From time-to-time I do the grunt work of going back and checking up on old stories to see what might be new in court cases. This time it was checking up on Otto Berges, a Florida lawyer who was/is selling debt relief assistance. You can see past stories, here.
A case filed in Florida against Otto Berges, Berges Law Group, Consumer Protection Counsel, Debt Be Gone, and Gergory Fishman. The case was originally filed in October of 2014.
When the case was originally filed the alleged facts stated Debt Be Gone had solicited a consumer for debt relief services and received a contract from Consumer Protection Counsel to “sign and return.”
“Services included in the contract include disputing account’s accuracy, sending letters of legal representation, requesting verification from debt collectors, reviewing responses received, requesting the credit reporting agencies to reinvestigate inaccurate or derogatory information, filing complaints with regulatory agencies, litigating claims, and settling claims.
The contract allegedly contained provisions for advance fees and a non-refundable fee as part of the services sold.
Included in the contract is a provision in the Scope of Legal Representation section, “Attorney shall then remit to the three major credit reporting agencies indicating that the Client desires that the credit reporting agencies reinvestigate any inaccurate or derogatory information contained in the Client’s consumer credit report.”
The complaint states Berges was the subject of a case in Wisconsin (Bennett v. Berges, et al., No. 14-cv-509) where “Judge Griesbach found that when Otto Berges, Berges Law Group, Consumer Protection Counsel “used an instrumentality of interstate commerce to sell services that were directed at repairing Plaintiff’s credit in return for money, they fall within the definition of a credit repair organization and credit services organization.”
The allegation made in the complaint was the services sold to the consumer violated the Credit Repair Organizations Act. – Source
Before I jump into the case update I wanted to share this quirky observation from the Berges Law Group website when I just dropped in to check what press release was mentioned in one of the filed court documents.
On July 16, 2015 the Berges Law Group was “pleased to announce that for his sixth time, Otto E. Bergés has attained Super Lawyers status for the 2015 calendar year under the Consumer Advocacy Category.” Congratulations.
But it was the third paragraph in the release that caught my attention, “For those individuals who are struggling with issues surrounding debt, the Bergés Law Group offers hope. The most difficult step in seeking legal assistance for debt-related matters is simply acknowledging the need for help. Once a troubled consumer realizes that they find themselves in dire need of some resolution, the Bergés Law Group can begin legal proceedings in attempting to get their debts dismissed and/or discharged.”
Maybe it is just me but the release is about consumer advocacy but appears to target debt relief services. I found that quirky because if you go to the top of the site and look at the practice areas the firm lists they are: Automobile Accidents, Construction Accidents, Consumer Law, Corporate & Business Disputes, Foreclosures, Litigation, Personal Injury, and School Loans.
The consumer law portion of the Berges website lists a number of issues the firm appears to target. These include debt collectors, Fair Debt Collection Practices Act, Telephone Consumer Protection Act, and Florida Consumer Collection Practices Act. At least it makes prominent mention of those items.
The consumer law page says, “Consumer litigation focuses on the rights of individual consumers and may involve claims relating to unfair and deceptive trade practices, credit cards, privacy issues, fair debt collection practices, truth in lending, and other disputes under state and federal consumer protection laws.”
A search of the federal court only found three cases related to the Berges Law Group and all as a defendant. The California case was dismissed, the Wisconsin case was settled, and the Florida case is still ongoing.
Otto Berges can be found as the attorney associated with nine cases filed in Florida between 2000 and 2015. One case was representation of a Jeremy Marcus in a debt collection action. It could be pure coincidence but a Jeremy Marcus was associated with another debt relief company, click here.
Not all of the cases were consumer debt representation that appeared to fall under the description above.
Anyway, as part of the Florida case I originally set out to checkin on I found an interesting document related to the Wisconsin case I mentioned above. It seems the settlement agreement was a bone of contention and the attorney representing Berges wants it to remain confidential in this case. That just makes me more curious and it appears it will be an exhibit in the Florida case.
I did find one press release associated with that case and it was issued by a Nathan DeLadurantey. It said, “We are pleased to announce that the parties to the above referenced litigation have come to an amicable resolution, and the case has been dismissed. Given the amicable resolution, the case was not decided on its merits. Specifically, there was no finding by a court of law that Otto Berges, Berges Law Group, P.A., Consumer Protection Counsel, P.A., Debt Be Gone, LLC, Paralegal Staff Support, or United Legal Group violated the Credit Repair Organizations Act, the Wisconsin Consumer Act or any other state or federal regulations, statutes or laws.” – Source
Now I’m absolutely certain Berges would have an opinion differing from the assertions of another one of the court documents but the document presents an entertaining story, that at the very least, makes for an interesting read. So let me cut to the logical chase here and state in advanced, Berges probably thinks the following statements from the current Florida case are all pure horse shit and he probably severely disagrees with them. I’m sure he will present some defense agains the allegations made by the Plaintiff attorney, Nathan DeLadurantey.
In a motion for sanctions, the Plaintiff counsel says, “Defendant Otto Berges is a lawyer licensed to practice law in the State of Florida and before this honorable court. During the course of his career, he has conducted or participated in approximately 1,000 depositions. Accordingly, he understands the nature of a deposition and that testimony is under oath and penalty of perjury. During deposition testimony in this case, both individually and as the 30(b)(6) designee of Defendant Consumer Protection Counsel P.A. (hereinafter “CPC”), Defendant Berges knowingly and intentionally lied about facts related to the core elements of Plaintiff’s case. These lies have unjustly increased the costs of litigation, were made in an attempt to hide facts central to Plaintiffs case, and were designed to mislead the court about Defendants’ actions.
Plaintiff’s Prima Facie Case
A central component to Plaintiff’s case is that Defendant Berges and his cadre of companies and companions provide credit repair services subject to CROA via written communications. In support of this assertion, he has advocated that they contracted to send letters to the consumer reporting agencies (Experian, Equifax and TransUnion) disputing the accuracy of the information on his credit reports in an effort to increase his credit. Plaintiff has specifically plead that these dispute rights are invoked under the Fair Credit Reporting Act (hereinafter “FCRA”) and that because Defendant Berges and CPC provide these services, they are violating CROA.
Accordingly, the contractual services, nature of Defendants’ business, as well as his specific legal representation becomes relevant. Depositions of the Defendants spanned several days (and resulted in two separate trips to Florida) as Plaintiff sought to uncover the truth regarding Defendants’ business and business model. Every time Defendant Berges was confronted with a fact or evidence that supported a finding that he could be a CRO, he would assert that the evidence was a mistake and should never have been produced, was his attorneys fault, or that the evidence was not reflective of what he and his companies actually did. During the course of this case, counsel for Plaintiff has been contacted by other consumers across the country who have complaints about the nature of services rendered by Defendants Berges CPC.
A consumer in Wisconsin approached Counsel regarding a letter that he had received as part of his representation from CPC. This letter and a supporting affidavit are attached to the Declaration of Joshua Russell. This individual, Joshua Russell, is currently represented by Attorneys DeLadurantey and Miller.
But what does this letter from Defendants Berges and CPC state? That both Defendants have been retained to represent a consumer in matters under the FCRA as they dispute the inaccurate or incomplete information on his credit reports. The letter is addressed to a lending institution and indicates that the loans in question should not be included in the financing application, because they are being handled by the Defendants. This is the exact nature of representation that is covered by CROA – disputing of information on a credit report and actions designed to increase their credit worthiness.
During deposition questioning, Defendant Berges and CPC were asked questions related to the nature of the services they rendered to the Plaintiff and other consumers. Defendant Berges steadfastly denied ever providing representation under the FCRA, actions related to disputing debts on credit reports, credit repair, or anything that would remotely trigger CROA. He professed an utter lack of knowledge about the FCRA [Emphasis added.] and stated that their representation was exclusively to “verify and validate debt” with the actual creditors. Despite many hours of testimony, Defendant Berges and CPC steadfastly lied about the nature of their business model and services.
Footnotes from this page of filed document.
2 Defendant Berges testified first as the Fed. R. Civ. P. 30(b)(6) representative of Defendant CPC, and then incorporated those answers as his personal testimony.
Q: “If I asked you all of those same questions again in your personal capacity, would your answers be the same?”
A: “Yes.” Berges Dep. 6:17-20.
3 Q: “In your own words, describe for me what the dispute process is as it relates to the Fair Credit Reporting Act.”
A: “And I don’t know, because I’ve never done it. I’ve never even attempted to try and do it.”
Q: “So you’ve never researched it to make sure that you weren’t accidentally doing it?”
A: “Correct.” CPC Dep. 85:13-24.
4 “So even though I do see credit reporting problems and I see carless credit bureaus, I don’t actually offer any services to any CPC’s clients regarding credit reporting problems or careless credit bureaus, other than what we’ve already addressed before where they get a blind cc.” CPC Dep. 94:9-15.
5 “We’ve never done credit repair or credit correction. We don’t even know how to do it.” CPC Dep. 317:25-318:2.
6 “I never mentioned credit reporting errors because I don’t know what those are.” CPC Dep. 94:22-24.
7 “[T]he only knowledge that I have of the FCRA happens to have been, maybe not even a five minute mention of Pete Barry’s boot camp, I think it was a way for me to provide information to the clients about relief that could be afforded to them as a consumer advocacy lawyer, but without ever having any intention of pursuing that, because we don’t deal with credit reporting agencies, nor have we ever.” CPC Dep. 228:22-229:5. “So even though I don’t use or know what the FCRA or FCBA are…” BLG Dep. 77:17-18.
8 Q: “In your words, what is the dispute process?
A: “I don’t know. I’ve never done it. I verify and validate debt through the legal system. That’s what I do.” CPC Dep 83:13-17.
9 “We’re not hired to determine the accuracy of an individual’s credit rating or credit report. We’re hired because those individuals have a legitimate concern about the validity of the alleged debt; and, and therefore, we’re hired to see whether or not we can get the debt dismissed altogether.” CPC Dep. 88:10-15.
The deposition transcripts span hundreds of pages as the Plaintiff wrangled to understand the truth. Attached as Exhibits A are excerpts from various portions that reveal Defendants Berges and CPC lie about the nature of their services. The relevant portions have been highlighted for the court’s convenience.
Defendant Berges and CPC obviously have a vested interest in avoiding compliance with CROA, as they service thousands of clients across the country. In addition to lying during deposition testimony, they have perpetrated a fraud on the court in their Motion for Summary Judgment. In support of that motion (and in response to the Plaintiff’s Motion for Summary Judgment) they have proposed material facts that are in direct contradiction to this letter and the nature of the services that they render.
Additionally, at the start of this case Defendants moved for a stay of discovery, pending the outcome of their motion to dismiss. D.E. 32. In support of that motion they indicated that they provided services to consumers under the FCRA. When Plaintiff explored this practice area in depositions, Defendants Berges and CPC beat a hasty retreat, discussed above. The argument in support of a stay on discovery comports with the declaration of Joshua Russell — that Defendants Berges and CPC provide services under the FCRA and that these services also trigger liability under CROA.” – Source
So that set me on a path of reading the depositions. Now bear in mind, the Berges Law Group website was bragging about the recent award where attorney Breges was recognized as a consumer advocacy lawyer. So how do you square quote form the deposition by Berges that says, “…provide information to the clients about relief that could be afforded to them as a consumer advocacy lawyer, but without ever having any intention of pursuing that, because we don’t deal with credit reporting agencies, nor have we ever.”
Berges offers, “However, I’ve never been personally contacted by any CPC employee that a client has indicated to me or indicated to them, that there has been an inaccurate reporting of their credit in their credit report and that we need to take action of some sort.”
Which is an interesting statement, considering the following exhibit offered in the case.
Berges also offered up his apparent strategy in dealing with client debts in getting them dismissed and discharged. He states, “The only way to dispute a debt and to get it completely dismissed is to go through legal courts and wait for the client to get sued so that we can then be agressive in their defense.” – Source
I guess he’s not heard about this thing called consumer bankruptcy.
The deposition seems to paint a picture, Berges doesn’t even know how to dispute a debt.
“Q: And then my follow-up question is: In your words, what is the dispute process?
A: I don’t know. I’ve never done it. O verify and validate debt through the legal system. That’s what I do.” – Source
If you are as confused by all of this now as I am, welcome to the group. It appears CPC and/or Berges was either offering to help consumers with debt/credit problems through validation and dispute or he was setting his clients up to be sued and then aggressively defend them. After catching-up on this case and reading the new documents, I will admit, I have no clue what the sales pitch was or what was actually being delivered.
Hopefully this case will go to trial and all the documents will come out. I did notice some of the sales scripts are listed as upcoming trial exhibits and that should make for some interesting reading and fill in some gaps.
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