Delbert Services is a debt collector, collecting bad debts for the internet payday lender, Western Sky.
Western Sky has been shut down for a couple years. Their payday loans violated a host of state and federal lending laws. Delbert Services has rocked along, collecting those ?illegal? loans.
Delbert Services got sued for illegal debt collecting by James Hayes and Debera Grant, in Richmond, Virginia. Delbert able persuaded a Judge in Richmond to send the case to arbitration. (Arbitration, among other things, forfeits the right to a jury trial, found in the Seventh Amendment to the constitution. It also stops class actions where two or three people sue on behalf of everyone who has been scammed in the same way.)
Hayes and Grant appealed.
The Fourth Circuit, on February 2, 2016, threw out the arbitration. That allowed Hayes and Grant and the rest to go ahead, for the class and in front of a jury, in Richmond.
The Fourth Circuit said arbitration is almost always allowedbut not here. Why? The arbitration agreement said the only law that applied was the laws of the Cheyenne River Sioux Tribal Nation.Three Judges of the Fourth Circuit said that was B.S. Western Sky (and Delbert Services) may not flatly and categorically renounce the authority of the federal statutes to which it is and must remain subject.
This goes beyond Virginia
The Fourth Circuit are the big judges between us the the Supreme Court for Maryland, Virginia, West Virginia, North Carolina, and South Carolina. Last fall, a judge in North Carolina protected Western Sky and Delbert, telling Thomas Brown and Monica Johnson that they had to bring their complaints to the Cheyenne River Sioux Tribe. This new decision should get Thomas Brown and Monica Johnson out of Eagle Butte, SD (population 619) and back in front of a jury in North Carolina.
This goes beyond Western Sky and Delbert Services
One of my clients, Jim J, had an internet payday loan with an outfit called American Web Loan. The interest rate on that loan was illegal under Virginia lawand Jim paid it off according to what could have been legally charged. But a debt collector, Admin Recovery, kept chasing him.
American Web Loans says they can violate state and Federal laws, because they are only covered by the law of the Oteo-Missouria Indians.
Like Western Sky, American Web Loan hides behind Indian tribe law: the Otoe-Missouria Tribe of Indians.
Ive been dragging my feet on whether it made sense for Jim to go after Admin Recoveryand be forced to fight it out in tribal court in Red Rock, OK, population 293. Now that the Fourth Circuit has come down on our side, were going ahead.
Seventh Amendment Jury Trial
Personally, I think the Seventh Amendment is kind of the forgotten amendment in the Bill of Rights. Every American has a right to trial by jury in Federal court, when more than $20.00 is at stake. But Congress, and the Supreme Court, has said over and over that businesses can take away that right in the fine print on their consumer agreements. If you could give up your other rights in fine print, we wouldnt have any rights at all. Its time for the elected officials who talk defending the constitution to defend the Seventh Amendment.