Rosenthal Law Group was fortunate to have the opportunity to represent an Oregon resident and his business seeking redress against a Florida-based debt management services provider concerning the defendants’ provision of “debt management services” to plaintiffs. The client sued the defendants in the United States District Court for the Southern District of Florida, alleging violations of Oregon’s Debt Management Services Act and Oregon’s Business and Trade Practices Act, which protects individuals against predatory debt management service providers. The client also sued the defendants for breach of fiduciary duty and unjust enrichment related to the debt management services alleging that the defendants took unfair advantage of them and did not act in their best interests. The defendants countersued for breach of contract, claiming that additional monies were due and outstanding for their alleged debt management services.
The defendants moved for summary judgment on the plaintiffs’ claims and their counterclaim. The defendants argued that they neither agreed to perform nor performed debt management services for the individual personally. They argued that Oregon’s Debt Management Services Act and Oregon’s Business and Trade Practices Act were inapplicable. They argued that it only applied to business debts.
Rosenthal Law Group disputed the defendants’ characterization of the parties’ relationship. It maintained that the defendants offered to perform debt management services to the individual (who guaranteed the business debts) and his business. Unlike Florida and Federal law which defines a consumer debt as one for household items, the Oregon statute did not limit consumer debt and merely defined a consumer as an “individual. “ Uncovering and drawing this distinction enabled Rosenthal Law Group to pursue the claim and resulted in a denial of the defendants’ motion for summary judgment. Judge Donald Middlebrooks’ lengthy opinion in favor of Rosenthal Law Group’s client in the case of Gorham v. Kaufman, 2021 WL 4397881 (S.D. Fla Sept. 22, 2021) was issued on the eve of trial. Following the order, the case settled on the day prior to trial.