Indiana Supreme Court orders changes in small claims courts - 13 WTHR Indianapolis

Indiana Supreme Court orders changes in Marion County small claims courts in 2014

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Derek Johnson Derek Johnson
INDIANAPOLIS -

The Indiana Supreme Court says enough is enough.  

The state's highest court and the judge charged with oversight of Marion County Small Claims Courts reveals new rules to fix what 13 Investigates exposed. The new plan aims to cut unreasonable fees and to give you justice where you live.

Cries of big injustice behind closed doors at Decatur Township Small Claims Court.

"I was flabbergasted. He was attempting to continue through with this even though it was already paid and I had proof," said a former collections employee who asked 13 Investigates to withhold her identity because of her position.

"I just felt more victimized than I ever have in my life," added Ashley Wilson, who thought her hospital had written off a $200 bill.  She was later sued in Decatur Township for the bill and forced to pay a $450 attorney fee.

"This shouldn't happen," said Gina Hoggs with disgust.  She too owed $200 but was charged the same $450 attorney fee at Decatur Township.

13 Investigates found Hoosiers ordered into court to pay old medical bills in a township where they don't live and didn't receive medical treatment.

One after another, showing up to pay what they owed only to see it doubled, tripled or more because of a routine $450 attorney fee.

Michael Warfield was dragged into court because of an insurance mistake. 

"I've been penalized for this and there's no excuse for that," said Warfield who took a hit on his credit score.

Lisa Jones was fighting cancer.

"For somebody who was sick, that's a very, very tough process," said Jones, who kept a notebook full of medical bills that she and her insurance company were paying.  Jones was taken to court on for a bill she says she never received.

For most of a year, 13 Investigates uncovered their stories and the failures of Marion County's small claims courts, where citizens came looking for a fair shake, but left with much less.

"I got screwed because this is how the system is," said Brandon Magor, who won a small judgment in Center Township against his landlord, but was then counter-sued for thousands of dollars more. Magor says it was all to prove a point at the "little guy's" expense.

"It was very disheartening," said Michelle Ware, who was ordered to pay court costs and attorney fees even after proving she had made payments on a bill wrongly calculated and sent to collections.

"Someday this travesty may be stopped," said attorney John Deckard, who represented Michelle Ware.

The beginning of "someday" starts in 2014 with unprecedented changes coming to ALL Marion County small claims courts.  The Indiana State Supreme Court and Marion County Circuit Court Judge Louis Rosenberg have seen and heard enough  They say it's time to correct the course.

"We don't like 'after the fact' corrections. We would much rather get it right to begin with and that's what I've tried to emphasize to the judges," Rosenberg told 13 Investigates.

On January first, collections attorneys will no longer be able to file bulk claims in a single court just because they want to.  The state's highest court says they have to file medical or credit card collections in the Marion County township where the individual they're suing lives or works, or where the bill originated. Landlords must file the claim in the township where the property sits. 

The change comes after 13 Investigates discovered attorney Derek Johnson filed 7,000 medical collection cases between 2011 and 2012 in Decatur Township alone.  Those cases generated more than a half million dollars in court filing fees, raising questions about "forum shopping" or favor based on the appearance of a cozy relationship between an attorney and the court. 

Johnson wouldn't speak with 13 Investigates earlier this year when asked if he'd been "forum shopping."

The Supreme Court's new rule now gives those being sued more control over where their cases are heard.

"Attorneys have kind of made one court their home court. This should prevent that. Some of the courts will lose some of their cases, there'll be a shift in case load," said Rosenberg. He said some collections attorneys might file more cases in Marion County Superior Court, but it's too soon to tell.

The other shift will come in how attorneys like Johnson collect fees.

"You're actually charging them more than what they owe?" we asked Johnson in a May 13 Investigates report, to which Johnson offered no response.

Johnson doesn't want to talk, but Judge Rosenberg has a new rule now limiting attorneys from charging their high fees for work done by other staff members who make less.  And attorneys can't rack up full travel expenses from each individual coming to court on a single day, for the same collections company. 

In Decatur Township, Derek Johnson collected a $450 attorney fee no matter what was owed.   Rosenberg says the amount of the claim must now be considered.  

"You can't just have a stock fee, you have to look at the case as a whole," explained Rosenberg.  "If a court is not following the rules, that should be brought to the attention of not only me but the State Supreme Court," he warned.  But Rosenberg says he believes his judges will comply.

Judge Rosenberg says progress is being made and addressing attorney fees and court venue is just a start.  The goal next year is to get all Marion County small claims courts using the same technology, in order to track accounting practices. 

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