By: Robert J. Nahoum
If you have ever checked your mail or credit report and seen the name Portfolio Recovery Associates, LLC (PRA), you are far from alone. PRA is one of the largest junk debt buyers in the United States. They purchase billions of dollars in old, charged-off debts from credit card companies, banks, and finance companies for pennies on the dollar, and then turn around and aggressively sue consumers to collect the full amount.
Many people panic when they receive a lawsuit or discover a default judgment against them. However, a recent decision out of the Supreme Court of New York County, Portfolio Recovery Associates, LLC v. Hatimi Djibo (2026 NY Slip Op 31863(U)), highlights a critical defense consumers have: debt collectors must follow the rules of proper service, or their lawsuits cannot move forward.
The Case: Portfolio Recovery Associates, LLC v. Djibo
In this case, Portfolio Recovery Associates sued a consumer for $4,960.87. When the consumer did not respond to the lawsuit, PRA did what debt buyers almost always do: they asked the court for a “default judgment.” A default judgment is an automatic win for the collector because the defendant didn’t show up to fight.
Usually, debt buyers get away with this. But in this instance, Honorable Judge Emily Morales-Minerer looked closely at how PRA claimed they served the lawsuit.
Under New York law (CPLR §308), a process server cannot just nail papers to your door (known as “nail and mail” service) right away. They must first exercise “due diligence” to hand the papers to you or someone at your home personally.
The judge found that PRA’s process server attempted to serve the defendant three times, but all three attempts were made on weekdays during normal business hours when a reasonable person would be at work or commuting. Because PRA failed to make a genuine effort to find the defendant at different times (like a weekend or evening), the court ruled that the service was legally defective and dismissed PRA’s motion for a default judgment.
Why This Matters for New York Consumers
This ruling is a massive reminder that you have rights, and debt buyers cannot cut corners. Here are the main takeaways:
- “Nail and Mail” is a Last Resort: A debt buyer cannot just slap a lawsuit on your door because it is convenient for them. They have to prove they made a high-quality effort to find you.
- You Can Challenge Sewer Server: Many default judgments are granted because consumers never actually knew they were being sued due to “sewer service” (where process servers fake the service details).
- A Lawsuit is Not a Guaranteed Loss: Even if you owe the money, companies like Portfolio Recovery Associates must prove their case and follow strict New York civil procedures. If they fail, the court can throw their case out.
What to Do If You Are Being Sued by PRA
If you find out that Portfolio Recovery Associates is suing you, or if you discover they already have a judgment against you, do not ignore it. It is often possible to vacate a default judgment or get the case dismissed entirely if you were never properly served.
At the Law Offices of Robert J. Nahoum, we dedicate our practice to defending consumers against aggressive debt buyers like Portfolio Recovery Associates. We understand the technicalities of New York procedural law and use them to protect your bank accounts, wages, and peace of mind.
How Law Offices of Robert J. Nahoum can help
The Law Offices of Robert J. Nahoum, P.C. represents consumers in debt collection lawsuits and helps defend cases brought by debt buyers like Portfolio Recovery Associates. The firm’s website explains common FDCPA issues, debt verification rights, and defenses that may apply in debt buyer cases.
If you need help settling or defending a debt collection law suit, stopping harassing debt collectors or suing a debt collector, contact us today to see what we can do for you. With office located in the Brooklyn and the Hudson Valley , the Law Offices of Robert J. Nahoum defends consumers in debt collection cases throughout the Tristate area including New Jersey.
The Law Offices of Robert J. Nahoum, P.C
(845) 232-0202
www.nahoumlaw.com