Kovitz Shifrin Nesbit, One Other Accused of Demanding Illegal Fees, Restricting Lake Access

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Kovitz Shifrin Nesbit and Kalman Management, Inc. are facing a proposed class action alleging several violations of the Fair Debt Collection Practices Act (FDCPA).

The complaint describes a months-long battle between the Mundelein, Illinois, Loch Lomond Property Owners Association (LLPOA) and homeowners residing on lots around its private lake. According to the suit, several self-appointed “officials” of the LLPOA hired the defendants to demand membership fees and attorney fees from the plaintiff and other Loch Lomond residents despite the deed granting ownership of the lake to the LLPOA supposedly specifying that membership in the association was voluntary. The plaintiff claims the organization was never designated as an official Home Owners Association (HOA), and that the individuals purporting to be officials were never elected by the community.

The suit argues that the defendants’ debt collection letters and subsequent restriction of proposed class members’ rights to access the lake are illegal under the FDCPA. Among the defendants’ alleged violations are the following:

• Falsely representing a non-attorney debt collector as an attorney;
• Demanding payment of attorney fees “without any basis in any agreement, statute, or court-made exception”;
• Falsely threatening litigation/additional attorney fees if proposed class members fail to pay the purported HOA membership fees;
• Misrepresenting the supposed creditor’s identity;
• Drafting false documents to convince proposed class members to pay the requested fees;
• Restricting proposed class members’ rights to lake access by withholding “beach tags, boat stickers, key cards” until their alleged dues were paid; and
• Threatening to use “reasonable force” to remove proposed class members from their homes if they failed to pay the requested amounts.

“[N]o person has the authority to declare themselves as corporate officials,” the complaint reads, “without holding charter-required elections, or assert any special status as corporate officials, assess fees, physically control access to the lake to the detriment of nonpaying easement owners, or compel easement owners to be members of the incorporated association and impose debts upon them.”