A lawyer for payday loan company Rapid Cash on Tuesday voluntarily withdrew applications in Las Vegas Justice Court for 20 default judgments linked to an unlicensed process serving firm accused of filing false affidavits.
The lawyer, Caleb Langsdale, said he expected to withdraw default applications in 15 more cases set to go next week before Las Vegas Justice of the Peace Melissa Saragosa.
Langsdale told Saragosa on Tuesday that the Kansas-based Rapid Cash was taking the action out of an "abundance of caution" amid the scandal over its former process server, On Scene Mediations.
"We want to ensure that every single defendant's rights are protected," Langsdale said afterwards.
He said Rapid Cash filed amended lawsuits on Friday seeking to recover debts from the 20 defendants and hired a new process serving company to give the defendants copies of the lawsuits.
"I don't think they had any choice but to stop going forward with the judgments," said Barbara Buckley, the executive director of the Legal Aid Center of Southern Nevada. "I'm not celebrating today. This is a huge fraud that was perpetrated upon the court and upon unsuspecting Nevadans."
Buckley, an attorney and speaker of the Assembly, has set up a hot line at the Legal Aid Center, 868-1136 , for people who think they might be victims of On Scene Mediations.
The owner of On Scene Mediations, former Las Vegas police officer Maurice Carroll, and his office manager, Vilisia Coleman, have been charged with lying in sworn affidavits claiming to have served defendants with copies of court papers in lawsuits filed by Richland Holdings. The affidavits allowed the debt collection agency to obtain default judgments against the defendants after they failed to respond to the lawsuits.
Las Vegas police are looking to corroborate allegations that Carroll's process servers lied in court affidavits to bolster lawsuits filed by Rapid Cash.
Coleman's name appeared as the process server on some of the 20 Rapid Cash cases before Saragosa on Tuesday.
Rapid Cash, which is cooperating in the police investigation, last week hired the Las Vegas law firm Gordon Silver to help it assess fallout from the scandal on the company, which has 16 payday loan stores here.
Justice Court officials are gearing up to conduct a review of almost 20,000 default judgments that Rapid Cash and Richland Holdings have obtained since 2004. The officials seek to determine whether the rights of any of the defendants were violated. On Scene Mediations has been operating as an unlicensed process server since 2003.
Saragosa has set a hearing on Thursday for 25 applications of default judgments sought by Richland Holdings. She has ordered Richland Holdings to come to court prepared to back up affidavits of service submitted by On Scene Mediations with additional evidence.
Attorney Kevin Hansen, who represents Richland Holdings in the cases, has not responded to calls for comment.
Contact Jeff German at email@example.com or 702-380-8135 or read more courts coverage at lvlegalnews.com.