Class Action Proceeds Against Fein, Such & Crane, LLP

A class action was started against a law firm, Fein, Such & Crane, LLP, for allegedly charging fees not authorized by agreement or law. The fees at issue were litigation costs connected to settlements of foreclosure actions. The debtor was represented by counsel when the fees were sought. The plaintiffs argued that the practice was directed at consumers at large and therefore violated General Business Law § 349 that provides relief for consumers against deceptive business practices.

If the fees were not legally owed by contract or statute, the practice would violate Fair Debt Collection Practices Act § 1692(e)(5) because it falsely implies that the creditor is entitled to the fees, held the court.

The plaintiffs further argued that if any legal fees were owed, those charged by the defendants were "exaggerated, unreasonable, or not actually incurred." Since the standard of law applied to Defendant's motion to dismiss is plausability, the court found that the class of plaintiffs met that here.

The court was not persuaded by the law firm's attempt to use prior cases ruling that communications made to debtors' attorneys were not actionable. Those cases cited were not binding or persuasive. According to the court, having counsel is just one factor the court considers to determine if the communication is false, misleading, or deceptive to the "least sophisticated consumer."

Similarly, at this early stage of litigation, the plaintiffs adquately alleged that the law firm used a practice and policy of overcharging consumers at large. The General Business Law § 349 claim would likewise proceed against Fein, Such & Crane, LLP.

The case is White v. Fein, Such and Crane, LLP, 15-CV-438.

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