Debt collector and woman sued over childhood medical bills reach settlement

LaToya Toliver (left) and attorney Derek Johnson (right) (WTHR)
Published:
Updated:

INDIANAPOLIS (WTHR) - A federal lawsuit against a local debt collector who went after a woman for an unpaid childhood medical bill, is getting tossed out.

13 Investigates has learned of a settlement in the a case. It means both the delinquent charges filed by Med Shield and LaToya Toliver's counter- lawsuit are going away.

It all started with a debt created 17 years ago.

“I never got a bill or anything.”

"It's not right. If it was my debt, I wouldn't be upset. But it's not my debt because I was a minor," Toliver said months ago as she explained what happened in small claims court.

She was sued over medical expenses dating back to 2002. Expenses she assumed her parents paid. She was just 17 years old and a minor under the law.

"I never got a bill or anything," Toliver said.


Just after her 18th birthday, Med Shield sued and won a judgment against her for those childhood bills from the old Wishard Hospital.​

Toliver said she never knew about them until attorney Derek Johnson started collection proceedings this year. Johnson works for Med Shield.

13 Investigates went looking for Johnson after he failed to answer our calls about the case.

13 Investigates Sandra Chapman questioning attorney Derek Johnson. (WTHR)

"Can you provide documentation of a 17 year old debt?" 13 Investigates asked Johnson.

"It would depend on the circumstances," he replied.

Johnson first tried to collect from Toliver's parents but couldn't due to bankruptcy. So he used an old Indiana law to go after her instead.

"Is that the right thing to do?" 13 Investigates asked.

"It's the law. Isn't the law right?" Johnson responded.

"This adult, that was a child when this transaction occured, is liable for this debt," explained John Steinbeck, a local Fair Debt Collection Attorney.

Toliver was ordered to pay the $1,300 judgment issued in 2004 plus an extra $1,500 in interest and fees in Decatur Township Small Claims Court.

It's the same court where Johnson came under scrutiny for filing thousands of lawsuits while skipping past the actual courts where the debt was incurred.

The Indiana Appeals Court has since ruled collectors must file in the appropriate jurisdiction.

Toliver and her attorneys questioned Med Shield's collection practices in her case.

"I want them to be fair to everyone across the board. And there should be a statute of limitation," Toliver said.

Court records showed notices went to the wrong address.

"It's never been on my credit. I don't have anything negative on my credit. Never have," Toliver told 13 Investigates.

But there might have been a clue that Toliver didn't understand.

LaToya Toliver. (WTHR)

13 Investigates has learned she did dispute charges on her credit report nearly a decade ago. What she thought might have been identity theft...might have actually been the hospital bills and Med Shield.

Now, as part of a settlement Toliver agreed to drop her lawsuit. In exchange, she's off the hook for the remaining $1,000 left on the judgment.

Med Shield will not admit any wrongdoing as part of the settlement and the case now goes away.

The Supreme Court is reviewing what qualifies as "knowing" about a debt.

The bottom line: If you get a notice or see something odd on your credit report don't ignore it. Ask questions. You only have a year to file a complaint.

And once there's a judgment against you, a company can always seek to collect it, even if it's 17 years later.

Filed under: