By The Vanguard Staff
ALAMEDA, CA – The bail bond industry must follow consumer protection laws, the California Court of Appeal indicated Wednesday after it upheld a lower court decision to prevent collection of $38 million in contracts by Bad Boys Bail Bonds.
The appeal court decision came as a result of a “historic class action lawsuit on behalf of cosigners to bail contracts…one of the first to challenge a commercial bail bond company for violating consumer protection laws (setting) a precedent for the application of such laws in the bail industry nationwide,” said Lawyers’ Committee for Civil Rights of the San Francisco Bay Area.
LCCR said it’s the first time the California courts have made such a ruling.
The court ruled Bad Boys could not “deprive…cosigners…of the protections the consumer credit laws were designed to address,” and prohibited Bad Boys from “taking any new actions that would expose defaulting cosigners to particularly severe forms of irreparable harm — wage garnishments, credit injury, the imposition of judgment liens, or the seizure of securities.”
“We anticipate that the impact of this decision will ripple across California — any bail company violating consumer laws should be ready for a lawsuit,” said Elisa Della-Piana, Legal Director at LCCR.
Della-Piana added, “Today’s decision is a devastating blow to the bail industry. The court confirmed that it is absolutely illegal for bail companies to violate consumer protection laws. This case is proof that the bail industry is abusing and exploiting vulnerable California families,”
“This decision is a victory for the thousands of Californians lied to, cheated, and harassed by Bad Boys Bail Bonds. For far too long, the commercial bail industry has operated like it’s above the law. Businesses like Bad Boys have made millions tricking well-meaning people into huge amounts of debt, then using illegal means to collect. That ends now,” said Niall Mackay Roberts, an associate with Keker, Van Nest & Peters LLP, that litigated the case with LCCR.
According to the pleadings, Bad Boys, starting in 2017, issued more than 18,000 bail bond contracts—outstanding debt on those contracts totaled nearly $38 million. Plaintiffs said Wednesday’s decision stop Bad Boys from engaging in any debt collection effort against those who signed Bad Boys’ bail agreements.
Plaintiffs charged Bad Boys used “illegal means to extract huge sums of money from low-income families on the false promise of helping get their loved ones released from jail for only a small fee (and) sign credit bail agreements that hold them responsible for the entire bail amount owed.”
However, the lawsuit claimed, the agreements didn’t include the mandatory cosigner disclosures required under California law, and “Cosigners later find themselves saddled with thousands of dollars in bail debt that Bad Boys did not provide them proper notice about.”
Plaintiff Kiara Caldwell, said LCCR in a statement Wednesday, cosigned what “she believed to be a $500 bail bond payment for her friend during a rushed, misleading 15-minute meeting with the company. Bad Boys then charged her $4,500, threatened her job and hounded her family, and sued her.”
“Co-Complainant Donzahniya Pitre cosigned and paid $600 towards a bail bond for her cognitively impaired brother after Bad Boys told her that she would not be responsible for any subsequent payments. Months later, Bad Boys began harassing her for payment and subjecting her to menacing calls, multiple times each week,” according to the filing.
Bad Boys “violated California consumer law by failing to inform Ms. Caldwell, Ms. Pitre, and others in their position about the true nature of their contracts, and has violated regulations specifically meant to provide transparency in commercial bail bond transactions,” said Plaintiffs.
The class action lawsuit demanded Bad Boys “rectify its illegal practices, stop violating consumer protection laws, and provide full restitution and relief to Ms. Caldwell, Ms. Pitre, and all other cosigners in California saddled with illegal debt from the company.”
The appellate court decision can be viewed here.
The preliminary injunction can be viewed here.
The class action cross-complaint can be viewed here.