Senior attorney helps secure $5.75 million settlement for 18,000 North Carolinians in class action against debt buyer

 In 2024, the North Carolina Justice Center, along with co-counsel Jerry Hartzell, Adrian Lapas, and Travis Collum, settled a class-action lawsuit against Portfolio Recovery Associates (PRA), one of the country’s largest debt collectors, resulting in a $5.75 million payment by PRA and the cancellation of approximately $35 million in default judgment debt.

“These are debts that the original creditor has decided are worthless. They’re not pursuing them and so, instead of just writing them off on their taxes . . . they then turn around and sell them to [debt buyers] for pennies on the dollar. Then [the debt buyers] take these worthless debts and turn them into a billion-dollar business by getting civil judgments against poor people,” said Jason Pikler, Senior Attorney and Deputy Director of the Housing, Consumer & Energy Project at the NC Justice Center.

In addition to the class action, the NC Justice Center and co-counsel also filed individual lawsuits on behalf of Pia Townes and Shari Spector, with the intent of obtaining a precedential ruling by the North Carolina appellate division interpreting and enforcing North Carolina’s laws that restrict the manner in which debt buyers can collect on debts in this state.

Read the full story to learn how this slowed down the debt buyer industry in North Carolina.