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"This settlement affects NAF arbitrations going forward, but it doesn't take account of previous or already pending actions where the debt collector companies and the hedge fund that owned them, was using them to extract money from consumers," said Jim Sturdevant, a San Francisco attorney.
Sturdevant has litigated on behalf of clients against credit card companies' arbitration clauses since they were first introduced by Bank of America in San Francisco during the early 1990s.
Credit card companies had long been able to keep the arbitration system alive by registering their businesses in states whose banking laws allowing them to require consumers to submit to arbitration in the event of payment disputes.
But Minnesota officials didn't file suit until last week, on the heels of a San Francisco judge's pivotal ruling making it easier to hold arbitration companies liable for their actions.
"After we filed our lawsuit, I did receive a call from the Minnesota attorney general asking about the nature of our lawsuit, and I put our deputies in touch with the Minnesota attorney general's office," Herrera said.
Martin, who is one of several former Minnesota deputy attorneys general who have criticized Swanson for "politicizing" her office, searched the Internet for the San Francisco lawsuit as soon as he heard about Swanson's Washington victory lap.
"The city attorney of San Francisco was on this issue, and filed this complaint with strikingly similar claims, a year earlier, Martin said. "Lawyers rip off people's work all the time. But when it comes to taking credit, that should be another story."
