American Express is Suing Me!
JULY 3, 2022
Who is American Express?
Most consumers would say they are very familiar with American Express. Their knowledge of American Express is gained principally from commercials. However, most of those consumers have never found themselves battling American Express in a credit card lawsuit and when that happens, they cry out in exasperation: “American Express is Suing Me!” If you have been sued by American Express, you came to the right page.
Incorporated in the State of New York, American Express Company has been in business for well over 170 years. They are a financial institution in this country. But don’t let this scare you.
Many credit card issuers do not file actions against their cardholders. Instead, they sell their credit card debt to a debt buyer also known as a third-party debt collector. Historically, American Express has not sold their defaulted credit card debt to other debt collectors but has pursued them by filing credit card lawsuits.
In presenting its case in court, American Express will usually rely on witness’ testimony in a “business records affidavit” when attempting to prove their case. It is important to fully understand the Florida Rules of evidence when attacking these affidavits and any documents attached. If you have recently been served with an American Express credit card lawsuit, then you should take action to protect yourself.
During calendar year 2023, American Express sued 500 consumers in Orange County, Florida. American Express is frequently uses as their legal counsel such law firms as Modlin Slinsky, P.A.; Cooling & Winter and Zwicker & Associates, P.C. In addition, American Express is represented in-house staff attorneys, Lisa DiSalle, Esquire, Joshua James Knurr, Esquire, American Express National Bank, 9550 Regency Square Blvd., Suite 501. Jacksonville, FL 32225, 844-641-4041.
What happens if I don’t pay my American Express Credit Card?
If you don’t pay you American Express monthly statement, they will eventually contact you and request payment. If you cannot work out a payment arrangement, you will most likely be greeted with an American Express lawsuit.
Will American Express Take Me to Court?
Yes they will. In Florida they have a few law firms that represent them in court.
Modlin Slinsky, P.A is a small law firm in South Florida that represents debt collectors and credit card companies. They are located in Sunrise, Florida, and currently only have five employees operating out of their office. In spite of their small size, Modlin Slinsky pursues American Express credit card lawsuits very aggressively. They do so in the hopes that they will be able to collect on the debt for their client and many times, they are successful.
Why is American Express Contacting Me?
American Express will typically contact you for a few reasons. First, if you are late on your payments. Second, if they are planning on suing you, or if the paperwork has already been filed. They are likely going to take legal action regarding a debt you owe.
Responding to the Lawsuit is of Critical Importance
After you receive a summons and complaint from counsel for American Express, review the documents carefully making sure that you understand the dates, time frame and deadlines. Your first instinct may be to put the lawsuit out of your mind. Unfortunately, ignoring it will not make it go away. On the contrary, it will have serious repercussions and will only work against you. You should always respond to or answer a lawsuit if you have received the notification. The last thing that you want is a default judgment entered against you.
If you do not respond to the lawsuit, you cannot defend yourself against it. There are many defenses to debt-collection lawsuits. You also may not have been served with the lawsuit properly, and that can also serve as a defense. If the statute of limitations has expired, the debt collector no longer has any right to take legal action regarding the debt. In Florida, the statute of limitations on debt collection cases is just five years.
Clearly, there are several defenses available to consumers in debt-collection lawsuits. But, if you ignore the lawsuit and do not respond, a default is entered, you cannot use any of them. Once you are properly served with the lawsuit, you will receive the complaint, as well as the summons which may tell you of a hearing date, and where you are to appear in court. Ignoring the lawsuit will mean you do not know any of this information and therefore, will not be present at the hearing to defend yourself. In turn, counsel for American Express will ask the judge to issue a default judgment against you, and they will likely be successful with the request.
Once a default judgment is issued against you, American Express then has the right to take whatever legal action the judge has approved. This could mean a wage garnishment, a levy on your bank account, or other serious consequences.
Verify the Debt
If you are sued for credit card debt, your first step is to verify that the debt is actually yours. Find out the balance owed to American Express. The Fair Debt Collection Practices Act requires debt collectors to provide a validation letter listing specific details about the debt, including the current creditor and the amount of debt. This letter must arrive no later than five days after the initial communication on the debt.
If you do not believe the debt is yours—or if you don’t know whether or not the debt is yours—you have the right to request additional information. Write a debt verification letter asking your debt collector to confirm the existing of the debt. You could request the name of the original creditor associated with the debt, for example, or ask the debt collector to confirm that the statute of limitations on the debt has not expired.
Know Your Options in a Debt Lawsuit
Even if the debt is yours or believe that you do not have a defense in the lawsuit filed by counsel for American Express, it is important to know you still have options. You can try to negotiate for a smaller amount than what American Express is claiming. We can help with these negotiations and give you the best chance of a successful outcome. While negotiation will mean you still have to pay a portion of the debt, it will be significantly less than the amount being pursued in the lawsuit.
If you have been sued by American Express and feel that you cannot defend against the lawsuit and you feel as though you cannot afford to pay a smaller amount, you may want to consider bankruptcy. Immediately after you file bankruptcy, the judge will issue an automatic stay. This will prohibit debt collectors from contacting you. If you are successful with your bankruptcy, the debt may even be discharged, meaning you will no longer be responsible for paying it.
Does American Express Settle Debt?
Yes, entering into a favorable settlement agreement with American Express on a defaulted credit card can be achieved. And, you may not necessarily have to pay the entire debt. Ask for favorable settlement terms. Request that interest fees be waived. Settlement possibilities should be explored immediately. American Express has a reputation for being very tough on credit card lawsuits. However, they are always willing to listen, especially where there is a hardship situation. You may consider talking to a credit counselor to explore ideas on dealing the credit card lawsuit as well as other debts. Lastly, it is advisable to have legal representation when discussing settlement.
Will the Credit Card Lawsuit affect my credit score?
Debt settlement may have a negative impact on your credit score, even though you are reducing your debt obligations. Before you do anything, get a copy of your credit report.
High credit scores are designed to reward those accounts that have been paid on time according to the original credit agreement before they’re closed. A debt settlement arrangement whereby you agree to pay back a portion of your outstanding debt—modifies or negates the original credit agreement.
When the lender closes the account due to a modification to the original contract (as it often does, after the settlement’s complete), your score gets negatively impacted. Other lenders may be reluctant to extend you credit in the future.
Still, it is possible that the reduced debt burden is worth a subsequent drop in your credit score. Keep in mind that high credit card account balances and late or missed payments have likely already lowered your score. If debt settlement jump-starts your path toward a sounder financial future, it should be considered.
What are my defenses to a credit card lawsuit?
A consumer that has been sued by American Express on a credit card debt as well as other debt collection lawsuit has several defenses.
Statute of Limitations
The statute of limitations is the time limit or deadline within which a lawsuit must be filed. If you fail to file your lawsuit within the prescribed deadline, the lawsuit will be banned and may be dismissed. The statute of limitations was established to create fairness and predictability for individuals and businesses that wish to file lawsuits.
Those who are potentially facing a lawsuit will be notified of the lawsuit and the filing deadline instead of having it hanging over their heads for an indefinite time. Potential plaintiffs are required to decide whether they should file a lawsuit within the time limit.
The statute of limitations serves to prevent plaintiffs from delaying the enforcement of their legal rights and reduce the risk of injustice. In order to know if the statute of limitations has expired or the amount of time left to file a lawsuit, a potential plaintiff has to first determine the time the statue of limitations began. Generally, the statute of limitations starts when the cause of action arises. For a contract breach, the timeframe for filing a lawsuit starts at the time when the breach occurred.
The statute of limitations of a credit card debt is governed by Section 95.11 of the Florida Statutes provides that:
95.11 Limitations other than for the recovery of real property.—Actions other than for recovery of real property shall be commenced as follows:
(2) WITHIN FIVE YEARS.—
(b) A legal or equitable action on a contract, obligation, or liability founded on a written instrument, except for an action to enforce a claim against a payment bond, which shall be governed by the applicable provisions of paragraph (5)(e), s. 255.05(10), s. 337.18(1), or s. 713.23(1)(e).
Therefore, an action on a credit card debt that is filed more than five years after the last payment is barred by the Florida Statute of Limitations.
The Truth in Lending Act
In the appropriate circumstances, the Truth in Lending Act can be a powerful defense to a credit card lawsuit filed by American Express. The Truth in Lending Act provides that “no credit card shall be issued except in response to a request or application therefor.” 15 U.S.C. § 1642. “Credit card” is defined as “any card, plate, coupon book or other credit device existing for the purpose of obtaining money, property, labor or service on credit.” Id. § 1602(k). Federal Regulation Z, drafted by the Federal Reserve Board pursuant to statutory authority, provides that “ regardless of the purpose for which the credit card is to he used . . . no credit card shall be issued to any person except: (1) In response to an oral or written request or application for the card; or (2) As a renewal of, or substitute for, an accepted credit card.” 12 C.F.R. § 226.12 (a)(1)-(2). Here, there is no question that Plaintiff’s predecessor issued a credit card within the meaning of 15 U.S.C. §1642.
Courts have recognized the remedial nature of the Truth in Lending Act demands that it be construed liberally in favor of the consumer. Therefore, if this Court follows the law and liberally construes 15 U.S.C. §1642, it should grant a motion for summary Judgment if the facts are appropriate for filings such motions.