Frequently Asked Questions

If approved, the Settlement provides the following benefits to Class Members:

• PRA will seek to cancel all default judgments included within the class, except for those judgments for which a notice of satisfaction or vacatur has already been filed with the Court that entered the judgment. PRA will seek to cancel the default judgments by filing an “authorization to cancel judgment” with the Court that entered the judgment and asking for the cancellation to be reflected on the judgment docket.
• PRA will place the accounts for default judgments included within the class in terminal status. PRA will not seek to collect on the accounts for the default judgments included within the class, and any payments received on those accounts after October 19, 2023, will be refunded or returned to the last known address for the account.
• PRA will pay $5,750,000 (5.75 Million Dollars) into a Settlement fund. The Settlement fund will be distributed to Class Members after deducting the amounts approved by the Court to pay for Attorneys’ Fees and expenses of Class Counsel and for service awards for the four Class Representatives. If the Court approves the requested attorneys’ fees, expenses, and service awards, Class Counsel anticipates that approximately $4 million would be available to distribute to Class Members (the “Settlement Fund Balance”). PRA has agreed to pay separately for the administration costs of the Settlement.
  

Each Class Member will receive a minimum payment of $50 from the Settlement Fund Balance. The remaining amount of the Settlement Fund Balance will then be used to compensate those Class Members who had money collected from them or property seized by PRA as a result of the default judgments. All such Class Members will receive a proportional share of the Settlement Fund Balance based on the amount of money that was collected from the Class Member, in addition to the minimum payment of $50. 

Settlement payments will range from $50 to more than $5,000.  The exact amount you will personally receive will not be known unless and until the court gives final approval to the settlement, but Class Counsel estimate that those class members who had money collected from them or property seized by PRA will receive an average settlement payment of approximately $385.

If Settlement Checks (a) cannot be delivered to all Class Members because the Class Members cannot be located or (b) Settlement Checks are not cashed by all the Class Members to whom they are sent within 90 days of mailing, a supplemental distribution of funds may be sent to Class Members who do cash the first Settlement Check provided that (1) the total payment to the Class Member would not exceed the amount collected from them on their default judgment and (2) the amount of the supplemental Settlement Check would be $10 or more. Any amounts remaining in the Settlement Fund Balance after this process will be distributed as directed by the Court for purposes that will benefit the public. The money will not go back to PRA.  

PRA has agreed to cease attempting to collect on accounts included within the class as the Court considers whether to approve the Settlement. Any payments that you may have made on your account to PRA after October 19, 2023, will be returned to you.

The Court will hold a Final Approval Hearing on June 12, 2024 at 2:30 p.m. ET  to decide whether to approve the Settlement. Assuming the Settlement is approved and there is no appeal, distribution to Class Members should occur in September 2024, and the supplemental distribution, if any, should occur in early 2025.

Unless you exclude yourself (“opt out”) from the Settlement, you will be part of the class. By staying in the Class, you give PRA a “release” of any existing claims you may have against it concerning debt collection or other activity on the accounts and/or alleged debts at issue in this case. A release means you cannot sue or be part of any other lawsuit against PRA over any of the released claims that existed on or before the Class Effective Date, which is January 12, 2024, the date the Court granted preliminary approval of the Settlement. Class Members are not releasing any claims that arise after January 12, 2024.

If you do not want to be part of the class, you can take yourself out of the Class by “opting out.” To opt-out of the Settlement, you must send a letter by mail saying that you want to be excluded from Pounds v. Portfolio Recovery Associates, LLC.  Be sure to include your name, address, telephone number, and your signature. You must mail your opt-out request postmarked no later than May 13, 2024, to:

You cannot opt out of the class by telephone, fax, or e-mail. If you opt out of the class, you will not receive any money from the Settlement, you cannot object to the Settlement, and neither you nor PRA will be legally bound by anything that happens in the case regarding you.

• Carlene McNulty and Jason Pikler of the North Carolina Justice Center, Raleigh, NC
• J. Jerome Hartzell, Attorney at Law, Raleigh, NC
• Travis E. Collum of Collum & Perry, PLLC, Mooresville, NC
• Adrian M. Lapas of Lapas Law Offices, PLLC, Goldsboro, NC

Class Counsel will ask the Court to award them Attorneys’ Fees equal to thirty percent of the Settlement amounts paid by PRA. If the Court approves this, Class Counsel would receive a fee of $1.725 million out of the total Settlement fund of $5.75 million. In addition, Class Counsel will also request reimbursement from this fund of litigation-related expenses they have incurred on behalf of the class. 

Class Counsel will file a motion seeking the Court’s approval of the requested fees and expenses, and copies of the papers relating to this request will be posted in the Documents section of this website.

Yes, Class Counsel will ask the Court to approve a service award of $10,000 for each of the four Class Representatives in this case. These awards would compensate the Class Representatives for the time and effort they have dedicated to this case over the past seven years. It is important to recognize that without their hard work, this case would not have been filed, and no one would have had their default judgment canceled or received any cash payment that will result from the Settlement.

No. If you are a Class Member, received a postcard of the Class Notice, and do not opt out, the Settlement Administrator will mail you a Settlement Check. Likewise, so long as you do not opt-out, you do not need to do anything to have your default judgment cancelled.

Yes, so long as you do not opt-out of the class.

By filing an objection, you can tell the Court that you do not agree with the Settlement or some part of it, or with the request for Attorneys’ Fees. You can give reasons why you think the Court should not approve the Settlement or the fee request. The Court will consider your views. To object, you must file your objection with the Court and deliver written objections to Class Counsel and Defendant’s Counsel, postmarked or hand-delivered no later than May 13, 2024, stating (i) your name, address, and telephone number; (ii) the name of this case and the case number; (iii) a clear statement of each objection; and (iv) an explanation of any specific reasons for each objection, including any legal and factual support, and any evidence you intend to offer in support of the objection.

Mail or hand-deliver the objection to Class Counsel, Defendant’s Counsel, and the Court so that the objection is postmarked or delivered no later than May 13, 2024, to:

You may object only if you stay in the class. Excluding yourself (by “opting out”) is telling the Court that you do not want to be part of the class. If you exclude yourself, you have no basis to object because the case does not affect you. 

The Court will hold a hearing to decide whether to approve the Settlement. At the Final Approval Hearing, the Court will consider whether the Settlement is fair, reasonable, and adequate. If there are objections, the Court will consider them. The Court will decide whether to approve the Settlement. The Court will also decide the request for Attorneys’ Fees.

You may attend the Final Approval Hearing and you may ask to speak, but you do not have to.  Class Members or their attorneys intending to speak at the hearing must file with the Court and deliver to Class Counsel and Defendants’ Counsel a notice stating how much time the Class Member anticipates needing to present the objection; identifying, by name, address, telephone number, and detailed summary of testimony, any witnesses the Class Member intends to present; and identifying and providing copies of all exhibits the Class Member intends to offer. You cannot speak at the hearing if you do not file a notice as provided herein or if you have opted out of the Settlement.

The Final Approval Hearing will be held before Judge O’Foghludha on June 12, 2024 at 2:30 p.m. ET at the following address:

 YOU DO NOT HAVE TO ATTEND THIS HEARING TO RECEIVE YOUR SHARE OF THE SETTLEMENT

This website summarizes the proposed Settlement. More details are in a Settlement Agreement available in the Documents section of this website or by calling toll-free (833) 462-3510. This website will be updated periodically.  

Please do not call the Judge or Clerk of Court; they cannot give you advice about this Action.