Texas Attorney General as Debt Collection Act Enforcer and Practitioner: Post-Judgment Amicus Curiae Brief in State of Texas vs. Samara Portfolio Management, LLC, et al, in the 80th District Court of Texas, Harris County, Texas

Abstract

In 2017 Ken Paxton, Attorney General of Texas, obtained a judgment for more than $25 million dollars in a civil enforcement action against Houston Attorney Joseph O. Onwuteaka, his debt buying company, Samara Portfolio Management, LLC, and his law firm, for violations of the Texas Deceptive Trade Practices—Consumer Protection Act (DTPA);—mostly for Onwuteaka’s practice of suing and obtaining default judgments against hapless consumers/defendants in a county in which they did not live (Harris County). Ironically, the Texas Attorney General engages in the very same conduct in suing former Texas college students and their co-signers on defaulted student loans made by the Texas Higher Education Coordinating Board Loans (THECB). He files all such collection actions in Travis County (Austin, TX) regardless where the student loan obligors may live, and additionally engages in deceptive or otherwise dubious practices with respect to disclosure of interest accrual on some loans and hefty add-on attorney’s fees in most or all of them. The Travis County venue for THECB education loan collection suits was fixed by the Texas Legislature, while the other practices are discretionary. The hefty attorney’s fees are heaped on because student loan debtors are considered a suitable revenue source to help fund operations of the Office of the Attorney General. As of April 2018, the AG enforcement case against Onwuteaka et al remains on hold in the Fourteenth Court of Appeals, pending performance of a settlement agreement.