State Attorney General and Judge Fight Over Collection Lawsuit

by Mike Bevel, CollectionIndustry.com

Things have gone all higgledy-piggledy in Minnesota. One?s a current Attorney General and gubernatorial hopeful Mike Hatch. One?s Ramsey County Judge William H. Leary III. Both are riled up over a law suit involving debt collection agencies. Will these two ever find love in the big city?

Not likely.

Hatch is trying to have Leary removed from two cases Hatch is directly involved in, and Leary is claiming that Hatch has improperly tried to influence the court in its decision making. And unlike the commercials of old, where one guy would accidentally get his peanut butter in the other guy?s chocolate, while the other guy?s chocolate accidentally got in the first guy?s peanut butter ? the result of this mash up of interests is not going to result in delicious.

Hatch filed two lawsuits back in 2004: one against a New Jersey collection agency and its related law firm; the other against Minneapolis-based law firm Messerli & Kramer. Both suits alleged FDCPA violations. Although CollectionIndustry.com could not verify the identity of the New Jersey collection agency, Hatch did file a suit against NJ-based collection firm JBC & Associates in 2004.

FDCPA violations can be pretty serious in the debt collection industry, and attorneys general looking to make a bid for governor can get a lot of mileage out of successfully suing collection agencies. In this case, however, it looked as if Judge Leary wasn?t necessarily going to play along. In an Associated Press story, Hatch has said that Leary took positions and made statements during the mediation sessions that made it impossible for him to remain neutral.

So Hatch called Leary.

This is where things get a little sticky. Hatch alleges that he made the call to Leary at 4:21PM on June 12, 2006. The time is important, because Judge Leary alleges that mediation had ended by that time. Mediation sessions often involve private offers and counteroffers conveyed through the judge. Once mediation ends, however, lawyers are generally prohibited from having private conversations with trial judges without all parties present. And that phone call was pretty mano-a-mano between Hatch and Leary. And if mediations had truly ended, then, Leary contends, Hatch was in the wrong.

Hatch, however, has said that he was under the impression that mediation was still underway. He called, he said, to assure the judge that the lawsuits were not politically motivated. Which is an odd statement, since he filed the lawsuits as Attorney General.

Judge Leary alleges that it?s not just the call that Hatch made that is the problem. It?s the nature of the call as well. Leary characterized it as ?threatening.? According to the hearing transcript, Hatch told Leary he was to talk to a television crew in a few minutes and they were interested in the Messerli & Kramer case. Leary later concluded the statements about the television station were an attempt by Hatch to threaten him and improperly influence his handling of the lawsuits.

“I have never threatened or in any manner indicated to Judge Leary that the media was involved in this manner,” Hatch said in an affidavit filed late last week supporting his motion to remove Leary from the case.

“I called him thinking the mediation was on,” Hatch said of Leary. “He said it was over, and the call was terminated.”

If Hatch is correct, if he believed that mediation was still occurring, then Hatch may have more ammunition with which to remove Judge Leary from the two cases ? cases that could prove an attractive feather in Hatch?s gubernatorial cap. However, if Hatch?s call to the judge was an ethics breach, then it could prove pretty damning come election time.