb, dumb cyclists in Louisville recently. Last Saturday, one woman was just riding at her leisure down the center of Frankfort Avenue heading north. In my car, I pulled up beside her and said, "'Share the road' goes both ways, you know." I'm not normally a dick, but that was a real dick move on her part. Obnoxious cyclists alienate drivers and make them more likely in the future to not respect cyclists. In a way, I felt like saying that to her was an act of self-protection. Listen: whether you're a cyclist or a driver, just don't be a dick. 

Having stated that rather obvious truth, if you are a cyclist that has been injured by the negligence or recklessness of a driver in Kentucky, contact me. Unfortunately, Kentucky is not a very bicycle-friendly state and you do not have the same rights and protections here as in other places. You still have the right to file a lawsuit and make the driver pay for his or her negligence or recklessness. Let me help you do just that. 

As you may have already guessed, I have to postpone the Commonwealth Justice conference I had hoped to host in August. 

Apparently, someone radically underestimated how hard starting a law firm would be and how much time he would be able to devote to organizing and hosting a conference for social justice-minded attorneys and organizers in Kentucky. 

I don't know when the conference will occur—probably sometime in 2014—but I am committed to making it happen. Thank you for your early support of the idea and stay tuned for updates.

Ben Carter Law PLLC has filed a class action lawsuit Jefferson County Circuit Court against attorney Marilyn Hartley, one of Louisville's largest private tax collectors. Ms. Hartley collects taxes under an assumed name, "DETCO".

In Kentucky, local governments fund their operations in part by selling unpaid property taxes as "Certificates of Delinquency" to individuals and businesses. These Certificates of Delinquency give these individuals and businesses the right to collect delinquent taxes. Today, 115 individuals and businesses have registered to purchase Certificates of Delinquency and function across the Commonwealth as private tax collectors. In the past, delinquent taxpayers didn't know what to expect from these private tax collectors: some were responsible and honest while others crushed delinquent taxpayers by charging them exorbitant, unjustified fees and costs and sometimes forcing the taxpayer's home into foreclosure. 

In 2012, the Kentucky legislature passed new laws and the Department of Revenue issued new regulations in an effort to curb the most abusive practices and ensure that third-party purchasers treated Kentucky's delinquent taxpayers fairly and uniformly. When a third party purchaser like Marilyn Hartley buys a Certificate of Delinquency, these new laws and regulations require third party purchasers to provide important information to delinquent taxpayers. The laws and regulations ensure transparency from the third party purchaser and require the third party purchaser to explain to the delinquent taxpayer the taxpayer's rights, obligations, and alternatives now that a third party purchaser owns the Certificate of Delinquency.

Transparency from the third party purchaser, fair treatment of an individual delinquent taxpayer, and equal treatment of taxpayers across the industry are important goals to the legislature: the new law forbids third party purchasers from charging interest, fees, or costs to a delinquent taxpayer's account unless they have provided the required information to the delinquent taxpayer.  

On January 22, 2013, I filed a class action lawsuit on behalf of my client—James C. Brown—and 459 other delinquent taxpayers who have been harmed by the failure of Marilyn Hartley to provide them with necessary, required information about their rights, obligations, and alternatives after she purchased their Certificates of Delinquency. Ms. Hartley purchased more Certificates of Delinquency in Jefferson County last year than any other third-party purchaser.

Read the Class Action Complaint and view the exhibits to the Complaint. 

Despite her failure to provide delinquent taxpayers with the required information, Ms. Hartley is charging interest, attorney's fees, administrative fees, and—in some cases—payment plan servicing fees. The law does not allow Ms. Hartley to charge interest and fees until after she has sent a proper notice of transfer that contains all of the information required by the new law. I believe that Ms. Hartley has unlawfully charged to the accounts of Mr. Brown and the Class members 1% interest per month, at least $52,900 for administrative fees, and at least $80,500 for attorney's fees. 

The heart of the suit is summed up in paragraph 146 of the Complaint:

In short, Defendant’s entire course of conduct—from her effort to obfuscate the true relationship between Marilyn Hartley and DETCO, to her failure to provide proper notice of transfer, to her failure to itemize both the amount currently due and the amount due under a payment plan, to her unlawfully inflated claims of amounts due under a payment plan, to her presentation of a payment plan as a one-time opportunity with a limited time to accept, to her citation to expired law—is an elaborate artifice designed to disorient hundreds of consumers, confront them with a placeless and faceless creditor, “DETCO”, and intimidate them into paying her hundreds of thousands of dollars in interest, attorney’s fees, administrative fees, and servicing fees to which she is simply not entitled under the law.

This lawsuit seeks to force Ms. Hartley to refund to the accounts of the Class members all of the unlawful interest and fees she has charged to the delinquent taxpayers' accounts. My client is asking for an injunction that would prohibit Ms. Hartley from charging fees and interest to the accounts until she has sent a notice that complies with Kentucky laws and regulations. Further, the lawsuit seeks to recover additional damages because Marilyn Hartley made false and misleading statements to get some delinquent taxpayers to enter into a payment plan agreement with her that requires them to pay interest and fees to Ms. Hartley to which she is not entitled. Finally, the lawsuit seeks punitive damages. Punitive damages in this case will serve three functions. They will:

1. Punish the Defendant for charging delinquent taxpayers interest and fees that the law forbids her from charging,
2. Make an example of the Defendant for other third party purchasers who might be tempted to line their pockets with bogus and unlawful interest and fees, and
3. Level the playing field for the third party purchasers who are abiding by the law and yet have been injured by the competitive advantage Ms. Hartley has enjoyed by charging delinquent taxpayers unlawful interest and fees.   

If you have been contacted by Marilyn Hartley or DETCO or if you are currently paying DETCO under a repayment plan, you can contact me online, email me at ben@bencarterlaw.com, or call (502) 509-3231. 

There are 115 other third party purchasers of Certificate of Delinquency operating in the Commonwealth of Kentucky today. If you suspect you are being charged too much by a third party purchaser or would like me to review a letter you received about your delinquent taxes, please contact me.

I am presenting to a group called "friskies" tomorrow morning. These are people who work at our schools' FRYSCs: Family Resources and Youth Services Centers. FRYSCs are on the front lines of out-of-school problems kids and families are facing that could affect in-school achievement. Tomorrow, they want info on renters' rights in foreclosure because this is an issue they see arise over and over again. FRYSCs report that often children and their families lose housing quickly and without much warning because a landlord and the foreclosing bank fails to tell the renter about the foreclosure. 

Because of the Protecting Tenants in Foreclosure Act, renters have substantial rights regarding their ability to enjoy the property they are renting even though it is going through a foreclosure. Originally scheduled to expire at the end of this year, the protections were extended through 2014 as part of the Dodd–Frank Act. Unfortunately, cuts to funding to Legal Aid organizations means that renters do not often have the representation they need and these rights often go unenforced. 

Renters' rights are pretty straightforward under the Protecting Tenants in Foreclosure Act. Provided you are not related to the landlord, are paying a fair price for the rent, and the rental agreement was an arms-length transaction, you are allowed to stay in the property all the way through the sale of the home in foreclosure. Even after the sale, the new purchaser must ask the court to issue him or her a deed. Only after the court issues a new deed can the new owner send you a Notice to Vacate and even then the new owner must provide you with ninety days (NINETY!) to vacate and find new housing. 

That's the bare minimum. If you have a lease agreement with the old landlord that lost the property in foreclosure that lasts longer than the ninety day minimum notice, you are entitled to enjoy the property for the duration of that lease unless the new owner plans on occupying the property as his or her primary residence.

As I said above, these are substantial rights that are rarely enforced because we do not fund legal aid organizations they way they should be funded and our legal system does not provide the infrastructure to renters that it should. I have created a document I'm calling "Entry of Appearance and Notice of Rights under the Protecting Tenants in Foreclosure Act". Two versions are below. One is blank and can be downloaded and handwritten. The other contains form fields into which you can type the required information.

Before you go using these forms, listen: I am not your lawyer. By using these forms you acknowledge that you are unrepresented by counsel and are seeking to assert your rights yourself, without an attorney. If I were going to be your lawyer, you would have to contact me and we would have to actually, you know, talk and you would probably have to pay me money. I am providing these forms as a community service and do not promise they will be useful or effective in any way. You know what is effective? Having a lawyer. So, you can contact me or contact the Kentucky Lawyer Referral Service to find one to help you with your case. I hate to get a stern tone with you, but seriously: I'm not your lawyer. 

All that being said and understood, here are the forms. You can "right-click" on these links to download the files to your computer).

• Blank "Entry of Appearance and Notice of Rights" (good for handwriting)
• Form-Fillable "Entry of Appearance and Notice of Rights" (good for people with computers)

Renters are often less financially secure than homeowners and so the disruption of a foreclosure can hit innocent renters even harder than it can the landlord being foreclosed upon. The Protecting Tenants in Foreclosure Act is designed to offer a brief period of stability following a foreclosure sale while the tenant endeavors to secure new housing. It's important to our community and especially our kids that we as a legal community do everything we can to provide them that stability in a time of flux. 

Do you know that sometimes being a lawyer gives me the chills?

I am presenting today in Louisville, Kentucky to a huge room of Kentucky attorneys on our ongoing foreclosure crisis. Many thanks to the Kentucky Bar Association for asking me to speak again this year at the Kentucky Law Update.

Last year, I spoke about the Home Affordable Modification Program (HAMP), the federal program designed to encourage servicers to modify struggling homeowners loans by offering them money for each loan they modify. (Here's the video of that presentation.)

This year, I'm discussing two recent Kentucky Court of Appeals decisions and then pivoting to a novel, but important argument that most advocates ignore: equity. Kentucky courts exist to consider both legal and equitable arguments in each case. My position is that foreclosure cases beg for equitable arguments.

I hope to have a video to post for you at a later date, but for now here is the PowerPoint presentation I will use today. Download the PowerPoint file for the notes section. If you just want the slides (preserved in their original formatting and not screwed up by the fact that you don't have the typeface I used), download the .pdf. 

If you're reading this because you attended the presentation, thanks again for attending. If you are an attorney or a homeowner with questions about foreclosure, contact me online or give me a call: 502-509-3231. 

If you are interested in foreclosure, justice writ large, and/or if you are an attorney who wants to use your law degree to make Kentucky a better place, sign up for email updates about the Commonwealth Justice conference I'm organizing. It's going to be in Louisville from August 8 to August 10, so sign up and mark your calendar. It's gonna be awesome.