Post-Judgment Interest Rates in Tennessee Have Finally Increased (by .25%)

Back in July 2012, the Tennessee legislature passed a new “post-judgment” interest statute, which can be found at Tenn. Code Ann. § 47-14-121. As I said back then, it was a big change: Instead of a blanket “10%” rate, Tennessee would be using a variable rate, tied to the “formula rate published by the commissioner of financial institutions.”

Long story short: I hate it when the law replaces something simple with something complicated.

Since the enactment of the statute, the post-judgment interest rate has been 5.25%, until January 1, 2016, when it jumped up to 5.5%.

The sky has not yet fallen, however, like I said it would. My biggest concern was: “[t]here appears to be an obligation to research and modify the rate every six months. Payoffs just got a lot more difficult.” I don’t like math.

After a few years with the statute, I’m of the opinion that the interest rate on a judgment is set at the date of the judgment and then doesn’t change. As a result, there’s no need to track the ups and downs of the statutory rate.

But, to be entirely safe, I always recite the exact post-judgment rate in effect at the time of my judgment in my judgment, to save any confusion and subsequent research.

Erin Andrews Judgment May Not be Easy to Collect Against Hotel Defendants

After a stalker took authorized “peephole” footage in her Nashville hotel room, Erin Andrews filed a lawsuit in Nashville in 2011 against the the stalker and the hotel entities for invasion of privacy, negligence, and negligent infliction of emotional distress. Here’s my post about the initial lawsuit, with a link to the Complaint.

For the past two weeks, Nashville has had the attention of sports and legal fans, as Andrews’ case was tried in front of a local jury. I was in the courtroom on Friday, to watch the lawyers make their closing arguments to the jury. It’s not often you get to see a fight over $75 million dollars.

Yesterday, the jury announced their verdict: A judgment of $55 million, with the stalker responsible for 51 percent of the blame, and the two hotel companies responsible for 49 percent (Note: Tennessee is a “comparative negligence” state). By my math, the hotel defendants are liable for about $27 million of the judgment.

After the judgment was announced, a number of media outlets analyzed the judgment. Some said that it may be appealed as excessive. Others focused on how much the lawyers are going to profit from it.

Sports Illustrated ran a story on her ability to actually collect the money. The article makes a good point about the stalker–that he’s in prison and probably “judgment proof.” That means that, even though he’s obligated to pay the money, his ability to earn money is diminished and he’ll be broke for the rest of his life.

The hotel defendants, however, are a different story. They appear to have strong cash flow, and they’ll probably look to their insurance carriers for some funds. Corporate bankruptcy may be an option, given the amount of the award. Most likely, the article concludes, the corporate defendants may appeal the amount of the award and, at the same time, work on a settlement agreement.

Here is my sales pitch: I will collect this Judgment. If you’ve read this blog or attended any of my collection seminars, you know the first thing I’d do: Record a Judgment Lien.

The hotel property at 2555 West End Avenue is in the heart of Nashville’s hottest district, and the property has a tax appraisal of $36,477.600. If the Judgment is recorded, then the defendants can’t refinance, sell, or do anything with the property without paying the judgment.

So, that’s that, right? Not so fast.

West End Hotel Partners, LLC doesn’t own the property; Vanderbilt is owner and West End Hotel Partners operates the hotel on the land pursant to to a 40 year ground lease. This means that Vanderbilt owns the property, but that the hotel has a long-term right to use the property, including construction of improvements. At the end of the lease, the hotel may revert to the ownership of Vanderbilt.

Regardless, a judgment lien attaches to whatever interest in the land a defendant holds, including this ground lease. The creditor may not get everything, but the lien would attach to enough to get their attention and complicate any future transactions related to the property.

Here, as always, record a judgment lien as the first step in collecting on a judgment.

Resources to Learn More About For Profit Student Loan Forgiveness

Student loans are a big problem for folks in the Middle Tennessee area. After I gave an interview on the “for profit” student loan forgiveness story last week, my phone started ringing off the hook.

One of the statements I made (which didn’t make the interview) was that a borrower who wants to make a forgiveness request may not need to hire a lawyer to help them with this process.

I mean, I love taking client money as much as the next lawyer, but there are resources online that you should review before talking to a lawyer.

I think the official Federal Student Aid website was a great resource. The site is written in good, clear text and contains a a link at the bottom, under the “How to Repay Your Loans” tab. The specific link is “Forgiveness, Cancellation, and Discharge.” This section contains a comprehensive “Frequently Asked Questions” section, as well links to the application to utilize the forgiveness process.

Lawyers are great and can be a benefit in any process like this. But, before you hire one, I’d suggest that you read the website and get an understanding of the issues first. Then, you know, bring in the big guns.

Loophole Under Federal Laws May Allow Some “For Profit” College Student Loans to be Forgiven

 

Last week, I talked to NewsChannel5 about a loophole under federal law that may allow borrowers to have their student loans forgiven, where they attended a “for profit” college that has either closed or made clearly false claims to attract students.

NewsChannel5

The law doesn’t apply to traditional colleges or universities, but, instead, to “for profit” colleges, a list of which can be found here.

These colleges generally target non-traditional students (i.e. older students with full time jobs), generally offer only night or online courses, and are known for advertising aggressively.

A great background “primer” on these issues can be found in “The Rise and Fall of For Profit Schools,” which suggests that the “advertising aggressively” part is the root of the trouble. Saying that “these schools made promises they couldn’t keep,” the article says that the industry may misrepresentations to get the attention of prospective students. This generally involves advertising inflated post-graduation job placement rates, misleading claims about potential future earnings, and lies about their faculty and facility quality.

With the economic downturn, as unemployed workers were looking for work and new job skills, those prospective students were the perfect marks for such alleged claims. Because many were unemployed or low income, the student body relied on federal student financial aid to pay the tuition.

The NewsChannel5 report drew from this Wall Street Journal article, which presented the shocking numbers of students availing themselves of the loan forgiveness process. Five years ago, the government had received only a handful of such requests; in the past 6 months, the story says, “more than 7,500 borrowers owing over $164 million have made applications.

Yikes.

Teaching CLE on Social Media for Lawyers: Do you really want your Lawyer as a Facebook Friend?

Because I’m an expert level blogger–or, well, I am when I actually, you know, blog–I’ve been asked to teach the audio CLE seminar “Marketing Your Legal Practice: Websites, Blogs, and More,” presented by M. Lee Smith Publishers. This seminar takes place on Thursday, August 27, 2015, at 2pm CST.

Just like the title says, I’ll be talking about all the things in social media and online that lawyers need to be thinking about. Plus, if you know me, I shoot pretty straight and offer my opinions when I think certain things are a waste of time.

Tune in, follow my advice, and watch the referrals roll in. Or, maybe, watch the scam emails from fake clients roll in (watch that CLE too).

Let’s Get Political for a Moment: My Endorsements for the 2015 Nashville Elections

I stay away from politics. I make sure to always vote, but, aside from the occasional sign in my yard, I tend to read the news, pick who I think would do a good job (regardless of party affiliation), and go back home. I don’t even wear the “I Voted” sticker.

But, this year is a little different, because I personally know some candidates and really think they’d do a great job. (And, if you know me in real life, you know that I wouldn’t go to this trouble unless I was sincere.)

First Endorsement: Charles Robert Bone for Mayor. (Disclaimer: I work with CRB.) When Charles Robert first announced he was running for mayor, I hated the idea, but not for any good reason. Instead, because he’s one of the smartest, hardest working lawyers at our firm. Why should Nashville’s gain be my firm’s loss, right?

Here at the firm, when we have a complicated case that needs some strong, smart firepower, my practice group has always roped Charles Robert in. He’s a great lawyer, smart, practical, and a leader at our firm. Plus, he’s sincere, nice, and funny. He’s got a real “Nashville” vibe, and he’s the type of person I want representing my city as we make some tough decisions in the next few years. I’m voting for him.

Second endorsement: David Briley for Vice Mayor. You think you’re seeing a pattern here, don’t you? Yes, I work with David Briley. Again, if you know me, you know I don’t give compliments easily, but I think he’d be great in this position. Briley is a leader at our firm and helped guide the firm through a tough economy over the past few years–both by leading the firm through hard decisions in lean financial times and also winning really big cases.

Last year–here’s where I’m biased–he and I worked together on a case against a Fortune 100 company (and won), and I was impressed with his strategy, decorum, and intelligence. He’s a guy I want on my side.

Third endorsement: Bob Mendes for Metro Council at Large: Wow, another lawyer? You really think I’m biased now. But here’s a secret: I hate having cases with Mendes. He’s smart, analytical, and great at strategy. When I see that he’s on the other side, I know I have to bring my “A game.” That’s what he would bring to this office. He would go to sleep thinking about the city and wake up the next morning thinking about the city. He would be a great councilman.

My other endorsements: I like John Lasiter for Metro Council At Large. I think he has an interesting perspective, and he seems engaged with the city.

I also like Peter Westerholm and Anthony Davis. I’m not in either of these Metro Council Districts, but they both are smart, engaged incumbent leaders who seem to really be looking out for Nashville’s future.