Paul L. Seave
United States Attorney
Michael Hirst
Assistant United States Attorney
Chief, Civil Division
555 Capitol Mall
15th Floor
Sacramento, California 95814
Telephone (916) 554-2700

Attorneys for Plaintiff

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA
Plaintiff

v.

Lundgren & Associates, P.C.,
a corporation, and
Alvin R. Lundgren,
individually and as an officer
of said corporation,
Defendants.

C-98

COMPLAINT FOR INJUNCTIVE AND OTHER RELIEF


Plaintiff, the United States of America, by its attorney, Paul L. Seave, United States Attorney for the Eastern District of California, acting upon notification and authorization to the Attorney General by the Federal Trade Commission pursuant to section 16(a)(1) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C.   56(a)(1), for its Complaint alleges as follows:

1. This is an action brought under sections 5(m)(1)(A), 9, and 13(b) of the FTC Act, 15 U.S.C.  45(m)(1)(A), 49, and 53(b), and section 814 of the Fair Debt Collection Practices Act ("FDCPA" or "the Act"), 15 U.S.C.  1692l, to obtain from defendants monetary civil penalties and injunctive and other relief for violations of the FDCPA and section 5 of the FTC Act, 15 U.S.C.  45.

JURISDICTION AND VENUE

2. This Court has jurisdiction over this action pursuant to 28 U.S.C.  1331, 1337, 1345, 1355, and 15 U.S.C.  45(m)(1)(A), 49, 53(b), and 1692l.

3. Venue in the Eastern District of California is based on 15 U.S.C.  53(b), and 28 U.S.C.  1391(b) and (c), and 1395(a).

COMMERCE

4. At all times relevant to this complaint, defendants have maintained a substantial course of trade in the collection of debts owed to third parties, in or affecting interstate commerce, as "commerce" is defined in Section 4 of the FTC Act, 15 U.S.C. 44.

DEFENDANTS

5. Defendant Lundgren & Associates, P.C., is a Utah corporation. Its principal office or place of business is located at 691 Montridge Way, El Dorado Hills, CA, 95762. Defendant Lundgren & Associates, P.C., has been and is now a debt collector, as "debt collector" is defined in section 803(6) of the FDCPA, 15 U.S.C.  1692a(6). Defendant Lundgren & Associates, P.C. transacts or has transacted business in the Eastern District of California.

6. Defendant Alvin R. Lundgren, is an attorney licensed to practice law by the states of California, Utah, Kansas, and Missouri. His principal office or place of business was located at 691 Montridge Way, El Dorado Hills, CA, 95762. His principal office or place of business is now located at 5125 Lamb Drive, Mountain Green, Utah, 84050. Defendant Alvin R. Lundgren, has been and is now a debt collector, as "debt collector" is defined in section 803(6) of the FDCPA, 15 U.S.C.  1692a(6). Defendant Alvin R. Lundgren transacts or has transacted business in the Eastern District of California.

7. The term "consumer" as used in this Complaint means any natural person obligated or allegedly obligated to pay any debt, as "debt" is defined by section 803(5) of the FDCPA, 15 U.S.C.  1692a(5).

FAIR DEBT COLLECTION PRACTICES ACT

8. The Fair Debt Collection Practices Act, 15 U.S.C.  1692 et seq., became effective on March 20, 1978, and has remained in force since that date. Section 814 of the Act, 15 U.S.C.  1692l, authorizes the Federal Trade Commission to use all of its functions and powers under the FTC Act to enforce compliance with the FDCPA by any debt collector, irrespective of whether that debt collector is engaged in commerce or meets any other jurisdictional test set by the FTC Act. This includes the power to enforce the provisions of the FDCPA in the same manner as if the violations were violations of a Commission trade regulation rule.

VIOLATIONS CHARGED

9. On numerous occasions, in connection with the collection of debts, defendants, or persons under their control, have used false, deceptive, or misleading representations or means, in violation of section 807 of the Act, 15 U.S.C.  1692e, including but not limited to:

a. falsely representing the character, amount, or legal status of a debt, in violation of section 807(2)(A) of the Act, 15 U.S.C.  1692e(2)(A);

b. falsely representing the compensation which may be lawfully received by any debt collector for the collection of a debt, in violation of section 807(2)(B) of the Act, 15 U.S.C.  1692e(2)(B);

c. threatening to take action that defendants did not intend to take, such as filing a lawsuit, in violation of section 807(5) of the Act, 15 U.S.C.  1692e(5);

d. falsely representing or implying that the consumer committed a crime or other conduct in order to disgrace the consumer, in violation of section 807(7) of the Act, 15 U.S.C.  1692e(7);

e. using false representations or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer in violation of section 807(10) of the Act, 15 U.S.C.  1692e(10); and

f. failing to disclose clearly and conspicuously in all communications made to collect a debt that the collector is attempting to collect a debt and that any information obtained will be used for that purpose, in violation of 807(11) of the Act, 15 U.S.C.  1692e(11).

10. On numerous occasions, in connection with the collection of debts, defendants, or persons under their control, have used unfair or unconscionable means to collect or to attempt to collect a debt, including but not limited to collecting any amount (including any interest, fee, charge, or expense incidental to the principal obligation) not authorized by the original agreement or permitted by law, in violation of section 808 of the Act, 15 U.S.C.  1692f.

VIOLATIONS OF SECTION 5 OF THE FTC ACT

11. Section 5(a) of the FTC Act, 15 U.S.C. 45(a), provides that unfair or deceptive acts or practices in or affecting commerce are unlawful.

12. In connection with the collection of checks which had been returned for insufficient funds, defendants have represented to debtors that defendants had a right immediately to collect treble damages under state civil law and/or to collect additional amounts under state criminal law.

13. In truth and in fact, defendants did not have the right immediately to collect treble damages from debtors under state civil law, and they were not entitled to collect additional amounts under state criminal law.

14. Defendants' misrepresentations, as alleged in Paragraphs 12 and 13, constitute deceptive acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. 45(a).

INJUNCTIVE AND OTHER RELIEF

15. Defendants have engaged in the various acts and practices described in Paragraphs 9 and 10 above, among others, in violation of the FDCPA, with the knowledge required under section 5(m)(1)(A) of the FTC Act, 15 U.S.C.  45(m)(1)(A).

16. Each instance, within the five years preceding the filing of this complaint, in which defendants performed or failed to perform an act as set out in Paragraphs 9 and 10 above, constitutes a separate violation of the FDCPA, for which plaintiff seeks monetary civil penalties.

17. Section 5(m)(1)(A) of the FTC Act, 15 U.S.C.  45(m)(1)(A), authorizes the Court to award monetary civil penalties of not more than $10,000 for each violation of the FDCPA.

18. Defendants' violations of the FDCPA are many and widespread and monetary penalties alone will not be sufficient to deter defendants from future violation of the FDCPA or to protect the rights of consumers against whom such actions have been or are being taken by defendants.

19. Section 13(b) of the FTC Act, 15 U.S.C. 53(b), empowers the Court to grant injunctive and other ancillary relief to prevent and remedy violations of any provision of the law enforced by the Federal Trade Commission.

PRAYER

WHEREFORE, plaintiff respectfully requests that this Court, as provided by 15 U.S.C.  45(m)(1)(A), 49, 53b, and 1692l, and pursuant to its own equitable powers:

1. Enter judgment against each defendant and in favor of plaintiff for each violation alleged in this Complaint;

2. Award plaintiff monetary civil penalties from defendants for each violation of the FDCPA described in this Complaint;

3. Order that defendants, under section 9 and 13(b) of the FTC Act, 15 U.S.C.  49 and 53(b), and the Court's equity powers, to include the following disclosures in each written collection communication with consumers in connection with the collection of debts:

Collection agencies like us must comply with a federal law that grants you certain rights. One of these is the right to have us stop communicating with you about this debt. If you write to us asking us to stop, we will. But if you owe this debt, you will still owe it and your creditor may continue to collect it from you. This law is administered by the Division of Credit Practices, Federal Trade Commission, Washington, D.C., 20580.

If you feel that the debt is being collected by unlawful means, you may contact the Division of Credit Practices, Federal Trade Commission, Washington, D.C., 20580;"

4. Enjoin defendants permanently from future violations of the FDCPA and the FTC Act;

5. Award such relief as the Court finds necessary to redress injury to consumers resulting from defendants' violations of the FTC Act, including but not limited to, restitution, the refund of monies paid, and the disgorgement of ill-gotten monies.

6. Award plaintiff its costs of bringing this action; and

7. Grant all additional equitable relief this Court may determine to be proper and just.

FOR THE UNITED STATES OF AMERICA:

FRANK W. HUNGER
Assistant Attorney General
Civil Division
U.S. Department of Justice

PAUL L. SEAVE
United States Attorney
Eastern District of California

By:
Assistant United States Attorney
555 Capitol Mall
15th Floor
Sacramento, CA 95814

EUGENE M. THIROLF
Director
Office of Consumer Litigation

ELIZABETH STEIN
Attorney
Office of Consumer Litigation
Civil Division
U.S. Department of Justice
Washington, D.C. 20530
(202) 307-0486

OF COUNSEL:

David Medine
Associate Director
for Credit Practices

Jeffrey A. Klurfeld
Regional Director
Sylvia Kundig
Attorney
Federal Trade Commission
901 Market Street, Suite 570
San Francisco, California 94103