Class Action Lawsuit Claims Debt Collectors Misled Victoria’s Secret Cardholders

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Class Action Lawsuit Says Debt Collectors Misled Victoria’s Secret Cardholders

By Anne Bucher

On Wednesday, September 11, two debt collection companies were hit with a class action lawsuit accusing them of misleading Victoria’s Secret credit card holders about the accruing interest on their debts. 

New Jersey resident Justina Luna filed the class action lawsuit, claiming that Allied Interstate LLC failed to properly inform her about the accruing interest on her defaulted Victoria’s Secret account when it sent her a collection letter in September 2012, allegedly in violation of the Fair Debt Collection Practices Act (FDCPA). The Victoria’s Secret account was purchased by CVF, a purchaser of defaulted debt. CVF is listed as the current creditor for the account. 

“The FDCPA broadly prohibits unfair or unconscionable collection methods; conduct which harasses, oppresses or abuses any debtor; and any false, deceptive or misleading statements, in connection with the collection of a debt and requires certain disclosures,” the Victoria’s Secret credit card class action lawsuit says.

According to the class action lawsuit, the letter sent by Allied only stated that it was attempting to collect on a $272.97 balance owed on the defaulted Victoria’s Secret credit card. The letter did not indicate that interest would continue to accrue on the unpaid principal balance. According to Luna, the letter simply asserted that she owed a fixed sum.

“By sending the letter … Allied violated the FDCPA because the collection letter was subject to two interpretations because it did not explain that interest would continue to accrue on the unpaid principal balance and asserted that a fixed sum was owed,” the Victoria’s Secret credit card class action lawsuit says. Luna also claims that CVF is vicariously liable for Allied’s conduct because it acted as an agent of Allied.

At some point after Luna received the letter from Allied, her defaulted account was sold or transferred to LVNV Funding LLC, another entity that buys consumer debt. On June 25, after the debt had been transferred to LVNV, Luna received another letter from Allied, stating that it was attempting to collect the balance on her Victoria’s Secret credit card. The amount it claimed she owed was $283.74. In this letter, Allied informed her that interest was accruing on the account.

By filing the class action lawsuit, Luna seeks to represent a putative class of New Jersey residents who received a letter from Allied that failed to inform them that interest would accrue on unpaid debts owed to Victoria’s Secret. She is seeking statutory damages, litigation expenses, attorneys’ fees and other relief to be determined by the court. She believes that there will be at least 40 Class Members who are eligible to join the class action lawsuit.

Luna is represented by Ryan L. Gentile of The Law Offices of Gus Michael Farinella PC.

The Victoria’s Secret Credit Card Class Action Lawsuit is Justina Luna v. Allied Interstate LLC et al., Case No. 3:13-cv-05404, in the U.S. District Court for the District of New Jersey.

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