Service of Process on Foreign Manufactures - To be performed in USA if Bill passes

Legislative Update -SERVICE OF PROCESS ON FOREIGN MANUFACTURERS

Current law allows foreign companies selling defective products in the United States to dodge service of process, and they do. When a foreign company does that, it puts all of the burden on American retailers to account for any harm that is caused because of the defective product. That is not fair to American companies, and it's not fair to American citizens.

This bill streamlines service rules so foreign companies selling products here in America can be served with process here in America.

This is at least the 3rd separate session of Congress that a Bill like this has been introduced.  If this Bill were to pass as currently drafted it might create a huge increase in service of process domestically.  United State House Bill 1910 of the 213th Congress seeks to fix what some think is an unfair and broken system. Click link for a summary and text of the Bill  http://thomas.loc.gov/cgi-bin/bdquery/z?d113:h.r.01910:

by SOPLF - Jeff Karotkin

NY Federal Class Action Lawsuit Alleges Racketeering & Sewer Service Filed May 1, 2013

Earlier this month a nationally recognized law firm Hughes, Hubbard & Reed LLP filed a Federal Class Action law suit alleging FDCPA violations and Racketeer Influenced and Corrupt Organizations Act (RICO) against debt collectors and their law firm. 

The Complaint alleges the defendants were engaged in a scheme involving improper litigation activities and the hiring of process serving agencies engaged in Sewer Service.  

The complaint mentions the names of the individuals process servers and agencies it alleges were part of the scheme. 

For example, some of the affidavits of service falsely attested that the process server effected "personal service" on the defendant at an address where that person did not live at that time, or never lived.

Other affidavits of service attested that the process server served the defendant at an accurate address but by " substitute service" on a fictitious person, such as a non-existent relative.

Other affidavits of service reported that the process server effected "nail and mail" service on an address where the defendant never lived.

On information and belief, Defendants knew that the affidavits of service were highly likely to be false.

On information and belief, Defendants knew that the vast majority of affidavits of
service supporting Defendants' applications for default judgment were fraudulent.

This case like the one filed in CA earlier this month could have a lasting impact upon the both the debt collection industry and the process serving industry.  Though there have been Sewer Service allegations for decades it was the American Legal Process case filed by the NY Attorney General that resulted in the far reaching regulations that currently face the NYC process serving industry.

Do an associations Bylaws matter? Do Robert's Rules of Order matter?

I for one think they do. 

The Bylaws are the constitution. They represent the framework for all affairs of the organization.  They help guide and govern an organization or association.  Bottom-line they are part of the glue that holds everything together.  Typically associations recognize Robert's Rules of Order to as the parliamentary authority that set forth the rules not specifically addressed in the Bylaws and are considered legally binding by associations that have adopted them.  NAPPS has a formal set of Bylaws and has adopted Robert's Rules. 

Yet for some reason NAPPS appears to have ignored its Bylaws and Robert's Rules when it comes to its last annual conference.  Either the folks running the association choose to violate the Bylaws or they just don't understand them.  At the end of the day it doesn't matter if they choose to ignore them or if the leaders are ignorant.  What matters is they (the bylaws and Robert’s Rules) MUST be complied with.  

I am referring to the election of Mr. Couch to the board of Directors.  There is no dispute as to his eligibility according to the associations Bylaws.  It has been acknowledged by all that have looked into the matter that he was not eligible.  I am told that the leadership or NAPPS sought a parliamentary ruling after the breach of the Bylaws was realized. 

It would appear based on the fact that Mr. Couch is still listed as a board member that whomever advised NAPPS may have told NAPPS that the timeliness to raise a Point of Order had passed.  If that was the advice they leaders received I submit they got bad advice.  If you refer to Roberts Rules and read the timeliness requirements for a Point of Order it says that a Point of Order must be raised promptly at the time the breach occurs. However this same section of Robert's goes on to list exceptions to this requirement.  The exception that I believe applies is as follows. See Page 251 of Robert's 11th Edition:

"The only exceptions to the rule that a point of order must be made at the time of the breach arise in connection with breaches that are of a continuing nature, in which case a point of order can be made at any time during the continuance of the breach. Instances of this kind occur when:

a) a main motion has been adopted that conflicts with the bylaws (constitution) of the organization or assembly" 

 A beach occurred, it continues to occur and in fact the breach conflicts with the Bylaws. 

In further support of this breach needing to be addressed by the members, I have also reviewed the section of Robert's that governs elections; specifically the rules for contesting the announced result of an election.  They allow an election to be contested by raising a point of order.  And as stated previously that point of order must be timely except where the breach conflicts with the Bylaws and where the breach continues.  Page 444 and 445 of Robert's specifically address when a point of order contesting an election can be raised.  On page 445 is says:

"Other exceptions to the general timeliness requirement are those that come with the five categories listed on page 251, lines 9-23, in which cases a point of order can be made at any time during the continuance in office of the individual declared elected.  For example:

If an individual does not meet the qualifications for the post established by the bylaw, his or her election is tantamount to the adoption of a main motion that conflicts with the bylaws."

In order to fix this breach a member must raise a point of order contesting the election.  It is the correct and lawful thing to do in order to address the breach of the Bylaws.   I have no axe to grind with Mr. Couch; I have heard nothing but good things about the man. This isn't really about him; it is about following the rules and doing the right thing.

I suspect a simple mistake was made when it was assumed by all members present that Mr. Couch was eligible to hold office.  Now is the time for a simple solution to be applied. 

This issue is ultimately about credibility.  If NAPPS continues to ignore this issue it will represent another black eye for an industry whose image in the media of late has been less than perfect.  Or NAPPS can continue to play the game like Calvin and Hobs.  Seriously... you either have rules that matter or no rules at all!

 

by Jeff Karotkin

CA Attorney General Sues Chase Over Debt Collection Practices

Last week the California Attorney General Kamala Harris sued Chase bank over its alleged consumer debt collection practices, robo-signing as well as allegations of systemic Sewer Service performed by the bank process servers. 

The Complaint alleges debt collection abuses against tens of thousands of California residents. 
 

"Defendants have flooded California’s courts with collection lawsuits against defaulted credit card borrowers based on patently insufficient evidence—betting that borrowers would lack the resources or legal sophistication to call Defendants’ bluff."

The Complaint also alleges that the Defendants do not properly serve consumers with the summons and complaint, despite filing proofs of service that declare under penalty of perjury that service was complete.

For example, Defendants, through their agents for service of process, falsely state in proofs of service that the consumer was personally served, when, in fact, he or she was not served at all—a practice known as “sewer service.”

This Complaint is similar to the Sewer Service allegations and Attorney General action in New York a few years ago that resulted in the arrest of the owner of a process serving agency and a severe crack-down and regulations placed on the process server community in that state.  It is estimated that many hundreds of process servers and process serving agencies in NYC ultimately went out of business because of the strict regulations that followed that scandal.

At this point it is impossible to say what the fallout will be in California and if the effects will be felt elsewhere in the collection and process serving industry.

What can or should the process serving industry leaders do to address these challenges?  I for one am not sure what the if anything CALSPro should do.  Let's face it there are already laws on the books making the some of the alleged actions of the process server illegal.  I could see stricter penalties being imposed for those who truly commit sewer service.

Whatever is decided by industry leaders they will need to make sure that they are credible, professional and committed to addressing the challenges facing the industry.  No amount of money and lobbying will help produce a solution that is reasonable if your industry leaders are not up to the task.  One would hope that the CA process servers would learn from counterparts in NY what works and what doesn't work...
by Jeff Karotkin

Does JJL Process take a shot at NAPPS?

Like them or not once again JJL Process is taking the lead when it comes to controlling the narrative for large volume consumer debt collection service of process.   JJL bills themselves as an industry leader and "the future of process serving"

If you recall they have been active attempting to establish industry standards for this segment of the process serving market.  NAPPS leaders had an opportunity to participate but chose to thumb their nose at the standard summit.   This quote is attributed to then NAPPS president by JJL “the collection industry has its own problems let them drive their own bus.” 

It would appear that the choice to stay away from the standards summit had everything to do with distancing NAPPS from JJL whom NAPPS appears to think is damaged goods.  Don't get me wrong I am not a fan of JJL but I do respect their efforts to take the lead and put their money where their mouth is.  It would be nice if NAPPS did the same. 

Here is the piece JJL recently wrote for InsideArm and collection industry online newsletter that is widely read by consumer debt collectors.   

"The goal of the Summit was to have a fully transparent and inclusive process of reviewing, revising and finalizing the advisory board’s draft document. Creditors, debt buyers, legal networks, collection law firms, compliance attorneys, process servers, trade associations and even a county judge participated in the Process Serving Standards Summit held in mid-2012 in Denver. The two-day Summit made numerous and significant revisions to the draft standards and each individual standard was democratically voted on by the participating organizations. In the spirit of inclusion, the Summit participants overwhelmingly directed that the standards be publicized in a comment period allowing for further revisions. Comments were received and several more revisions made to the standards by the advisory board."