Maryland's District Court said Wednesday that it had frozen nearly 3,900 debt-collection lawsuits because the state suspended the licenses of the affiliated companies that filed them.
Ben C. Clyburn, chief judge of the District Court, ordered the stay to temporarily prevent the cases from proceeding or the companies from collecting. State regulators announced Friday that they had suspended the collection licenses of the firms, LVNV Funding and Resurgent Capital Services, and ordered them to cease attempting to collect on consumer debts.
The state Department of Labor, Licensing and Regulation said Friday that the violations included filing "false, deceptive or deficient affidavits" in court cases, misrepresenting the amounts owed, and collecting unauthorized attorney fees.
Resurgent Capital said then that it was "very disappointed" about the allegations and looked forward to resolving the situation.