A First Amendment lawsuit filed in a Manhattan federal courtroom has been brought forth by a South Bronx pastor and a national nonprofit against the New York Attorney General’s office in an effort to challenge laws that prevent low-income New Yorkers from seeking free legal advice in debt-collection lawsuits.
Attorney General Letitia James is named as a lead defendant in the suit.
The nonprofit, Upsolve — an organization that helps low-income and working-class families access legal and financial assistance — and Rev. John Udo-Okon allege that New York’s laws imperil low-income New Yorkers who are struggling to ward off debtors and potential bankruptcy. An estimated 90% of Americans sued for their debt receive no legal representation
New York’s rules governing the unauthorized practice of law, prevent people who aren’t lawyers from providing such “individualized” advice on responding to lawsuits, the filing said. Udo-Okon, who offers such legal services and advice to his South Bronx clientele, would be banned from doing so and levied with criminal misdemeanor prosecution and civil penalties under the law.
“Members of my community are shut out from ways to vindicate their own rights, and are left with what feels to them like an oppressive justice system stacked against them,” said Udo-Okon.
In the suit, claimants state that debt collection actions are the most common kind of lawsuit in New York.
According to Upsolve, an estimated 70 million Americans have debt in collections, and each year, roughly 4 million of these Americans are sued for their debt, often for debt that they don’t actually owe or for the wrong amounts.
“We believe that this is the kind of case all Americans can get behind,” said Upsolve CEO and co-founder, Rohan Pavuluri. “We don’t have equal rights under the law. What we have is equal rights if you can afford a lawyer. This is one of the fundamental and urgent injustices of our time.”
Citing examples of how the law has burdened New Yorkers unable to seek legal assistance, Upsolve highlighted the cases of Liz Jurado, Christopher Lepre and William Evertson.
Jurado was sued for $12,000 by her anesthesiologist for a surprise medical bill she received after a routine epidural during childbirth. Lepre, a navy veteran, was unknowingly sold a broken car, financed with a high-interest loan from subprime auto-lender Credit Acceptance, and then sued by Credit Acceptance for more than $15,000 — even though he gave the car back to the dealer within three months.
And Evertson, a Brooklynite social worker was sued by large third-party debt buyer Cavalry for a debt that was never his. All three who could not afford legal fees to fight back when they were sued, lost their cases and Jurado and Evertson ended up filing for bankruptcy.
Lepre had his wages garnished and had to borrow from his 401(k) to make rent.
A new law, which took effect on Nov. 30, 2021, allows collectors to contact people on social media, text or email, in addition to phone calls. Collectors must clearly identify themselves, only send private messages and as part of their message, offer an opt-out option for receiving further messages.
Reach Robbie Sequeira at [email protected] or (718) 260-4599. For more coverage, follow us on Twitter, Facebook and Instagram @bronxtimes.