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JP Morgan Chase Bank allegedly attempted to collect on forgiven loan, class action says

By Legal News Line | Feb 5, 2015

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A class action lawsuit against a national bank claims the bank allegedly tried to collect on forgiven loans.

Madeline Montry and Rebecca Burlingame filed the lawsuit Feb. 3 against JP Morgan Chase Bank, the National Collegiate Student Loan Trust and the Law Offices of Patenaude & Felix, A.P.C.

According to the lawsuit, the bank told consumers and the IRS that some debts it was owed were “discharged, cancelled or forever forgiven.” However, the bank then allegedly attempted to collect on the same debts after forgiving them.

In the plaintiffs' case, the two took out a loan through Chase Bank totaling about $86,574. Around Dec. 31, 2013 the loan went into default, and the bank allegedly sent a letter informing them the debt had been forgiven.

However, on Feb. 12, 2014 the bank transferred the loan to the National Collegiate Student Loan Trust to collect on the unpaid loan. The trust retained Patenaude & Felix, which is a debt collection law firm.

The lawsuit claims the consumers in the class should get statutory damages, and “any monies the defendants wrongfully obtained as a result of this practice.”

The plaintiffs are represented by Robert L. Hyde and Joshua B. Swigart of Hyde & Swigart, in San Diego and Abbas Kazerounian of Kazerouni Law Group, APC, in Costa Mesa.

United States District Court Southern District of California case number 3:15-cv-00223.

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