ACSBlog: The Blog of the American Constitution Society

The Wall Street Journal reported that retailers are providing names to collection agencies of those they suspect of shoplifting, even when there is no conviction or solid evidence to indicate guilt.  Retailers turn over the names to collection agencies, who then write and telephone suspected shoplifters, threaten lawsuits or police involvement, and demand money (including "pre-litigation" legal fees) in amounts that often greatly exceed the value of the alleged theft. The collection agencies then split the money with the retailers.

Retailers need not have any intention to sue, and the "civil recovery" statutes do not limit who can be targeted. Lord & Taylor, for example, never follows up civil-demand letters with lawsuits, according to the report.

Last year, Florida Judge Donald Hafele filed a complaint with the state bar about the civil recovery practices used by the law firm Palmer, Reifler & Associates, P.A. While the judge’s complaint was dismissed due to jurisdictional issues, the bar association told the firm that, “harassment techniques in an effort to collect for your clients are not acceptable.”